Getting Back To Business: HR Outsourcing’s Big Advantage

Running a business isn’t easy. As almost any CEO can tell you, doing their job right means doing several jobs right – and doing them all at once. All too often, many of these jobs consist of burdensome HR activities that don’t generate revenue, drive sales, or build competitive advantage, but which are nonetheless essential to daily operations.

As necessary as it is to keep on top of payroll, tax, regulatory compliance, workers’ comp and other activities, these do nothing to advance the business. In fact, the time devoted to them is time taken directly from strategy, promotion, revenue generation, relationship building, customer service and other core functions of a company. Time spent on administrative matters doesn’t just cost money – it costs opportunity. The attention, resources, and working hours devoted to these tasks isn’t used to create, innovate, expand, or sell – and the lost opportunity to do so may well be taken by the competition.

More and more, companies are recognizing the enormous burden that HR administration is placing upon them – and they’re doing something about it. Outsourcing is becoming a key element in many growing companies’ success strategies as they recognize the unique benefits it provides:

Companies with outsourced HR functions quickly reap the rewards of this new management model – and the differences they see are reflected in their growth trajectories and their bottom lines.

A white paper published by the National Association of Professional Employer Organizations shows that companies that outsource HR functions experience a 9% higher employment growth rate than those that don’t. In addition, they show a 4% higher employment growth rate than in the overall economy.

At Trion, we’ve helped countless clients get their opportunity mojo back. We know from firsthand experience that for a company to succeed to their greatest potential, its senior management must remain focused on business-building activities. We make it our job to make that possible.

Is Your PEO Licensed? It Better Be

In the Human Resources field, September is significant for more than just the Labor Day holiday. For PEOs, it’s also the deadline for renewal of State of Michigan licenses.

Professional Employer Organizations operating within the state are required to receive their licenses by September 1 in order to remain compliant and to avoid an escalating range of significant penalties. Since the PEO licensing law took effect in 2012, the net effect has been a steady reduction in the number of PEOs doing business in the state. Increasingly stringent requirements and the need to maintain over $100,000 in working capital have forced many smaller and less reliable companies from the market.

While the numbers of less stable, less established PEOs have diminished as a result, a considerable number remain – including some that try to sidestep licensing, and the licensure requirements, altogether. Such companies typically work with a small number of employees and clients, and do their best to remain “under the radar” where regulations are concerned. They manage to maintain stable, longstanding relationships with their established clients – until suddenly they don’t.

When an unregulated PEO fails, the ripple effect can affect many people outside of the organization – most notably the PEO’s client. Apart from the considerable and immediate legal ramifications, a company can suddenly find itself saddled with a wide range of unforeseen obligations and burdens – liability issues, unpaid wages, unpaid premiums, unfiled paperwork, and more – that can put its very existence at risk.

The 2012 licensing law was enacted in an effort to prevent such scenarios. In the wake of some catastrophic PEO collapses prior to regulation, there was a broad consensus that something had to be done to protect workers and businesses alike from underfunded, incompetent, or unscrupulous outsourcing firms. The 2012 regulations sought to establish a baseline capability and quality standard for professional employer organizations, and the annual licensure provides a measure of protection for companies that entrust their vital human resource functions to outside providers. Companies that can’t or won’t meet the licensing standard undermine that protection.

Companies operating within the law have advanced the PEO industry, and have provided immeasurable benefit to the business community. Today’s best PEOs have helped their clients improve efficiency, improve compliance, and cut costs, helping to strengthen the business community as a whole. But “Caveat Emptor” – “Let the buyer beware” – still applies; where non-licensed PEO’s continue to operate on the margins, there is still the potential for disaster for client companies that neglect to do their due diligence.

Sure, the prospect of saving a few dollars, cutting a few corners, or not disrupting an established business relationship can be appealing – but an unlicensed PEO can be putting your business at mortal risk. Now more than ever, it’s essential to check a PEO’s licensing status before starting – or continuing – a working relationship. The licensing standards aren’t just some arbitrary bureaucratic hassle; they’re a vital layer of business protection, and can literally make the difference between stability and insolvency. So check out your PEO, and make the switch to a stronger, more stable, licensed company if you need to. The business you save may be your own.

Introducing Trion Advantage

In today’s fast moving, highly regulated, hypercompetitive business climate, it isn’t easy to survive – let alone succeed. Naturally, the challenges of the modern marketplace are magnified for small and medium-sized businesses. Emerging companies’ smaller headcounts, lower cash and credit reserves, and limited capacity increase the impact of any adverse events.

At Trion, we see this firsthand every single day. We work closely with small, medium and large businesses across a full range of industries. We’re there to see their struggles, triumphs and tragedies. Mostly, though, we’re there to help.

We’ve built our business by helping other businesses to succeed – by increasing efficiency, by cutting red tape, by streamlining operations, by driving down turnover. It’s our job to give our client companies every possible advantage when it comes to human resources, benefits administration, payroll management, government/ACA compliance, Worker’s Compensation, risk management and other essential non-core functions within their organizations—and to do so at fixed costs with no surprises. In doing so, we’ve picked up a fair bit of knowledge along the way – and we think it’s a good idea to share some of it.

Introducing Trion Advantage. Trion Advantage is the official blog of Trion Solutions, and we’re going to make it a valuable resource for business insights, suggestions, inspirations, and success stories for people who do the hard work of keeping companies going, day after day.

We want to empower businesses like yours by sharing some of the hard-earned knowledge we’ve gained over the years, and by offering some of the perspectives that only a company in our unique position can acquire. Hopefully, you’ll find the articles and insights we offer here to be not only inspiring, but genuinely helpful. As in our normal business practice, we’re striving to deliver tangible, dollars-and-cents business benefits.

Here’s some of what you can expect to see in the coming weeks and months:

In short, we’ll be looking to provide whatever knowledge we can that might help you and your business succeed. Hopefully, we’ll be able to provide answers to your questions, and insights that help you meet challenges head on.

We consider ourselves lucky to have achieved the success we have within our field. We know how hard it is to establish, grow, and manage a company within a competitive field – we’ve not only helped our clients do it, we’ve done it ourselves. We understand that as a CEO, as a CFO, as a manager, as an employer, as a strategist, as an HR or benefits professional, you’ve already got your work cut out for you. If we can make things even a little easier for you, that’s what we want to do.

So check back with Trion Advantage every week. We think you’ll like what you see in the coming weeks and months. And we can’t wait to share it with you.