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Updated Oct 30, 2024

The Best PEO Service Providers of 2024

PEO services from ADP, TriNet and more can relieve your HR burden by managing onboarding, employee benefits and payroll.

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Written By: Skye SchooleySenior Lead Analyst & Expert on Business Operations
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A business.com editor verified this analysis to ensure it meets our standards for accuracy, expertise and integrity.
Chad Brooks
Managing Editor & Expert on Business Ownership
Business.com earns commissions from some listed providers. Editorial Guidelines.

The best PEOs provide all the HR-related services you need, including guidance that a small business without a full-time HR team needs. They do this while ensuring employees can get their HR-related questions answered. To help you find the best PEO for your business, we spent dozens of hours researching and testing the top vendors. Then we evaluated each service on, among other factors, its price, features, usability and customer support.

Sponsored Partners
TriNet PEO Services
Best PEO for Industry-Specific Needs
Trinet logo
Visit Site
Links to TriNet PEO Services
  • Custom pricing
  • Contacts vary based on need
  • Accreditation: ESAC and IRS
Justworks PEO
Best for Ease of Use
Image related to the service.
Visit Site
Links to Justworks PEO
  • Starts at $59/employee per month
  • Monthly & annual contracts
  • Accreditation: ESAC and IRS
Deel PEO Services
Best for Global Payments
Deel logo
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Links to Deel PEO Services
  • Custom pricing
  • Monthly contracts
  • No ESAC, IRS or BBB accreditation
Insperity PEO Services
Best for SMBs
Image related to the service.
Visit Site
Links to Insperity PEO Services
  • Custom pricing
  • Annual & multiyear contracts
  • Accreditation: ESAC, IRS and BBB
Rippling PEO Services
Best PEO for Scalability
Image related to the service.
Visit Site
Links to Rippling PEO Services
  • Starts at $8/employee per month
  • Monthly contracts
  • Accreditation: BBB
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At business.com, we strive to provide business owners with unparalleled recommendations for the best HR software and services, along with actionable advice for navigating human resources processes, fostering a healthy company culture and improving employee engagement. We infuse our playbooks and explainers with expertise from real HR advisers, payroll consultants, retirement planners and other human resources professionals.

Across our HR reviews and product guides, every solution we recommend — whether it be a payroll platform, PEO/HRO service or employee monitoring software — is thoroughly tested, investigated and vetted independently to ensure vendor claims about products are legitimate and backed by real user experiences. As part of our commitment to fairness and accuracy, each assessment is reviewed by a top business.com editor who was not involved in the analysis process. Learn more about our editorial process.

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How We Decided

When evaluating PEO service providers, we examined whether vendors were accredited by the Employer Services Assurance Corporation (ESAC) and IRS. We studied the HR services offered (such as payroll and benefits administration, legal compliance assistance and...

MoreMore

When evaluating PEO service providers, we examined whether vendors were accredited by the Employer Services Assurance Corporation (ESAC) and IRS. We studied the HR services offered (such as payroll and benefits administration, legal compliance assistance and employee training) and whether employers had to purchase preset packages or could customize plans and bundle features as needed. We also compared pricing structures, contract terms and minimum employee requirements.

60

evaluated

9

researched

7

chosen

When evaluating PEO service providers, we examined whether vendors were accredited by the Employer Services Assurance Corporation (ESAC) and IRS. We studied the HR services offered (such as payroll and benefits administration, legal compliance assistance and employee training) and whether employers had to purchase preset packages or could customize plans and bundle features as needed. We also compared pricing structures, contract terms and minimum employee requirements.

60

evaluated

9

researched

7

chosen

If your small business struggles to manage HR processes efficiently, it may be time to seek an outsourced solution to support your business, such as a professional employer organization (PEO). Small companies needing full HR support benefit from a PEO, as it provides full-service HR functions like employee onboarding, benefits administration, payroll processing and tax filing, reporting, and compliance assistance. PEOs differ from traditional human resources outsourcing (HRO) services because of the co-employment model: The PEO absorbs your employees legally to leverage large numbers in benefits markets to obtain competitive pricing.

