The fact is, independent statistics show it pays to use a PEO, with businesses reporting increases in revenue and profitability.
A PEO company's average administrative rate is between 2-4% of annual payroll. Consider how that estimate relates to your business. Is it possible to find a professional to manage all payroll- related administration throughout the year for that cost- not including the costs of check stock, payroll programs, annual upgrades and other related expenses?
Plus , that person would need to be a certified risk manager, able to review your safety manual, help identify potential workplace hazards and provide training material.
They would also need to be a licensed HR expert, able to minimize your employment liabilities, assist with hiring/Firing procedures, wage and hour laws, employee training, performance reviews, new hire reporting and more.
All businesses have these five cost factors in common. The right PEO can save you thousands of dollars on workers' comp insurance premiums, and time saved outsourcing payroll administration.
Federal Insurance Contributions Act is a Federal payroll tax imposed on both employees and employers to fund Social Security and Medicare
The Federal Unemployment Tax Act tax is a payroll or employment tax paid solely by the employer
The State Unemployment Tax Act is also a payroll tax paid by the employer and set by each state.
Insurance providing wage replacement and medical benefits to employees injured in the course of employment
Accurate and timely payment of wages along with dozens of other responsibilities.
David is the owner of a trucking company in Macon, Georgia. David currently has 13 drivers with an annual payroll of $413,000.
Even with a great workers' comp claims history, David's annual costs for workers' compensation insurance were over $72,000.
Working with a PEO company reduced David's work comp costs by over $30,000 annually, allowing him to provide more competitive bids for his services to grow his business.