Partnering with a professional employer organization (PEO) is the right solution for an ever-growing number of businesses. The advantages include better employee benefits options, a team of HR specialists at your disposal to handle functions including payroll, benefits administration, hiring, compliance and more, and freeing up your own time and that of your HR and other key team members to focus on other strategic initiatives and business growth.

Even if you already know the benefits of a PEO partnership, how do you choose the one that’s right for your business? After all, there are almost 500 of them to choose from. As with any important business relationship, you want to be able to sleep at night, knowing you’ve made the right choice.

Here’s a checklist of guidelines for selecting the right PEO:

Finding the Right PEO Partner

Carefully assess your workplace needs.

As recommended by the National Association of Professional Employer Organizations (NAPEO), assess your HR and risk management needs and make sure the PEO you’re considering is capable of meeting your specific goals.

• Meet the people who will be serving you. Look for the right chemistry with your designated PEO representatives. You will be working with them on a day-to-day basis, on issues and functions that matter immensely to your company and its future. So, the right match is critical.

Be sure your PEO does its own due diligence.

Your PEO partner will be sharing employment liability with you. So, expect them to ask a lot of questions of their own, and to talk bottom line in a straightforward way.

Find a PEO with a history of working in your industry.

Like any business partnership, it makes a tremendous difference to work with a PEO that knows your industry, is familiar with its hiring trends and competitive atmosphere, and has specific knowledge of applicable laws, rules and regulations. You want them to be able to hit the ground running.

Check their credentials.

Be sure your PEO is transparent and upfront with important information, such as their own financials for you to review.  Check to see if they are a member of NAPEO, if they have been independently certified by the Certification Institute, and if their operational, financial and ethical practices have been independently accredited by the Employer Services Assurance Corporation (ESAC). These are PEO industry gold standards.

Ensure that they are realistic with their promises.

Have your PEO show you all the plans and numbers relevant to your business needs as well as your industry. Then, have them illustrate exactly how they can help get your company where it needs to be.

Ask for client and professional references.

If this requirement can’t be met, consider it a glaring red flag. Enough said.

Carefully review the service agreement.  

Are the respective parties’ responsibilities and liabilities clearly laid out? What guarantees are provided? What provisions allow you or the PEO to cancel the terms of your contract? Make sure you’re 100 percent comfortable with every answer.

Looking to Find the Right PEO Partner for Your Organization?

Key HR is aligned with numerous leading PEOs and other preferred provider companies to provide a full range of HR services to our clients, as their business needs demand. Tap into our expertise and network to ensure you make the right choice for the future of your growing business. Contact us today to learn more.