Competing for top talent is tough, especially when larger companies can offer incredible benefits packages. As a small or medium-sized business, it can feel impossible to keep up. A national PEO is the strategic partner that levels the playing field. By pooling thousands of employees from all their client companies, they gain massive buying power, giving you access to Fortune 500-level health insurance and retirement plans at affordable rates. But that’s just the beginning. A PEO also handles the complex administrative work behind the scenes, from payroll to compliance. Ahead, we’ll break down what a PEO does and how it can help you build a happier, more resilient team.
If you’ve heard the term “PEO” but aren’t quite sure what it means, you’re in the right place. A National Professional Employer Organization (PEO) is a firm that provides comprehensive HR services for small and medium-sized businesses. Think of it as an all-in-one partner that handles the complex, time-consuming administrative tasks that come with having employees. By partnering with a PEO, you can offload critical functions like payroll, benefits administration, and regulatory compliance. This allows you to get back to what you do best: running and growing your business. A national PEO specifically offers these services across state lines, making it an ideal solution for companies with remote teams or plans for expansion.
At its core, a PEO handles your most important "back-office" HR tasks. Instead of juggling multiple vendors for payroll, benefits, and compliance, a PEO bundles these services together. They take over the administrative work, including processing payroll, filing payroll taxes, managing employee benefits, and ensuring you stay on top of ever-changing labor laws. This partnership frees you from the paperwork and lets you focus on your company’s mission and strategy. The goal is to streamline your operations and give you the support of a full-fledged HR department without the associated overhead. You can learn more about the specifics of what a PEO is and how it can support your business.
When you partner with a PEO, you enter into a co-employment relationship. This might sound complicated, but the concept is straightforward. Your business remains the “worksite employer,” meaning you still manage your employees’ daily duties, hire and fire, and control your company’s culture and operations. The PEO becomes the “administrative employer,” or the employer of record for tax purposes. This allows them to legally handle tasks like paying your team, remitting taxes under their own tax ID number, and providing access to their large-group benefits plans. You don't lose control of your team; you gain a powerful partner to handle the administrative side of employment, which is central to our process of finding you the perfect match.
There are a few common misconceptions about PEOs that can cause business owners to hesitate. One of the biggest myths is that you’ll lose control of your business. In reality, a PEO partnership allows you to focus more on your core business functions by removing administrative burdens. Another myth is that a PEO will replace your in-house HR team. PEOs often work alongside existing HR staff, freeing them up to focus on strategic initiatives like employee engagement and development. Finally, some think PEOs are just glorified payroll companies. They actually offer a wide range of strategic advantages, from risk management to access to Fortune 500-level benefits that help you attract and retain top talent. You can find answers to more frequently asked questions about how PEOs really work.
Partnering with a Professional Employer Organization is about more than just outsourcing tasks; it’s a strategic move that can fundamentally change how your business operates for the better. Think of it as gaining a dedicated partner whose main job is to handle the complex, time-consuming administrative work so you can focus on growth. From managing payroll and compliance to offering incredible benefits, a national PEO provides the infrastructure and expertise that growing companies need. The real advantage lies in how these services work together to save you money, reduce risk, and help you build a stronger, more resilient team. Let’s break down the specific ways a national PEO can make a tangible difference for your business.
One of the most immediate benefits of working with a PEO is the potential for significant cost savings. Because PEOs represent thousands of employees from all their client companies, they have immense buying power. This allows them to negotiate much lower rates on essentials like health insurance and workers' compensation—rates you likely couldn't get on your own. Beyond insurance, the numbers show that businesses using a PEO tend to be more financially sound. They often experience 40% faster revenue growth and are 50% less likely to go out of business. This isn't just about cutting costs; it's about creating a more stable financial foundation for long-term success.
For many small and medium-sized businesses, having a dedicated, in-house HR department is simply out of reach. A PEO gives you access to a team of certified HR professionals without the cost of hiring them directly. These experts specialize in everything from payroll processing and benefits administration to employee relations and labor law compliance. Instead of spending hours trying to figure out a tricky HR issue, you can just pick up the phone and get guidance from someone who handles these situations every day. This level of expert support frees you up to concentrate on your core business operations, knowing your HR functions are in capable hands.
