Whether they want to or not, small business employers knows that they have to offer certain forms of employee benefits, including the basics such as Worker’s Comp and Social Security. Having to provide these means taking the time to research and understand the most current government regulations on the subject; even choosing which voluntary benefits, if any, can be a difficult. Although voluntary benefits consume your time and budget, offering them can be worthwhile, as voluntary employee benefits can lead to a boost in morale in your workforce and increasing productivity. The following are the benefits you are required to provide, highly recommended voluntary benefits, and how a Professional Employer Organization (PEO) (formerly Employee Leasing) can relieve you of this formidable task, keeping you focused on growing your business.

The "Big 3," as I like to call them, are the three employee benefits required by law that must be provided to your employees. These are Worker’s Compensation, Unemployment Insurance, and Social Security.

• Worker’s Compensation is insurance that provides medical costs and lost wages if an employee is injured while employed, as well as the right to sue the employer for the accident if the employer is at fault. Worker’s Comp requirements differ from state to state, in order to get the specifics, make sure you know the regulations based on your location.

• Unemployment insurance assures temporary income provided to a previous employee for a specified amount of time, who is actively seeking employment and who meets other specific criteria.

• Social Security, a federal system of retirement and disability insurance for various categories of employed and dependent persons. Social Security is put in place to protect against expenses that might otherwise drain their entire reserves.

Benefits that you are not required to provide to workers can be both negative and positive. The negatives include the obvious cost of providing them. Add to that the fact that once you offer them, it’s nearly impossible to take them back, as regulations and strong discontentment nearly take away the option of withdrawing them.

Although this is true, some of the positives of offering additional employee benefits can outweigh the costs. For example, a well-organized and generous employee benefits package can attract talented job applicants, boost employee morale, and retain you most valued employees.

List of recommended optional employee benefits:

• Health Insurance

• Retirement Annuities

• Life Insurance

• Health & Wellness Programs

• Telecommuting

• Vacation pay

• Holiday pay

• 401K or Thrift Savings Plans

Interestingly, the most commonly offered benefit packages are Life Insurance, Vacation pay and Holiday pay. However, the two most sought after plans by potential employees are Retirement Annuities and 401K plans.

There are numerous benefits a small business can provide and it’s up to the individual employer to select those that best fit their budget and the desires of their workforce. Make sure you know beforehand the regulations and compliance required of you, the employer, to participate. Understanding your choices and all of the paperwork necessary to offer the mandated benefits and/or optional ones can turn into a black hole consuming hours of your time. This is when you may consider hiring an HR professional or outsourcing these duties to a Professional Employer Organization, or PEO. This is a growing industry that has been proven to assist small businesses in these areas, and not really many PEO Disadvantages.

PEOs composes a list of employee benefits and the costs of each one, giving you a wide range of offerings, as well as the capability to offer some plans at a cost that your competitors just can’t compete with. Most PEOs can save you a percentage of your medical costs and other benefits by pooling your employees with other groups to lower risk and obtain lower insurance costs. These savings are passed on to you. Professional Employer Organizations can also offer help with other taxes and regulations such as SUTA cutoffs, Worker’s Compensation and the new Health Care Reform rules. PEOs can analyze your current plans and help you identify wasted resources.

PEO Employment has also been used to "co-employ" workers, which makes the PEO the legal owner of record. However, rest assured, your employees are still under your control and everything is just as before, aside from the fact that employment taxes are cut and health benefits can be offered at a lower premium. The best thing you can do is ask questions, talk to other business owners about how they deal with the mandatory benefits and what caused them to choose their current package. Lastly, know that the PEO is there for the benefit of the employer, they offer businesses help with all administrative tasks as well as cutting costs in other areas. The end result just might save you money as well as time.