One of the things that small business owners appreciate about their company ?especially during the early phase when it may be just themselves and perhaps one or two employees? is the lack of bureaucracy. They may have left a much larger company to strike out on their own, and not needing an expense claim to be approved by two different levels of corporate accountants, being able to write a three checks a month for payroll and knowing exactly how much vacation time each employee has coming (because there are only two other people in the company) can be liberating. However, as the company begins to add staff, things rapidly become complicated, especially in the back office and human resources areas.
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Tax payment and filing on behalf of employees, payroll administration, labor law compliance, Workers? Compensation, tracking employee attendance and benefits administration rapidly become more complex as more staff are added. And if a small business is successful, it certainly will grow. Suddenly, the owners are faced with the dilemma of having their streamlined and lean back office operations completely overwhelmed. This can be disastrous. Failing to comply with safety regulations, an incorrectly documented Workers? Compensation claim or a mistake in employee tax deductions could result in a regulatory mess. Lacking the trained staff to manage the back office functions and fill a human resources role means that the owners or senior managers are left to cover the gaps, pulling them away from the strategic focus they need to maintain in order to continue growing the company.
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In many cases, the most logical solution to a situation that could threaten the transition of a small business to a successful company is to turn to a professional employer organization. Doing so leverages the experience, highly trained staff and capabilities of a company that specializes in payroll services and other time consuming back office ?functions; the customer immediately gains full service HR capabilities without the expense of hiring human resources personnel. Employees benefit from the development of safety training programs, employee handbooks, job descriptions and the potential for superior benefits programs. Through audits and training programs, safety and applicable regulatory compliance for the company is ensured. Advanced payroll systems give management advanced reporting capabilities to staff shifts, track employee attendance and plan for new hires.
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When it comes time for those new hires, a PEO services company provides the expertise critical to ensuring that the right employees are hired, at the right price. Landing high quality hires is crucial for a company as it expands and having experts who know how to screen applicants, negotiate favorable terms and perform effective background checks ensures a growing company benefits from bringing the highest quality candidates on board. Small and medium-sized companies avoid the trap of back office complexity, gain access to the payroll and HR functions needed to grow and management is able to remain focused on its core business.
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About the Author:
Ben Cowan is an accredited HR professional with experience in all aspects of the human resources field, particularly in helping small to medium sized businesses. For questions about payroll outsourcing companies, employee benefits or any HR functions, please feel free to contact Ben by calling (480) 429-8098 or writing 4800 North Scottsdale Road, Suite 2000, Scottsdale, AZ 85251.
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