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Administrative Services Organization Vs Professional Employer Organization Case Study

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Administrative Services Organization vs Professional Employer Organization
Which type of service does your business need

Administrative services organizations (ASOs) and professional employer organizations (PEOs) both offer human resources outsourcing services that can help your small or mid-size business continue to grow. By reducing the amount of time that you have to spend processing payroll or handling common human resources tasks, your outsourcing partner allows you to focus on your more immediate business needs. Determining which service is right for you is a critical first step in relieving some of the burden from your shoulders.

What is a PEO?

In the ever-changing world of human resources compliance, a PEO takes on the administrative function of an HR department and …show more content…

Client is the employer of record. PEO is the employer of record, allowing them to share employment-related risks.
Human Resources Administration Human resource responsibilities are supported by ASO, but client is responsible for following proper HR policies compliant with laws and regulations. Human resource responsibilities are supported by PEO, but client is responsible for following proper HR policies compliant with laws and regulations.
Workers’ Compensation Coverage Client selects and provides own coverage at market rates. Coverage provided under PEOs master policy at rates negotiated by the PEO.
Employee Benefits and Administration Coverage obtained by client or obtained through ASO. ASO can offer assistance with administration. Coverage can be offered under PEO master policies or client may choose to use own policy. PEO administers the plans.
Risk and Safety Management Provides safety program support but cannot provide claims management. PEO administers claims management and safety program compliance.
Payroll Tax Liability The employer maintains all payroll tax liability. The PEO is liable for federal taxes. State rules

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