Professional Employer
Organization (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, workers’ compensation, recruiting, risk/safety management, and training and development. The PEO does this by hiring a client company’s employees, thus becoming their employer of record for tax purposes and insurance purposes. This practice is known as joint employment or co-employment.
Through employee leasing, the PEO assumes your employee related responsibilities and risks for workers’ compensation, unemployment, payroll and payroll taxes under what is called a co-employment agreement. Under this agreement, the PEO helps with all HR needs and company benefits. They maintain all personnel files, employee records, documentation and provide you with direct access to support staff.
By outsourcing these responsibilities, you can spend more time and resources to revenue producing activities such as product development, sales, marketing and customer service.
In a co-employment relationship, the PEO will act as the administrative employer and the business acts as the worksite employer. The employer maintains control of the business and is in charge of all business decision-making including employee supervision and staffing decisions. The PEO handles the time-consuming administrative tasks associated with the employment relationship.
Your business is responsible for providing the funds to cover payroll and payroll taxes, the PEO administers payment of wages to employees and tax payments to the appropriate agencies.
One of the responsibilities of a PEO is to provide your business with guidance and education regarding employment laws and regulations. Ultimately, the responsibility for complying with most of these laws lies with the business
No. The management relationship that you have with your employees will continue.
Do you have more questions about a PEO? Contact Orca Insurance Group for your PEO questions.
PEO Services in Orlando & Central Florida
A Professional Employer Organization (PEO) handles HR, payroll, benefits administration, and compliance — so you can focus on running your business. For small and mid-size Orlando businesses, partnering with a PEO gives you access to big-company benefits at small-company prices, plus expert HR support that keeps you compliant with employment laws.
How a PEO Works
In a PEO arrangement, the PEO becomes the "co-employer" of your workforce for administrative purposes. You maintain full control of day-to-day operations, hiring, and management. The PEO handles:
Payroll & Tax
- Payroll processing and direct deposit
- Federal, state, and local tax filings
- W-2 preparation and delivery
- Wage garnishment administration
- New hire reporting
Benefits Administration
- Group health insurance at enterprise rates
- Dental and vision plans
- 401(k) retirement plans
- Life and disability insurance
- Employee enrollment and changes
HR & Compliance
- Employee handbook development
- Florida and federal labor law compliance
- Harassment training and prevention
- Termination guidance and documentation
- OSHA compliance assistance
Risk & Workers' Comp
- Workers' compensation coverage
- Claims management
- Safety programs and loss prevention
- Return-to-work programs
- EPLI (Employment Practices Liability)
PEO Benefits for Small Businesses
According to NAPEO (National Association of Professional Employer Organizations), businesses using PEOs experience:
- 10-14% lower employee turnover — Better benefits attract and retain talent
- 50% less likely to go out of business — Compliance support prevents costly legal issues
- 7-9% faster revenue growth — When you're not buried in HR paperwork, you focus on growth
- Significant benefits savings — PEOs pool employees across hundreds of companies to negotiate rates you'd never get on your own
Frequently Asked Questions
How much does a PEO cost?
PEOs typically charge either a per-employee-per-month fee ($100-$250/employee/month) or a percentage of payroll (3-8%). The cost is often offset by savings on benefits, reduced HR staff needs, and avoided compliance penalties.
Do I lose control of my employees with a PEO?
No. You maintain full control over hiring, firing, daily management, and business operations. The PEO handles administrative HR functions only. It's a co-employment arrangement for paperwork purposes — not operational control.
What size company benefits most from a PEO?
Businesses with 5-150 employees typically see the most value. Under 5, the per-employee costs may not justify the investment. Over 150, you may have the scale to bring HR in-house. The sweet spot is 10-75 employees.
How does a PEO get better insurance rates?
PEOs pool thousands of employees across their client companies into a single group for benefits purchasing. A PEO with 50,000 employees negotiates the same rates as a Fortune 500 company — then passes those rates to your 15-person business.
Is a PEO Right for Your Business?
We'll help you evaluate whether a PEO makes sense and compare options from top Florida providers.
Schedule a Free Consultation