October 2023

Mohammad Anas Wahaj | 23 oct 2023

Professional Employer Organization (PEO) is an entity that acts as a human resources collaborative bridge that provides lease of employees to business organizations. By managing essential HR functions such as employee benefits, compensation and payroll administration, workers' compensation etc, PEO's take the load off the businesses. PEO's hire for their clients, but keep these employees on their own payroll and they become Employer on Record (EOR) for the PEO. These employees are provided key performance indicators (KPIs) by the client organizations on a regular basis while they operate under the HR guidelines set by PEOs. By working with PEOs, busineses can focus on their strategic issues and core competencies. The extent of HR functions outsourced to a PEO can vary depending on the specific agreement and the PEO's offerings. Another option can be Administrative Services Outsourcing (ASO) for organizations that seek outsourcing benefits without co-employment. Krishan Aggarwal, Senior Manager, International Business Advisory at Dezan Shira & Associates, says, 'The arrangement of Employer of Record (EOR) provides a cost-effective and efficient method for foreign entities to conduct market research activities without the need to establish their own entity, which can be a costly and time-consuming process...the management or control remains with the principal employer, enabling efficient staff management in India.' Multi-national organizations can utilize the expertise and resources of PEOs in India but there are things that they can and cannot do. PEOs can do the following in India - Assist with hiring and onboarding; Mitigating risk and ensuring compliance; Ensure proper payroll management and processing; Enhanced efficiency and time savings; Access to expertise and resources; Cost savings and improved benefits; Scalability and flexibility. PEOs cannot do the following - Serve as the sole legal employer; Take full control of your organization; Be solely responsible for hiring and firing employees; Read on...

India Briefing: Maximizing Business Growth in India with PEOs as Strategic HR Partners
Author: Naina Bhardwaj

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