The usual concern of the industry is; how to minimize the work burden of the organization. When an entity starts worrying about that; they prefer outsourcing model. In HR outsourcing arena; the recent buzz is PEO. If you are listening the jargon for the 1st time; then the early question what normally comes to mind is, What is a PEO? or what is PEO. A (PEO) is a one point source of integrated services which enable business owners to go for economic outsource of the management of human resources, employee benefits, payroll and workers compensation, recruiting, training and development etc. This is also called as professional employer organization.

A PEO, or Professional Employer Organization, is described as the outsourcing HR Partner that provides human resources outsourcing services to its customers/companies via the existence of a co-employment relationship. The PEO Organization involves a contractual system and sharing of employer responsibilities with its client.

A PEO charge the service fee for outsourcing the human resources functions of the client company.

The major service usually provided by PEO organization is to secure employees Compensation and insurance coverage for its clients organization. This is usually one of the significant points that a PEO can provide Workers Compensation insurance coverage at comparatively lower cost than the customer/concerned organization can obtain on an individual basis. A PEO also holds better weight how far the complicated and litigation issues are concern.

The Key role and Responsibilities of a PEO Organisation; in a co-employment structure

The following scenarios describe the roles of each employer in a PEO relationship:

The PEO is responsible for the wage payment; under co-employment relationship, in the same time handle the end to end management of workers compensation claims and various other administrative functions. A PEO carry out the entire paperwork and administrative compliance issues.

Many times a PEO provides advices to the concerned managers/officials on employee termination procedures, how to carry on disciplinary actions against the Un ethical practices etc. PEO Organization handles the respective organization and its employees at worksite with employee compensation insurance, Employment Practices Liability Insurance (EPLI), health insurance, voluntary insurance products and a broad range of other employee benefits programs.

Advantages of tying up with a PEO Organization

If a company goes with a PEO Organization under co-employmnet; they can enjoy its benefit in multiple ways. When they will assign your non-revenue portion of tasks to a PEO, then the organization can devote more quality attention/focus on what lead them to generate revenue. By outsourcing their human resources activities and payroll administrative tasks a PEO, they can enjoy the advantage of expertise service of a PEO Organization.

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