The HR department of a company is typically responsible for all details ranging from tax filing and payroll to administration of employee benefits and legal compliance. Not only are there more HR tasks than ever, but regulatory and statutory burdens are becoming more and more complicated.
Such challenges have forced many companies; especially SMEs to outsource one or more of one’s HR responsibilities to PEO agency Dubai. They will aid in minimizing risks, reducing costs, and providing one the flexibility and freedom to focus on one’s business.
What is a PEO?
A PEO (Professional Employer Organization) is an integrated and comprehensive solution. PEOs offer a full suite of HR functions to companies. A PEO is an excellent choice if one cannot afford an independent HR department or want to outsource multiple HR functions.
PEOs and CPEOs (Certified PEOs) function with a co-employment model; this implies that employees work for both the PEO and the company. The business retains total control over all business operations and decisions while the PEO assumes control over HR-related functions like worker’s compensation, benefits, payrolls, etc.
Even if the company has an HR department, the PEO will offer much-required support, which can free the in-house HR professionals for strategic projects instead of administrative work.
Role of PEO
In the co-employment arrangement of outsourcing of HR functions, the PEO performs multiple tasks. The role of the PEO is to help with the following:
- Tax filing and payroll
The payroll is processed by PEOs, and sometimes the latter help to pay federal, state, and local taxes. Many companies also do integration of time of attendance with payroll through PEOs that help in reducing errors of duplication and data entry.
- Helps administration
Any arrangement of co-employment often comes with access to cost-effective and high-quality health insurance along with employee perks, retirement benefits, and dental care. The PEO will typically handle all employee details for such benefits and process one’s claims.
PEO companies have experts in legal compliance who are able to protect one‘s company from penalties and fines. Area of expertise may be in payroll tax law, needs of reporting, HR compliance, workmen’s compensation, unemployment insurance, etc.
- Safety and risk
Besides insurance for workmen’s compensation, PEOs at times offer training programs and safety audits to help in limiting one’s claims. They also help deliver safety solutions.
- Support for Human Resources
A PEO company features HR professionals who offer HR support and services most of the time. If one already has an in-house HR team or professional, the PEO works with them administratively and strategically. These account for the best PEO services
- Talent management
Certain PEOs provide total talent management services such as strategic hiring and recruitment, engagement with and training of employees, and management of performance.
Services of PEOs
Following are some HR services that can be handled by a PEO on one’s behalf:
- Hiring and recruitment
Much work goes into the process to attract and retain the best talent for a specific organization. In case the burden of HR function rests on a single manager, a PEO can help him in finding and vetting the right candidates for employment. Other relevant services may include helping in creating engaging and accurate job descriptions, conducting pre-screening and checks on backgrounds, and considering total recruitment strategy.
After making a decision on hiring a candidate, a PEO can take up the task to design and issue standard forms: employee handbooks, orientation packs, and, finally, performance appraisals. Several small businesses also depend on PEOs for the administration of new hires, including all the paperwork related to set up benefits, payrolls, etc.
- Current benefits and payroll
Issues about payroll and benefits emerge every day in the smallest of companies. Employees encounter life-changing events; bank accounts change; mortgage lenders require authentication of employment as well as salary; part-time employees need to know about overtime policies. When one works with a PEO, there is always a person who is ready with answers for such problems.
Additionally, the Best PEO services have the knowledge and tools to supervise record management of payroll and compliance. This may include activities like enabling paystubs to be used by employees, maintaining records of paid time off, or the generation of reports of payrolls for senior management.
- Workmen’s compensation, leaves, and termination
The chances of accidents in the workplace are quite common. For protecting employees from injury and one’ company from claims for liabilities, arranging workmen’s compensation is a core function offered by PEOs. The PEO can issue certificates for workmen’s compensation and ensure putting in place safety programs. He can deal with claims resolution when claims are pressed for.
Similarly, there are several complicated procedures and laws linked to termination or suspension of employment. Handling these is virtually impossible for small businessmen on their own. A PEO can deal with all tasks related to unemployment compensations, appeals, and hearings. The PEO can also keep track of leaves of absence and administer additional health benefits.
- Services of employee relations
Conflicts are bound to arise no matter how hard one tries to set up a supportive and safe work environment. From small issues like lack of personal hygiene or improper attire to serious ones like sexual harassment, all aspects of employee relations can be left to PEOs.
PEOs often serve as human resource consultants, advising on daily policies and disciplinary matters, and general principles of HR. They can look into the veracity of claims of harassment or discrimination.
PEOs and small business
SME’s (Small and Medium Enterprises) often depend on PEOs for support with strategic and critical HR management such that they can focus on other important business concerns.
Going beyond the administration of HR
Certain PEOs provide benchmarking services and data analytics that enable one to gain insights into one’s workforce. Using proper data and HR expertise, one can offer better answers to questions like:
- How much does one pay for some employees, and how does this compare to the pay in the market?
- What are the skill sets which best match available work opportunities?
- Which are the departments that require more employees?
- How does one’s turnover compare to that of peer companies?
In sum, these are the functions of PEOs. The PEO agency Dubai will handle some or all HR functions and leave the business owner to focus on other more crucial business activities.