The Best PEO Companies of 2021

Our PEO company reviews are the result of over 40 hours of research on 50+ PEO companies from across the web. These reviews and our PEO company guide help small businesses and startups find the best PEO company for their business.

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How We Chose the Best PEO Companies

Many professional employer organization (PEO) companies offer a wide variety of services, including human resources (HR) consulting, payroll processing, and tax preparation. With so many service providers available, it can be difficult to determine which PEO company will do the best job meeting your needs. We evaluated each company based on several  important factors, including the number of service lines, the size of the firm, and its industry focus as well as price.

Multiple Service Lines

Not every business has the same needs when it comes to working with a PEO company. Some firms just need help with payroll processing and tax planning while others need a full suite of HR services like risk management, benefits administration, and assistance with regulatory compliance. We chose firms that have multiple service lines, including payroll processing, tax preparation, and HR consulting.

Size of Firm

Some PEO companies have fewer than 50 employees while others employ more than 10,000 people. There are advantages and disadvantages to working with firms of either size. A small PEO company may be able to provide more personalized attention. However, due to the low number of employees, you may have to wait a little longer to receive responses to questions or have meetings to discuss progress on some of your projects. Large firms tend to have more resources available, which is especially helpful if you need more than basic payroll and tax preparation services. One disadvantage of working with a large firm, however, is that you may have to work with a large team of people, making it a little more difficult to develop relationships with PEO professionals. Our list includes both small and large companies to ensure you can find a PEO company that meets your needs.

Industry Focus

Several industries have complex compliance requirements, making it important to choose a PEO company that understands the ins and outs of the industry. We chose companies with a wide range of industry expertise to make sure your needs are covered.

The 15 Best PEO Companies of 2021

CompanyPriceService LinesMore
Abel$25-$49/hourHR servicesVisit Abel
ADPQuote-basedTax preparationPayroll processingVisit ADP
CoAdvantageQuote-basedHR servicesVisit CoAdvantage
Engage PEOQuote-basedHR servicesVisit Engage PEO
FrankCrumQuote-basedHRs
Workers’ compensation
Payroll services
Employee benefits
Health insurance
Visit FrankCrum
Infiniti HRQuote-basedPayroll processing
HR services
Visit Infiniti HR
Insperity$230/employee/monthHR servicesVisit Insperity
JustworksBasic: $44/employee/month
Plus: $89/employee/month
Compliance
HR services
Health insurance
401(k)
Payroll
Vendor/contractor payments
New hire reporting
Tax filing
Visit Justworks
National PEOQuote-basedHR servicesVisit National PEO
Oasis OutsourcingQuote-basedHR services
PEO services
Employee benefits
Payroll administration
Risk management
Benefits
Employee leasing
Healthcare reform
Visit Oasis Outsourcing
PaychexQuote-basedHR services
Tax preparation
Visit Paychex
QuestcoQuote-basedHR consulting
Employee benefits
Workers’ compensation
Payroll processing
Retirement services
Affordable Care Act (ACA) compliance
Recruitment
Visit Questco
TriNetQuote-basedHR services
Tax preparation
Visit TriNet
VensureQuote-basedPayroll processing
HR services
Visit Vensure
XcelHRQuote-basedHR servicesVisit XcelHR

Abel

Abel
Abel offers a variety of PEO services to help firms expand their HR capabilities without adding to their headcounts. For companies that need help with HR compliance and administration, Abel can create customized employee handbooks, develop new policies and procedures, set up custom human resource information systems (HRIS), assist with the development of compensation plans, and process new hires. The firm also offers benefits management, including enrollment assistance and access to more than 20 health plans. Available payroll and tax preparation services include direct deposits, payroll processing, W-2 preparation, quarterly tax filings, and tracking of paid time off (PTO).

Abel also offers help with training and development, workers’ compensation administration, ACA coordination, and employee safety. Experienced trainers are available to develop sessions on communication, harassment, discrimination, conflict resolution, and Microsoft Office skills. Abel has expertise in the financial and health care industries, which means clients have access to training on industry-specific topics.

