PEOs and Your Labor Costs

Especially in the recent difficult economic times, many owners have seen a dramatic difference in how a PEO can stabilize their overall labor costs. One piece of this equation is keeping the company’s SUTA (State Unemployment Tax) rate as low as possible. Many construction companies experienced higher than usual lay offs in the past years. Those partnered with a PEO saw very small, if any, SUTA increases because of the PEO’s ability to weather the unemployment storm. On the other hand, many stand-alone businesses saw large increases and some had their SUTA rates nearly double. PEOs not only assist in dealing with unemployment claims, they also provide employee handbooks and safety manuals specific to their clients needs. These are two critical items that are sometimes overlooked in the blue collar sector.