Using a PEO broker offers several benefits to businesses, supported by various statistics:
- Cost Savings:
- Reduced HR Administration Costs: Companies can save approximately 35% on HR administration costs by outsourcing these functions to a PEO, which includes payroll processing, benefits administration, and compliance management (NAPEO).
- Lower Employee Benefits Costs: PEOs can provide access to high-quality employee benefits at lower costs, potentially saving up to 20% on health insurance premiums and other benefits (NAPEO) (NAPEO PEO Insider).
- Time Savings:
- Efficient PEO Selection: PEO brokers streamline the complex process of selecting a PEO by leveraging their industry knowledge and relationships, which significantly reduces the time businesses spend on research and negotiations (NAPEO) (NAPEO).
- Ongoing Support: Brokers provide ongoing support and reassessment of PEO services, saving businesses time on administrative tasks and allowing them to focus on core activities (NAPEO PEO Insider).
- Compliance and Risk Management:
- Avoidance of Penalties: PEOs help ensure compliance with state and federal regulations, reducing the risk of costly fines and legal issues. This proactive management can save businesses substantial amounts in potential penalties (NAPEO).
- Improved Risk Management: Brokers guide businesses in selecting PEOs that offer robust risk management services, including workers’ compensation and safety programs, further protecting businesses from financial losses (NAPEO).
- Business Growth and Stability:
- Enhanced Growth: Businesses using PEOs grow 7-9% faster, which can be attributed to the operational efficiencies and strategic focus enabled by outsourcing HR functions (NAPEO).
- Lower Employee Turnover: PEO clients experience 10-14% lower employee turnover, which can result in significant cost savings related to recruitment, training, and lost productivity (NAPEO).
- Business Longevity: Companies that use PEOs are 50% less likely to go out of business, indicating the stability and resilience provided by comprehensive HR support and compliance management (NAPEO).
- Negotiation and Customization:
- Better Rates and Terms: PEO brokers often secure better rates and service packages due to their industry relationships and negotiation skills, leading to cost-effective and customized solutions for businesses (NAPEO PEO Insider).
- Tailored Solutions: Brokers conduct thorough needs assessments to ensure that the selected PEO matches the specific requirements of the business, enhancing overall satisfaction and efficiency (NAPEO).
Overall, PEO brokers add substantial value by saving businesses time and money, reducing risks, enhancing growth and stability, and ensuring tailored and effective HR solutions.