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How the PEO Business Model Complements I.T. Companies

How the PEO Business Model Complements I.T. Companies

Many IT companies have to operate with thin profit margins. This circumstance limits their spending considerably. Meanwhile, attracting top talent is always on the agenda.

Staffing and supporting an HR department can be tedious and costly. That's why many IT companies turn to professional employer organizations (PEOs).

A PEO can cater to the company's HR needs at a fraction of the price of creating an HR department while offering substantial benefits to both employer and the workforce.

PEO Handles HR tasks that Don't Generate Revenue

Many IT companies struggle to maintain a separate department to handle HR-related matters. As a result, financial specialists have to deal with payroll while other employees take on recruiting tasks and the onboarding process.

Eventually, your workforce becomes distracted from its primary duties, which affects the productivity of the entire company. A PEO can help with all the essential HR tasks, including:

It's an excellent solution for IT companies with a thin profit margin, which are looking to concentrate on growing the business instead of maintaining departments that don't generate profit directly.

PEO Provides Access to Fortune 500 Benefits

More than 90% of employees state that benefits are highly important to their overall job satisfaction. Some are prepared to overlook a better salary offer from another company in favor of high-quality benefits at their current workplace.

Many small IT companies struggle to provide excellent benefits to their employees, thus losing access to top-notch talent.

By collaborating with a PEO, you can offer your employees Fortune 500 benefits, thus improving their overall satisfaction and workplace environment. Since a PEO represents numerous employees, it gets access to much better benefit options than a small company's HR team.

401k Retirement Plans

Additionally, a PEO can offer a 401k plan. Reporting and fiduciary obligations for 401k plans coupled with complicated tax reporting, often make it a liability for small HR departments. A PEO can handle all the reporting and maintenance, thus offering your employees a significant benefit.

Online Benefits Enrollment

Managing benefits enrollment is usually time-consuming and complicated. Processing mistakes made during that period could turn into costly consequences for a company.

Outsourcing benefits enrollment to a PEO with high-quality software for online processing is an excellent way to ensure employee satisfaction and reduce errors to a minimum.  

Top-Notch PEOs Consolidate HR Technology

Working with HR software can be overwhelming, especially if you try to save by opting for off-the-shelf programs. Juggling these generic apps without specialized knowledge can be frustrating.

Best-in-class professional employer organizations consolidate HR technology into a single all-in-one interface. One cloud-based app can handle:

  • Reporting
  • Hiring
  • Onboarding
  • Benefits
  • Time & attendance
  • Payroll
  • And many other HR functions.

High-quality, all-in-one software doesn't just simplify the work of HR specialists, it helps employees manage their benefits, improves the onboarding process, and reduces errors.

Since the software is cloud-based, you can access the necessary information at any time and anywhere. This advantage helps you solve problems promptly so you can focus on growing your business.

Access Pay-As-You-Go Workers' Comp Insurance

PEOs give client companies access to their workers’ comp insurance, which already has a paid deposit. That means accessing better rates without hurting cash flow with a hefty upfront payment.

A PEO can set up a return to work program, helping your employees come back on board quicker.


Working with a PEO can help keep your IT firm lean while offering employees Fortune 500 benefits, easy enrollment, consolidated tech stack, and more affordable workers' comp program.

By outsourcing your HR-related tasks, you aren't just cutting costs, you are improving employee satisfaction and reducing turnover rates.

Even better, if you use a local Utah PEO, you will spend as much as you would on payroll processors while getting many additional services.

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