Keeping up with ever-changing employment laws is a full-time job. Federal, state, and even local regulations around payroll taxes, benefits (like the ACA and COBRA), and workers' rights can be a minefield for business owners. A national PEO is particularly valuable here, especially if you have remote employees in different states. Their compliance experts stay on top of these complex rules for you, ensuring your business avoids costly fines and legal trouble. By handling things like tax filings and workers' compensation claims, a PEO helps protect your business and significantly reduces your administrative burden.
In today's competitive job market, attracting and retaining top talent often comes down to your benefits package. A PEO levels the playing field, allowing smaller companies to offer the kind of robust benefits typically reserved for large corporations. Through their large-group purchasing power, PEOs can provide access to premium health insurance plans, comprehensive dental and vision coverage, and attractive retirement plans like 401(k)s. Offering a great benefits package not only helps you keep your best employees happy and engaged but also makes your company a more attractive destination for skilled candidates.
Modern HR requires modern technology, but the cost of sophisticated HR software can be prohibitive for smaller businesses. PEOs invest heavily in powerful, integrated technology platforms that streamline everything from payroll to onboarding. Through a single, easy-to-use system, you and your employees can manage time tracking, view pay stubs, enroll in benefits, and access important HR documents. This technology simplifies administrative tasks and provides a professional, seamless experience for your team. The right PEO will have a tech stack that fits your needs, a key part of our matching process.
When you start looking into PEOs, you’ll quickly realize they aren’t all built the same. Different providers structure their services in various ways, from all-inclusive packages to more flexible, à la carte options. Understanding these models is the first step to finding a partner that truly aligns with your business goals. Think of it less like buying a one-size-fits-all product and more like finding a partner who can adapt to your specific needs. Let’s break down the most common service models you’ll encounter.
The most common PEO model is the comprehensive, all-in-one package. In this setup, the PEO becomes your co-employer or "employer of record" and takes on the full spectrum of your HR administration. This includes processing payroll, managing employee benefits, handling workers' compensation, and ensuring you stay compliant with labor laws. It’s designed to be a complete solution, allowing you to offload the bulk of your administrative work. This is the core of what a PEO is and why so many businesses find it to be a transformative partnership. It’s ideal for owners who want to hand over their HR functions to a single, expert team.
You might also come across the term ASO, which stands for Administrative Services Organization. While an ASO provides similar services like payroll and HR support, there’s one critical difference: the co-employment relationship. A PEO legally co-employs your team, which allows them to sponsor benefits under their own name and take on more liability. An ASO, on the other hand, operates more like a traditional outsourcing vendor. You retain all the legal responsibility as the sole employer. An ASO can be a great choice if you only need help with specific administrative tasks, but a PEO offers a much deeper, more integrated partnership.
Just as every business is unique, so are PEOs. Many specialize in serving specific industries, like technology, construction, or healthcare. A niche PEO understands the particular challenges and compliance requirements of your field, from safety regulations to specific benefits that attract top talent in your sector. For example, a PEO focused on restaurants will have deep expertise in managing tips, scheduling, and industry-specific labor laws. Finding a partner who gets your industry is a huge advantage, and it’s a key part of our matching process to ensure you’re paired with an expert who truly understands your world.
A common misconception is that PEOs force you into a rigid, take-it-or-leave-it service bundle. The reality is that many PEOs offer a great deal of flexibility. You can often choose the specific services you need and build a customized plan that fits your budget and priorities. As your company grows and your needs change, you can adjust your service plan accordingly. This à la carte approach ensures you’re only paying for what you actually use. The key is finding a provider with the right flexibility, which is a major reason why businesses use Right Fit PEO to connect with a partner that can scale with them.
When you’re focused on scaling your business, the last thing you want to be doing is spending your days buried in administrative tasks. Growth requires a clear vision and the time to execute it. A national PEO acts as a strategic partner, taking on the complex, time-consuming HR functions that can pull your attention away from your core mission. By handling the critical backend operations, a PEO frees you up to focus on innovation, customer relationships, and strategic planning.
This partnership does more than just save you time; it builds a stronger foundation for sustainable growth. With expert support, you can create a more professional, compliant, and attractive workplace. This helps you not only attract top talent but also keep them happy and engaged for the long haul. Let’s look at the specific ways a national PEO can help you move your business forward.
One of the most significant ways a PEO helps is by streamlining your administrative workload. By entering into a co-employment relationship, the PEO becomes the official employer of record for your team. This means they take legal responsibility for tasks like payroll processing, tax filings, and benefits administration. Instead of juggling multiple systems and endless paperwork, you get a single, integrated solution. This shift allows you to reclaim valuable hours in your week, redirecting your energy from tedious administrative duties to activities that directly contribute to your company’s growth.
