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The Strategic Advantage of a PEO in Managing Workers’ Compensation for SMEs

Diverse team of professionals discussing payroll management strategies in a modern office.

Why Payroll Is a Prime Target for Cyberattacks

 

The digital space is continuing to grow and evolve every day. With so much of life conducted online, it’s more important than ever to protect your personal information from vulnerability.

 

Payroll systems, however, have become a prime target for cyberattacks. They contain some of the most confidential employee information that a business manages—including Social Security Numbers, tax identification numbers, addresses, salaries, and direct deposit information. A single breach can expose hundreds of records—if not more—leading to financial fraud, identity theft, and compliance violations.

 

Cybercriminals may not even need to break into a company’s system to gain information. They may simply trick an employee into handing over credentials or clicking on a malicious link, making payroll fraud prevention crucial for any business. It’s essential for business owners, HR managers, and IT directors to know how to protect their employees and prevent data breaches.

 

Let’s dive into the types of threats facing payroll systems today, what businesses risk without proper security, and how PEOPayGo prioritizes cybersecurity in payroll services.

 

Types of Threats Facing Payroll Systems Today

 

There are many types of threats facing businesses that may not even require a hacker to gain access to their payroll system. Let’s take a look at some of the most common cybersecurity threats.

 

Phishing

 

Phishing scams occur when cybercriminals trick individuals into providing sensitive information. Many attackers will impersonate someone from the HR or IT department and send fake emails to employees to steal their login credentials.

 

Ransomware

 

Hackers may use malicious software to lock payroll systems until a ransom is paid. If the company chooses not to pay the ransom, the cybercriminals may leak the stolen data.

 

Insider Threats

 

Insider threats come from the organization itself rather than someone outside of it. Unhappy employees or contractors could misuse their access to payroll data.

 

Insecure Integrations

 

In some cases, attackers find poorly secured third-party apps connected to the payroll systems and take advantage of those vulnerabilities to get the information they want.

 

Weak Passwords

 

When employees create weak passwords or fail to use the multi-factor authentication, it makes it far easier for hackers to guess their credentials and break in.

 

What Businesses Risk Without Proper Security

 

A lack of security can have a major negative impact on a company. Here are some of the things that businesses risk when they don’t have proper security in place.

 

Financial Loss

 

Companies can face significant financial losses during an employee data breach. From incident response and legal fees to lost revenue and reputational damage, the impact of financial loss on a company can be drastic.

 

Employee Trust

When personal information is compromised, employees may lose confidence in their employer. When trust dwindles in the workplace, employees tend to walk away.

 

Operational Downtime

 

The financial loss and legal consequences that stem from compromised payroll systems could result in payroll delays and operational downtime.

 

How PEOPayGo Prioritizes Cybersecurity in Payroll Services

 

Professional employer organizations (PEOs) take on the administrative tasks of businesses like payroll, workers’ compensation, benefits administration, and risk management. Because they’re regularly handling sensitive employee information, cybersecurity is essential. Here’s how PEOPayGo prioritizes security in their payroll services.

 

End-to-End Encryption

 

This is a security method that ensures when messages are sent via their platform, only the sender and receiver can read them.

 

Multi-Factor Authentication

 

By requiring more than one form of identification, multi-factor authentication ensures only verified users can access payroll systems.

 

Regular Security Audits

 

Trusted PEOs want to make sure they’re in compliance with industry regulations and best practices. PEOPayGo undergoes third-party security audits in order to maintain that standard.

 

Role-Based Access Control

 

Ensuring permissions are granted based on user roles means a lower possibility of security threats from within the company.

 

Employee Training and Awareness

 

PEOPayGo implements training programs that help keep employees educated on how to spot phishing attacks and manage payroll securely.

 

Secure Your Payroll Data with PEOPayGo’s Trusted Protection

 

A payroll breach can be detrimental to your company. When you partner with a trusted PEO like PEOPayGo, you can rest assured that your systems are secure. If you’re ready to secure your payroll data with PEOPayGo, reach out to their team of experts today.

 

Contact us today to get the coverage and support you need!

If you own a small- to mid-sized business, you probably have your hands full at work. Business owners are the brains behind the operation—simultaneously the big dreamer and the detailed-oriented glue that holds it all together. As rewarding as it is to own your own business, it isn’t without its challenges.

 

Administrative tasks like workers’ compensation, payroll, and other HR services are vital to the success of your business, but managing these tasks has the tendency to eat up a huge chunk of your time. Focusing on your strengths as a business owner can be difficult if it feels like you’re weighed down by the day-to-day.

 

So what can you do to optimize your time? Professional employer organizations (PEOs) offer support with these essential aspects of your business so that you can focus your energy where it’s best utilized. Keep reading to learn about the strategic advantage of a PEO managing workers’ comp for small- to mid-sized businesses.

Why workers’ compensation is important for small- to mid-sized businesses

Whether you have one employee or one hundred, workers’ compensation insurance is crucial in protecting your workers in the event an accident happens on the job. Workers’ comp can cover medical expenses, rehabilitation costs, and even lost wages while the injured employee is unable to work.

 

Traditional workers’ comp may seem costly—particularly for a small business with fewer resources—but there are other options available. The benefits of having coverage if someone gets injured at work far outweigh the cost.

 

Additionally, workers’ compensation not only protects the injured employee financially, but it also protects you as the business owner. If there’s no workers’ comp insurance in place and an employee gets injured at work, you could be responsible for paying out-of-pocket for their medical expenses.

What exactly is a PEO?

Sometimes referred to as a co-employer, a PEO steps in to handle the administrative side of your business for you. As the business owner, you’re still in charge of decision-making, so you aren’t relinquishing control to the organization. Partnering with a PEO simply allows you to outsource aspects of your business like workers’ comp and payroll services, ultimately creating more time for you to focus your attention elsewhere.

Advantages to partnering with a PEO for workers’ comp

When it comes to workers’ compensation insurance, what are some of the strategic advantages to working with a PEO?

PEOs allow you to optimize your time for company growth

Managing workers’ compensation can be tedious and complex. When you partner with a PEO you’ll have the knowledge of experts on your side to help you make the best decisions for both your employees and your business.

 

When you don’t have to worry about the administrative tasks that are essential to your business, you can focus on the mission of your company. As a business owner, it’s crucial that you rely on your unique skills and strengths for the growth and success of your company. By working with a PEO, you give yourself space to do that.

You could get better coverage for your workers while saving money

PEOs function by grouping all of their clients together so that they can get the best coverage possible for the lowest cost. Depending on your financial situation as a small- or mid-sized business, the traditional workers’ comp plan you find for the same price may not have great coverage.

You only pay for the coverage you need

One of the best things about working with a PEO for workers’ compensation is the flexibility it offers in terms of coverage. Many small- to mid-sized businesses hire short-term employees on a project-by-project basis, and therefore don’t need a plan quite as extensive as traditional workers’ comp.

 

Pay-as-you-go programs with PEOs allow the flexibility of stopping and starting the coverage whenever it’s needed. Additionally, instead of paying an estimated premium as a lump sum at the start of the year, you can simply pay in conjunction with your payroll—taking the guesswork out of what you’ll owe.

Strategic advantages of working with a PEO

For small- to mid-sized businesses with less manpower and free time, it’s important to know when to outsource. Handing over administrative tasks to professionals could be incredibly advantageous to the growth of your company.

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