Most especially during the COVID-19 pandemic, employers need to improve or adjust their recruitment and hiring efforts to reach more qualified talents and implement cost-effective processes at that.
One way to help employers hire workers is through working with a professional employer organization or PEO. Companies that use a PEO often enjoy a lot of advantages, both short- and long-term. To see why you should consider hiring one, use this guide to know how a PEO works and how it can help set your organization up for success.
How a Professional Employer Organization Works
Before anything else, here are some basics you need to know about what a PEO actually is.
1. What is a PEO?
Ultimately, a PEO aims to provide organizations with an alternative to in-house HR management. Considered as a co-employment model, this setup is when the PEO hires the organization’s employees and then leases them to the client. Having that said, the client retains full control of their staff and business. On the other hand, the PEO assumes all employee-related administration and liability.
2. What does a PEO offer?
Depending on a client’s needs, PEOs can offer customized and comprehensive service models to cater to the client’s hiring efforts. Some of the most common PEO services are:
- Employee Support and Onboarding
- Payroll Processing
- Tax Filing
- Benefits Administration
- Risk Management
- Compliance with Labor Laws
- Retirement Plans
3. What kinds of businesses usually benefit from hiring PEOs?
PEOs are considered a good fit for almost every industry and organization, big or small. To note, the sectors that can benefit from hiring PEOs include:
- Health services
- Legal services
- Management consulting services
- Business services
- Computer services and technology
- Engineering services
- Accounting, auditing, and bookkeeping
- Securities brokers and dealers
- Real estate and property management
4. What does a PEO’s process typically look like?
To help ensure a smooth process, clients are required to endorse to the PEOs the specific job description for the roles needed to be filled. With this, make sure you’re able to provide the PEO with all the necessary details for your job openings. Once this is done, the PEO can now proceed to source and screen ideal candidates for your requirements.
In general, a partner PEO follows a certain process:
- Collect and discuss the job requirements from the client
- Search for ideal candidates
- Screen shortlisted candidates and endorse them for client interview
- Assist in the onboarding process of qualified candidates
- Manage employee-related functions such as reporting, training, and payroll on behalf of the client or company upon employment
With all these, a PEO basically serves as an administrative employer while you, as the client, serve as the worksite employer. The main difference lies mainly in the authority you hold and the responsibilities that a PEO should perform.
Top Benefits of Working with a PEO
Now that you have a good understanding of how a professional employer organization works, let’s now discuss why you should consider hiring one by looking at some of its major benefits.
1. Better employee perks
In this day and age when employees are becoming more competitive as they should, one common thing that they deem highly important to overall job satisfaction is their benefits package. Since PEOs can significantly increase the pool of employees, the cost of insurance and healthcare can also be reduced. This, among others, allows even small businesses to afford generous benefits packages which are also effective in attracting and onboarding highly qualified candidates.
Also, PEOs help their clients retain talent by having a lower employee turnover rate. This is because many employees report greater work engagement. Apart from that, they are more willing and empowered to consult HR for any workplace-related concerns they have.
2. Optimal HR experience
As mentioned earlier, PEOs are effective in helping retain exceptional employees. This helps deliver a more worthwhile HR experience on your end as you can save time and resources in your recruitment efforts. Aside from that, you can even gain access to top-performing candidates in the local job market. You can rely on your partner PEO to do the work for you to source and screen hundreds of applicants and talents that fit your requirements. This process is crucial for you to focus on interviewing the highly qualified ones to fill in your job openings.
Furthermore, partnering with a PEO also lets you offer your employees access to a wider range of exclusive discount programs, career growth initiatives, and other perks you deem fit for your organization. Lastly, you can also expect your partner PEO to help provide a streamlined process for payroll, tax, and reporting requirements.
3. Reduced business costs and increased revenue
Being able to cut costs on recruitment, training programs, and even employee management is also a notable perk of hiring a PEO. Since PEOs are HR experts, they can use their existing resources and infrastructure to perform administrative tasks more efficiently than a small HR team possibly could. To add, PEOs are often able to negotiate better rates with insurance companies and other benefits providers due to the fact that they’re co-employing so many workers.
With lower business expenses, you can allot more of your resources to other core aspects of your business. This can help result in increased profits over time.
Hire a Professional Employer Organization in the Philippines Today
Now, are you ready to connect with a professional employer organization to help you step up your efforts? Simply do a quick search online to know more about the top PEOs in the Philippines that you can consider. During your research, make sure to keep your options open and gauge which provider fits your needs and can offer you the best PEO solutions depending on your current requirements.
You can also organize all your recruitment efforts in one place! Connect with the best talents and manage multiple candidates using Bosshunt—Application Tracking System. The first-ever management tool customized for recruiters in the Philippines, Bosshunt lets you coordinate, store, and encrypt details of all the candidates and applications you manage to make your work easier. Request a Bosshunt demo for free today!