Does Co-employment In PEO Really Works?

BySuresh Kumar

Co-employment PEO (Professional Employer Organization) refers to a contractual partnership where both parties share specific employment responsibilities. The primary advantage of co-employment is that it helps organizations mitigate some of the employer’s costs and liabilities.

In a co-employment relationship, a PEO usually provides the HR support you need while making your business more compliant and competitive.

PEO Service Providers 173,000 small and mid-sized businesses, employing more than 4 million people.

If you don’t know what a PEO is, how co-employment PEO works, or if it could be beneficial for your organization, this article is for you! We will answer all these questions today. Let’s get started!

What is PEO?

PEO or Professional Employer Organization partners with small and mid-size businesses to provide outsourced HR management, including payroll, benefits, compliance, compensation, and training.

In other words, a PEO is someone who specializes in employee-related administrative duties (e.g., payroll, benefits, HR, and labor compliance).

How does co-employment PEO work?

Co-employment is a contractual agreement between the PEO and a company regarding employee management.

Please note that co-employment doesn’t mean that they’ll control your employees. Instead, it means that they’ll take care of employee administrative tasks.

As a client, you’ll maintain control of:

  • All business decisions
  • Operations
  • Employees’ day-to-day tasks and core job functions

Your partner, i.e., the PEO, will offer these services:

  • Human resources management
  • Payroll processing
  • Benefits management
  • Issuing pay checks
  • Preparing and filing payroll taxes
  • Employees compensation coverage and claims management
  • Time and labor management
  • Safety and risk management
  • Ensure Statutory Compliance

Is co-employment PEO beneficial?

Small businesses that use PEOs grow 7-9% faster than their peers that don’t. It also allows you to better utilise your human resources on high-value activities that help grow your business.

That said, here are some more ways co-employment PEO can benefit your business.

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