What To Do if Your Company Wants to Outsource to a PEO

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So your company decided that a PEO can help scale up operations. Existing HR staff may feel threatened by the decision and resist the change. To guarantee a smooth transition, it’s up to leadership to explain why outsourced PEO is a good thing for the company and has several benefits for HR employees.

Why an Outsourced PEO is Good for HR

Most HR professionals did not enter the field dreaming about endless admin tasks. They are usually highly educated with multiple certifications in a range of HR disciplines. But before long, payroll, PTO requests, risk management, and other tasks demand more working hours than they signed up for.

Unless they have met a PEO before, many HR employees are unaware of the ways a PEO can help relieve them of unwanted tasks. With a PEO managing the tedium, HR staff can focus on higher-level projects. They will be free to take on exciting priorities such as leadership development, company culture, team building, and more.

In addition to everyday admin, supporting company employees comes with its complexities. A good PEO will have a team of experts to handle the more nuanced employment issues, including government compliance, workers’ compensation, unemployment, payroll taxes, onboarding, offboarding, and more.

Freeing up HR time can mean significant returns for a company’s bottom line. With the intricate legalities and administrative tasks outsourced to a PEO, HR teams can focus on department productivity. For example, HR teams may issue surveys to departments with high turnover and develop an action plan. With the day-to-day running smoothly behind the scenes, HR teams can focus on increasing profitability.

Benefits for All

The perks of working with a PEO can permeate throughout the entire company. Often an outsourced PEO is the only way a small business employee can get Fortune 500–quality benefits such as health insurance, dental care, and a 401k.

A good PEO will scale its available features and services as your business grows. Service scalability can ensure that your HR team and the rest of your staff have the resources and support they need to work smoothly at any growth stage.

Understanding the Resistance

It’s normal for anyone to fear the unknown. Many feel uncomfortable at the idea of change, especially in the workplace and especially for long-standing employees. From the HR staff member’s perspective, giving up duties can feel like taking a subordinate role in the organization and becoming less valuable.

Upon hearing about an outsourced PEO, HR team members may wonder:

  • Will I lose my job?
  • How does this affect my job?
  • Am I going to be let go?
  • Are they shrinking my department?

Leadership needs to step in and ease fears about the change. Be transparent and optimistic about the coming changes, but avoid minimizing worries. Acknowledge that the transition may be an uncomfortable process initially. Offer reassurance by radiating confidence that it will give way to a better and more efficient way of doing HR in the long run.

Managing the Change

Lean on your PEO for help to manage the transition. A well run PEO has training and extensive experience handling the period of adjustment when coming on board. It’s a learning curve for all but should not slow down any ongoing HR processes.

A good starting place is to invite your staff to imagine life in their workplace in the near future. For all staff, layout HR’s vision specifically and include the benefits to the entire organization moving forward.

The conversation could sound like this: “You will now be more involved in initiatives that improve workplace culture. This includes plans to manage growth and to weigh in on high-level decisions within the organization.”

When you have illustrated visions of the future workplace, make sure to answer questions and concerns, no matter how trivial they may seem.

Don’t Fear the Transition

Outsourcing to a PEO can bring some uncertainty, but the transition doesn’t need to be a headache. The advantages to the company as a whole, and HR specifically, can bring exponential returns. The management team gets a better running organization. HR team members can focus on more fulfilling priorities. Employees receive better benefits and a greater sense of worth.

Learn more about America’s Back Office PEO service. Call today at 586-997-3377 or email at sales@abopeo.com for a free consultation.