What is an Administrative Services Organization (ASO)?

For many companies, it is usual to need help to carry out HR tasks and operations without wasting time. Therefore, some of them opt for requesting the services of an Administrative Services Organization (ASO), which can provide several benefits. So, if you require a flexible service model that provides you with HR outsourcing services, this is your best option.

In this article, you will learn everything you should know about the services that an ASO offers to companies. Besides, here we will provide you with information about the pros and cons of requesting these services for your business. After reading this, you will be able to start considering an ASO’s services to improve your company. Let’s observe:

  1. What is an Administrative Services Organization (ASO)?
  2. How many advantages can you obtain by requesting the services of an ASO?
  3. What things should you know about a PEO (Professional Employer Organization)?
  4. What benefits can your company enjoy by using the services of a PEO?
  5. How many differences can you find between an ASO and a PEO?
  6. Does your business require the services of an ASO or a PEO?
  7. Are there any ASO risks and requirements that you should know about?
  8. How can Connect Resources help you improve your company’s HR operations?

1. What is an Administrative Services Organization (ASO)?

ASO is an acronym that stands for Administrative Services Organization, which is very popular for being a services provider. If you are the owner of a small business, getting the services of an ASO can be favorable for you. In fact, they will allow you to have better management of HR operations, business logistics, and your staff in your company.

The main function of an Administrative Services Organization is to provide HR outsourcing services for companies of all sizes. And those services specialize in several core HR operations, tasks, and processes that are vital for any company. For example, an ASO can cover payroll processing, employee benefits, and many other HR-related functions that are very important.

Nonetheless, there is an important detail that you should know about the services that an ASO can provide you with. And that detail is that it does not provide these services directly to businesses under a co-employment model. In other words, working with an ASO is outsourcing your HR to some partner who can facilitate services. And also, this partner must be able to provide high-quality HR service alternatives for your company.

On the other hand, an ASO will not be able to help you with some areas due to the co-employment model. For instance, you must know that most ASOs do not provide services related to workers’ compensation. Besides, the overall HR risk management of an Administrative Services Organization is limited if you compare it to a PEO’s.

2. How many advantages can you obtain by requesting the services of an ASO?

The best way to understand how an Administrative Services Organization works is by taking a look at the advantages it offers. And if you request the services of a professional ASO, you will be able to enjoy the following benefits:

2.1. A wide range of services

If you get an ASO’s services, they will help you cover many areas due to the variety of service offerings. And some of those elements that an ASO can handle include payroll tasks, HR policy development, and benefits administration.

Nonetheless, this services provider can also cover risk management support and consultation in certain cases. And generally, small companies have access to essential HR systems without the need to develop an internal HR-related department.

2.2. Flexibility

Since ASOs do not count on the co-employment commitment, they are more flexible when providing companies with their services. And this is a perfect advantage for companies that do not need extensive risk management support or workers’ compensation.

Therefore, if you own a company with these characteristics, then partnering with an ASO will be very favorable for you. Besides, you will not get bogged down in some mandatory package at all.

2.3. Perfect solutions for small businesses

As we have mentioned before, partnering with an Administrative Services Organization is the ideal solution for small companies. If your company does not want or need to commit to a complex services package, then ASOs are your solution.

With the services of a qualified ASO, you will get the best solutions for operating all HR tasks efficiently. And besides, they will help you get the most satisfying results that will lead to the growth of your business. And as your company grows, you will be able to add more services to your package or get PEO services.

2.4. The necessary medical coverage

Although Administrative Services Organizations do not operate under a co-employment model, they can provide benefits and medical coverage as well. However, they do this through a third-party service provider and not directly.

With this advantage, all small companies can easily get access to top-level medical benefits that are vital. As a result, they will not need to shop for them independently.

3. What things should you know about a PEO (Professional Employer Organization)?

On the other hand, there is another services provider that is similar to an Administrative Services Organization. But even though a Professional Employer Organization (PEO) is similar to ASO, there are some differences between them. But before describing them, you should first know what a PEO is exactly and what services it offers.

Under a co-employment model, a PEO can offer extensive HR support to small companies, similar to an ASO. However, if those small companies decide to grow and expand, they will require the extensive assistance of a PEO. And that is due to the need of getting top-level services in order to expand their businesses effectively.

