HR Strategy is crucial in times of crisis.

What COVID-19 has taught us about HR Strategy.


COVID-19 has made a significant impact on business as we know it. So many organizations are struggling to keep afloat. Some will make it, while others will not. A strong HR strategy makes a significant difference in the survival of an organization, especially in times of a crisis like COVID-19.


Some small and mid-sized businesses, however, may not see HR strategy as a top priority. It could be due to lack of an internal HR department or complacency because their business has run smoothly thus far without much HR assistance. There are many reasons an organization doesn’t have the amount of HR help they really need, but what we do know is that those organizations that have prioritized HR by partnering with a PEO are ten steps ahead of the game. They grow 7-9% faster, experience 23-32% less turnover, and are 50% less likely to go out of business. These numbers should only serve to increase after this pandemic. Why?


Because PEOs are helping small businesses through this pandemic. How?


PEOs assist with rapidly changing employment law.

The U.S. government quickly produced the Families First Coronavirus Response Act (FFCRA) and the CARES Act to help individuals and businesses struggling due to COVID-19. Small companies became inundated with information. They have so many questions about eligibility for the benefits and tax credits, who needs to comply, and whether their business was considered essential. PEOs provide a full team of experts who anxiously awaited the legislation, final rulings, and updates on all the Acts. They spend countless hours diving into legal jargon to answer business owners’ questions. Then, PEOs work alongside organizations to implement processes that assist in keeping the business compliant. They also help employees through the difficult time, with the livelihood of the business always in mind.


PEOs help businesses implement social distancing practices.

COVID-19 brought on a social distancing mandate with many states instituting Shelter in Place orders. Businesses found the need to scale, cease, or implement remote workforces, or sometimes a combination of any of these. PEOs work with an organization’s leadership team to identify the best solution that may be unique to that business. PEOs suggest implementing job sharing opportunities. This alleviates layoffs allowing businesses to keep employees while only utilizing part-time unemployment benefits. They assisted organizations with group layoffs or furlough situations. They worked with benefits vendors to find out options for keeping furloughed employees on benefits plans and created systems for payments of those benefits. HR experts are also available to guide managers through the new scenario of managing a remote workforce.


PEOs handle the increasingly burdensome payroll administration.

Payroll administration is now a nightmare. Tracking the FFCRA emergency sick leave and expanded FMLA separately from regular sick and FMLA leave has thrown a wrench in many payroll processors’ systems. Add on any furloughed or terminated employee reporting and tracking, and now the job has doubled.


Outsourcing payroll processing and payroll taxes to a PEO has lifted this burden off the organization’s staff members. Instead, they are spending their time on mission-critical work that could make or break the business. Additionally, their payroll is processed by professionals who have the time and expertise to know the nuances of payroll and payroll tax laws with back up teams of professionals in place.


PEOs help businesses gather crucial paperwork needed to apply for the Paycheck Protection Program (PPP) loans through the CARES Act.

Lenders are asking for historical payroll data and tax reports quickly produced by a PEO’s HRIS system. Many small businesses without HR help find these systems financially draining.


PEOs assist with staffing needs–both onboarding and terminating.

Small businesses that take advantage of the PPP loans are required to spend at least 75% of that loan on staffing costs. Companies that had previously furloughed or terminated employees find they need to hire employees back. This comes with additional paperwork and many employee questions, such as whether benefits wait periods start over.


On the other hand, some businesses find they need to furlough or terminate employees. A PEO guides a company through a compliant layoff process, including any paperwork, government reporting, and COBRA administration.


PEOs pooled benefits plans assist with long-term cost control

Many business executives are worried about what their insurance renewal rates will look like considering medical, workers’ compensation, and unemployment claims. When you partner with a PEO, you have the option of joining pooled plans with other small businesses to create a larger group of employees with better buying power and long-term cost control.


While PEOs are helping businesses create HR strategy and wade through increased administration, it is essential that you partner with a financially stable PEO. Unfortunately, COVID-19 has taken out some financially un-stable vendors. It is crucial to ensure your PEO is financially sound by checking if they are certified by the IRS (a CPEO) or backed by the Employer Services Assurance Corporation (ESAC). Just like you’d make sure FDIC covers your bank, these designations signify a financially stable PEO.


If you’re interested in hearing more about the advantages of partnering with a PEO, we’d love to talk to you.

Fill out the form below or email for a FREE Consultation Today!


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