January 10, 2020
Blog You have an internal conflict within your business: your budget is tight, but you’re also growing faster than expected and need the extra help.
How can you possibly resolve both of these issues at the same time?
Enter Employee Leasing… every small business’s solution to meeting the needs of both the company and its clients
It can be a bit confusing to understand the process and how it all gels with your business operations.
Here is everything you need to know regarding employee leasing, as well as how it fits into your day-to-day mechanics:
What Is Employee Leasing?
The best way of understanding employee leasing is to know how it fits into your business plans.
Here are a few pointers on the process of employee leasing.
Professional Employer Organizations
Now that you know employee leasing exists, you may be wondering… “where do these ’employees’ come from? Do they just fall out of the sky?”
Any employee for lease is technically working for an out-of-house hiring agency known as professional employer organizations (PEO’s for short).
These PEOs give small and mid-sized businesses, such as yourself, the option of temporarily hiring outsourced workers from their organization.
This helps you eliminate all the heavy-lifting and budget-swallowing processes of hiring an employee in-house.
In fact, did you know that the average cost to hire a new employee right now is over $4,000 PER position? Holy hiring processes, Batman!
That’s why PEO’s are such a valuable asset to your business: you get access to the employees that you need without the responsibility of being their legal employer.
Perhaps you’re familiar with the term “co-employment”? If so, that term is referring to the relationship a leased employee would have with the PEO that hires them and the company (your company) that they work for.
It takes experience and knowledge to find the appropriate talent for your team.
Let the PEO that you team up with take that off your hands for you!
Specific Benefits of PEOs
Employee leasing already sounds like a pretty good option for your business, right?
Acquiring top-tier talent to represent your brand without the hiring and onboarding hassle of being your in-house employee… what a deal!
Well, get ready… because it gets better when you dive into the details of all that PEO’s offer your business.
These God-sent organizations eliminate the need for you to exhaust your efforts on the advertising and network-burning hassle associated with recruiting.
They also help you save on payroll and all the pains of tax compliance with being a legal employer.
Certain PEO’s, as long as they offer this service, will assist you on employee benefits such as worker’s compensation, insurance costs on health and life policies, and setting up retirement plan accounts.
Do you need help with the onboarding process of these employees for your business? No sweat!
Professional employer organizations will work with you to find the best way of integrating employee training and shadowing techniques to ensure their employees carry out the expected performance level.
Most PEOs will also monitor the employee’s time clock. That way they can make sure their attendance and performance are up to par.
Your Responsibilities of the Employees
You’re probably wondering… “What responsibility do I have as the leased employee’s every day ‘boss’?” Excellent question!
In short: it depends on the professional employer organization that you hire and what they offer.
Not all PEOs oversee everything that was listed out in the section above, although they all try to provide as much of the “paperwork” side of things as possible for you.
Essentially, you oversee the employee’s daily output as much as you would an in-house employee without having to worry about the legal and administrative side of things.
That means you’re still responsible for their operations, performance review, salary or hourly rates, and regulations/expectations while they represent your brand.
Choosing the Right PEO for Your Business
As with any other service, there are PEO’s that will vary between what they can and can’t offer for your business.
This is where it’d be beneficial for you to talk specifics with several different PEOs to see which ones differ from the rest.
Which employee services are you desperately trying to avoid? Make sure the PEO you hire oversees that side of the business so you don’t have to.
Are there in-house services you already offer and don’t need a PEO to provide you with? Talk that over and make sure you’re not paying for something you don’t need.
Ultimately, the professional employer organization that you go with is there to help your brand become known as one that treats its employees with respect.
Because of that, the PEO has to understand your ultimate goals and the true reason behind why you’re exploring this option (beyond saving on costs).
As your company continues to grow, you may one day find it beneficial to start hiring in-house employees of your own.
That’s why finding the right PEO to partner with, who will not only provide the service but teach you the technique behind it, is so important.
Ensure the Safety of Your In-House and Leased Employees
Regardless of whether you ultimately decide on employee leasing or going the in-house route, you’ll want to protect them and your business.
That’s why worker’s comp insurance is such an important piece to the legal integrity of your business.
It ensures the safety of your company and it’s employees in case of an injury.
Be sure to read this article on who is covered by worker’s comp for details on everything you need to know regarding workers compensation.
For more inquiries, please reach out by phone at 855-852-0128.
