A Guide to PEO in Florida

Businesses in Florida have to manage the state’s complex and ever-changing regulations. Partnering with a professional employment organization (PEO) can help them ensure compliance while streamlining their HR operations. CFOs and finance teams can delegate administrative tasks to the provider leaving themselves more time to focus on strategic initiatives.

Continue reading to learn more about the process and advantages of using a PEO in Florida.

The role of Florida PEO services

PEOs offer a vital service for companies looking to outsource HR and employee management tasks. These administrative services encompass payroll processing, benefits administration, and compliance with both state and federal laws.

By partnering with a PEO, businesses enter into a co-employment relationship. This arrangement means the provider assumes many of the legal obligations of the employer while the PEO client retains control over day-to-day operations. 

Florida requires all PEO companies operating within its jurisdiction to obtain a license from the Department of Business and Professional Regulation (DBPR). The provider must take responsibility for tax withholding and reporting, including the state’s re-employment tax.

Companies must also check their PEO can secure worker’s compensation packages for their workforce. The state requires coverage for all employees. If you don’t have adequate plans, your organization can incur penalties. 

It’s worth noting that Florida’s Department of Revenue doesn’t differentiate between PEO providers and employee leasing companies. While they may use the terms interchangeably, the latter refers to a temporary staffing agency.

Benefits of partnering with a Florida PEO

A PEO enables Florida businesses to streamline their human resources operations, improve employee benefits, and maintain continuous compliance with state laws.

Efficiency 

CFOs and finance teams face the critical task of optimizing core HR functions to boost efficiency and control expenses. HR outsourcing offers them a way to significantly decrease the time and resources allocated to administrative tasks, allowing teams to focus more on strategic financial planning and analysis rather than daily operations.

A PEO can also introduce advanced HR solutions to the organization that automate US payroll processing, benefits administration, and data analysis. These tools streamline time-consuming processes and allow teams to prioritize resources more effectively. As a result, teams have more scope to focus on driving growth and profitability while having the assurance the company is in expert hands.

Access to expertise

A PEO allows companies, especially small businesses and startups, to access expertise that might be out of their budget otherwise. The service is typically more cost-efficient than employing a full-time HR department. It also provides a predictable, monthly pricing model that helps companies manage expenses.

The PEO’s expertise allows human resources, CFOs, and finance teams to make data-driven, fully informed decisions. With these extra insights, they’re more likely to track the right metrics, meet overarching goals, and drive growth.

Affordable employee benefits plans

Partnering with a PEO allows companies to offer more attractive employee benefits packages. The provider can pool workers from multiple companies to negotiate better rates on plans like health insurance, retirement funds, and worker’s compensation.

In Florida’s job market, this advantage can help companies attract the best candidates, as small to mid-sized businesses can offer plans comparable to those of large organizations and level the recruitment playing field. 

Enhanced compliance management

Companies may face challenges complying with Florida’s constantly evolving laws without expert guidance, risking penalties, lawsuits, and damage to their reputation if they fail to adhere to these regulations.

For example, Florida has recently revised laws on employment eligibility and background screenings. Now employers must conduct more thorough checks on candidates or risk up to $1,000 USD per day in penalties. Luckily, PEOs can help companies understand and stay up-to-date with these regulations and others.

Payroll, labor, and employment laws in Florida

While Florida’s laws are moderate in comparison to states like California and New York, they’re still fairly comprehensive. Let’s look at some of the state-specific payroll, labor, and employment laws in Florida:

Payroll and benefits laws

• Minimum wage: The current rate in Florida is $12 per hour. Under the Florida Minimum Wage Act, the rate increases by $1 every September, so it will rise to $13 per hour in 2024. There’s a $1,000 fine for non-compliance
• Minimum wage notification: Employers must display a notice with information about the Florida minimum wage in a public place where all workers can access it
• Overtime: Florida defers to federal law on overtime rates. The US Department of Labor (DOL) states that employees must receive overtime pay when they work more than 40 hours in a week
• Paid sick leave: Florida doesn’t have a state-specific policy on paid sick leave. Instead, employers can determine the policy. State-owned companies may implement a sick leave pool in which staff donate their time off to each other 
• Pay transparency laws: Although Florida doesn’t currently require companies to post salaries in job listings, the idea is growing in popularity among businesses
• Benefits: Florida doesn’t mandate benefits like insurance coverage or retirement plans, but federal law requires employers with 50 or more FTEs to comply with the FMLA. State laws say that group insurance can’t be mandatory and workers should be free to reject or withdraw from these plans
• Paydays and pay periods: There are no state payday regulations in Florida. Employers should follow federal labor laws which require them to pay workers a minimum of once a month
• Domestic Violence Leave Protection: Employees have the right to request and take up to 3 working days of leave from work in any 12-month period if the employee or a family or household member of an employee is the victim of domestic violence or sexual violence