Competing for talent with larger corporations can be tough, especially when it comes to employee benefits. National PEOs level the playing field. Because they represent thousands of employees from all their client companies, they have immense buying power. This allows them to negotiate for top-tier benefits packages—including health insurance, dental, vision, and 401(k) plans—at much lower rates than a small business could get on its own. Offering these high-quality benefits makes your company a more attractive place to work, which is key for improving employee satisfaction and retention.
Keeping up with the ever-changing landscape of employment laws is a full-time job in itself. From payroll tax regulations to federal and state labor laws, a single misstep can lead to costly fines and legal trouble. This complexity only increases if you have remote employees in different states. A national PEO has a team of compliance experts dedicated to navigating these rules for you. They ensure your business stays compliant with all regulations, manage workers' compensation claims, and help you mitigate workplace risks, giving you invaluable peace of mind.
When you’re not bogged down by day-to-day HR administration, you can focus on the more strategic side of people management. A PEO partnership gives you the bandwidth to invest in your team’s development. Many PEOs also provide access to tools and resources for performance management, employee training, and leadership development. By offloading the administrative burden, you can dedicate your time to building a strong company culture, mentoring your employees, and creating an environment where everyone can do their best work. This focus on your team is what ultimately fuels long-term success.
A safe work environment is essential for your team’s well-being and your company’s bottom line. National PEOs provide expert guidance on risk management and workplace safety. They can help you develop and implement effective safety plans, prepare for OSHA inspections, and manage any workplace incidents that occur. By proactively addressing safety, a PEO helps you reduce the frequency of accidents and injuries. This not only protects your employees but can also lead to lower workers’ compensation insurance premiums, saving your business money while fostering a secure and positive workplace.
Once you decide a PEO is the right move for your business, the next step is figuring out how to choose the best one. With so many options out there, it’s easy to feel overwhelmed. The key is to look past the sales pitch and focus on the core services that will actually make a difference for your company and your team. A great national PEO doesn’t just take tasks off your plate; it becomes a strategic partner. Here are the essential features you should look for to find a PEO that truly fits your business.
Your PEO should make your life easier, not more complicated. That’s why a streamlined, all-in-one HR system is at the top of the list. Think of it as your command center for all things people-related. A top-tier PEO provides an integrated platform that handles everything from hiring and onboarding to performance management and offboarding. This means no more juggling multiple spreadsheets or disjointed software. Instead, you get a single source of truth that simplifies your administrative workload. When evaluating a PEO’s services, make sure their technology is modern, intuitive, and capable of growing with you. The goal is to spend less time on paperwork and more time leading your team.
Let’s be honest: payroll has to be perfect. Even small mistakes can damage employee trust and create serious compliance headaches. This is one area where you absolutely cannot compromise. A leading national PEO will offer rock-solid, reliable payroll processing that ensures your team is paid accurately and on time, every time. This includes managing complex tasks like tax withholdings, wage garnishments, and filing federal, state, and local payroll taxes. They should handle direct deposits, W-2 preparation, and provide clear reporting. When you partner with a PEO, you’re entrusting them with a critical business function, so look for a proven track record of accuracy and dependability.
Offering competitive benefits is one of the best ways to attract and retain top talent, but managing them can be a huge burden for a small business. A great PEO simplifies the entire process. By pooling their clients together, they give you access to high-quality, affordable health insurance, retirement plans, and other perks you couldn’t get on your own. But their job doesn’t stop there. The PEO should handle all the administrative heavy lifting, including open enrollment, employee questions, and carrier negotiations. This allows you to offer amazing employee benefits without becoming a benefits expert yourself. It’s a game-changer for leveling the playing field with larger corporations.
As a business owner, you’re responsible for maintaining a safe and compliant workplace. A top national PEO acts as your partner in managing risk and protecting your company. This goes far beyond simply securing workers’ compensation insurance. They should provide proactive support, including creating safety plans, offering employee training, and helping you stay on top of complex regulations like OSHA. If an incident does occur, the PEO will manage the claims process and help employees return to work safely. This comprehensive approach not only helps prevent accidents but also shields your business from potential fines and legal trouble, giving you invaluable peace of mind.
