Month: July 2006

How Do We Earn Employee Loyalty When More Money Isn’t Enough?

by National Peo National Peo No Comments
Question: How do we earn our employees’ loyalty–and more importantly, preserve it?Answer:

No. 1: You cannot buy loyalty, so forget matching competing offers. Once an employee has decided to leave, the emotional bond is broken. Your first step is to begin the diagnosis. Are you conducting exit interviews? If not, consider hiring an outside service–professionals, not telemarketers–to ask questions that will yield honest, candid answers about why people are leaving.

No. 2 involves conducting a survey of remaining employees. Again, it’s better to hire professionals from outside the firm. Don’t try to do this in-house, as employees may not feel the level of trust required to give you meaningful feedback. Although you may be in a highly competitive market, you need to understand how employees perceive the experience of working for your company. Is it something they value?

This knowledge should provide a clearer picture of how your work environment is creating conditions that prompt–perhaps even encourage–people to leave for other jobs. Your job: Develop strategies that strengthen your defenses and make deliberate improvements to become a less toxic, more attractive employer.

Bonus hint: Employee retention is a management responsibility, not a human resources responsibility. Do your managers understand their retention role? Are they trained and equipped to perform it? You’ll need to get at the root of these questions too.

Call us at National PEO for specific ways to implement these suggestions. Ask for John Rico , he’s more than ready to help!

Wells Fargo Endorses PEO Arrangement

by National Peo National Peo No Comments

Outsourcing HR: Using a Professional Employer OrganizationIn the August 2005 Wells Fargo Business Banking Roundup newsletter’s “Outsourcing IT and HR” article, we discussed some of the benefits of finding a partner to handle these functions. In terms of HR, utilizing a professional employer organization (PEO) might be a viable solution for your company.

“Think of the PEO as a contractual relationship in which the PEO acts as a co-employer with you,” says Edie Clark, spokesperson for the National Association of Professional Employer Organizations (NAPEO). “Under the terms of the agreement, a PEO becomes the employer for purposes of payroll, employment taxes at the state and federal levels, securing Worker’s Comp coverage and providing a package of benefits and related services. A PEO is essentially an outsourced HR department.”

PEO Benefits

The true advantage of using a PEO is that you’re contracting with a company that has expertise you don’t. In addition to the general benefits described above are a variety of services that work to support you as an employer:

  • Keeping you in compliance—While PEOs ensure that you keep up-to-date with state and federal taxes, they also help in other areas of compliance. “One example is employment documentation, especially critical now with the focus on immigration,” Clark says. “A PEO is responsible for verifying employment status, checking the documentation of all employees and maintaining records ongoing. With some 60 employment laws on the books, remaining in compliance can be difficult for those businesses tackling HR on their own.”
  • Recruiting—PEO services often include the recruiting, screening and background checking—based on your job parameters—of new employees.
  • Termination—“This is a very sensitive area,” Clark notes. “A PEO will advise you about the process, both as it affects your organization and as it relates to compliance issues. They’ll even be available to be a part of the event, if needed.”
  • Training—PEOs typically offer training on harassment, employee privacy and other key workplace issues.
  • Benefits packages—Based on the number of companies they represent, PEOs have volume buying power, giving them access to solid health care plans and other benefits at reasonable costs.

Finding a PEO

So what should you look for in a PEO? Clark and NAPEO offer the following guidelines for companies considering such a relationship:

  • Assess your workplace to determine your human resource and risk management needs.
  • Make sure the PEO is capable of meeting your goals. Meet the people who will be serving you.
  • Ask for client and professional references.
  • Check the firm’s financial background, and ask for banking and credit references. Ask the PEO to demonstrate that payroll taxes and insurance premiums have been paid.
  • Investigate the company’s administrative and risk management service competence. What experience and depth does their internal staff have? Do any of the senior staff have professional training or designations?
  • Understand how the employee benefits are funded. Is the PEO fully insured or partially self-funded? Who is the third-party administrator (TPA) or carrier? Is their TPA or carrier authorized to do business in your state?
  • Understand how the employee benefits are tailored. Determine if they fit the needs of your employees.
  • Review the service agreement carefully. Are the respective parties’ responsibilities and liabilities clearly laid out? What guarantees are provided? What provisions permit you or the PEO to cancel the terms of the contract?
  • Make sure that the company you are considering meets all state requirements.

As far as terms and fees are concerned, they’ll differ by arrangement and company. Clark notes that contracts are generally structured for a year at a time, with rollover provisions after that. The PEO client pays an administrative fee based on payroll.

Some people still refer to PEO arrangements as “employee leasing,” but Clark calls the label a misnomer. “This isn’t leasing. PEOs are service businesses that advise businesses on good employment practices and regulatory compliance,” she says. “Day-to-day employee management belongs to you, but if a PEO finds something egregious happening with regard to an employment issue, it’s their job to resolve the issue.”

To find a PEO in your area, check out the NAPEO’s directory of PEO Members.

©2006 Wells Fargo Bank, N.A. All rights reserved. Member FDIC

HR outsourcing helps you with payroll and administrative tasks and keeps you in legal compliance. It can even help you attract top talent!

by National Peo National Peo 1 Comment
If you’ve worked for a large company, you know about perks such as flexible health and retirement plans. Your small business, though, probably doesn’t have the resources to put together a competitive benefits package on its own.
That’s where HR firms such as National PEO ( )can help. HR outsourcing gives you experts to handle payroll and administrative tasks and keep you in legal compliance. It can even help you attract top talent.
Here’s how to get the most from HR outsourcing.
1. Consider the size of your company.
If your business has eight employees or more, outsourcing HR can be cost-effective, experts and small-business owners say. “With 20 employees, it’s cheaper and more effective to outsource HR,” said Frank Sabella, the controller for International Facilities North, a business insurance aggregator. “You have access to a larger range of HR services for hiring, recruitment, terminations, and legal issues,” Sabella said.If you have fewer than eight employees but still want to remove some of the administrative headache, consider a regular payroll service, such as Pro Pay, ( which helps you with taxes and filings.

2. Offer competitive benefits.
Mike Sobolik is the finance director at Roving Planet, a 30-person network software company. The company takes advantage of its PEO’s customer base for buying power, letting it secure a more affordable and comprehensive benefits package than it could get on its own.”We have eight health care programs, 401(k) programs, Delta dental, and a vision plan. We have what you would call ‘big company’ benefits,” Sobolik said.

3. Recruit top talent.
“For the cost of half an admin and fees equivalent to half a regular position, we’re getting a fully loaded HR team, and our employees are better off as well,” Sobolik said. “It’s a recruitment advantage. When you have a 30-person firm that’s venture funded and yet you can tell prospective employees you have a world-class benefits package, it helps.”

4.Give power to your employees.
If you have a multitiered management structure, give different levels of access to different employees. A regular employee can log in to check benefits, tax information, and available vacation days. A supervisor can view his or her own benefits plus those of the team, whereas a manager or administrator can see the entire company picture.5.Relieve the administrative burden.
Sabella found that outsourcing HR increased the administrative staff’s productivity. “Without it, you end up spending a lot of time on paperwork with employee files, such as hires, fires, and locating documents,” he added.

Online access means your employees can find the answers to questions themselves. to solve problems,” added Sobolik. “It was clearly a value-add over and above what a straight payroll service would have given us.”