Labor laws

• Meal and rest breaks: Florida doesn’t require employers to offer a rest period or meal break to workers unless they’re under 18. Minors must have a 30-minute break for every four hours they work according to the local statute
• Competition: Employers may not prohibit workers from trading with or buying from competitors. If the state feels there’s a threat of termination on these grounds, companies can incur penalties
• Seating: Certain workers are entitled to sit when they’re not actively engaged in their jobs. 
• Discrimination: Employers can’t discriminate based on sex or gender. All workers must receive the same rate for equivalent work unless there’s a seniority, merit, or variable income system in place

Employment laws

• Worker classification: Florida defines an “employee” as an individual accepting a permanent position where they perform labor under the direction of an employer in return for salary or wages. Misclassification is a felony which means it could be punished with a jail sentence
• Reporting: All Florida-based businesses must report on workers in a Quarterly Employer Report for tax and benefits purposes
• Eligibility: Employers must verify their workers’ availability for employment within three business days of the contract start date. They should use the state’s e-verify system and retain any records for up to three years

Additional requirements and enforcement

The above information covers just some of the labor, payroll, and employment laws in Florida. 

One other noteworthy law is Florida’s re-employment tax which employers must pay into a trust fund. The state uses this money to pay unemployment assistance benefits to eligible claimants. Businesses pay the tax on the first $7,000 they pay employees every year but don’t deduct the amount from wages. 

If there is any overlap between state and federal law, employers are required to follow the policy that affords workers the greatest rights or protections.

How to choose the right PEO in Florida

Florida’s distinct set of state laws and regulations demands a thoughtful approach to choosing a PEO. Here’s a step-by-step process you can follow to ensure your provider aligns with your company’s goals and interests.

1. Define your business needs

Start with a comprehensive review of your current HR services, looking specifically for potential time or cost savings. Also, consider your potential growth so you can check whether the PEO can adapt and scale with you.

Detail the exact services you’ll require to manage all your HR tasks. Key focus areas are payroll processing, benefits administration, and compliance management.

2. Research PEOs with Florida expertise

Limit your search to PEOs with a notable presence in Florida and a proven track record. You can research case studies, testimonials, and reviews to find examples of how well they perform. Request social proof from any service providers that you contact before you enter negotiations. 

3. Assess the value of services and benefits

See whether the PEO offers the services you need at a competitive rate. Pay close attention to the benefits packages they offer in terms of their quality, range, and affordability. These plans should cover essential benefits such as healthcare coverage, retirement funds, and workers’ compensation insurance.

Check the PEO has customizable options that allow them to tailor their solution to your organization’s changing HR needs.

4. Evaluate compliance and risk management capabilities

Explore the PEO’s strategies for maintaining continuous compliance with Florida’s different regulations and requirements. The ideal provider should have a proactive approach to mitigate risk and reduce errors. For example, Deel has a Compliance Hub that provides customers with the latest updates on changing laws around the world. 

5. Check customer service and support

Look into the PEO’s response times, availability, and contact options. Are their customer support experts located in the same time zone as your Florida employees? Are they only available through email, or can your team contact them directly through a messaging system? Will you have a dedicated customer success manager, or will you be passed off to someone new every time you have an issue?

Effective communication is critical for a smooth co-employment relationship with a PEO. By asking these questions (and more), you can gain peace of mind that you’re choosing the right provider.

6. Review and negotiate the contract

Ensure you understand every detail of the terms, conditions, fees, and exit clauses. If necessary, seek professional legal advice to review the contract, negotiate terms that cater to your company’s needs and interests, and clarify everyone’s responsibilities. 

7. Plan for implementation and transition

Prepare your team for the transition to the PEO service by explaining all of the upcoming changes and expected benefits. They’ll be more receptive if there’s a gradual onboarding and they understand the rationale behind the company’s decision.

Determine an implementation timeline with the PEO, including check-in points to ensure you stay on schedule. Effective communication and collaboration enable you to inform each other about potential issues and resolve them quickly.

Manage your Florida, US, and global workers with Deel

Deel simplifies HR and payroll management, whether you’re a single-state, country-wide, or global employer.

As your PEO*, Deel takes care of payroll services, HR management, and benefits administration while guaranteeing state tax compliance and handling sensitive issues. We offer:

• Expert payroll administration and tax filing
• Access to benefit plans from leading carriers and benefits administration
• Robust HRIS with free IT, Finance, and PTO management
• State-specific training, HR policies, and on-demand HR support
• Advanced tax and benefits compliance
• And more

Book a demo to learn more about using Deel’s PEO in Florida.

*Provided by Deel PEO US, LLC, Deel Employment Services, LLC, or through Deel's partnership with licensed providers where required.