The best HR technology is designed for the people who use it every day: your employees. A top PEO will provide a clean, intuitive, and user-friendly online portal where your team can manage their own HR information. Through a self-service platform, employees should be able to easily access their pay stubs, review their benefits information, request time off, and find answers to common HR questions. This empowers your team with the information they need and significantly reduces the number of administrative requests you have to field. When vetting potential partners, ask for a demo of their employee portal to ensure it’s a tool your team will actually want to use.
Choosing between a national and a local PEO feels like a big decision, because it is. The right partner can feel like an extension of your team, while the wrong one can create the headaches you were trying to avoid. The best choice really comes down to your company’s specific needs, size, and where your employees are located. Both national and local PEOs provide core HR services, but they deliver them in very different ways.
A national PEO operates across the country, making it a strong option for businesses with employees in multiple states. They have the infrastructure to handle complex, multi-state payroll taxes and compliance regulations. A local PEO, on the other hand, offers a deep understanding of your specific state and city laws, often with a more personal, high-touch service model. Before you start comparing quotes, think about your priorities. Do you need a powerhouse with a massive network, or a neighborhood expert who knows your name? Understanding what a PEO does is the first step, but figuring out which type of PEO fits your business is where the magic happens.
If your team is spread across several states, a national PEO is built to handle that complexity. They have experts in multi-state labor laws, tax withholding, and workers' compensation, which can save you from major compliance issues down the road. Their large scale also gives them significant buying power for benefits.
In contrast, a local PEO provides a level of personalized service that can be hard for larger providers to match. They have an in-depth knowledge of the local business landscape and state-specific regulations. This can be incredibly valuable if your operations are concentrated in one or two states. You’re often more than just an account number; you’re a local business they are invested in helping succeed.
At their core, both national and local PEOs offer comprehensive services like payroll processing, benefits administration, HR support, and risk management. The main difference often lies in the breadth of their offerings. National PEOs typically provide a wider variety of health insurance plans from major carriers, along with more extensive 401(k) options and employee wellness programs.
A local PEO might have fewer options but often curates benefit packages that are particularly competitive or relevant to the local market. They may have stronger relationships with regional insurance carriers or wellness providers. Ultimately, partnering with a PEO enables you to offload critical HR functions, giving you more time to focus on your business, regardless of the provider’s size.
Technology is a huge part of the PEO experience. National PEOs generally invest millions into developing sophisticated, all-in-one HR software platforms. These systems can handle everything from online onboarding and payroll to benefits enrollment and performance management, all in one place. For a business with a distributed workforce, having a powerful, unified platform is a major advantage.
Local PEOs may use third-party software or offer a simpler, more streamlined platform. While their tech might not have all the bells and whistles of a national provider, it’s often incredibly user-friendly and straightforward. The right choice depends on your team’s comfort with technology and the level of complexity you actually need.
Think about the last time you had to call customer service. Did you prefer talking to a different person each time or having a single point of contact? With a national PEO, you’ll likely have access to a large team of specialists—one for payroll, one for benefits, and another for HR issues. This ensures you’re always talking to an expert in that specific area.
A local PEO typically assigns you a dedicated HR consultant or a small, consistent team. They get to know you and your business on a personal level, allowing them to provide highly contextualized advice. This personalized relationship is a key reason many businesses choose a PEO partner that feels like a true extension of their own team.
When it comes to cost, there are trade-offs with both models. National PEOs leverage their economies of scale to negotiate competitive rates on health insurance and workers' compensation, which can lead to significant savings. However, they also have higher overhead costs from marketing and large corporate structures, which can sometimes be reflected in their administrative fees.
Local PEOs have lower overhead, which can translate to more straightforward and potentially lower administrative fees. While their benefits packages might not have the same negotiating power as a national provider’s, their overall pricing structure can be very competitive. It’s important to look at the full picture—both the admin fee and the costs for benefits—to understand the true value.
Finding the right PEO is a lot like hiring a key team member. You’re looking for a long-term partner who understands your business and can help you reach your goals. With so many options out there, it’s easy to feel overwhelmed. But taking the time to carefully evaluate your choices will pay off in the long run. A great PEO partnership can free you up to focus on what you do best—growing your business—while a poor fit can create more headaches than it solves.
Think of this as a matchmaking process. You need a PEO that not only offers the right services but also aligns with your company culture and technology. It’s about finding a partner that feels like a natural extension of your team. To do that, you need a clear plan for vetting potential candidates. We’ll walk through the most important factors to consider, from the services they offer to the technology they use, so you can make a confident and informed decision. Our goal is to help you find a PEO that truly fits, and our streamlined process is designed to do just that.
