For small businesses in the Bay Area, HR can be hard to keep up with – especially California’s tight and changing employment regulations.
It can also be hard to attract and retain talent in an area with such a high cost of living. The answer, in many cases, is to outsource your business’s HR. And the best choice for doing so is a local professional employer organization (PEO).
Here are some reasons why a Bay Area PEO is your best choice for outsourcing and managing HR.
Learn more about what you should expect from your outsourced HR partner
Expertise
Many smaller and newer businesses lack a dedicated HR team or may have only one HR generalist. This means you might not have access to the expertise you need. Bringing together an internal team is often prohibitively expensive.
By outsourcing to a PEO, you can benefit from their expertise and have a full team of HR, payroll, and benefits specialists available. And since they operate on an economies of scale model, you get a proportionate saving in costs gained by an increased level of production. Furthermore, the PEO’s team has experience that comes from working with multiple clients in your industry and others. They have seen it all.
Compliance
The HR compliance environment is eternally changing at both the federal and state levels, especially in California. Keeping up with all of the various regulations is practically a full-time job on its own. But only large, established companies can afford to hire a compliance specialist.
Enter the PEO. They have compliance people who dedicate their time and energy to keeping up with these rules. They will make sure that you are up to date and advise you on what you need to comply with FLSA, OSHA, state, and local regulations. They can help with everything from required posters for the workplace to issues that can arise if you have remote workers in another state. This helps reduce your risk and ultimately can save you a lot of money, as many small businesses end up paying large amounts for non-compliance.
Staying compliant also helps sustain employee morale and keep everyone productive.
Better Benefits and Perks
A PEO can enroll your employees in their master benefits plan. Healthcare is often expensive for smaller companies, yet without good health benefits you are unlikely to attract top talent. Benefits are even more important for smaller companies that might struggle to offer a competitive salary.
The PEO can also help with retirement benefits, and with other perks, giving you advice on things you can offer within your budget that will help you compete in the tough Bay Area market. Sometimes, it helps to think outside the box on benefits, and a PEO can help you do that by working with you on ideas, sharing knowledge of what may or may not have worked for others in your industry.
Good benefits then improve employee retention, saving even more money and more of HR’s time, not to mention helping you build the institutional culture you will need to thrive in the long term.
Improved HR Infrastructure
Another thing smaller businesses often struggle to afford is good HR infrastructure. As well as building your team (PEOs are not intended to replace your in-house team but rather complement them), you need to put together software and technology that support HR.
Often, the best-in-class software is expensive. Additionally, it’s only as good as the knowledge you have in using it. PEOs can give you access to enterprise-level software for applicant tracking, employee management, and payroll. A really good HRIS reduces errors by reducing the number of places data has to be entered and helps you find the best candidates by handling automated resume screening. Having this infrastructure can make a huge difference for your business.
Improved Productivity and Engagement
Last, but not least, outsourcing to a PEO saves your in-house team a lot of time. As already mentioned, the point is not to replace HR. Rather, PEOs handle things like compliance, which are more or less the same across all of their clients.
Meanwhile, your in-house HR can focus on the things you hired them for. This includes developing a strong company culture and providing your employees with the support they need to be engaged and productive. Because your in-house team knows your business, they can tie everything they do to your overall goals.
Outsourcing HR improves productivity and makes your company a better place to work, attracting top talent in the process. Check out our blog for more ways a Bay Area PEO can help your business grow.
