The advantages of PEO’s stem from the economies of scale they bring to their clients due to their size and buying power, allowing the PEO client to concentrate on the operational and revenue-producing side of its operations.
 
The leaders in the PEO industry have the power to negotiate more competitive worker’s compensation rates than their clients can get on their own. PEO’s process thousands of payroll checks every month, therefore are experts in the ever changing regulations of the IRS, State and Federal Governments.
 
Every employer knows that Human Resource Management is an area that is becoming more and more litigious, and time consuming. Having a full time, qualified Human Resources Director is expensive, and difficult to find. Leading PEO’s, because of the large amount of employees they provide services to, have Fortune 500 level Human Resource Departments. These H.R. Departments are dedicated full time to their client’s needs. Offering professional and legal advice on a wide range of employment issues, as well as providing up to date employee handbooks, training, and day to day questions, comes included in their fees.
 
Health plans and employee benefits are also becoming critical issues for employers. Not only are health plans becoming more expensive, the management of these plans are more complex than ever with the new Affordable Care Act. Most PEO’s have a health plan their clients can join, which is qualified and in compliance with the ACA. The PEO also assumes all of the responsibilities for managing the plan.
 
There are 3 core services a PEO provides as a minimum requirement. They are Payroll, Human Resources Management, and Worker’s Compensation coverage.