Before you start scheduling calls, it helps to have a game plan. A simple checklist can keep you focused on what truly matters and ensure you’re comparing each PEO fairly. Think about your non-negotiables and your nice-to-haves. What are the core HR functions you absolutely need to offload? What kind of support experience are you looking for?
Your checklist should cover these key areas:
We’ll break down each of these points to help you build your own vetting checklist.
Not all PEOs are created equal, and their service menus can vary quite a bit. Start by making a list of your company’s specific needs. Do you need basic payroll and benefits administration, or are you looking for more comprehensive support? For example, many PEO service providers help businesses understand employment laws at federal, state, and local levels to reduce legal risks. If you operate in multiple states or a highly regulated industry, this kind of compliance support is essential. Compare your list of must-haves with what each potential PEO offers to make sure there’s a solid match from the start.
In today’s world, the technology a PEO uses is just as important as the services it provides. A clunky, hard-to-use platform can frustrate your team and create extra work for your admins. When you’re talking to potential PEOs, ask for a demo of their software. See for yourself if it’s intuitive for both your HR team and your employees. It’s also smart to check if their system integrates with other software you already rely on, like your accounting or project management tools. A seamless tech experience makes everyone’s job easier and ensures a smooth flow of information across your business operations.
Switching to a PEO is a big move, and you want the transition to be as smooth as possible. A great PEO will have a clear, well-organized onboarding process to get you set up for success. When you partner with a PEO, you gain a strategic partner who can take over the day-to-day management of HR tasks. Ask detailed questions about what implementation looks like. How long will it take? What information will you need to provide? Who will be your dedicated point of contact to guide you through the process? A PEO that invests in a thorough onboarding experience is showing you that they’re committed to your long-term success.
It’s tempting to compare PEOs based on price alone, but the cheapest option isn’t always the best value. Instead of focusing solely on the cost, think about the return on your investment. Outsourcing your HR to a PEO can provide a number of strategic advantages and cost savings that you wouldn’t get from a typical payroll firm. Consider how much time you and your team will save on administrative tasks. Think about the value of having expert guidance on compliance to avoid costly fines. A good PEO is an investment in your company’s efficiency and stability, which is why it’s so important to find the right fit for your business.
Once you’ve decided a national PEO is the right move, the next step is finding the one that fits your business like a glove. With so many options out there, each with different strengths and specialties, the search can feel a bit daunting. But don't worry—it's all about knowing what to look for and asking the right questions. Think of it less like a search and more like a matchmaking process. You’re looking for a true partner who will support your company’s growth for years to come, not just another vendor. Breaking down the process into a few key steps will help you compare your options clearly and confidently.
You could spend weeks vetting dozens of PEOs on your own, or you could let an expert do the heavy lifting for you. A PEO matching service acts as your advocate, taking the time to understand your business's specific needs, budget, and goals. Instead of you having to sift through endless sales pitches, they bring a curated list of the best-fit PEOs directly to you. This approach not only saves you an incredible amount of time but can also save you money. Because they have established relationships and deep industry knowledge, a good matching service can often find better rates, helping you make a smart, cost-effective decision without the headache.
When you start looking at top PEOs, it’s easy to get lost in the feature lists. The key is to look beyond the basics and evaluate them as a potential strategic partner. A great PEO doesn’t just process payroll; they become an extension of your team, taking on the responsibility and risk of day-to-day HR management. Ask yourself: Do they understand my industry? Is their team responsive and knowledgeable? A true industry leader will offer more than just services—they’ll provide guidance and support that helps you run your business more effectively. This partnership is the core of what a PEO is designed to be.
To make an apples-to-apples comparison, focus on the core services that matter most to your business: payroll, benefits, compliance, and HR support. Look at the specifics of their benefits packages—what carriers do they work with? How do their plans compare? On the HR side, what level of support do you get? Is it a dedicated rep or a call center? While cost is a major factor, remember to consider the return on investment. Studies show the average ROI of using a PEO is over 27%. A clear side-by-side comparison, which is a key part of our process, helps you see the full picture and choose a partner based on true value, not just the price tag.
