Your Human Resource Department, Since 1990

Frequently Asked Questions

What is a PEO?

PEO stands for "Professional Employer Organization," which is an entity that contractually assumes and manages critical human resource responsibilities and employer risks for small to mid-sized businesses by establishing and maintaining a "co-employer" relationship with their worksite employees. Nothing changes operationally and the employees still remain under the direction and control of the client company. The main difference is that client-company and employees now have the PEO to process and administer all payroll and HR functions.

Who is the Employer of Record?

Under the PEO service model, the Internal Revenue Service acknowledges that PCI is the employer-of-record for federal income and unemployment taxes. Numerous states provide some form of licensing, registration, or regulation for PEOs. Among many of these states it is statutorily recognized that PCI is the employer or co-employer of worksite employees for purposes of workers' compensation and state unemployment insurance taxes.

Who uses PCI?

PCI currently has clients ranging from 5 - 1,500 worksite employees. These clients include accountants, landscapers, doctors, attorneys, restaurants, insurance agencies, financial service firms, retail shops, non-profit organizations, real estate agencies, light manufacturing, technology firms and many other diverse types of companies. All of these companies have one thing in common: they acknowledge that it is more cost-effective to outsource their HR functions to PCI.

Why would a business use PCI?

Business owners want to focus their time and energy on the "business of their business" and not on the "business of employment." As businesses grow, most business owners don't have the necessary human resource training; payroll and accounting skills; knowledge of regulatory compliance; or backgrounds in risk management, insurance and employee benefit programs to meet the demands of being an employer.

What impact does a PEO arrangement have on a client company?

The only impact is a positive one, and that is a client company can take advantage of the economies of scale that a PEO offers in the area of HR management. The "co-employment" status that is created when a client company contracts for PEO services allows PCI to use this status to the advantage of all PEO clients in that bulk purchasing power is achieved, and bulk processing efficiencies are attained.

There is absolutely no ownership change with any client company, and employees are not required to "report" to PCI; in short, all daily functions and supervisory control remain intact. The client still remains as the operational employer and PCI becomes the "administrative employer."

PCI is responsible for payroll and employment taxes, maintaining employee records, and regulatory compliance.

Client companies are also provided with HR counseling to assist in handling uncertain areas of personnel management (like any other HR department that is typically only available in larger firms).

What impact does a PEO arrangement have on employees?

Employees get the most out of a PEO arrangement, and it is usually in the area of employee benefits. Before PCI, most clients either could not afford their own benefits program or were not aware of all the various cost-saving tools available in the marketplace. PCI makes these options available for the client company to offer the employees.

PCI provides various ancillary benefits such as an online data center designed for each employee to use to view HR-related information, print check stubs, review their own personnel information and payroll history, etc. PCI may provide Fortune 500 quality employee benefits including health insurance, 401(k) retirement plans, comprehensive workplace risk management, and a wide variety of seasonal discount "perks" such as travel and amusement park savings.

Employee retention and productivity increases when employees are provided quality human resource services like employee manuals, grievance procedures, and improved communications, all of which are facilitated by PCI.

What sets PCI apart from larger publicly-traded competitors?

It is true that there are larger PEO firms out there in the marketplace. It is also true that most of these firms have grown through merger or acquisition. However, in the PEO industry, where service sets others apart, bigger does not necessarily mean better. PCI finds itself to be in the best position in that we are big enough to offer all the HR services and technological functions offered by the larger competitors, yet we are small enough to actually know our clients.

PCI's philosophy on customer service is that every client should be given prompt, accurate, and consistent results. Clients want to speak to a person familiar with their account, not to someone who has to review their account history each time they call. To this end, PCI does not employ "call centers", but rather keeps key personnel assigned to client companies so that single point of contact remains the rule, not the exception.

In short, customer service is the intangible that really sets PCI apart from the larger competitors.

How does PCI charge for its services?

PCI employs a simple service fee structure that is usually a flat fee per paycheck. Unlike others in the industry, PCI does not "nickel and dime" for every transaction or have various off-cycle recurring fees, such as for processing W2's, tax-filing, new-hire setup, employee information changes, report creation, etc. The amount charged depends on the level of service the client elects to receive. Some clients utilize PCI just to process their payroll, whereas others use PCI to handle every HR aspect. The key element to PCI's pricing is it is structured to offset the cost to pay individuals and/or other vendors to perform the functions and to still save the client money.