By Shraga Jacobowitz
The air is getting crisper, holiday music is playing nonstop and your children have 50 items written on their gift lists already….which for many can only mean one thing… it’s time to go shopping. Shopping for a PEO that is!
I bet you didn’t see that coming….but yep, with everything else happening at the end of the year, it seems that the PEO industry is also geared towards this “magical time of the year.”
For one, many things handled by the PEO, i.e., payroll, open enrollment, health insurance renewal, and W2s fall out around this time as well, which is why 80% of PEO business is done in December. No, that’s not saying that PEOs are sitting around the rest of the year; there is still plenty for them to do all year round, but last quarter is when push really comes to shove.
For another, with the hectic end-of-the-year business, with many employees taking vacations and companies trying to meet end-of-the-year goals, business owners are even more overwhelmed with their HR tasks and are looking for a way to simplify their lives. Plus with everything going on, errors are bound to happen, and therefore having a professional take over sounds like a great idea. So obviously, it just seems natural that this time would be the best time to switch to a PEO.
But before you pick up that phone, there’s something you should know. If you’re only looking into PEOs now, most likely you won’t be taking advantage of them for this fiscal year. Unfortunately, while Rome may have been built in a day, the process of partnering with a PEO can take anywhere from 30-90 days. And even if a PEO tells you that they can get the job done in a shorter period of time,
- take it with a very large heaping spoonful of salt, because in order for the process to be done correctly, it really does need to take that long, and
- we wouldn’t recommend rushing the process, as it can result in partnering with the wrong PEO and ending up with a contract and services that are all wrong for you. Plus with the over 700 PEOs in America, you really want to take the time to research which PEO best fits you.
- Similarly, a rushed onboarding equals problem, which in turn equals unhappy employees. And you know what they say, Happy Employees = Happy Work Life (hey, you try rhyming employees). But all kidding aside, rushing the onboarding process will prevent a seamless transition and most likely will result in mistakes costing you time, money and frustrations in the long run.
But you ask, isn’t it preferable to switch at the beginning of a fiscal year?
And while the answer to that is yes, to ensure that you are not being taxed twice or have other financial implications, a January 1st transition is most recommended, it doesn’t mean if you’ve missed the boat for this year (and unfortunately, as mentioned above, you have), then you have to sit around until next year waiting to make the switch.
This is where a PEO consultant or PEO Broker (such as ARC Consultants, of course) comes in handy! When making a mid-year switch to a PEO, your consultant/broker will work with the PEOs to ensure that there is no financial impact to a company joining the PEO at any time of the year. Furthermore, if you decide that a CPEO is the right fit for you, the IRS allows for mid-year switches without financial or tax repercussions.
So if you’re looking to switch to a PEO, really any time of the year is the ideal time to make the move. PEOs are here to make business owners’ life less complicated, why would you wait for a specific time of the year to do so? If you’re ready to make the switch, just do it! And do it now….because like I said, unfortunately, it’s ain’t happening overnight.
Okay, you can pick up that phone again now! Give ARC Consultants a call and let’s get started on partnering you with the right PEO for you.