PriceService LinesDetails
$25-$49/hourHR services>Number of employees: 50
>Notable clients: MetLife, PNC, and Wells Fargo
>Industries served: Financial services, healthcare, and medical industries
>More info at Abel

What Customers Are Saying
Customers appreciate that Abel HR links them with experienced HR professionals, making it easier to manage payroll, benefits, recruiting, and other HR functions. One user comments, “Abel’s quality of work is very good.” Abel also has a positive reputation for completing projects on time and staying in close contact with clients.

ADP

ADT
ADP provides several PEO services, with a focus on benefits administration and risk management. The company’s main offering is access to high-caliber benefits, including health insurance, dental coverage, vision insurance, life insurance, short-term and long-term disability coverage, retirement plans, and commuter benefits. ADP representatives communicate directly with employees, freeing clients from having to spend time answering benefits-related questions or updating employee coverage details. If an employee has a qualifying life event and needs to add or drop a dependent from the plan, ADP takes care of the change.

In terms of risk reduction, ADP PEO aims to reduce the legal liability of each of its clients. ADP does this by providing assistance with compliance and making the workplace even safer. The firm has a team of experienced professionals available to advise clients on complying with local, state, and federal regulations related to workplace safety, discrimination, and taxes, among other topics.

PriceService LinesDetails
Quote-basedTax preparation
Payroll processing
>Number of employees: 101 to 1,000
>Notable clients: 4C Foods Corp., Grand Street Medical Associates, and Nina Footwear
>Industries served: Manufacturing and restaurant/hospitality industries
>More info at ADP

What Customers Are Saying
Customers love that ADP PEO helps them expand their HR capabilities without increasing headcount. One user writes, “ADP provides my company and employees with two departments, saves me the cost of creating those departments internally and helps me avoid costly mistakes.” ADP also receives positive reviews for helping its clients meet their legal obligations.

CoAdvantage

CoAdvantage
CoAdvantage employs Certified Human Resources Consultants (CHRCs) to help clients with a wide range of HR activities. For companies that need help with HR administration, CoAdvantage provides assistance with employee handbooks, legal compliance, and guidance on disciplinary issues. Consultants are available to help with a variety of reporting activities, such as Equal Employment Opportunity (EEO) compliance and the management of data related to hiring, onboarding, compensation, benefits, and the management of PTO programs. CoAdvantage also provides assistance with the development of several programs designed to make workplaces more attractive to talented employees. For example, CoAdvantage can help with the creation of a robust employee assistance program.

For firms in need of assistance with payroll and accounting tasks, CoAdvantage offers a wide range of services. One such service is job costing, which helps firms determine how much a job truly costs per project or client. CoAdvantage can also help with invoice allocation, helping firms do a better job tracking their payroll expenses across many accounts.

PriceService LinesDetails
Quote-basedHR services>Number of employees: 50 to 249
>Notable clients: Providence Energy, Healthcare Simplified Holdings
>Industries served: HR, payroll, and risk management
>More info at CoAdvantage

What Customers Are Saying
Clients appreciate that the experts at CoAdvantage handle essential HR activities, leaving them free to focus on strategic planning. One reviewer also writes that CoAdvantage is “a good option to help small businesses streamline HR processes,” making the PEO service a good fit for firms that want to expand their HR offerings without hiring additional staff.

Engage PEO

Engage-PEO
Engage PEO offers services across six key categories: payroll and tax administration, employee benefits, HR services, workers’ compensation and risk management, integrated technology, and compliance/training. In the payroll category, Engage PEO offers full payroll processing, employee self-service options, integration of time and attendance systems, garnishment administration, and the processing of deductions for health insurance and other benefits. For companies that need help with benefits, Engage PEO provides access to group vision and dental plans, major medical, supplemental insurance, and short-term/long-term disability insurance. Engage PEO can also help with administering commuter benefits and setting up health savings account (HSA) or flexible spending account (FSA) plans.

