Good thing you’re not alone…
The shape of the modern workforce is changing and many startups are now operating as remote or distributed teams. This shift comes with a lot of positives, like saving on rent, access to a larger talent pool, and access to cheaper talent. But going remote also comes with new hurdles for founders, like paying employees in multiple states.
To prepare your business for the future of work, we could offer you a detailed checklist with 1,001 permutations of your compliance obligations. Or, we could introduce you to a better alternative. One solution many founders choose to take compliance off their to-do list altogether is to partner with a PEO.
We’ll walk you through:
- What a PEO is.
- How PEOs help startups face the challenges of remote work.
- The most common HR challenges for leaders of remote teams.
- Resources for you to reference when considering hiring remotely.
PEO – Overview:
A Professional Employer Organization (PEO) helps you manage the human resources side of your business, and acts as your HR partner. Having a partner helps you stay compliant with state employment laws you’ve never heard of, but apply to your employees.
A PEO specializes in HR services that small to midsize businesses can use to manage their payroll, HR, and benefits. It allows businesses to offload complex administrative tasks while providing employees access to big-company benefits, such as large group health coverage.
Under a PEO, employees are co-employed— meaning employees are employed by both your business, as the “worksite employer,” and the PEO, as the “administrative employer.”
You keep control of the aspects of running a business that’ll dictate your startup’s success, like hiring, determining employees’ responsibilities, and building company culture. In the background, the PEO will help with the less glamorous side of HR, like enrolling employees in benefits or state-by-state compliance.
If a PEO is a good fit for your business, consider Rippling’s PEO. GAN founders are eligible to receive 6-months of free access to Rippling HR, Payroll, and more to help you manage your remote employees.
The top 4 challenges startups face when hiring remotely:
When the pandemic hit, companies jumped head-first into remote work. There was no time to proactively consider how HR systems should change to support employees and meet new compliance obligations. 2020 taught founders the biggest challenges of managing remote teams when it comes to HR. We’ve listed these challenges below, or read more about how to avoid these pitfalls by referencing the full article here.
Problem #1: Ensuring benefits are available to all employees
A distributed workforce only adds to the challenge. For companies with remote employees, where they live determines the carriers, benefits, and workers’ compensation policies they’ll need. This opens up employers to liability if they miss state-specific coverage requirements. For example, you’re required to offer disability insurance to any New York-based employee.
A PEO platform levels the playing field by offering “big company” benefits at lower costs to smaller startups and keeps you compliant with benefits regulations wherever your employees work.
According to the National Association of PEOs (NAPEO), on average, companies that use a PEO save $1,775 per year per employee.
Problem #2: Multi-state tax registration is mayhem
For every new remote hire or when an employee moves, a company is required to get a state unemployment insurance account. These involve hours of paperwork and employers face fines and penalties if they’re mismanaged.
The right PEO can handle the issues by registering your company and employees in every new state you hire in and help pay state taxes, manage unemployment claims and handle tax rate changes.
Problem #3: Securely manage employee app access and devices from afar
Any HR or IT team will tell you how giving employees access to apps, tools, and systems can be a huge effort in time and resources.
Mis-managing physical devices like laptops and work equipment can waste money on laptops, and create huge data security risks. Investing early in device and inventory management nips these risks in the bud.
Device management software allows you to set up the equipment and app access remotely. If someone resigns from the company, these tools can quickly wipe former employee’s laptops and remove them from work platforms like Slack and Salesforce. Plus, these types of security measures are need-to-have requirements for SOC II certification.
Problem #4: Staying compliant with 1,001 different state labor laws
A complex regulatory environment can overwhelm founders when it comes to state regulations for time-off, overtime, and firing an employee.
Rippling’s PEO keeps remote teams automatically compliant in every state, with smart rules based on the employee’s location, helping founders focus on growing their business instead of time-consuming state regulations.
HR Resources you need to know about!
Our partner Rippling is always willing to connect with GAN founders to discuss your HR needs. Whether it is hiring remotely, or other HR questions you can connect with the Rippling team anytime. Here are the resources selected by the GAN team that you should reference in order to build an understanding of the HR needs of your startup.
New Employees Onboarding Checklist
More on… Hiring Remote Employees