How does PEO work?

Professional employment organizations usually serve as an outsourced human resources department that offers comprehensive employment services.  The services can include the following:  assistance with employer compliance, human resources management, benefits, and payroll administration.  Professional employment organizations normally serve as your strategic human resources partner that can assist in:

Effectively minimize liability as well as exposure to risk


Create efficiency

Contain rising human resources costs

Attract and retain talent

The management of  day to day administration matters

When it comes to co-employment, the Professional employment organizations usually becomes an employer of record for tax purposes. The documents completed for coverage and benefits are under the PEOs Tax identification number as the employer.  So where do you stand as a business in this relationship?  As a client company, you will continue to dictate or direct the employees’ daily activities. The Professional employment organization is responsible for most of the human resources.  This includes handling the payroll.   Thus, you can spend your time building your company.  Professional employment organizations can affect your business’ day to day operations.  They focus on safety programs, workplace risk management, and human resources practices.

 For many businesses, either small or large, joining a Professional employment organizations makes absolute sense. In addition to helping save a substantial amount of time and money, Professional employment organizations can also help mitigate liability. Joining a PEO membership will, without doubt, make hiring the next employee (s) a much better experience.