Jill Pappenheimer brings 30 years of experience supporting the people function for organizations, ranging from large financial institutions to small entrepreneurial teams. In 2006, she began consulting with companies, and in 2012 she co-founded Options4Growth, a boutique-consulting firm bringing both outsourced Human Resources and Strategy Advising, combined with cloud-based technology, to a broad range of clientele. In 2018 Options4Growth rolled into BPM, and today the same model still holds true. Honoring and valuing people is the cornerstone that drives our team and support for our clients, combined with a progressive approach to building structure and growing teams.
When business leaders think about supporting their HR function and growing their teams, some accomplish this through a professional employer organization (PEO) relationship. In very simple terms, employees are employed via a third-party entity, PEO, that handles everything, from HR compliance, payroll and benefits to the onboarding and offboarding staff. This can create significant advantages for companies that want to offload the majority of their human resources work, but it can also generate several potential challenges that organizations need to consider.
First, once companies reach a certain head count, staying with a PEO will likely become financially burdensome, and can affect culture, morale and employee engagement. PEOs become the de facto HR department, handling all the transactional functions. For small companies, the healthcare expense can be astronomical. Organizations can benefit from leveraged benefit costs through the PEO’s clients as a whole. So, financially, it’s sometimes the best way for growing companies to go.
So far, so good, right? Not so fast. PEOs don’t make sense if a company is really serious about building a culture and treating their employees in a way where they feel empowered and valued, and are ultimately engaged. This is so important in the current environment we exist in, where people are leaving their jobs left and right. It’s very hard for a company to be competitive and hold on to their people if they’re part of a PEO where they have no control. The bottom line is that PEOs can be great from an administrative standpoint, but employees may feel disengaged because they don’t have an HR department supporting their “people” needs and providing the human touch that we all need right now in our current work environment.
Making the transition away from a PEO isn’t easy. It’s hard to exit, because you get very entangled in their policies, practices and systems — and you must unravel from all of that. It’s not as simple as just canceling a contract. It’s complex.
Our team at BPM has extensive experience working with our clients to make sure that their HR practices are optimized for current success and future growth. If a PEO is the right choice, we work to make sure our clients are getting the maximum potential benefits from that relationship. If a different path is needed, we help manage the entire transition and ensure a seamless migration.
To learn more about how BPM’s HR team can help you figure out if a PEO is the right choice for you – or to plan a transition away from an existing PEO relationship – please contact Jill Pappenheimer.