Compare Our Best Picks

BDC Ribbon
Our Top Picks for 2024
TriNet PEO Services
Justworks PEO
Deel PEO Services
Insperity PEO Services
Rippling PEO Services
ADP TotalSource
Papaya Global PEO
Rating (Out of 10)9.69.69.09.69.39.49.0
Best for

Industry-Specific Needs

Ease of Use

Global Payments

SMBs

Scalability

Benefits Administration

International PEO

ESAC or IRS certified

Both

Both

None

Both

None

Both

None

Contract length

Varies based on customer’s needs

Monthly or annual

Monthly

Annual or multiple years

Monthly

None

Annual or multiple years

Minimum no. of employees supported

5

2

1

5

5

5

1

Customer support

Varies based on customer’s needs

Account manager, live chat, phone and email

Dedicated CSM and 24/7 chat in-app

Phone and email (A client liason, HR specialist, payroll specialist, benefits specialist, HR services manager, performance specialist, safety consultant)

Phone, email, chat

A dedicated team of experts and a payroll specialist

Phone, email, chat

Review Link
Scroll Table

Our Reviews

Trinet logo
Editor's Rating: 9.6/10
Visit Site
Links to TriNet PEO Services

TriNet offers industry-specific PEO plans, so your business can receive specialized attention based on your particular business environment. This isn’t something we saw many competitors offer. We like that TriNet PEO offers essential HR services that every business needs, like risk management, document management, payroll processing, compensation benchmarking and benefits administration. TriNet also offers custom dashboards with pre-built key performance indicators (KPIs) and visualizations so you can gain insight into the HR trends that matter to your business and industry. What’s more, multi-company reporting access allows you to generate consolidated reports from multiple related entities simultaneously. We found this especially useful for those in an industry where multiple locations are common.

TriNet custom reports

We were impressed that TriNet offers custom reports, as well as more than 100 pre-built reports. Source: TriNet

PlanKey ServicesAdd-On ServicesPrice
TriNet HR Platform (Essentials)Automated onboarding, employee management, time off tracking, scheduling, integrations, analytics dashboard and mobile appPayroll tax compliance manager, payroll manager, HR manager, payroll tax compliance audit, HR operations audit$8 per employee per month (billed annually)
TriNet HR Platform (Growth)Everything in Essentials, plus configurable people analytics, compensation management and performance managementPayroll tax compliance manager, payroll manager, HR manager, payroll tax compliance audit, HR operations audit$16 per employee per month (billed annually)
TriNet HR Platform (Zen)Everything in Growth, plus payroll, employee engagement surveys and a people hubPayroll tax compliance manager, payroll manager, HR manager, payroll tax compliance audit, HR operations audit$27 per employee per month (billed annually)
TriNet PEOTriNet technology platform, administrative HR services, payroll, benefits administration, risk mitigation and employee training and developmentGlobal payments, contractor paymentsCustom quote

  • TriNet users can customize their permission settings to give employees tailored access to workforce data.
  • It offers several valuable online resources, including its Connect 360 services, which put you in touch with specialized HR support professionals who can answer your industry-specific questions.
  • The technology is intuitive, user-friendly and platform-responsive, making it easy to access across various devices.
  • TriNet doesn’t support clients that operate in hazardous industries, like heavy construction and oil drilling.
  • It doesn't list PEO pricing online, which can deter users who want to quickly identify PEOs within their budget.
  • It has a five-employee minimum for PEO plans.

TriNet PEO received a 7.1/10 rating from users who reviewed the platform on TrustRadius. Customers praised the platform’s implementation, employee onboarding and training, scalability and overall value. However, some users have found customer support to be somewhat difficult to contact. This drawback might be avoided by accessing TriNet’s Connect 360 services.

Editor's Rating: 9.6/10
Visit Site
Links to Justworks PEO

With Justworks, entrepreneurs and their teams can access comprehensive benefit offerings, time tracking, automated payroll, compliance support and valuable HR tools, all in one place. We like that the company’s automated payroll services handle all benefits and tax withholdings for you, simplifying this process for small business owners. If you opt-in for Justworks Time Tracking, the platform automatically integrates employee hours and time off into your payroll process as well, reducing the need for manual time and attendance tracking. What separates Justworks from other PEOs we reviewed is its intuitive cloud-based platform, which can also be used on mobile devices. The platform is straightforward, but if you need assistance, the company provides designated support agents to help your team learn and use the new system.

