The Professional Employer Organization

What is a PEO?

A Professional Employer Organization (PEO) is a company that partners with businesses to manage Human Resource (HR) functions such as payroll, employee benefits, risk management, HR management and recruiting.

Through a co-employment arrangement, the PEO handles administrative tasks and becomes the official employer of record for tax and insurance purposes, while the business continues to direct day-to-day operations and employee management. This arrangement allows businesses to streamline HR processes and reduce administrative burdens.

PEO Services

Payroll Administration:

PEOs manage payroll processing, ensuring employees are paid accurately and on time. They handle all aspects of payroll, including direct deposits, tax withholdings, and issuing W-2s.

Benefits Management:

By pooling multiple client companies, PEOs can offer competitive benefits packages that might be unattainable for smaller businesses on their own. This includes health insurance, retirement plans, dental and vision coverage, and more.

HR Management:

PEOs ensure compliance with federal, state, and local employment laws. They stay updated on changes in regulations and help businesses avoid costly fines and legal issues by managing compliance-related tasks.

Risk Management:

PEOs provide workers' compensation insurance and help implement safety programs to minimize workplace risks. By pooling together multiple companies, they are able to provide superior coverage and a cost savings.

Recruiting:

A PEO helps with recruiting by streamlining the hiring process, providing access to a larger talent pool, and offering expertise in crafting effective recruitment strategies.

PEO's By The Numbers

PEOs have been providing HR support to businesses since the 1970s. *
PEOs provide services to 200,000 businesses, employing 4.5 million people.*
There are 508 PEOs in the United States.*
The total employment represented by the PEO industry is roughly the same as the combined number of employees for the four largest employers in the U.S. *
The PEO industry’s 200,000 clients represent 17 percent of all employers with 10 to 99 employees. *
Businesses utilizing PEOs experience growth rates 7 to 9% faster, employee turnover rates 10 to 14 percent lower, and a 50 percent lower likelihood of going out of business compared to those not using PEOs. (Source: McBassi & Company, 2015)
The ROI of using a PEO, considering cost savings alone, is 27.3%. (Source: McBassi & Company, 2019)

*Data from NAPEO

Employee Lifecycle Support

The employee lifecycle encompasses all stages an employee goes through during their time with an organization, from recruitment and onboarding to development, retention, and ultimately, seperation.

A Professional Employer Organization (PEO) plays a crucial role throughout this lifecycle by providing comprehensive support and expertise. During recruitment and onboarding, a PEO helps streamline processes, ensuring compliance with employment laws and offering efficient administrative support. As employees progress, the PEO contributes to their development by managing benefits, handling payroll, and offering HR services that enhance job satisfaction and retention.

When it comes to offboarding, the PEO assists with compliance issues, finalizing paperwork, and ensuring a smooth transition. By managing these critical aspects, a PEO enables organizations to focus on their core operations while ensuring a positive and legally compliant employee experience.

The Professional Employer Organization

PEO Services

PEO's By The Numbers

Employee Lifecycle Support

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