The average cost of non-compliance has spiked 45% over the last decade, with a single event costing businesses up to $4 million or more in revenue. That's not including the costs of other risks where your business is vulnerable when it is not appropriately managed—like financial, operational, reputational, global, competitive, etc.
The importance of minimizing risk in the workplace isn't just to save on costs, although the positive impact is significant. It also keeps your employees productive, safe, confident, and capable. In turn, employees are more engaged and remain with your company.
Keep reading for more guidance on compliance and minimizing risk in the workplace (and how a professional employer organization can handle risk and compliance for you).
How PEOs Manage Risk and Compliance
"If you don't invest in risk management, it doesn't matter what business you're in; it's a risky business." — Gary Cohn, Vice chairman of IBM
You also don't want to invest in uninformed and unsuccessful ways. Investing in any risk management may help some, but you need to invest in the latest and most successful practices and procedures to benefit in a meaningful way. Enter: your PEO.
What is a PEO, and how does it help in managing risk and compliance?
A PEO is a service that helps your business by taking on Human Resources and other employment-related tasks. Your business enters into a co-employment relationship where they provide you access to the following and more:
- Handles all your paperwork and critical HR functions
- Conducts audits of your company’s OSHA compliance history
- Makes suggestions on ways you can ensure your company is in compliance
- Introduces and implements risk management strategies
- Manages workplace safety policies and procedures—for instance, a PEO can help you create a solid employee handbook
- Stays up to date on complex local, state, and federal (and industry-specific) laws, so you don't have to
Overview of PEO services
Services often include (but are not limited to):
- Human resources
- Payroll processing
- Employee benefit plans & administration
- Risk management
- Regulatory compliance
- Workplace safety
- Workers' comp
- Wellness
- HR technology and service
Areas of Risk and Compliance Covered by PEOs
Get some peace of mind knowing that your PEO covers the following areas of risk and compliance:
- Human Resources (HR) Compliance: Fair Labor Standards Act (FLSA), Affordable Care Act (ACA), Family and Medical Leave Act, Title VII of the Civil Rights Act, Occupational Safety and Health Act (OSHA), Equal Pay Act (EPA), Americans with Disabilities Act, etc.
- Payroll and Tax Compliance: Accurately calculating wages and overtime, withholding the appropriate amount of payroll taxes, timely deposits, etc.
- Workplace Safety and Health Compliance: Wearing the appropriate personal protective equipment (PPE), emergency procedures, safe work practices, etc.
- Insurance and Benefits Compliance: Affordable Care Act (ACA), Consolidated Omnibus Budget Reconciliation Act (COBRA), Employment Retirement Income Security Act (ERISA), Family and Medical Leave Act (FMLA), Health Insurance Portability and Accountability Act (HIPAA), etc.
How Do PEOs Ensure Compliance?
There is a multitude of ways your PEO can help ensure your compliance and protect your organization from fees and penalties:
- Regular updates on changing laws and regulations
- Use of technology and tools to track compliance
- Provide expertise of PEO professionals in HR and compliance
- Helps you design essential documents (i.e., employee handbooks, safety procedures, training, etc.)
- It enables you to foster a culture of safety
The Benefits of Using a PEO for Handling Risk and Compliance
Your company will significantly benefit from a reliable PEO handling your risk and compliance. Let your PEO experts handle the complexities of HR, risk management, and compliance while you focus on revenue-driving decisions and tasks.
Here are the most important benefits your organization will enjoy:
- Cost savings on compliance-related expenses
- Reduced risk of penalties and lawsuits
- Improved employee satisfaction and retention
- Fewer accidents and injuries
- Reduces your workload so you can focus on achieving your business objectives
- Access to the latest best practices and procedures
Is a PEO Right for Me?
On a scale of 1 to 10, where would you rank your business regarding management and compliance? If it's not a 10, why not? A PEO can help you get there.
Managing risk and compliance is complex and requires specialized expertise and skill. Taking on such a fragile and important part of the business without the right guidance could mean investing heavily in risk management and compliance while still being very vulnerable to the true costs of not investing.
According to research, these costs can accumulate in more ways than the monetary impact of a critical risk event: employee productivity (62%), operational efficiency (e.g., disrupted systems, processes, etc.) (59%), employee safety (29%), competitive differentiation (29%), and brand and reputation (28%).
A PEO has all the knowledge and skill you need to ensure your business is safe and running smoothly. PRO Resources, in particular, goes beyond just keeping you safe. We do everything in our power to help your business thrive! Let's have a conversation to discuss your needs further.
