PEO in North Carolina [2024]

Published

Feb 21, 2024

From a booming technology and research industry in Raleigh—part of the “Research Triangle”—to some of the biggest names in finance operating in Charlotte, North Carolina businesses have a lot of competition when it comes to attracting and retaining skilled workers, meaning employers need to be at the top of their game.

A professional employer organization (PEO) helps companies in NC and beyond gain access to impressive yet cost-effective benefits that can provide them with a competitive edge when hiring. And small to mid-sized businesses can also use a PEO to streamline and automate their administrative HR functions such as payroll services, benefits administration, compliance management, and workers' compensation insurance.

To make sure you partner with the best PEO for your workforce’s unique needs, it’s crucial to assess the available options, including Rippling PEO—the most modern choice on the market with automatic state tax registration, remote laptop management features, and more.

Benefits of using a PEO in North Carolina

Find out how partnering with a North Carolina PEO can decrease administrative HR tasks, grant access to more economic benefits for your workers, and more.

Offload administrative HR work

Businesses can unload repetitive, manual HR responsibilities by joining a PEO. 

When you sign a contract with a PEO, you enter into a co-employment relationship, which divides duties between you and the PEO. As the worksite employer, you retain control over hiring decisions, day-to-day employee management, and overall business strategy and operations. Meanwhile, the PEO serves as the administrative employer, employing your workforce under its employer identification number (EIN) so it can legally manage HR tasks like payroll, benefits administration, and compliance.

When PEOs leverage their technology and expertise to streamline your HR tasks, your HR team is able to spend more time focusing on work that contributes to real business outcomes.

Better employee benefits, at a lower price

Access to high-quality employee benefits at a lower cost is a significant advantage of joining a PEO.

PEOs in the US co-employ millions of people. As such, they’re powerful enough to negotiate with insurance providers for more affordable benefits—something smaller businesses typically don’t have the resources to do. In this way, working with a PEO gives small and mid-sized businesses a way to differentiate themselves when shopping for top talent. 

PEOs don’t sell benefits themselves, but via a partnership, they enable business owners to access comprehensive, affordable benefits, often including health insurance, dental insurance, life and disability insurance, worksite benefits, retirement plans, dependent care, and even more.

Worry-free compliance with North Carolina laws

A PEO can be instrumental in navigating federal as well as state employment and labor laws in North Carolina, which include the North Carolina Wage and Hour Act (NCWHA), Disability Income Plan of North Carolina, and North Carolina False Claims Statutes Policy—to name just a few. 

That doesn’t even touch on payroll tax in North Carolina. While North Carolina has no state-specific minimum wage, there are a wide variety of salaries across industries—and plenty of different tax requirements for in-state and remote employees to match.

A PEO like Rippling automatically detects potential minimum wage violations based on employees' locations, guarding you against inadvertent breaches of local laws.

In addition, PEOs extend legal and compliance support to assist businesses in adhering to:

  • Payroll regulations, including accurate classification of employees and contractors, filing North Carolina state unemployment insurance and federal unemployment insurance on time, timely deposit of payroll taxes, and compliance with wage laws such as overtime requirements, etc. 
  • Benefits laws, including adherence to North Carolina’s Disability Income Plan for short-term leave, as well as federal regulations like the Affordable Care Act (ACA), COBRA, FSA, HSA, and other benefits-related mandates
  • Labor laws, including providing support for workers' compensation insurance (required for employers with three or more workers in North Carolina), adherence to the North Carolina Equal Employment Practices Act (NCEEPA) as well as federal equal employment laws, and the display of state-mandated labor posters

Failing to file payroll taxes on time adds up—incurring a 5% penalty in the state of North Carolina for every month you’re late. Lacking workers’ comp insurance? Aside from fines, employers found responsible for lapses in insurance coverage could face misdemeanor charges, felony charges, and jail time. This is where a PEO’s comprehensive compliance support is critical.

Dedicated support team

When working with a PEO, you get front-row access to very experienced, skilled human resources professionals.

This is especially valuable for small businesses and startups, which often don’t have the staffing to juggle the growing list of HR tasks every day. But a PEO doesn’t only aid in time and cost savings—it also provides guidance on optimizing benefits administration, crafting employee handbooks, training managers, assessing safety practices, and more.

What to consider when evaluating a PEO service in North Carolina

With numerous PEO service providers available in North Carolina, it's essential to carefully evaluate the tools on the market to find the one that best suits your business. Consider the following criteria during your assessment:

  • Business needs: Determine what your business requires from a PEO. Competing against other top tech or finance organizations? Maybe you’re looking for awesome benefits administration to improve employee retention. Here are the top features you want to make sure a PEO has:
    • Payroll processing
    • Tax filing and compliance
    • Benefits administration
    • Recruitment
    • Onboarding
    • Safety compliance and risk management
    • Time and attendance tracking
    • Regulatory compliance
    • HR outsourcing
  • Budget: Different PEOs utilize varying pricing structures, such as per-employee per-month fees or a percentage of each payroll run. Factor in your future growth plans and assess whether the PEO will remain affordable as your headcount increases.
  • Experience and reputation: Research the PEO's track record, focusing on its experience with other North Carolina businesses and its overall reputation. Review sites like G2 and Capterra can provide insights from past and current clients.
  • Benefits: Examine the quality, variety, and cost of benefits packages you can access through the PEO to ensure alignment with your employees' preferences and needs.
  • Renewal rates: Check if the PEO transparently discloses how much employee benefits may increase in cost after the initial year. Some PEOs have been known to significantly raise renewal rates, leading to unexpected costs for businesses.
  • Integrations: Evaluate how well the PEO will integrate with your existing systems and technology. You probably don’t want to reinvent the wheel on all of your business processes.
  • Industry specialization: Determine if the PEO specializes in a certain niche and how that aligns with your needs.
  • Legal and compliance expertise: If your business must adhere to specific regulations—which is pretty common in NC’s top sectors of technology, research, and finance—you may want to opt for a PEO with specialized experience in those areas.
  • Ease of exit: Consider your exit strategy from the PEO. Some PEOs make the transition challenging, which is why you should plan for this possibility before joining a PEO.

