Pairing with a PEO

Professional Employer Organization (PEO)It’s no secret that utility contractors in today’s world have more demands on their time than any other period in history. In our extremely fast paced and information-overloaded daily routines, it’s no wonder that most business owners feel overwhelmed and “bogged down.” They can sometimes even lose focus on the very reasons they started their companies. In a business environment where the fax machine has become a dinosaur, smartphones have quickly surpassed flip phones, iPads are replacing desktop computers and Twitter is taking over the construction conversation 140 characters at a time, what’s a contractor to do in order to keep up?

Many blue collar business owners are finding solutions to their time challenges and employment problems by partnering with a Professional Employer Organization (PEO). PEOs were developed out of the need to help small- to mid-size business owners increase profitability, maximize employee productivity, reduce time spent on human resources and payroll administration, share liability and ultimately reduce overall labor costs. Utility contractors are always looking for better and more streamlined ways to run their businesses, and for thousands of companies across the country, partnering with a PEO allows them to do exactly that.

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Time — Time may be considered a contractor’s most precious commodity. You may be able to make another dollar, but you’ll never get back the hours wasted on “pushing paper” and non-revenue generating tasks that you or your employees perform each week. Activities such as payroll and tax administration, researching the most recent labor law changes, fighting an unemployment claim or dealing with benefits administration are very time consuming. All of these are extremely important and necessary, but unfortunately, they don’t make your company any money. Becoming stifled and not having enough time to properly handle all these tasks is understandable as most owners are usually focused on getting more bids out the door, meeting with current clients or vendors and completing existing projects. Companies who partner with a PEO spend minimal time on non-money making activities and more time on their core competencies and bottom-line initiatives.

Expertise — Most utility contractors would probably admit that they don’t know each of the nearly 200 federal labor laws currently enforced by the Department of Labor, and they aren’t always familiar with the changes that happen every year. Understanding the intricacies of employment laws like the Fair Labor Standards Act (FLSA), Family Medical Leave Act (FMLA) and Immigration and Nationality Act (INA) or standards from the Occupational Safety and Health Administration (OSHA) can be mind-numbing at best. How many owners truly know if they are 100-percent compliant with all the employment laws to which they are expected to conform?  Unfortunately, many companies don’t have a degreed Human Resources (HR) professional on staff to rely on for help nor can they afford one.  That’s when one misstep as an employer can negatively and significantly impact the course of your company’s financial future. PEOs help by giving continuous HR support and by developing specific employee handbooks for their clients. This allows owners to sleep better at night knowing they have a team of HR professionals working with them to solve problems when they inevitably arise.

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Payroll and Tax Administration — We all know, by law, you must pay your employees correctly, withhold the proper amount of taxes, garnishments, etc., and most importantly, pay them on time to ensure happy employees. PEOs allow owners to be focused on bottom-line initiatives by handling your weekly payroll administration and tax compliance, filing your 940s and 941s, and also handling your W-2s at the end of the year.  Certified payrolls and Davis-Bacon Act compliance are two other areas where PEOs significantly assist construction companies.

Cash Flow — Let’s face it, cash flow is critical for all business owners. One way that a PEO helps owners beat this burden is by allowing them to simply “pay as they go” for their workers’ compensation (WC) insurance. Businesses who partner with PEOs are no longer forced to hand over large down payments or go through a time-consuming and sometimes expensive annual audit. There is also no more “guessing” your annual payroll to determine WC premiums or getting hit with a large audit fee for underpaying from the previous year. For larger contractors and those who must carry higher risk WC coverage (more expensive), using a PEO can keep tens of thousands of dollars on hand to grow their business throughout the year.

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Employee Benefits — We’d all probably agree that one of the secrets of a successful company is attracting and keeping highly-skilled employees. Providing benefits such as healthcare, dental insurance and 401k plans are essential in attracting the top talent in your industry. PEOs allow you to do that by providing access to, and also administering, a full suite of employee benefit options for your company. Further, whether you have 25 or 125 employees we all know that healthcare delivery in our country is changing. Are you ready to handle the Affordable Care Act all alone, or would you like to have a team of professionals advising and assisting you through these new and uncertain rules and regulations?

PEOs and Their Future for Utility Contractors — The simple fact is that our current federal and state administrations are not making it any easier on business owners to run their companies. New laws are being passed every year, and the amount of red tape, government compliance and time-consuming HR tasks are only going to increase. In a PEO partnership, owners get back their time and can rest assured knowing one team of professionals is there to help them navigate the ever-changing landscape of being an employer. Most owners realize that they don’t run their company exactly the same way they did five years ago or even two years ago. With new legislative changes impacting construction companies such as healthcare reform, new labor laws and increased jobsite liability, it’s no wonder why so many owners are looking to partner with a PEO to gain a competitive advantage. Could using a PEO help you “win big” in your business?

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Mark Mettille is the Owner and Founder of M2 PEO Solutions (, a national PEO consulting firm based in Dallas. He can be reached at