A single workplace accident can set back any business, as it can incur costs in recovery, reduce productivity, and damage morale amongst staff. Keeping employees safe is foundational to any successful business – but being able to support workers in case of an accident helps reassure them they are in good hands. For many growing or small businesses, cost-effectively managing workers comp to provide ample coverage can be a considerable challenge. Partnering with a PEO can help you reduce these costs by gaining access to comprehensive coverage and assisting in developing safety procedures that minimize risk.

In this post, we'll discuss what PEO workers comp coverage includes and how they can lower costs and keep your business well-equipped to handle any incident.

How PEOs Provide Workers Comp Coverage

Workers comp is part of the benefits PEOs offer, including payroll processing and benefits administration. PEOs then shoulder the risk management task and remove the burden and effort businesses undertake when filing claims. All claims go through the PEO's management team, which frees up your internal time and streamlines the process by following a set procedure for filing claims. Furthermore, PEOs can further reduce costs by negotiating better rates, which allows you to reduce costs without sacrificing the quality of your coverage.

PEOs are HR professionals and can implement workers comp coverage efficiently so business owners can trust that they are in good hands – which filters down so their employees feel they are in good hands, as well.

Achieving Economies of Scale with Worker's Comp

The critical means that PEOs can provide such high-quality workers comp benefits at lower costs is through economies of scale. When partnering with a PEO, they become the employer-of-record by entering co-employment with their client. That means that the PEO is listed as the official employer – as they take on the responsibilities of managing payroll and benefits – but the decision-making power remains with the client company.

Because they group so many companies under their umbrella, they have a larger employee pool to negotiate benefits and workers comp rates. Many beneficial rates are only available to larger enterprises, but PEOs can make them available to companies of any size. Furthermore, PEOs keep current with trends and have significant expertise with all HR procedures their clients can access. When partnering with a PEO, companies always have an expert on call who will never take a sick day or be unavailable.

How PEOs Can Transform Safety Programs

Another vital way PEOs help companies reduce costs is by reducing the risk of incidents occurring. By guiding safety program development, PEOs ensure your company adheres to OSHA regulations and provides proper training to educate employees on up-to-date procedures. These safety programs lower the risk of accidents and put companies in better standing if an injury happens. Demonstrating safety efforts shows that you take proper care of your employees and indicates that there are less likely to be overarching systemic risks within your company – which minimizes coverage fees by not incurring rate increases.

A PEO partner will assist with developing or restructuring safety programs. They conduct thorough safety audits to pinpoint areas where improvements can be made. Then, they devise an actionable plan to implement changes that lower the risk of on-the-job injuries.

The additional time given back to your company gives staff more time and resources to create better work environments and give employees more attention. Your staff will be able to learn better and receive more guidance, helping them feel more assured in their jobs and supported if they have any questions. Reducing risk lowers the chances of incurring an OSHA fine or having a PAGA claim filed against you. Robust safety programs also give you ample evidence to respond to claims and prove that you take proper measures.

Ensure Compliance with PEO Support

PEOs go beyond mere coverage support by assisting companies in navigating safety regulations. With their in-depth expertise, they help businesses adhere to California's intricate regulatory requirements, thus lowering the risk of incurring fines or encountering a PAGA claim. They easily navigate the labyrinth of regulations, ensuring businesses maintain an impeccable compliance record. This proactive approach to compliance demonstrates yet another reason why PEOs are the ally every business needs.