PEO in Montana [2024]

Businesses in the state of Montana can partner with a professional employer organization (PEO) to outsource their manual human resources tasks, like payroll processing, benefits administration, compliance management, and workers' compensation insurance. PEOs also help businesses access high-quality employee benefits plans at cost-effective rates, making it easier to recruit and retain top talent. 

Whether you’re a business owner in Helena, Whitefish, or Butte, staying compliant with Montana employment laws and dealing with increasing operational costs is a challenge. Fortunately, PEOs can help you reduce HR costs, ensure compliance with local laws, and access better benefits for your employees.

Wondering what type of PEO is right for your Montana business? It’s important to weigh your options, which is where this article can help. From automatic state tax registration to remote IT management, Rippling PEO simplifies hiring and onboarding employees in Montana and across the US. 

Benefits of using a PEO in Montana

Partnering with a Montana PEO can ease the burden of administrative HR tasks, offer you valuable HR support, lower your insurance costs, and more. 

Offload administrative HR work

When you team up with a Montana PEO, you enter into a co-employment relationship. Under this partnership, you stay in control as the worksite employer, deciding who to hire or let go, setting salaries, and managing your overall business strategy.

Meanwhile, the PEO takes on the administrative employer role, employing your workers under its federal tax identification number (EIN). This enables the PEO to handle employment-related HR tasks like payroll, benefits management, legal compliance, and more. 

PEOs use a combination of technology, established processes, and expertise to streamline HR management and reduce costs. With the admin work off your plate, your HR team gains the bandwidth to focus on strategic work that moves your business forward.

Better employee benefits, at a lower price

The National Association of Professional Employer Organizations (NAPEO) reports there are more than 500 PEOs across the US, co-employing 4.5 million workers across 200,000 businesses. Since PEOs co-employ workers from so many different companies, they wield significant bargaining power. This helps them negotiate better deals with insurance providers, meaning you get access to more affordable benefits.

PEOs also use their economies of scale to offer robust benefits plans, often including health insurance, life and disability coverage, mental health support, retirement plans, and more. For small businesses, providing such robust perks alone can be impossible. But with a PEO, it becomes doable.

The Affordable Care Act (ACA) requires businesses across the US with 50 or more full-time employees to provide health insurance. While Montana businesses aren’t required to provide additional state-level insurance, a PEO can help companies meet the federal mandate—and offer additional, optional employee perks to stay competitive in the hiring landscape.

Worry-free compliance with Montana laws

A PEO can help you comply with both federal and state regulations. If you employ remote workers across multiple states, keeping track of changing state and local-level employment laws can be tricky. Take Montana’s minimum wage, for example. It’s currently $10.30 per hour (notably more than the federal minimum wage) and increases annually.

A PEO helps you stay on the right side of all relevant laws so you can focus on running your business without compliance headaches. Rippling, for example, automatically flags any minimum wage slip-ups based on your employees' locations—and recommends how to solve them to avoid penalties. 

A PEO can also help you maintain compliance with: 

• Payroll regulations: Worker classification (employees and contractors); issuing and filing tax forms; reporting, collecting, and submitting payroll taxes to the proper authorities when due; and complying with other wage regulations, like overtime laws
• Benefits-related laws: Federal sick leave laws (FMLA), ACA, COBRA, FSA, HSA, and other benefits regulations 
• Labor laws: Workers’ compensation insurance, Equal Employment Opportunity (EEO) regulations, and correctly displaying state-mandated labor posters

Dedicated support team

When you partner with PEOs, you tap into their HR expertise, which can be a game-changer for small businesses and startups lacking in-house resources. 

Your PEO not only helps you cut down on HR expenses but also offers advice on things like streamlining benefits administration, crafting an employee handbook, training managers, checking safety practices, and tackling any other HR challenges your team encounters.

What to consider when evaluating a PEO service in Montana

There’s no shortage of PEO providers in the state of Montana, whether you have workers in Bozeman, Missoula, Billings, or anywhere in between. Consider the following criteria when choosing the right PEO for your business:

