What is a PEO?
A Professional Employer Organization (PEO) is a firm that provides a service under which an employer can outsource employee management tasks, such as employee benefits, payroll and workers’ compensation, recruiting, risk/safety management, and training and development.
It works through co-employment: the PEO becomes the employer for payroll tax and benefits purposes, while the client company keeps control of the day-to-day work. Co-employment is a US model. Outside the United States, providers selling “international” or “global PEO” services act as an Employer of Record.
For how a PEO works, what it costs and when you need one, see our guide What is a PEO? If you are hiring outside your home country, our comparison of EOR vs PEO vs staffing agency sets out which model fits.