How Employee Benefits Brokers Can Conduct Due Diligence on PEOs
The world of employee benefits is an intricate one, and benefits brokers often work closely with their clients, becoming a trusted advisor. During this process, clients’ deficiencies and needs – in areas such as recruiting, employee retention, payroll, and other facets of human resources – often become exposed.
Benefits brokers may find their clients could benefit from the services of a Professional Employer Organization (PEO) to help improve and grow their businesses. To this end, benefits brokers and PEOs often develop a symbiotic relationship that can be a fruitful one for everyone involved. But the strength of these relationships hinges on one crucial factor: due diligence.
For benefits brokers, ensuring that a PEO aligns well with their client’s needs isn’t just good practice; it’s a foundational first step toward building a mutually beneficial relationship that can stand the test of time. As a trusted PEO serving multiple industries, Aspen HR has a proven program to successfully partner with benefits brokers.
How Employee Benefits Brokers Partner with a PEO
Employee benefits brokers are vital players in the HR landscape, acting as trusted advisors to businesses navigating the complex world of HR. Their ability to offer insights on benefits packages, products, and services can help clients dramatically. However, their expertise extends beyond that of an intermediary; they’re the architects who design and tailor the benefits packages that align with both the company’s ethos and its employees’ needs.
The role of an employee benefits broker requires an understanding of a company’s unique culture, workforce dynamics, and long-term objectives. This insight is also crucial when it comes to referring the right PEO partner: one that fits with the company’s vision and can deliver on its specific HR requirements. Brokers need to have a keen eye for detail and an in-depth understanding of the HR industry to make these matches successful.
When it comes to partnering with a PEO, the broker’s role is even more important. They may be the critical link between the business and the PEO, ensuring that the partnership is fruitful and aligns with the client’s culture, values, and strategic goals. This requires vetting the PEO’s capabilities, from their expertise in regulatory compliance and risk management to their proficiency in payroll administration and employee benefits administration.
The partnership between an employee benefits broker and a PEO is a dynamic and collaborative process. In success, it offers a whole that becomes greater than the sum of its parts, enhancing the clients’ HR experience, elevating employee satisfaction, and driving business success. Brokers can be the linchpins in this process, leveraging their expertise to forge partnerships that are not just beneficial but transformative for both their clients and the PEOs they work alongside.
The Benefits of the Right PEO Partner
Ideally, the partnership between a benefits broker and the right PEO is one that pays dividends for everyone involved.
Benefits for the Broker
For insurance brokers, teaming up with a PEO is a strategic move to stand out in a competitive market. This partnership not only helps expand their client base but also offers an advantage over competitors, including larger firms. Additionally, brokers can expand their earning potential by pairing up with a PEO that looks out for its referral partners, providing financial benefits like guaranteed, flat residual commissions.
Benefits for the PEO
From the PEO’s perspective, nurturing long-term relationships with successful referral partners like insurance brokers is a no-brainer. It helps a PEO broaden its reach, connecting it with more small and mid-sized businesses nationwide. It’s a growth strategy that benefits not just the PEO, but their entire network of partners and clients.
Benefits for the Client
It’s no secret that PEOs offer significant benefits for their clients, and the rapid growth of PEOs attests to the value they can bring to their clients. According to a recent report by the National Association of Professional Employer Organizations (NAPEO), clients of PEOs can save up to 35% on HR administration costs.
Small businesses that partner with PEOs also grow 7% to 9% faster and have a 50% lower chance of going out of business. PEOs enhance workforce management efficiencies, especially when it comes to compliance, which can be extremely costly. They also empower small and mid-sized companies to offer the kind of platinum benefits packages (usually only available at larger companies) that can help them attract and retain top talent.
Practical Steps for a Comprehensive PEO Evaluation
When it comes to evaluating a Professional Employer Organization (PEO), the process should be as thorough as it is thoughtful. PEOs like Aspen HR offer a huge spectrum of services that extend from HR compliance and payroll management to employee benefits and training programs. Our approach exemplifies white glove service, where attention to detail and personalized care are paramount. That being said, every PEO is different, so it’s crucial that benefits brokers accurately assess each PEO’s strengths and weaknesses during the due diligence process.
Comprehensive Services Offered by PEOs
Which services matter most to your client’s business? That’s the question a benefits broker should ask when evaluating what a PEO brings to the table.
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Most PEOs provide an all-encompassing suite of HR services. This includes ensuring HR compliance, which is particularly crucial given the ever-changing landscape of employment law. Payroll management is another critical service, involving everything from processing paychecks to handling taxes and ensuring compliance with state and federal laws.
And across each service, the level of care a PEO can offer is another crucial consideration. Aspen HR, for instance, elevates each of our services by integrating a high-touch approach, ensuring that each of our clients receives personalized and attentive service.
Embracing Technology in HR
In today’s fast-paced digital world, the importance of cutting-edge HR software and tools simply can’t be overstated. These technologies streamline processes, enhance data accuracy, and improve employee engagement. Aspen HR, for example, leverages advanced HR technologies to provide efficient and accurate payroll services, robust HRIS systems, and intuitive employee self-service portals.
The Power of Client Testimonials and Case Studies
Real-world examples often speak volumes about a PEO’s capabilities. Client testimonials and case studies can provide insights into how a PEO like Aspen HR has positively impacted the business of past clients in the real world. These examples often highlight everything from improved HR efficiencies, to cost savings, to enhanced employee satisfaction — all outcomes that could fit the needs of various businesses.
Researching a PEO’s Industry Expertise
Since benefits needs can change depending on industries, it’s crucial for brokers to research a PEO’s expertise across specific industries. This involves understanding the PEO’s experience in handling industry-specific HR challenges and their ability to provide tailored solutions. Aspen HR has extensive experience working with alternative investment and portfolio companies as well as startups and those in the technology and life sciences industries.
Remote and Onsite Workforce Management
Is your client’s business remote, or onsite? Understanding a PEO’s approach to working with both remote and onsite workforces is essential to ensuring a good fit. This includes evaluating their strategies for remote workforce engagement, technology infrastructure for remote work, and their ability to handle the unique challenges of onsite workforce management.
Geographical Reach and Localized Services
Brokers should also consider the geographical reach of a PEO. A PEO with a broad reach can provide more comprehensive services, especially for businesses with a national or global presence. Localized services are equally important, as they ensure that the PEO is well-versed in local employment laws and customs, particularly in states like Texas, New York, or California. Aspen HR has offices across the country, in financial, technology, and biotech hub cities to provide localized service to our clients.
Managing Diverse Workforces/ESG Commitment
Understanding how a PEO like Aspen HR manages diverse workforces is crucial. We’ve created strategies for promoting diversity and inclusion, handling cultural differences, and ensuring equitable treatment of all employees. Additionally, we can offer clients assistance with ESG compliance, which can be a valuable asset.
Questions to Ask a PEO Partner
When evaluating a PEO, brokers should ask critical questions:
These questions help brokers gauge the PEO’s effectiveness, reliability, and commitment to excellence.
Conclusion: The Road Ahead for PEO and Broker Collaborations
The importance of due diligence in forming successful PEO-broker partnerships simply can’t be overstated. As the HR landscape evolves, staying proactive and informed is key. Aspen HR offers brokers seeking a PEO partner an unwavering, collective commitment to executional excellence in the delivery of our white-glove HR services. Learn more about how Aspen HR sets ourselves apart from other PEOs.
Interested in a partnership that elevates your client’s HR experience? Contact Aspen HR today.