The firm offers many HR services related to recruiting, training, and compliance. For example, Engage PEO helps with the development of employee handbooks and company policies and procedures. Clients can also work with the consultants at Engage PEO to set up drug screening programs that comply with all relevant regulations. Engage PEO consultants are on hand to deliver training on interviewing, hiring, discipline, and preventing workplace discrimination.

PriceService LinesDetails
Quote-basedHR services>Number of employees: 50 to 249
>Industries served: Accounting, HR, and recruiting services
>More info at Engage PEO

What Customers Are Saying
Engage PEO stands out because its consulting team is staffed by attorneys with extensive expertise in employment law. One reviewer notes that this approach is helpful because “you can be sure you’re compliant with labor laws.” Engage PEO also receives positive reviews for its training offerings, which include modules on interviewing, handling disciplinary issues, and avoiding discrimination.

FrankCrum

FrankCrum
FrankCrum partners with its clients to improve efficiency and ensure compliance with local, state, and federal legal requirements. The PEO company’s payroll services team provides a variety of services, including payroll processing, direct deposits, check printing, state and federal tax filings, setting up new payroll systems, and ensuring the accuracy of all payroll-related reports. FrankCrum offers access to competitive workers’ compensation insurance rates through Frank Winston Crum Insurance Company, and experienced professionals are available to advise clients on how to reduce their liability when it comes to workplace safety.

Client companies also have access to MyFrankCrum, a digital human resources information system that allows employees to access self-service options from their computers or mobile devices. These self-service options include downloading pay statements and tracking PTO balances. The portal is customized for each client, ensuring employees can access the information they need quickly and easily. MyFrankCrum also comes with tools to help with employee onboarding and HR reporting.

PriceService LinesDetails
Quote-basedHR
Workers’ compensation
Payroll services
Employee benefits
Health insurance
>Number of employees: 201 to 500
>Notable clients: Stanley Steemer, Avery Home Remodeling, and Thomas Financial Group
>Industries served: HR, payroll, insurance, and benefits industries
>More info at FrankCrum

What Customers Are Saying
Customers love that FrankCrum helps them reduce their HR and administrative expenses, with one reviewer commenting that the firm’s “payroll and benefits services are very cost-competitive.” FrankCrum also receives positive reviews for linking its clients with friendly, efficient account managers, payroll coordinators, and other HR experts.

Infiniti HR

INFINITIHR
Infiniti HR has extensive experience in the HR and payroll industries, giving clients access to industry experts who can assist with compliance, reporting, and other HR activities. The service has four pillars: payroll and tax filing, employer-mandatory insurance, state-specific HR management, and employer voluntary insurance. Consultants with the payroll and tax filing team provide assistance with time tracking and payroll processing. Employer mandatory insurance deals with coverages that employers are required by law to purchase, such as employment practice liability insurance and workers’ compensation insurance.

With its state-specific HR management services, Infiniti HR helps its clients comply with the legal requirements of each state in which they operate. Clients have a single point of contact to act as a human resources director, and they also have access to recruiters and other HR professionals with state-specific expertise. The voluntary insurance pillar gives clients access to custom benefits packages with a variety of options, including health, vision, dental, and disability insurance.

PriceService LinesDetails
Quote-basedPayroll processing
HR services
>Number of employees: 10,000+
>Notable clients: Aetna, Senior Helpers, and American Hotel and Lodging Association
>Industries served: PEO, HR, and payroll
>More info at Infiniti HR

What Customers Are Saying
Customers appreciate that Infiniti HR focuses on finding ways to save money and reduce liability. Several reviewers report that the company offers a “tailored service to save them time and money.” Infiniti HR also receives positive reviews for its experience working with franchises, which require specialized expertise to ensure success with compliance and other HR activities.

Insperity

INSPERITY
Insperity offers full-service HR packages as well as individual solutions for clients who need a little extra help with human resource management. The PEO company has two full-service packages: one designed for firms with five to 149 employees and the other for larger firms with 150 to 5,000 employees. For smaller firms, Insperity focuses on providing HR support that helps improve compliance while reducing costs and limiting employer liability. Insperity’s consultants assist with a wide range of HR activities, including benefits administration, recruiting, risk management, payroll tax filing, and employment eligibility verification.

