How to Get Your Money's Worth From Your PEO: An 8-Step Checklist
Short answer: To get your money's worth from a PEO, find out every service your plan includes, track which ones your company actually uses, and assign someone inside your business to own follow-through. Most companies use payroll and benefits and leave training, consulting and compliance support untouched.
After nine years inside a publicly traded PEO, here's the checklist I wish every client had.
Step 1: Get a written list of what's included
Ask your PEO rep for every service in your plan, not just the ones in the sales deck. Look specifically for:
Compensation benchmarking and pay range support
Manager, harassment and compliance training (onsite and online)
Safety audits and risk management support
Performance and organizational development consulting
Handbook and policy review
Recruiting or hiring support
Employee assistance programs
Step 2: Audit what you used last year
For each service, mark it used, partly used or never used. If most of your list is "never," you're paying for value you're not getting.
Step 3: Act on every compliance alert
PEOs send policy updates, law changes and required notices. Create one place they go and one person who acts on them within a set number of days. An alert sitting in an inbox doesn't protect you.
Step 4: Customize your handbook
A PEO handbook is a starting point. Make it match how your company actually operates and every state you have employees in, then review it every year.
Step 5: Put training on the calendar
Schedule harassment training and at least one manager training session this year. Make the learning platform part of onboarding so new hires actually use it.
Step 6: Use the consultants
If your plan includes compensation, safety or organizational development consulting, book them. Pick the two areas that would make the biggest difference this year and start there.
Step 7: Review your benefits every renewal
Look at participation rates, employee feedback and what competitors offer. Ask your PEO for options before renewal, not after.
Step 8: Assign an owner
This is the step that makes the other seven work. Someone inside your business needs to own your PEO relationship: requesting services, following through and making sure the value shows up. If that person is you and you don't have the time, that's the gap a fractional HR leader fills.
Frequently asked questions
How do I know if my PEO is worth it?
Compare what you pay to what you use. If you only use payroll and benefits, you may still be getting good value, but you're likely leaving consulting, training and compliance support on the table.
Should I switch PEOs if I'm not getting value?
Not necessarily. Often the problem isn't the PEO, it's that nobody inside the company is using what's included. Fix that first, then compare.
Who should manage the PEO relationship?
Someone with HR knowledge and the time to follow through. For many companies with 10 to 75 employees, that's a fractional HR leader. Read more in 7 Signs It's Time to Hire a Fractional HR Director.
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UNTIL NEXT TIME,
Stacey
Stacey Dennis, SHRM-SCP, is the founder of Possibilities Unlocked, a fractional HR firm for growing companies. She spent nine years inside a publicly traded PEO before starting her firm.