PEO – Do’s and Don’t

What is a PEO?

A PEO, or professional employer organization, is an organization that provides a complete HR Outsourcing solution to small and medium-sized businesses. In this arrangement, a PEO manages different personnel administrative functions on behalf of a company, such as payroll and benefits management. While some PEOs also offer strategic services, no two are comparable, so it’s crucial to do your homework and compare the details of each PEO you are considering.

PEOs are an attractive solution for companies that do not have the internal resources to manage their HR functions effectively. When done correctly, partnering with a PEO helps your business focus on its core competencies and strategic initiatives, while leaving the day-to-day management of HR to the experts.

Why use a PEO?

There are many reasons to use a PEO, but saving time and money is the most common. A professional employer organization (PEO) enables small to mid-sized firms to streamline many administrative HR processes, including payroll, benefits, compliance, and workers’ compensation, and to give their employees access to better, more affordable healthcare.

In the past, businesses had to outsource these HR duties to their PEO completely. But thanks to contemporary PEO technology, companies may automate processes and retain their most crucial data in-house while still taking advantage of the time savings, advising services, and improved benefits a PEO can offer.

Payroll and tax filing

According to the terms of the agreement between the PEO and the employer, the PEO will handle some or all of the activities connected to withholding, reporting, and paying employment taxes. The PEO uses the money it receives from the client to pay the employees’ wages and employment tax obligations.

Benefits administration

Employee benefits administration generally includes medical insurance, dental, vision, vacation time, maternity and sick leave, IRAs (individual retirement accounts), pensions, and other benefits. In addition, the benefits administration of a PEO records information on the employee, like their employment date, family composition, working hours, attendance history, etc.

These can be time-consuming, tiresome, and difficult for managers and business owners to keep track of. By handling these employee benefit programs, the PEO relieves you of these burdens by remembering deadlines and completing forms and returns correctly. While you focus on managing and expanding your firm, the PEO makes sure that all these details are handled for you.

Compliance Assistance

It’s best to leave compliance to the professionals because non-compliance can cost organizations money and hurt their bottom line. A PEO can offer critical counsel and direction to assist your firm and adjust to a new normal, whether completely remote or struggling to maintain an on-site workforce. In addition, businesses can more easily manage challenging pandemic-related issues like vaccine mandates or adjustments for workers with disabilities with the help of a PEO.

Businesses that engage with a PEO have access to the help of trained specialists who are available round-the-clock to stay informed of any changes in regulation. In addition, they manage all the paperwork necessary to maintain the company’s compliance, saving you time and money.

Even routine HR compliance can sometimes be too much to handle. The widespread misunderstanding around compliance is understandable given the current global health crisis, which is why it’s more crucial than ever for businesses to think about utilizing a PEO.

Human Resource Support

A co-employment agreement is a legal document you sign when collaborating with a PEO. The PEO takes over while you operate your business. This enables the PEO to manage specific HR tasks on your behalf. These tasks can range from comprehensive HR solutions or small questions you and your employees might have about operations.

PEO Risk and Safety Management

Human Resource Support is a significant part of a PEO; this support can help you with various tasks, from recruiting and hiring to employee training and development.

A PEO can provide a comprehensive suite of human resource services that can be customized to meet your specific needs. From payroll and benefits administration to employee relations and compliance, a PEO helps you manage that while providing the resources you need to recruit and hire quality employees.

Do’s and Don’ts

Before signing up for a PEO, there are many things to consider, such as cost, services offered, and whether the PEO is a good fit for your business. Here are some do’s and don’ts when considering a PEO.


  • Do your research. Make sure you understand what a PEO is and how it can benefit your business.
  • Get quotes from multiple PEOs. Compare pricing and services to find the best fit for your business.
  • Read the fine print. Carefully review any contract before signing. Make sure you understand the terms and conditions of the agreement.


  • Don’t sign a contract without fully understanding the terms and conditions.
  • Don’t choose a PEO based on price alone. Instead, compare services and reviews to find the best value for your business.
  • Don’t forget to check references. A PEO is a big decision for your business. You want to make sure you’re choosing a reputable and reliable provider.

The Bottom Line

A PEO can save you time and money by handling your payroll and benefits, compliance, risk management, and human resources. But before signing up with a PEO, research and compare pricing and services. Read the fine print and check references to get an unbiased opinion. Ultimately, a PEO can be a valuable partner in growing your business, and here at Triton, our sole goal is to provide you with the best possible service. Contact us today to learn more about how we can help you grow your business.

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