Why Rippling PEO is the right choice for your North Carolina business

Rippling PEO stands out as a pioneering PEO because of how it integrates HR, IT, and Finance into a unified, modern platform. 

In contrast to most PEOs relying on software from the 1980s (yikes), Rippling operates on fresh, fast, and user-friendly software that’s powerful enough for swift 90-second onboarding, remote IT management, and more. 

Rippling takes charge of even the most complex compliance duties, such as establishing state and local tax accounts and automatically identifying minimum wage and overtime violations. But not just that—we also help you and your employees access Fortune 500-level benefits at much more affordable rates.

When you choose Rippling for your PEO, you get all of the following:

  • Integration of HR, IT, and Finance into a single, delightful-to-use platform
  • Access to top-notch benefits at below-average renewal rates
  • Automated flagging for federal, state, and local compliance issues, complete with recommended solutions for each
  • Robust and customizable analytics reporting to better understand employee data
  • Tools for effectively managing remote teams, including state and local tax registration, paperless onboarding, and device management
  • Automatic risk and compliance management, covering ACA and COBRA administration, anti-harassment training, digital distribution of labor law posters, etc. 
  • Access to an extensive collection of HR resources, including guides and templates

Plus, it’s no sweat to move away from Rippling’s PEO if you choose to move HR functions in-house. Unlike other PEOs with cumbersome disentanglement procedures, Rippling allows you to effortlessly turn off the PEO and transition to our comprehensive workforce management platform. Your HR, payroll, and employee data remain securely stored in your account, integrations with other systems stay intact, and your employees even get to keep their same login information—ensuring a smooth continuation of their Rippling experience.

FAQs about PEOs in North Carolina

What is a PEO, and how does it work?

A PEO is an organization that collaborates with a company to deliver comprehensive HR solutions, including payroll processing, benefits administration, HR management, and compliance assistance. Via a PEO’s relationship with insurance companies, businesses can also access affordable, varied benefits plans. 

How does a PEO arrangement affect control over my employees?

In a co-employment relationship with a PEO, companies maintain control over day-to-day operations and employee management. The PEO becomes the legal employer of your workforce for tax purposes and handles HR functions and employment-related tasks. 

What is a Certified PEO?

A Certified PEO (CPEO) is a PEO that has met specific IRS criteria regarding its background, expertise, finances, and reporting. Certification is voluntary and not an IRS endorsement. While CPEO status once provided certain tax benefits, these advantages are largely obsolete today—which is why this isn’t one of the features we suggest prioritizing when choosing a PEO.

What size company can benefit from a PEO?

While PEO companies cater to businesses of all sizes, small to mid-sized businesses often derive the most benefit for two reasons: 1. PEOs open a pathway to more affordable and high-quality benefits plans 2. PEOs assist in cost savings for smaller teams by outsourcing manual HR tasks.

How does a PEO charge for its services?

Costs vary based on the services your company needs and your employee count. PEOs may charge a flat fee per employee or a percentage of the total payroll. 

What is the implementation process, and how long does it take to go live?

Usually, a PEO partnership begins by gathering essential details about your employees, such as payroll data, employment records, and benefits information.

They then establish systems to manage your HR, payroll, and benefits administration, which may involve integrating their technology with your systems wherever necessary.

Next, they might conduct onboarding sessions for your employees, clarifying new processes and benefits and providing training to your team on how to make the most of the systems they’ve put into place. 

The duration of this process varies a lot. It can take just a few weeks or a couple of months, depending on your business's size, the complexity of the integration, and how much of your HR they’re taking on.

Are PEOs regulated?

PEOs are subject to federal and state regulations, and they may also seek accreditation from industry organizations for additional credibility.

Are PEOs in North Carolina required to have special certifications or licenses?

North Carolina professional employer organizations are required to be licensed, which is a process managed by the North Carolina Department of Insurance

Start the application process for an individual or group PEO here, apply for de minimis registration here, and view all the filing requirements here

What happens if I want to terminate my relationship with a PEO?

Most PEOs require a cumbersome process to end the relationship, as you extract all their systems from your tech stack while trying to maintain some semblance of a normal workflow and accurate data. 

In contrast, Rippling PEO offers a seamless transition in which you can simply switch off the PEO and move to our workforce management platform. All systems, data, and integrations are automatically preserved.

In what states is Rippling PEO available?

Rippling PEO is available across the USA.

Disclaimer: Rippling and its affiliates do not provide tax, accounting, or legal advice. This material has been prepared for informational purposes only, and is not intended to provide or be relied on for tax, accounting, or legal advice. You should consult your own tax, accounting, and legal advisors before engaging in any related activities or transactions.

last edited: February 21, 2024

The Author

Tina Harris

A recovering project manager, trained journo, and mean grilled cheese maker — Tina is a marketing content writer humanizing complex topics one article, infographic, and ebook at a time.