For larger firms, Insperity focuses on maximizing productivity while reducing legal liability. The PEO company’s HR experts aim to help their clients establish HR infrastructures that can grow with them, which helps reduce expenses, increase efficiency, and mitigate risk. Clients who select this option must commit to a two-year service agreement with Insperity. This fixed-fee agreement gives clients access to all Insperity HR services for one fee.

PriceService LinesDetails
$230/employee/monthHR services>Number of employees: 1,000 to 9,999
>Notable clients: Clever Ducks, Evolve BioSystems, and Allstate Insurance agency owners
>Industries served: Accounting, HR, and recruiting services
>More info at Insperity

What Customers Are Saying
Customers love that Insperity’s HR professionals act as business partners rather than mere service providers, producing better results for clients. One reviewer comments, “Their follow-up is excellent, and they really are a business partner.” Insperity also receives positive reviews for the accuracy of its payroll and human resources reports.

Justworks

JUSTWORKS
Justworks offers 24/7 support to companies that need help with payroll, compliance, benefits administration, and other HR functions. The PEO company also employs certified HR consultants to answer questions and help clients develop policies that are both cost-effective and fair to employees. Justworks has several automated tools to speed up payroll processing and improve accuracy, including automatic direct deposits and the ability to integrate with QuickBooks, Xero, and QuickBooks Online. Clients also have access to a custom HRIS tool that streamlines activities related to onboarding, key performance indicator (KPI) tracking, and tracking of PTO balances.

Justworks gives its clients access to many of the same benefits that large corporations offer their employees, which may help attract high-quality employees. For example, Justworks offers health insurance through Aetna and Kaiser, dental and vision coverage through MetLife, and access to fitness memberships and other health-related perks. In terms of compliance, Justworks can help with W-2 and 1099 preparation, workers’ compensation administration, unemployment insurance filings, and employment practices liability insurance.

PriceService LinesDetails
Basic: $44/employee/month
Plus: $89/employee/month
Compliance
HR services
Health insurance
401(k)
Payroll
Vendor/contractor payments
New hire reporting
Tax filing
>Number of employees: 201 to 500
>Notable clients: Axios, Case Agency, and CreativeMornings
>Industries served: HR,  healthcare, financial technology, and real estate
>More info at Justworks

What Customers Are Saying
Justworks receives high marks for making frequent updates to meet the needs of its clients better. One customer writes, “They’ve done a great job of being responsive and adding functionality over the past year, and they’re a tech-first company, so I’m confident it’ll just continue to improve.” Customers also appreciate that they have access to a custom HRIS.

National PEO

National-PEO
National PEO is an HR outsourcing company that aims to take care of employees so its clients can focus on strategic activities. Services are available in four key categories: employee benefits, payroll, workers’ compensation, and human resources. In the employee benefits category, National PEO provides a variety of services, including assistance in developing attractive benefits packages and setting up retirement plans that can help companies attract and retain talented employees. National PEO’s payroll services include job costing, deductions, garnishments, direct deposits, tax filings, and online payroll entry.

For companies struggling with workers’ compensation administration, the professionals at National PEO can offer suggestions on improving workplace safety and limiting legal liability. The company also ensures each client’s workers’ compensation premiums are paid on time. National PEO’s HR services focus on legal compliance, but the company also helps with recruiting, training, and the development of employee handbooks, among other activities.

PriceService LinesDetails
Quote-basedHR services>Number of employees: 10 to 49
>Notable clients: McDonald’s, Arizona Animal Welfare League, and Kids Kare Pediatrics & Family Kare
>Industries served: HR and Payroll Industries
>More info at National PEO

What Customers Are Saying
Customers appreciate that National PEO staff make themselves available to answer questions and give advice. One reviewer comments, “The staff are very knowledgeable and helpful.” National PEO also receives positive reviews for its ability to streamline the onboarding process, reducing the amount of time between when an offer is extended and when the new employee starts working.

