Professional Employer Organization

A Professional Employer Organization or PEO, is a company that specializes in handling Human Resource and Payroll issues for its clients. The easiest way to think of it is as outsourced Human Resources and Payroll Departments for your business. And no business is to small to need expert HR and Payroll services. The problem for small businesses is that on their own the cost of having that expertise is just simply too high. A PEO allows a business no matter the size to have all of the HR and Payroll tasks handled expertly and at a cost per employee that is less than the national average for even very large employers. The PEO relationship involves a contractual allocation and sharing of employer responsibilities between the PEO and the client; this shared employment relationship is called co-employment. When evaluating the employer role of either the PEO or the client, the facts and circumstances of each employer obligation should be examined separately, since neither party alone is responsible for performing all of the obligations of employment. Each party will be solely responsible for certain obligations of employment, while both parties will share responsibility for other obligations. When the facts and circumstances of a PEO arrangement are examined appropriately, both the PEO and the client will be found to be an employer for some purposes, but neither party will be found to be "the" employer for all purposes.