Justworks Timecards

When we tested the Justworks platform, we liked how clean and user-friendly its design was. Source: Justworks 

PlanKey ServicesAdd-on ServicesPricing

PayrollPayroll, basic HR tools, expert supportTime tracking$50/month base fee, plus $8 per employee per month
PEO BasicATS integrations, onboarding and offboarding, document storage, org chart and directory, payroll, time off management, reporting, compliance assitance, HR consulting, 24/7 support, commuter benefitsTime tracking, international contractor payments, employer of record$59 per employee per month ($49 per employee per month after 50+ employees)
PEO PlusEverything in PEO Basic, plus medical, dental and vision Insurance; HSA and FSA accounts, health advocacy services and One Medical accessTime tracking, international contractor payments, employer of record$99 per employee per month ($89 per employee per month after 50+ employees)

  • Justworks’ cloud-hosted platform is simple to access and navigate.
  • It is one of the few PEOs that list pricing online, making it easy to know whether the services fit your budget.
  • Users can pay international employees and contractors with Justworks' add-on features.
  • Justworks does not offer industry-specific plans.
  • The platform is not meant to support larger businesses with more than 500 employees.
  • Justworks doesn't support some high-risk industries like heavy construction.

Justworks received a 4.3/5 rating from users who reviewed the platform on Trustpilot and a 7.8/10 rating from Justworks users on TrustRadius. Customers praised the platform’s user-friendly onboarding, intuitive user interface and helpful customer service. However, some users noted reporting limitations.

Deel logo
Editor's Rating: 9/10
Visit Site
Links to Deel PEO Services

Deel offers global PEO/EOR services, enabling employers to hire and pay employees and contractors across more than 150 countries and jurisdictions – even in countries where they don’t own an entity. This is more than what most competitors offer. We like that Deel’s centralized platform allows businesses to view and manage payroll across multiple countries simultaneously. It provides useful payment features, like competitive salary insights, automated invoicing and payments, localized payroll and employee benefits, multiple currency pay options, and tax filing and payments. If you have questions or concerns about your payment obligations in a specific country, Deel can assist you, thus ensuring that you fulfill your legal obligations. With its localized support, customizable dashboard, centralized payment capabilities and various payroll reports, Deel is our choice for the best PEO for global payments.

Deel payment methods

We like that users can choose from multiple payment methods to pay their workers with Deel. Source: Deel

PlanKey ServicesPrice
Deel EORLocal payroll, benefits, taxes, and compliance; employee benefits; support from 200+ local HR and legal experts, IR protection, integrationsStarting at $599 per month
Deel Contractor ManagementLocally compliant contracts and guidance on local laws; auto collect local tax agreements, payroll (with 10+ methods in 150 currencies); automated invoicing, expenses, time off, etc.Starting at $49 per month
Deel PayrollOnboarding, offboarding, payroll, government declarations, taxes, benefits, payslips, compliance assistance, global payroll reportsCustom quote
Deel HRCustom documents, expense and time off management, data storage, people directory, HR reports, org charts, workflow automationFree
Deel ImmigrationVisas sponsorship (in 25 countries), application tracking, support from local immigration experts, ongoing visa supportCustom quote

  • Deel lets you hire and pay employees and contractors in countries where you don’t own an entity.
  • The company offers localized contracts, benefits and support to help you stay compliant in multiple countries.
  • It has a Compliance Hub that tracks regulatory changes across hundreds of countries and provides monthly reports to flag potential compliance issues like expiring visas, misclassified workers and minimum wage violations.
  • Deel isn’t accredited by the BBB or the ESAC.
  • Its performance management features are limited, compared to other vendors we reviewed.
  • Some users claimed to have experienced minor bugs with the platform; however, most admit they were promptly resolved after contacting customer support.

Deel received a 4.8/5 rating from users who reviewed the platform on Trustpilot and a 6.5/10 rating from Deel users on TrustRadius. Customers praised the platform’s global contract management and payroll features and the responsiveness of the customer service representatives. However, some users noted minor limitations, such as wanting a clearer understanding of total fees.

Editor's Rating: 9.6/10
Visit Site
Links to Insperity PEO Services

Insperity’s HR services, risk management, payroll administration, employee benefit plans and easy-to-use platform make it an excellent option for small and midsize businesses. A standout feature of Insperity is its employee training solutions. For example, we like that Insperity partners have access to thousands of online books and resources, and you can even set up on-site or online training sessions tailored to your business’s needs. When testing the platform, we were pleased to see that employees can access Insperity’s cloud-based portal to clock in and out, check how much paid time off they have accrued, request time off and review their pay stubs. What’s more, Insperity provides extensive services without sacrificing personalized support. Businesses that partner with Insperity receive access to a dedicated support team for any questions or concerns.

