5 Reasons Staffing Agencies Should Use a PEO
July 23, 2020

A PEO or Professional Employer Organization provides several services to small and medium-sized businesses in areas such as human resources, risk management, payroll administration, and workers comp claims. Unlike a temporary staffing agency, a PEO provides full-time staff that remains employees of the PEO, so the staffing agency doesn’t need to deal with all the factors that would go into hiring an employee directly. This partnership is beneficial to the PEO, staffing agency, and the employees themselves for several reasons. So why do so many staffing agencies turn to PEOs and what value can they provide to your business?

1. Save on Costs

This important aspect of using a PEO is often why staffing agencies turn to them. When a PEO provides workers comp insurance, they are often able to do this at a lower cost than the staffing agency itself through aggressive pricing and negotiation. Ultimately, when you outsource things like HR, payroll and workers comp claims you are

2. Outsource Services

Payroll and the administration of benefits plans can take a large chunk of time, and to be done correctly, require experience and expertise. A PEO will handle payroll, benefits, insurance, and HR needs, thereby relieving the staffing agency of these responsibilities and removing the headache of dealing with these often complex matters. Imagine the freedom of completely outsourcing your HR needs!

3. Lower Risk

When you work with a PEO, one of the great benefits is that it takes on some of the risks that are associated with being an employer. Should an injury occur to an employee, the workers’ comp claims will be the responsibility of the PEO. If there is an HR issue, it’s once again the PEO’s responsibility to resolve it.

4. Ability to Place Staff in Different States

Let’s say you have a new client in California. But your staffing agency is registered in Arizona. What do you do? Each state has different legislation and laws when it comes to employment. If a staffing agency needs employees to work in a state different than the one they are registered as a business, they may not have the time or resources to go through the paperwork needed to be certified to place employees in that state. Working with a PEO removes this hassle.

5. Retain Talent

Finding and retaining talented workers is a challenge for staffing agencies. Competition is often cut-throat, and talented workers know their value. This is especially true in the tech world. PEOs offer a variety of insurance and benefits plans, often at better rates and with more perks than a staffing agency can and this can help and attract talent.

The Final Word

As a PEO ourselves, we have seen first-hand the benefits staffing agencies and businesses experience when they work with us. Our unique approach uses years of experience, the power of data and technology and custom solutions that take into account the needs of your organization. If you’re a staffing agency considering using a PEO, reach out to find out how we’ve helped California’s staffing agencies to keep their costs down, retain a talented workforce and save on workers comp claims.

This is a photo of staff from a staffing agency that used a PEO.