Furthermore, you should know that if you partner up with a PEO, it will act as your company’s representative. Besides, it will manage all of your company’s HR operations and tasks on your behalf, making it easier for you. In addition, a qualified PEO should also be able to help with benefits administration and offer excellent payroll services.

4. What benefits can your company enjoy by using the services of a PEO?

By requesting the services of a PEO, you can enjoy a wide range of benefits that will help your business. For example, these are the main advantages that you can have by working with a Professional Employer Organization:

  • Cover and simplify many areas, including payroll, taxes, compliance, HR management, workers’ compensation, risk management, employee health, welfare benefits administration, and more.
  • Your company can quickly enter your target market during its expansion process. This advantage is an important element for those who desire to expand internationally since it helps them find workers abroad.
  • PEO services make it easier for companies to carry out the recruitment process due to many reasons. One of them is that the PEO provides assistance in all stages of the process, including screening, shortlisting, and interviewing.

5. How many differences can you find between an ASO and a PEO?

As you may know, getting the services of an Administrative Services Organization or PEO can be favorable for your business. However, choosing between an ASO and a PEO will depend on their features, services, and the benefits that you receive. Therefore, in case you are not sure which option fits best your company, here you will find a useful comparison.

The co-employment model is the main difference between these two types of organizations, besides some of their services and offerings. If you partner with a PEO, you will have to sign a co-employment agreement since PEOs work under this model. But with an ASO, there will be more flexibility because there is no need to work under the co-employment model.

As for the services, most ASOs and PEOs provide similar services to companies of all sizes. Nonetheless, there are certain services that you can get with a PEO but not with an ASO. For example, risk management support and workers’ compensation are some of the services that PEOs can offer but not ASOs.

In the case of ASOs, workers’ compensation coverage is provided by the client’s own policy. In the meantime, PEOs provide it under their master policy of coordinated master policies. As for risk and safety management, there is no claim management when it comes to ASOs. On the other hand, there are claims management and also safety programs compliance that are administered by PEOs.

6. Does your business require the services of an ASO or a PEO?

Depending on your company’s needs, you might need to request the services of an Administrative Services Organization or a PEO. As we have previously mentioned, both options can provide your business with the most efficient HR services and solutions. However, you should be aware of their differences and when it is convenient to hire an ASO or a PEO.

If you are operating a large company, choosing a PEO as your business partner might be the right decision. And that is because you will most likely require services related to workers’ compensation, extensive HR support, and more. But if that is not the case, then choosing an ASO can bring your company many more advantages.

Smaller companies get the best results with an ASO’s services due to their flexibility and cost-effectiveness. And if you are not sure which alternative can best fit your needs and requirements, then choose a PEO. Some of the best PEOs usually provide an ASO offering too for small businesses that want to expand eventually.

7. Are there any ASO risks and requirements that you should know about?

One of the things you should be aware of is that employers are responsible for legal and financial responsibilities for covered claims. And that is what happens when employers work under an arrangement such as ASO plans.

Besides, sometimes employers under this kind of arrangement invest in stop-loss insurance. And that insurance undertakes the responsibility of paying certain claims that exceed a determined amount of money.

On the other hand, you should know that most ASOs do not provide life insurance alternatives due to the coverage amounts. Therefore, the employer must think about these and many other factors before choosing their ideal option. And in case you need help, you can contact Connect Resources to get more detailed information and guidance.

8. How can Connect Resources help you improve your company’s HR operations?

If you are the owner of a small company, then the services of an Administrative Services Organization are ideal. And Connect Resources can help you find more information about it and its offerings for small businesses. However, if you own a medium or big company, then your best solution should be the services of a PEO.

With Connect Resources, you can obtain the most efficient PEO services to improve your company’s operations exponentially in no time. And besides, you will be able to obtain the most convenient advantages to make improvements without taking any risks. Therefore, if you are interested in getting our services, make sure to call our team members to get more information.

Would you like to contact our Connect Resources team to obtain more information about the services of an Administrative Services Organization (ASO) in the UAEIn case you have any questions, please feel free to call us on +97143316688. And you can also email us at contact@connectresources.ae. After that, you will talk to one of our representatives who will gladly answer all of your questions.

On the other hand, if you are searching for the most convenient job opportunities, make sure to visit thetalentpoint.com website. Then, all you need to do there is to submit your CV or resume to search for your dream job easily. Besides, you can also feel free to send an email at contact@thetalentpoint.com, so we can receive your application and review it.

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