What is Professional Employer Organization (PEO)?
Professional employer organization, also known as co-employment, refers to a firm that provides staffing service and is contracted to undertake the employers responsibilities and risk for his/her workforce.
Professional employer organization definition (PEO)
Professional employer organization, also known as co-employment, refers to a firm that provides staffing service and is contracted to undertake the employers responsibilities and risk for his/her workforce.
PEO process
Through this arrangement employers outsource employee management tasks such as employee benefits, payroll and workers' compensation, recruiting, risk/safety management, and training and development.
The PEO then becomes the employer of record for tax purposes and the client company continues to direct the employees' day-to-day activities.
PEOs charge a service fee is from 3 to 15% of total gross payroll.
A great example of a professional employer organization are New Horizons Global Partners and HROne.