Can Your Small Business Benefit From Using A PEO?

Posted on: 6 May 2015

If you are a small business owner, then a Professional Employer Organization (PEO) can save you a lot of time, money, and stress. Utilizing a PEO allows you to easily outsource all of your human resources, benefits, and employee retirement administration tasks to seasoned professionals.

Using a PEO gives you the ability to refer your employees to the PEO for all of their issues and questions. This frees up a significant amount of your time so that you can spend it growing your business. Your remaining responsibility is simply to hire, fire and manage your business's employees. 

Here is some introductory information about PEOs to help you decide if one is right for your small business's needs:

Services PEOs Offer to Small Businesses

Large businesses have the advantage of hiring a large stable of people to handle all of their human resources and benefits administration. They also have a legal department to ensure their compliance with all of the laws and government regulations that go along with running a business. As a small business owner, you do not have the same ability and likely have to rely on a part-time HR person who has limited knowledge. This is where a PEO can help you! They offer the following services:

  • employee health insurance
  • employee retirement
  • employee training
  • government compliance
  • human resource data administration
  • payroll
  • workers' compensation

In addition, some PEOs offer services that relate to scheduling, sick time, and vacation benefits.

Advantages of PEOs for Small Businesses

The biggest advantage of PEOs for small businesses is that they are able to essentially bundle your staff with other business's staff to provide less expensive insurance options. In addition, PEOs offer your small business the following:

  • the ability to hire employees easily in other states
  • more experienced and specialized human resources administrators
  • all employment paperwork for employees will be provided and processed for you

In addition, a PEO will ensure that your business is always in compliance with all state and federal laws and regulations, such as those of the:

  • American's with Disabilities Act (ADA)
  • Equal Employment Opportunity Commission (EEOC)
  • Food and Drug Administration (FDA)

Also, all employees will be working with a clear understanding of the Occupational Safety and Health Administration (OSHA) rules.


Now that you have a better understanding about PEOs and how they can help your small business, you can find the best PEO companies in your local area for initial consultation appointments. At this appointment, you will be given all of the necessary information to decide if using a PEO is the best HR solution for your company.