Employee Leasing vs. Staffing: What’s The Difference?

Employee Leasing and Staffing agencies often get confused. General people don’t understand that these are not the same thing. It can be confusing since the seem to imply the same type of business. Despite the similarities these business models could not be any more different. An employee leasing agency is more often referred to as a professional employer organization (PEO) . This helps to distinguish between the two.

Let’s Break It Down

First a staffing agency is a company that supplies workers for companies in need. They do the hiring and then help companies fill roles where they need extra labor on a temporary basis. More recently staffing companies have been able to help companies permanently fill rolls. This usually happens in fields where specific skills are needed and it is harder to find qualified workers.

On the other hand, a PEO is a company that will help take care of all the administrative tasks that come with hiring employees. They won’t provide the labor in the same way that a staffing agency does but they will act as a co-employer and take on many responsibilities such as the payroll and compliance associated with your work force. The co-employment relationship allows the PEO to file and pay taxes on the employers behalf as well as provide workers compensation coverage under the PEO’s master policy. This often leads to savings for smaller to mid sized companies who don’t have access to workers comp easily or the extra staff to take care of payroll among other administrative tasks.

So while they may seem similar, a staffing agency and PEO are completely different. So how do you know which one is right for your needs? First you need to identify your companies’ desires. If you are a company in need of more workers quick then a staffing agency is what you would be looking for. However, if you already have employees ready to hire but need someone to handle all of the administrative tasks that comes with hiring an employee then you are looking for a PEO. This free up more time to focus on core business activities.

Want To Learn More?

Here at Alliance HR we have helped many businesses in many different states with their employee leasing needs and will continue to do so as we grow and expand our reach. If you are interested in learning more about employee leasing at AllianceHR give us a call today and one of our qualified experts will give you all off the information that you need.