Oasis Outsourcing

OASISADVANTAGE
Oasis Outsourcing partners with its clients to offer assistance with payroll, benefits administration, and human resources. In terms of payroll processing, Oasis Outsourcing aims for a high level of accuracy with every payroll. Because Oasis is a Paychex company, its employees have access to the same tools used by Paychex to ensure the right amounts are deducted from each payment. Oasis Outsourcing gives clients access to a web-based payroll system and helps with payroll accrual and tracking to save companies money.

For companies in need of assistance with benefits administration, Oasis Outsourcing can provide access to insurance coverage and financial savings plans. Consultants aim to help clients minimize their benefits-related costs while also offering plans that attract high-caliber employees. Oasis Outsourcing offers a variety of HR services to give clients the opportunity to focus on strategy rather than worrying about paperwork. These services include compliance assistance, infrastructure development, and recruitment assistance.

PriceService LinesDetails
Quote-basedHR services
PEO services
Employee benefits
Payroll administration
Risk management
Benefits
Employee leasing
Healthcare reform
>Number of employees: 501 to 1,000
>Notable clients: Farmers Insurance, The American Society of Tropical Medicine and Hygiene, Smile Café, Crown Jewell Entertainment Systems, Xpress Yourself Screen Printing, and Balagio Ristorante
>Industries served: HR and payroll
>More info at Oasis Outsourcing

What Customers Are Saying
Customers love that “their customer service team is very small, so you get to know the people,” which enhances the experience of working with a PEO. Oasis Outsourcing also receives positive reviews for the breadth of its payroll services. Several reviewers note that Oasis Outsourcing is a Paychex company, giving clients access to world-class tools to improve accuracy and help with compliance.

Paychex

Paychex
Paychex offers a variety of PEO services, many of which focus on compliance, payroll processing, and benefits administration. Clients who upgrade to Paychex PEO+ also receive access to an HR business partner who understands the challenges of attracting and retaining top talent while complying with local, state, and federal laws and keeping costs as low as possible. All Paychex PEO clients work directly with an experienced HR professional who can help apply best practices in HR to a variety of industries and work environments.

The company’s outsourcing services can help clients expand their recruiting and onboarding capabilities, reducing the amount of time it takes to fill open positions with employees who have the knowledge and skills needed to grow with a company. Because Paychex works with so many clients, it can connect those clients with the resources they need to offer health savings accounts, flexible spending accounts, 401(k) plans, and other attractive benefits.

PriceService LinesDetails
Quote-basedHR services
Tax preparation
>Number of employees: 10,000+
>Notable clients:  Farmers Insurance, Crown Jewell Entertainment Systems, and The American Society of Tropical Medicine and Hygiene
>Industries served: HR and payroll industries
>More info at Paychex

What Customers Are Saying
Paychex receives excellent reviews for its payroll services, which are accredited by the Employer Services Assurance Corporation. One reviewer also explains that “Paychex was one of the first PEO services to receive certification from the IRS,” giving clients additional peace of mind. Customers also love that Paychex PEO can help with software integration.

Questco

Questco
Questco offers a variety of services to help employers control their costs, streamline their HR processes, mitigate risk, and find the right people to fill open positions. One of the main ways Questco helps control costs is by offering its clients access to affordable employee benefits. These benefits include group health insurance, vision, and dental coverage, flexible spending accounts, disability insurance, retirement plans, and access to telemedicine services to reduce health care expenses. Questco consultants also aim to help clients save money by reducing their workers’ compensation expenses.

Questco helps relieve the administrative burden of running a company by performing many HR tasks, including the development of job descriptions, company policies and procedures, HR forms, and employee handbooks. The HR professionals at Questco are also available to help with employee onboarding, advise managers on conducting legally defensible performance reviews, and conduct background checks. Questco even provides training in conflict resolution and team development.

