Guide to Outsourcing Human Resources To A PEO

By Peter J. Kaye Reprinted with permission from the Pennsylvania CPA Journal, a publication of the Pennsylvania Institute of Certified Public Accountants

Is a PEO or Employee Leasing a Viable Option for Your Business?A PEO, or Professional Employer Organization, is a company specializing in human resource management. A PEO will contractually assume responsibility for all human resource-related functions for your business and its employees including interviewing and hiring assistance, payroll management, employee benefit design and administration, and administration of federal and state workplace regulations.When you hire a PEO,your business and the PEO become co-employers with the PEO effectively becoming your off-site personnel department. This relationship can result in significant cost savings for you and your personnel department by reducing paperwork and human resource administration time.It is estimated that PEOs currently employ 2-3 million Americans. PEOs exist in every state of the country with approximately 2,000 different PEO companies.The industry is growing 20-30 percent each year.


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