| The business of being an employer is hitting enterprise | | | | 1.Conduct a specific needs analysis. Does your |
| hard. This is especially true in the areas of staffing and | | | | company simply need a payroll processing service to |
| government compliance. The decreasing labor pool | | | | take care of paychecks and payroll taxes or, is your |
| and competition from other companies have made | | | | company in need of a more comprehensive approach |
| employment issues a nightmare for small businesses all | | | | to HR? Determine what type of human resource and |
| over the country. | | | | risk management concerns you have. These questions |
| Finding top talent is also growing increasingly difficult. | | | | must be asked and answered before you consider a |
| Because most small businesses are self-funded, | | | | specific solution. |
| private businesses, they cannot afford to offer their | | | | 2.Ensure that the HRO vendor you choose can meet |
| employees competitive salaries or the same benefits | | | | all of your needs and will do so in a manner that |
| that a larger employer can provide. | | | | meets-if not exceeds-your expectations. After |
| In addition to traditional staffing challenges, most small | | | | conducting your needs analysis, you should be clear |
| business owners have little knowledge of HR | | | | about what your HR needs are. Ask your HRO |
| administration or of the complexities of compliance | | | | provider specific questions about your individual needs |
| issues. This lack of compliance to government policies | | | | in the interviewing process. Chances are, if you bring it |
| and procedures can cause a business to fail. The | | | | up and they have little information on the subject, it's |
| average CEO isn't equipped with either the knowledge | | | | time to interview another provider. |
| or the time to comply with the mountain of regulations | | | | 3.Ask your potential HRO provider for references |
| required by the government. | | | | from current clients and check them thoroughly. You |
| Because of these challenges, employers often turn to | | | | would not hire an employee without first checking their |
| outsourced HR solutions. | | | | references. A smart CEO does his or her |
| Outsourcing HR is often less-expensive than hiring an | | | | due-diligence on every vendor, and a reputable HRO |
| internal HR staff. For a fee typically ranging from 1.5% | | | | provider will be happy to provide you with information |
| to 8% of your payroll, an outsourced HR company can | | | | needed to research their solutions thoroughly. |
| handle all of your employment needs. For example, a | | | | 4.Commit one person on your staff to manage the HR |
| payroll processing company will handle everything as it | | | | vendor relationship. Have them communicate with the |
| applies to payroll, including issuing pay checks, | | | | vendor on a monthly basis and hold the vendor |
| calculating employment taxes, and issuing W-2's and | | | | accountable for any issues that may arise. Set |
| 1099s. While this is a good option for some, others | | | | expectations of how you want to be communicated |
| may want a more in-depth solution. A PEO handles | | | | with by your vendor. Tell your vendor exactly what |
| the whole gamut of HR responsibilities, including | | | | your expectations are and what kind of time frame |
| benefits, payroll, taxes, workers' compensation, and | | | | you expect in regards to having phone calls or e-mail |
| regulatory compliance. The PEO handles all | | | | returned. An open line of communication ensures that |
| employment matters related to W-2's, issuing payroll | | | | you will get the service you deserve. |
| checks, and working with compliance and regulatory | | | | 5.Ask for some demonstration that payroll taxes and |
| matters. The PEO takes over all of the risk-associated | | | | insurance premiums are being paid properly and on |
| tasks, helping a CEO concentrate on his or her job and | | | | time. A reputable vendor can show proof that the HR |
| not on HR headaches. | | | | responsibilities they are managing for their clients are |
| Utilizing any outsourced HR option can provide a | | | | being properly handled. Also, ask for proof that any |
| variety of benefits, from cost savings to access to | | | | past clients´ legal issues have been correctly |
| specialized expertise on taxes, payroll, workers' | | | | and efficiently handled. |
| compensation and more. However, without an | | | | 6.Have an escape clause. After you have chosen a |
| understanding of the industry and what a company's | | | | vendor, make certain that the vendor contract allows |
| specific needs are, an employer may not get what he | | | | you to withdraw your business for unsatisfactory |
| or she is paying for. | | | | performance. If your vendor consistently misses |
| In order to get what you need out of an outsourced | | | | deadlines, avoids communication, and causes you |
| HR relationship, it is imperative to take the following | | | | headaches, cut your losses and move forward with a |
| steps: | | | | vendor who wants to earn your business. |