PriceService LinesDetails
Quote-basedHR consulting
Employee benefits
Workers’ compensation
Payroll processing
Retirement services
ACA compliance
Recruitment
>Number of employees: 51 to 200
>Notable clients: Apache Oil Company, Master Machine, Alpha Space Test & Research Alliance, Stauffer Pipe Services
>Industries served: HR, healthcare, financial technology, and real estate industries
>More info at Questco

What Customers Are Saying
Clients love that Questco makes it easy to streamline HR processes without using multiple software packages. One reviewer notes, “They stay modern, think ahead, and remain accessible no matter the platform you need to work on.” Questco also receives positive reviews for its a la carte pricing, which allows clients to pay only for the services they use.

TriNet

TRINET
TriNet gives its clients access to experienced HR consultants who can provide information and advice on a variety of human resources issues. Consultants are available to discuss HR strategy, best practices in recruiting and onboarding, talent management, and other topics. TriNet can also help employers save time by providing HR services directly to employees. Under this type of arrangement, TriNet’s HR professionals communicate directly with a client’s employees, answering questions about maternity leave, benefits, tax paperwork, and other topics. This leaves clients free to spend more time on strategic activities.

Because TriNet is such a large company, its clients have access to a wide range of health plans. As a result, small companies have the opportunity to compete with larger firms for the top talent in their respective regions. In addition to health coverage, TriNet gives its clients access to commuter benefits, retirement plans, and perks like hotel discounts and pet insurance.

PriceService LinesDetails
Quote-basedHR services
Tax preparation
>Number of employees: 1,000 to 9,999
>Notable clients: Crosslink Capital, Edge Electronics, and Invictus International
>Industries served: Information technology, financial services, nonprofit organizations
>More info at TriNet

What Customers Are Saying
TriNet receives high marks for the responsiveness of its HR consultants. One reviewer comments, “When an employee has a question or concern, TriNet is prompt to respond with an answer.” Customers also appreciate that TriNet offers a self-service portal that is easy for employees to use, freeing up HR staff to focus on other activities.

Vensure

Vensure
Vensure offers PEO solutions for small, medium, and large businesses, giving clients the opportunity to access the services they need to get to the next level. For small businesses (1 to 49 employees), Vensure offers payroll services, HR services, benefits administration, and assistance with workers’ compensation administration. Consultants use their small-business expertise to provide guidance that can help small businesses grow while remaining compliant with all relevant regulations.

Vensure’s midmarket solutions are available to firms with 50 to 500 employees. When working with midsize firms, Vensure consultants aim to take existing business frameworks and expand them, improving efficiency, and making it easier to attract top talent. Vensure’s large-entity solutions are designed for firms with more than 500 employees. For these firms, Vensure provides large-scale payroll processing, recruiting, benefits administration, and performance management. Vensure PEO also offers risk-management services to help companies limit their liability and control their costs better.

PriceService LinesDetails
Quote-basedPayroll processing
HR services
>Number of employees: 250 to 999
>Notable clients: Not provided
>Industries served: HR
>More info at Vensure

What Customers Are Saying
Vensure has a positive reputation for offering size-based packages, allowing clients to access the right combination of services to reach their current goals. Several reviewers have also mentioned that anytime access to HR expertise is one of the most helpful features offered by Vensure. With anytime access, clients no longer have to wait several days for guidance on serious HR issues.

XcelHR

xcelhr
XcelHR offers HR services aimed at meeting three different needs: hiring and retaining talent, optimizing profit, and boosting business growth. One way XcelHR meets these goals is by offering access to high-caliber employee benefits. With a robust benefits package, it is easier to attract talented employees and keep them employed as long as possible. The right benefits package may also improve morale by demonstrating that employees are valued.

XcelHR aims to optimize profit by streamlining HR processes and reducing overhead costs for its clients. When a client partners with XcelHR, the PEO takes over some of the most time-consuming HR activities, leaving the client company’s staff members free to focus on other activities. XcelHR uses a co-employment model to reduce liability and help clients take advantage of economies of scale when it comes to creating competitive benefits packages and accessing competitive rates for required and voluntary forms of insurance.

PriceService LinesDetails
Quote-basedHR services>Number of employees: 50 to 249
>Industries served: IT and government contracting, health and medicine, and HR
>More info at XcelHR

What Customers Are Saying
Customers appreciate that XcelHR gives them the flexibility they need to control costs and address urgent challenges. One reviewer notes, “The flexibility of its service structure makes it a good option for very small businesses looking for payroll and human resources support.” XcelHR also has a positive reputation for offering industry-specific expertise.

