November 17 2008 0comment

Common Mistakes Made Shopping for PEOs and Employee Leasing on the Web

Web Shopping for Employee Leasing and PEOs can be Tricky.

Where can a Busy Executive Turn to for Help?
You’re a small business owner who is trying reduce costs because of the slowing economy. Your insurance broker just delivered your annual renewal rates. Workers compensation coverage increased another 20% because of a large claim you experienced 2 years ago. Your small group health insurance went up another 25%, and the only recommendation your broker has is …… reduce the benefits again, and ask your employees to pay even more for less coverage.
Faced with this dilemma, many successful business owners will seek out solutions offered by an employee leasing company or PEO (professional employer organization). Unfortunately, many executives have little experience shopping for employee leasing and HR outsourcing services. Some will ask an associate or their accountant for a recommendation, and others may let their fingers do the walking through the “Yellow Pages”.

Never Judge a Book by it’s Cover

Search Google or Yahoo using the keywords employee leasing or professional employer organization and you will find hundreds of websites offering all variations of employee leasing, HR Outsourcing and PEO services. Many are legitimate websites for companies that actually provide employee leasing and HR services. These sites belong to “Providers”, companies that are Professional Employer Organizations like ADP and Oasis Outsourcing.

Another type of website offers “quoting” services that will allow you to receive quotes from multiple companies. Very often these websites are designed to do nothing more than capture leads. These “Lead Generation” sites don’t offer professional services or expertise, but are simply taking your contact information and selling it. Often your company profile is stored in a database, and sold to 10 or more sales organizations that are foolish or desperate enough to pay $25 – $50 for your “lead”.
Still other websites offer employee leasing and PEO consulting services from professionals who will analyze your needs, introduce you to suitable partners, and assist you with the proposal and implementation process. As in any industry, it is sometimes difficult to tell who truly has the expertise and integrity worthy of your business.
Unfortunately, Google and Yahoo often list the NAPEO website on the second page. Usually people will click on the first few “paid” inclusions found at the top and side of the search page. These ads are sold to the highest bidder and it may indicate an organization that is more interested in putting their money into marketing, instead of delivering affordable quality service. The most important website for information about the industry is, the National Association of Professional Employer Organizations. There you can learn about the co-employer concept, the history of the industry, statistics, and a list of member employee leasing companies, PEOs, as well as PEO brokers and consultants. The primary function of NAPEO is to promote the industry to business owners and government officials. Members pay NAPEO annual association dues based on their size to support these efforts.