Employee leasing is an agreement between an employee leasing company, also called a professional employer organization, and a business owner (you). In this contractual agreement the Employee Leasing company becomes the official employer of record. The HR responsibilities are shared between both the business owner and the employee leasing company. The exact terms of the shared responsibilities varies, however, the business owner will maintain control over core business activities and the Employee Leasing company will handle all HR needs from employment taxes to health care plans. Your job as the business owner turns into running what really matters, your core business. The PEO does the rest of the annoying stuff for you.
Running the HR functions for your firms can be unnecessarily complex and seem like a waste of time compared to your core business. Employee leasing companies remove all that administrative complexity. They will manage all of your companies payroll, W2/I9 forums, unemployment claims, and any other state or federal compliance related tasks. Employee Leasing companies will also handle your worker’s compensation insurance as well as any other added benefits you offer to your employee. Some of these benefits could be health insurance, dental insurance, 401k, just to name a few.
Not only will it save your company time when working with an employee leasing company, it will often save you money. This happens because employee leasing companies have access to better rates from worker’s compensation to health insurance. Employee Leasing companies organize employees from different companies into larger plans so they can get discounted rates that are typically only accessible to large corporations. These savings are passed onto you, the business owner.
So it seems that Employee Leasing may be a good fit for your business and you are looking into working with a PEO. There are a couple things to make sure of when seeing what PEO is right for you.
Our experts at AllianceHR will be able to assist you with any questions you might have about the employee leasing space. Contact us with the number on our website to get connected with one of our representatives and we will be sure to get you the information you need.