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> You cannot 1099 everyone especially if they are only working for you as a full time employee (IRS won't like that) One way smaller companies do accomplish th

by drewda 5y ago

> You cannot 1099 everyone especially if they are only working for you as a full time employee (IRS won't like that) One way smaller companies do accomplish this is with "professional employer organizations." A PEO is the legal employer of the full-time staff, provides their insurance, processes their W-2s, etc. An executive at the company is the actual day-to-day manager of the staff, and the company pays the PEO to cover all the staffing expenses. Not as relevant when you also want to pay staff with equity, but it's a fine option for paying staff with cash and benefits in multiple states or countries.

toomuchtodo 5y ago
I worked for a fully remote startup who used Trinet (PEO) and was issued equity, didn’t seem to be an issue. There are challenges if you want to hire and issue equity across international borders, I believe you have to incorporate a related entity in the country you’re issuing equity in to support such compensation issuance.
- 1-more 5y ago
  We use Trinet and while I think there are weird challenges to the whole thing, I know our international employees have stock options just like those of us in the US. They were even able to exercise some of their options when we had a weird event that let us do that. So it's definitely doable! I'm not sure how much of a hassle it is for the executive team to deal with all of that, but I do know that we got to the result.
  - toomuchtodo 5y ago
    Appreciate you sharing the datapoint.
deleted 5y ago
[deleted]
jasonjei 5y ago
This is very interesting. I might use this. What is a good and reputable one that you’ve heard people using successfully? And also not too costly?
ghaff 5y ago
That sounds very unattractive to me as a potential employees. So I'm not really being hired and I have to deal with this PEO if I have issues with insurance of any sort. Small companies do hire employees in multiple states. I've been in that position myself and know many other small distributed companies. But it is paperwork and cost. [ADDED: Maybe it's fine but it would be a red flag for me.]
- mbesto 5y ago
  Background: I used to belong to a 50 person company that used TriNet and now run a ~10 one that uses Gusto (multi-state). Honestly, if you are in a small company, having a PEO helps tremendously for both being an employee and the company's management. > So I'm not really being hired and I have to deal with this PEO if I have issues with insurance of any sort. (1) When would your employer ever have to deal with insurance issues even at a F500? That's all done directly with the carrier unless it has to do with the benefits calculation, which would be no different to do at a F500 with benefits and one that uses TriNet. (2) If you did actually have to deal with insurance issues, trust me you want to go through a larger organization to deal with carriers. Carries don't give great customer service to small biz / independent LLCs. (3) Yes, you legally are an employee of <insert PEO here> but who cares? There are few instances where this actually has an effect.
  - ghaff 5y ago
    >When would your employer ever have to deal with insurance issues even at a F500? Large companies will get involved when there are insurance-related issues. How effective they'll be is another question.
fiftyacorn 5y ago
Is this like an umbrella company?
chipotle_coyote 5y ago
To chime in as another TriNet "user" (e.g., employee of a startup that used them), they're pretty great on both ends. They handle a lot of regulatory and benefit management for the employer (state/local taxes, 401(k) programs, health benefits), and for the employee, TriNet's HR dashboard feels modern and easy to use. When my current company was abruptly forced to switch from "independent subsidiary of BigCo" to "division within BigCo", we had to switch from TriNet to all of BigCo's internal HR systems -- most of which are clearly powered by HR IT companies like Workday and UltiPro -- and they are all just terrible. Uh, anyway, yes, PEOs seem like good ideas. :)

by drewda 5y ago

toomuchtodo 5y ago

I worked for a fully remote startup who used Trinet (PEO) and was issued equity, didn’t seem to be an issue. There are challenges if you want to hire and issue equity across international borders, I believe you have to incorporate a related entity in the country you’re issuing equity in to support such compensation issuance.

1-more 5y ago
We use Trinet and while I think there are weird challenges to the whole thing, I know our international employees have stock options just like those of us in the US. They were even able to exercise some of their options when we had a weird event that let us do that. So it's definitely doable! I'm not sure how much of a hassle it is for the executive team to deal with all of that, but I do know that we got to the result.
- toomuchtodo 5y ago
  Appreciate you sharing the datapoint.

deleted 5y ago

[deleted]

jasonjei 5y ago

This is very interesting. I might use this. What is a good and reputable one that you’ve heard people using successfully? And also not too costly?

ghaff 5y ago

That sounds very unattractive to me as a potential employees. So I'm not really being hired and I have to deal with this PEO if I have issues with insurance of any sort. Small companies do hire employees in multiple states. I've been in that position myself and know many other small distributed companies. But it is paperwork and cost. [ADDED: Maybe it's fine but it would be a red flag for me.]

mbesto 5y ago
Background: I used to belong to a 50 person company that used TriNet and now run a ~10 one that uses Gusto (multi-state). Honestly, if you are in a small company, having a PEO helps tremendously for both being an employee and the company's management. > So I'm not really being hired and I have to deal with this PEO if I have issues with insurance of any sort. (1) When would your employer ever have to deal with insurance issues even at a F500? That's all done directly with the carrier unless it has to do with the benefits calculation, which would be no different to do at a F500 with benefits and one that uses TriNet. (2) If you did actually have to deal with insurance issues, trust me you want to go through a larger organization to deal with carriers. Carries don't give great customer service to small biz / independent LLCs. (3) Yes, you legally are an employee of <insert PEO here> but who cares? There are few instances where this actually has an effect.
- ghaff 5y ago
  >When would your employer ever have to deal with insurance issues even at a F500? Large companies will get involved when there are insurance-related issues. How effective they'll be is another question.

fiftyacorn 5y ago

Is this like an umbrella company?

chipotle_coyote 5y ago

To chime in as another TriNet "user" (e.g., employee of a startup that used them), they're pretty great on both ends. They handle a lot of regulatory and benefit management for the employer (state/local taxes, 401(k) programs, health benefits), and for the employee, TriNet's HR dashboard feels modern and easy to use. When my current company was abruptly forced to switch from "independent subsidiary of BigCo" to "division within BigCo", we had to switch from TriNet to all of BigCo's internal HR systems -- most of which are clearly powered by HR IT companies like Workday and UltiPro -- and they are all just terrible. Uh, anyway, yes, PEOs seem like good ideas. :)