What Is a PEO Company?

A PEO (professional employer organization) company leases its employees to employers worldwide, providing assistance with payroll processing, benefits administration, and other human resources functions. In many cases, the PEO company is the employer of record for a client’s employees. This means that the PEO is liable for the employees. Wages are also reported under the PEO company’s employer identification number. The exact details of the agreement are outlined in a contract between the PEO company and the client.

PEO companies offer a wide range of assistance with human resources activities. For companies that don’t have large in-house HR departments, a PEO can help with  Family and Medical Leave Act (FMLA) administration, legal compliance, and workers’ compensation administration. PEO companies also perform a variety of recruiting and hiring activities, from placing job advertisements and screening applicants to conducting background checks and issuing offer letters.

Companies that need help with payroll processing can rely on their PEOs to run payroll reports, set up direct-deposit transfers, comply with state and federal overtime laws, and ensure the right deductions are taken out of each employee’s pay. PEOs also help with tax preparation by issuing W-2 and 1099 forms as required, making tax payments to the appropriate revenue agencies and having new employees fill out W-4 and W-9 forms as required.

Benefits of PEO Companies

PEO companies provide a variety of benefits for employers in every industry, including the following:

  • Save time: If you have a small HR team, it can be extremely time-consuming to keep up with recruiting, benefits administration, payroll processing, and other HR activities. Using a PEO company saves time by giving you access to experienced HR professionals who can take some of the work off your hands, leaving your in-house HR staff free to spend time on more important tasks.
  • Improve compliance: Businesses must comply with a variety of local, state, and federal laws related to payroll taxes, overtime, hiring and firing practices, benefits administration, and employee discipline. If your company has unionized employees, you also have to abide by a union contract. Working with a PEO gives you access to trained HR professionals who understand the legal requirements and know how to comply with them, which can help you avoid fines and other penalties.
  • Make your company an employer of choice: If you don’t have a large HR team, you may have difficulty launching new programs for employees. Partnering with a PEO company gives you access to additional resources, making it easier to launch a new training initiative or an employee assistance program. By offering these programs, you have the opportunity to make your company an employer of choice in your region.

What to Look for in a PEO Company

If you want to take advantage of the many benefits of a PEO company, it’s important to understand which features are nice to have and which ones are essential. The first thing to look for is multiple service lines. A company that offers only one or two services may not be able to meet your needs as well as a company that offers services across the full range of HR functions. A PEO company with multiple service lines can also grow with your company in the coming years.

The next factor to consider is the size of the firm. Working with a small firm does have some advantages, such as personalized attention and the opportunity to develop lasting relationships with your contact. One drawback, however, is that small firms may have limited resources, leaving them unable to meet all your needs. Large companies often have access to additional resources, giving them the ability to meet your specialized needs. The disadvantage of working with large firms is that they may be juggling many clients, leaving your contact unable to give you much in the way of personalized attention.

Finally, you should look for a PEO company that has expertise in your industry. Many industries have additional compliance requirements, creating more work for your in-house HR staff. A PEO company with specialized expertise can help you meet your legal obligations as efficiently as possible.

The Cost of PEO Companies

The cost of working with a PEO company varies greatly based on the size of the company, the number of employees you have and what services are written into your contract. In many cases, you must contact the PEO company directly to get an estimate based on your unique circumstances. For PEO companies that publish their prices, you may see hourly pricing or a price per employee. The benefit of working with a company that charges per employee is that small firms may be able to limit their costs as they’ll only have to pay for the number of employees they have. If you just need a little extra help with HR, a company that charges hourly may be your best bet as you’ll only pay for the services you use.

Companies that charge per employee charge anywhere from $40 to $230 per employee per month. Before choosing a PEO company based on price, check to see what’s included in each package. If it’s just a few dollars more per employee to receive access to many more services, it may be worth your while to choose the company that’s a little more expensive.