Why Choose Small Business HR Outsourcing Over DIY Platforms?
Fans of the popular HGTV show Fixer Upper can relate to the feeling that DIY is always better than paying for a ready-to-go solution. After all, Chip and Joanna can take a dilapidated old house and make it look chic, updated, and move-in ready in just one show, right?
But as anyone who has ever attempted to tackle a DIY home renovation project knows, it’s not that simple. A successful kitchen remodel requires plenty of know-how, some savvy design skills, a touch of inspiration, and a whole lot of grunt work. And we haven’t even talked about the rest of the house yet. At the end of the day, Chip and Joanna may be able to pull off a gorgeous renovation on our screens in just 60 minutes, but you and I will need weeks or months to get the same result. (And even then the drywall seams might show. Don’t ask me how I know this.)
And that’s not just true for houses. It’s true for HR departments too.
What’s the Big Deal About DIY?
Innovations in cloud technology have created a whole new buffet of software offerings designed for small businesses. Popular HR platform Zenefits, for example, offers DIY HR management, hiring and onboarding, ACA reporting, benefits integration, and more. The appeal is that they make it easy for small businesses to take care of administrative HR tasks all in one integrated, user-friendly platform. By automating parts of the administrative process with employee self-service, benefits management, and easy reporting, Zenefits can be an attractive option for small businesses looking to cut down on paperwork and streamline workloads.
But there’s more to running a business than that.
At the end of the day, Zenefits and other platforms like them are just tools to help you get the work done. They’re not actually reducing your workload; they’re just making it more efficient. And that’s why you need a PEO.
Living the PEO Life in a Zenefits World
Small business HR can be a minefield, especially when you’re also trying to develop your brand, grow your business, and market yourself to your target audience. When you partner with a PEO, you shift the administrative burden to their shoulders, leaving you free to focus on running your business.
But are PEOs really better than a DIY platform? Let’s take a look at four things a PEO offers that Zenefits can’t:
- Co-employer relationship—As your co-employer, your PEO has a strong incentive to make sure all tax filing and compliance issues are handled correctly. The co-employer relationship means that the PEO assumes responsibility for these and other functions, leaving you free to focus on core competencies. With Zenefits, that responsibility is still yours.
- Vendor management—Zenefits may offer third-party integration, but you’ll still be dealing directly with Intuit if there’s a payroll error. A PEO will manage vendor interactions that take up hours of your time each week.
- Compliance management—Compliance errors are costly, and with regulations constantly evolving, staying on top of current requirements requires careful vigilance. Your PEO will manage compliance issues across your business, from hiring policies to ACA reporting.
- Better benefits—Because PEOs act as the employer of record for many businesses, they can aggregate buying power to deliver better plans and rates that would typically be available only to larger companies.
Perhaps the greatest benefit offered by a PEO is peace of mind. Just as a DIY kitchen remodel seems attractive until you run into a problem with your drywall seams, DIY HR platforms offer plenty to love—until you find yourself on the hook for a filing error or noncompliance issue.
If you’re ready to leave DIY to Chip and Joanna and enjoy the benefits of a PEO partnership, check out our PEO matching tool for an unbiased look at PEOs based on your business requirements.
Read more about this topic:
The #1 Reason to Go With a PEO
What is Human Resources Outsourcing?
PEO, ASO, or HRO: Which Solution Is Right for You?
About the Author: Susan McClure is our resident content marketer at PEOcompare.com. She writes about HR outsourcing, HRIS, and general employment issues. When she isn't writing, you might find her browsing shelves at the library, exploring a local hiking trail, or digging in the garden with her family and fur kids.
