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Professional Employment Organization

Who uses PEOs?

PEOs provide the HR infrastructure small businesses need. They also offer better employee benefit packages to small- to mid-sized businesses because they can buy in bulk. They group your company employees with employees of their other clients and get the discounts and perks that only large companies usually have access to

How does a PEO work?

The PEO becomes a co-employer of your employees. The PEO does all your administrative HR work such as employee benefits, payroll, risk management, and employee tax compliance—allowing you to focus on operating and growing your business. PEO co-employer responsibilities are mostly administrative and cover these areas:

Here are a few details on how the PEO/client relationship looks, and how the co-employment agreement affects your employees:

Your employees continue to work at your company locations(s).

The PEO pays your employees' wages and taxes out of its own accounts

The PEO collects, deposits, and reports your employees' employment taxes with the proper state and federal authorities.

In many cases, PEOs build a long-term relationship with client employees—often to ensure your company complies with any pertinent regulations—and to manage the liability they assume as a co-employer of your employees.

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