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No business is immune to risk—whether it’s workplace safety concerns, legal compliance challenges, or financial liabilities. Without proper risk management, even minor issues can escalate into costly disruptions. That’s where Professional Employer Organizations (PEOs) come in. By proactively managing workplace risks, ensuring compliance, and reducing costs, PEOs help businesses protect their workforce and bottom line.
In this article, we’ll explore how PEOs support businesses in managing risks, from workers’ compensation to regulatory compliance, and why partnering with a PEO can provide long-term benefits.
What is risk management?
Risk management involves identifying, assessing, and addressing potential threats that could impact business operations. These risks range from employee safety hazards and HR compliance issues to financial and cybersecurity concerns. By implementing proactive risk management strategies, businesses can prevent costly incidents, ensure compliance, and safeguard their workforce. But managing these risks alone can be overwhelming—that’s where PEOs make a difference.
Studies show that businesses in a PEO arrangement grow 7-9% faster, have 10-14% lower turnover, and are 50% less likely to go out of business. [1]
How PEOs strengthen risk management strategies
PEOs can play a helpful role in promoting workplace safety by offering compliance support and assisting with risk assessments when required. At PER, we provide guidance on Occupational Safety and Health Administration (OSHA) standards when requested and support risk assessment efforts as needed by workers’ compensation carriers. Our goal is to help businesses foster safer, more compliant work environments.
Learn more:
The role of PEOs in crisis management and business continuity
Handling workers’ compensation can be complex and costly. PEOs simplify the process by securing workers’ compensation insurance at competitive rates, overseeing claims management, and ensuring businesses meet state-specific requirements. This not only protects employees but also shields businesses from financial strain.
Related resource:
Five reasons to partner with a PEO for workers’ compensation
Employment laws and regulations change frequently, making compliance a challenge for businesses. PEOs stay current with labor laws, wage regulations, and HR policies, ensuring businesses remain compliant. They also assist in mitigating legal risks associated with wrongful termination, discrimination claims, and workplace disputes.
A poor hiring decision can be costly, and improper termination can lead to legal complications. PEOs can help you streamline the hiring process, allowing businesses to craft effective job descriptions, conduct background checks, and implement structured termination policies to minimize legal exposure.
Learn more:
The five best professional employer organization (PEO) services to look for
By pooling resources across multiple businesses, PEOs negotiate better insurance rates, reducing costs for workers’ compensation, liability coverage, and other risk-related expenses. The average return on investment of using a PEO from cost-savings alone is 27.3%. [1] Their expertise in risk prevention further minimizes financial losses due to workplace incidents.
Risk management is essential for business success, but navigating it alone can be overwhelming. PEOs provide expert guidance, cost-saving solutions, and strategic support to help businesses minimize risks, ensure compliance, and create safer workplaces. In fact, 98% of business owners who work with a PEO would recommend one to a small business colleague, showcasing the proven benefits of this partnership. [2]
Interested in how we can take care of your PEO needs?
With over 25 years in the industry, our dedicated HR professionals at PER help you with payroll management, human resources, benefits administration, and more.
Our team will support you as your coach and safety net for HR situations, helping you become more comfortable and confident in your role.
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Ready to grow your business?
