As a small business owner, you wear so many hats that you probably need a separate closet to store them all! With seemingly dozens of tasks demanding attention, it can be challenging to carve out the time to spend on "move the needle" projects.
HR responsibilities require specialized knowledge and can soak up a lot of time. For example, do you relish the task of monitoring the regulatory changes in all the payroll tax jurisdictions applicable to your business? Even if you are highly skilled in entrepreneurship, you may struggle to balance HR's demands against other business management priorities.
That's when an administrative services organization (ASO) may be the solution. What is an ASO? What are its benefits? And, how does it differ from professional employer organizations (PEOs)? We'll answer all these questions here.
An ASO is an HR outsourcing organization that can provide software and human expertise to cover a wide range of functions. The ASO and its client is not in a co-employment relationship, as is the case with a PEO. Businesses can, to some extent, pick and choose the services they use from an ASO.
ASOs provide a wide range of HR outsourcing services that help business administration initiatives. These services may come with an advanced Human Resources Information System (HRIS), a cloud-based HR software platform. Some of the most popular ASO services are:
Since small businesses often don't have lots of staff or big budgets, working with an ASO can provide them with some major benefits:
When organizations consider human resources outsourcing, they typically look at professional employer organizations and administrative services organizations. These outsourcing companies are structured quite differently.
A PEO is an outsourcing company that provides comprehensive HR services. A PEO is the co-employer, or the employer of record for the client's employees for tax purposes. The client manages the day-to-day business operations and workforce, while the PEO helps support the HR responsibilities. The organization's employees continue working under the client's supervision and rules. PEOs can helps with HR functions including payroll processing, benefits administration of its sponsored plan, HR compliance, risk mitigation, and HR administration. PEOs can provide the clients with access to a much wider range of benefits than the client could typically obtain on its own.
While ASOs and PEOs both offer numerous HR services for small businesses, a PEO is more comprehensive. For example:
How can a small business leader know which option will serve their organization better, a PEO or ASO? Here are some questions to help make a smart decision:
An ASO can be a great choice for businesses looking for a cost-effective, less involved approach to HR and payroll tasks. You can gain access to a dedicated team of experienced professionals who will help with the responsibilities of a traditional HR department. Instead of worrying about payroll processing, employee onboarding tool and benefits administration, you can focus on big-picture tasks like developing new products and moving into new markets.
TriNet's HR Plus offers the ASO solution you may need. Complimented with the HR Platform technology, we offer three different levels of service to add-on to help you grow your business cost-effectively. Learn more about our solutions and book a demo today.
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