It’s a common misconception that only large corporations can benefit from a Professional Employer Organization (PEO). The truth is, businesses of all sizes and across nearly every industry are finding that partnering with a PEO is a smart move. Whether you’re a small startup trying to offer competitive benefits or a rapidly growing company struggling to keep up with HR paperwork, a national PEO can provide the structure and support you need. The key is finding the right partner that understands your unique challenges and goals.
A national PEO acts as an extension of your team, handling the complex, time-consuming tasks that often pull you away from what you do best: running your business. Think of it as gaining an entire HR department—experts in payroll, compliance, benefits, and risk management—without the hefty price tag of hiring a full-time staff. This partnership allows you to streamline operations, reduce administrative burdens, and offer the kind of top-tier benefits that attract and retain great talent. From tech startups and construction companies to medical practices and non-profits, a wide range of businesses can find significant value in what a PEO brings to the table.
If you’re running a small business, you’re likely wearing multiple hats, and "HR manager" is probably one you never expected to put on. Small businesses stand to gain the most from a PEO partnership, especially when it comes to administrative tasks like payroll and HR management. A PEO takes that work off your plate, freeing you up to focus on your customers and products. More importantly, it gives you access to enterprise-level employee benefits, like health insurance and retirement plans, at a much lower cost than you could get on your own. This helps you compete for top talent with larger companies and build a team that’s ready to grow with you.
Growth is exciting, but it also comes with a new set of challenges. As you hire more employees, especially across different states, HR complexity multiplies. This is where a national PEO becomes a powerful ally for scaling your business. They handle multi-state payroll, ensure you’re compliant with local labor laws, and streamline your onboarding process so you can bring new team members on board smoothly. In fact, businesses that use a PEO have been shown to grow their revenue 40% faster. By offloading the administrative side of growth, you can keep your focus on strategy and innovation. Our process is designed to find you a partner that can keep up with your pace.
Not all businesses have the same HR needs. A construction company has different safety and compliance concerns than a marketing agency, and a medical office has unique requirements around HIPAA and employee certifications. That’s why finding a PEO with experience in your industry is so important. Many national PEOs have specialized teams that create HR solutions for different types of businesses. They understand the specific regulations, risks, and talent markets relevant to your field. This industry-specific expertise ensures you get support that’s not just generic, but tailored to the realities of your work.
Choosing a PEO isn’t just about solving today’s problems; it’s about preparing for tomorrow’s opportunities. A great PEO is a long-term partner that scales with you. Partnering with a PEO allows you to efficiently manage your HR functions without needing to hire your own internal HR personnel, even as you expand from 10 employees to 100. They provide a flexible framework that adapts to your changing needs, whether you’re adding new benefits, expanding into new states, or updating workplace policies. This ensures your HR infrastructure is always ready for the next stage of your company’s journey. Finding the right long-term fit is exactly why you should use Right Fit PEO.
Will I lose control of my business if I partner with a PEO? Not at all. This is one of the most common worries we hear, but the co-employment model is designed to give you more control over what matters. You still manage your team’s day-to-day responsibilities, make all hiring and firing decisions, and shape your company culture. The PEO simply takes on the administrative side of employment, like payroll taxes and benefits management, freeing you up to focus on leading your business.
Is my company too small to work with a PEO? PEOs are actually a perfect fit for small and growing businesses. They give you access to the kind of HR support, risk management expertise, and high-quality benefits that are typically only available to large corporations. By pooling employees from many small businesses, PEOs can negotiate for better insurance rates, which means you can offer a competitive benefits package that helps you attract and keep great people.
What’s the real difference between a national and a local PEO? The best choice depends entirely on your business structure. A national PEO is ideal if you have employees in multiple states because they are experts at handling complex, multi-state tax laws and regulations. A local PEO offers deep knowledge of your specific state and community, often with a more hands-on, personal touch. Think about whether you need nationwide compliance expertise or a high-touch local partner.
How does PEO pricing actually work? Most PEOs charge an administrative fee that is either a flat rate per employee per month or a percentage of your total payroll. It’s important to look beyond that fee and consider the total value. A PEO can often save you money on health insurance and workers' compensation premiums, and the time you save on administrative work allows you to focus on activities that generate revenue.
Isn't a PEO just a fancy payroll service? While flawless payroll is a core part of what they do, a PEO offers so much more. Unlike a payroll-only company, a PEO enters into a co-employment relationship with you. This allows them to take on legal responsibility for things like tax filings and also sponsor comprehensive benefits plans. They provide a complete HR solution that includes compliance, risk management, and expert support for your team.
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