• Your business and HR needs: Identify what services you need from a PEO, which might include:
• Payroll processing
• Tax filing and compliance
• Benefits administration
• Recruiting and onboarding
• Safety compliance and risk management
• Time and attendance tracking
• Regulatory compliance
• HR outsourcing services
• Your budget: Different PEOs use different pricing structures, like per-employee monthly fees or a percentage of each payroll run. If you plan to expand your business, make sure the PEO will remain affordable as your headcount grows.
• Experience and reputation: Look into the PEO's track record. Has it collaborated with businesses in Montana before? Is it well-regarded? Check reviews on platforms like G2 and Capterra for feedback from past and current clients.
• Benefits: Examine the quality, variety, and cost of benefits plans the PEO offers access to, ensuring they align with your employees’ preferences and needs.
• Benefits renewal rates: Find out how much the PEO's benefits plans increase in cost after the first year. Unexpected cost hikes can be a headache, so choose a PEO that clearly communicates potential renewal rate increases.
• Integrations: How will the PEO integrate with your existing systems, tools, and technology?
• Specializations: Consider if the PEO specializes in certain industries or legal and compliance issues. If your business operates in a niche field or has specific regulatory needs, a PEO with specialized experience can be valuable.
• Exit strategy: Many PEOs make it challenging to leave their service, requiring a complete system overhaul. Think about your exit strategy before committing to a PEO, as you might eventually want to take your HR processes in-house or switch PEO providers. 

Why Rippling PEO is the right choice for your Montana business

Unlike most PEOs still running on outdated 1980s software, Rippling PEO syncs HR, IT, and Finance seamlessly in one modern platform. We manage your critical compliance tasks, including setting up tax accounts and identifying wage violations—all while helping you access Fortune 500-level benefits at affordable prices.

With Rippling, you get:

• HR, IT, and Finance in one powerful platform
• Efficient and customizable reporting on any employee data 
• Tools for managing remote teams, including state and local tax registration, paperless onboarding, and app and device management
• Access to premium benefits plans, plus below-average, predictable renewal rates
• Automatic flagging for federal, state, and local compliance infractions, along with recommended plans to fix each one
• Automated risk management processes, including ACA and COBRA administration, anti-harassment training, and sending digital labor law posters to your employees
• Access to hundreds of HR resources, guides, and templates

If you ever decide to bring your HR operations back in-house, Rippling PEO makes the transition easy. You can simply move to our all-in-one workforce management platform, keeping your data, integrations, and employee logins intact. And employees can keep using Rippling the same way they did before. 

FAQs about PEOs in Montana

What is a PEO, and how does it work?

A PEO collaborates with businesses to offer complete HR support, covering tasks from payroll processing and benefits administration to compliance assistance. PEOs usually operate under a co-employment model, where the PEO legally employs the company's workforce for tax reasons. 

How does a PEO arrangement affect control over my employees?

When you team up with a PEO, you retain full control over your company’s day-to-day operations and employee management. Meanwhile, the PEO takes care of administrative HR functions and employment-related tasks, which allows your team to concentrate on more impactful work. 

What is a Certified PEO?

A Certified PEO (CPEO) is a PEO that meets specific criteria set by the IRS regarding background, expertise, finances, and reporting. While obtaining CPEO certification is voluntary and doesn't imply an IRS endorsement, it does indicate that the PEO has successfully passed a series of assessments. In the past, CPEOs provided extra tax benefits to businesses, but today, those benefits no longer apply.

What size company can benefit from a PEO?

While PEOs cater to businesses of all sizes, small to mid-sized businesses usually reap the most rewards. PEOs help small businesses reduce administrative costs by outsourcing manual HR tasks, allowing teams to focus on strategic work. Plus, PEOs help small companies access top-notch benefits plans at affordable rates. 

How does a PEO charge for its services?

PEO costs vary depending on the range of services you need and your company size. PEOs might implement a flat fee per employee or a percentage based on your overall payroll.

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

Usually, the PEO will first gather essential details about your employees, like payroll data, employment records, and benefits information. They'll then configure their systems to manage your HR, payroll, and benefits administration, integrating their tech with your systems if needed. The PEO might also conduct onboarding sessions for your employees to clarify new processes and benefits.

The implementation process can take anywhere from a few weeks to a couple of months. 

Are PEOs regulated?

Yes, PEOs operate under an umbrella of both federal and state regulations. Many of them also choose to earn accreditation from industry organizations. 

Are PEOs in Montana required to have special certifications or licenses?

Yes, PEOs must be licensed through the Montana Department of Labor and Industry. While co-employment and employee leasing are two different business models, Montana considers them one and the same for regulatory purposes and requires PEOs to obtain a license under the state’s employee leasing statute. As part of the application process, PEOs must share information about ownership, financial stability, benefits packages, workers' comp and unemployment policies, and contract copies.

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

Breaking ties with most PEOs typically involves a cumbersome process of removing all PEO systems from your business. However, with Rippling PEO, the transition is simple: You can switch off the PEO and transition seamlessly to our all-in-one workforce management platform, leaving your systems, data, and integrations intact.

In what states is Rippling PEO available?

Rippling PEO is available in all US states, including Montana.

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.