Advantages of a Professional Employer Organization

Professional Employer Organizations, or PEOs, were established in the early 1980s, primarily offering insurance and payroll services to small and mid-sized employers. In the early days, the PEO industry was also known as “Staff Leasing” or “Employee Leasing.”

As employment and labor laws became more complex in the ’80s and ’90s, the PEO industry expanded to include many other aspects of employee relations and HR compliance. In a PEO relationship, a PEO shares many of the responsibilities of being an employer with their clients. Best professional employer organizations (PEOs) New York, which allow small businesses to lease employees and outsource administrative jobs.

These responsibilities include: processing payroll, filing payroll taxes, providing health insurance for the staff, issuing workers’ compensation insurance, and assisting their clients to comply with relevant state and federal labor law regulations.

Even a PEO business can help tiny companies effectively reduce prices by pooling hundreds, and sometimes tens of thousands of organizations under one umbrella application.   Also they are in the position to set up connections with regional insurance providers to offer lower premiums with better coverage choices.  The web effect is that small companies gain access into this PEO’s buying power and economies of scale.


Beyond negotiating plans and rates, Professional Employer Organization keep up with the interior tools to encourage programs which to keep down insurance premiums in to the long run.  Most PEOs provide health insurance and health incentives, Work/Life balance apps, or discounts to health clubs and clubs.  Research consistently indicates that a healthier life style indoors and away from the workplace produces significant, positive consequences on the price of medical insurance fees.

In reference to safety and workers’ compensation, the PEO creates effective accident and disease prevention plans and conducts onsite security inspections, also will be offering safety incentives to decrease the frequency of workplace accidents.  These programs eventually cause fewer workplace injuries and more competitive insurance plan fees.

While many small employers try to ‘go at it alone’, partnering with a PEO offers them a competitive advantage in terms of reducing labor costs, providing their employees enhanced benefit programs, and reducing workplace injuries. If you are small business trying to make it in today’s tough economic environment, a PEO may just be the answer you are looking for.

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