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Do your homework

If you are considering employee-leasing services, here are some guidelines in choosing a professional-employer organization:
–Check the PEO’s professional references, including its bank, insurance carriers, and legal and accounting firms.
–Document the PEO’s stable financial condition by seeking financial references. Also confirm that all taxes and mandatory insurances are paid on a timely basis as verified by a reputable CPA.
–Ascertain that the PEO uses an accepted method of funding benefit programs.
–Determine if the PEO is a member of the National Association of Professional Employer Organizations.
–Ask the PEO to describe its own corporate infrastructure. Seek out a PEO with well-established divisions in the areas of accounting, payroll, benefits administration, human resources, compliance/risk management and management-information systems. Also ask about the experience, qualifications and training of its personnel in these various departments. Among its staff should be a certified professional-employer specialist (CPES) trained to oversee the efficient delivery of PEO services.
–Evaluate the PEO’s internal quality controls and quality-assurance policies and procedures.
–Scrutinize the PEO’s contractual agreement–especially indemnification clauses. Also look for flexible terms, for example, clauses that would permit short-term notices for termination of services.
–Ask the PEO to demonstrate a proven track record over an extended period of time. Secure references of current affiliated companies for which the PEO is providing services, and contact them for a performance rating.
Source: National Association of Professional Employer Organizations


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