Insperity dashboard

We found Insperity’s dashboard to be relatively user-friendly and easy to navigate. Source: Insperity

PlanKey ServicesPricing
PEO for Small BusinessHR administration, employee benefits, payroll, compliance assistance, personalized HR support, all-in-one HR technologyCustom quote
PEO for Middle Market BusinessHR administration, employee benefits, payroll, compliance assistance, risk mitigation, HR support and consulting, advanced workforce technology and analyticsCustom quote
HCM + HR Technology SuiteHR administration, employee benefits, payroll, compliance tools and support, workforce management technology, as-needed support from an HR service teamCustom quote

Users who reviewed Insperity on TrustRadius rated it 4.4 out of 10. Customers appreciate how user-friendly the platform’s onboarding process is. However, some users mentioned its pricing as a drawback.

  • Insperity offers training and development materials, including hundreds of online books and courses.
  • The platform lets you track attendance, request time off and view compensation details, among other things.
  • Insperity offers dedicated support specialists.
  • To partner with Insperity, businesses must have at least five employees.
  • The vendor doesn't list pricing online.
  • PEO clients are not able to use third-party payroll solutions.

Users who reviewed Insperity on TrustRadius rated it 4.4 out of 10. Customers appreciate how user-friendly the platform’s onboarding process is. However, some users mentioned its pricing as a drawback.

Editor's Rating: 9.3/10
Visit Site
Links to Rippling PEO Services

As a growing small business, it can be challenging to pick solutions that can scale to meet your needs. Rippling is one of the most scalable and intuitive platforms of any PEO we tested and reviewed. One of the advantages of Rippling is the support it provides for decentralized companies as they scale. These employees often need different access levels to specific software features, and Rippling allows you to customize those. For example, you can configure employee access to the applicable PTO system based on their region. We also found that Rippling excels as a scalable platform for new and growing businesses by providing local tax registration, scalable employee benefits, remote inventory management tools and workflow automation capabilities. With several automation features and the ability to easily scale between its stand-alone HR platform and a PEO model, Rippling is our choice for the best scalable PEO for small businesses.

Rippling headcount

We like that Rippling has features like headcount planning to help you monitor your workforce as you scale larger.  Source: Rippling

PlanKey ServicesStarting Price
Rippling Unity*Workforce directory, HR workflows, global workforce analytics, policy management, onboarding and offboarding automation, permissions and approvals management, admin and field privileges, document management, compensation bands, Compliance 360 and vacation and leave management$8 per user, per month
Rippling PEO ServicesPEO services like automated state unemployment tax registration, access to large group health plans,  live one-on-one healthcare guidance, access to PHR-certified HR advisors, and access to mandatory anti-harassment trainings for employeesCustom quote
Other Add-on ServicesUS and global payroll; time and attendance; benefits administration; HSA, FSA and commuter benefits; ACA and COBRA administration; recruiting; learning management; headcount planning; performance management; pulse surveys; HR Help Desk; ASO; global EOR services; app, device and inventory management; corporate cards; expense management; bill payCustom quotes

*Rippling Unity is Rippling’s base plan that every user must purchase. There are four options to choose from. After that, you can add other Rippling features, like Rippling’s PEO services.

  • Rippling’s cloud-hosted platform can serve businesses that have both in-office and remote employees.
  • The company provides local tax-compliance services, which is beneficial for businesses with employees located in multiple states.
  • Rippling offers HR and IT management features, allowing users to manage these functions from one centralized platform.
  • Rippling is not accredited by the ESAC or the BBB.
  • Rippling doesn't share pricing for most of its features online.
  • It has a five-employee minimum.

Rippling received a 4.6/5 rating from users who reviewed the platform on Trustpilot, and an 8.5/10 rating from Rippling customers on TrustRadius. Customers praised how user-friendly the platform is, including processes like benefits enrollment, employee self-service, and device management. However, some users noted that pricing may not be ideal for very small businesses.

ADP logo
Editor's Rating: 9.4/10

ADP TotalSource offers all the services you are likely looking for in a PEO, including new-hire onboarding, employee retirement plans, work-life assistance programs and full-service payroll. However, when we tested the platform, one feature that stood out to us was its employee benefits administration. Employers can access Fortune 500-level benefits, a variety of flexible service plans and add-ons, an intuitive user platform, and seamless online benefits enrollment. While the company’s benefits administration is a highlight, ADP also offers dedicated specialists to help you navigate tricky HR issues, including benefits enrollment.

ADP benefits enrollment

We found ADP’s benefits enrollment process to be user-friendly. Source: ADP

PlanKey ServicesPricing
ADP TotalSourceADP Workforce Now technology suite, employee onboarding, document management, employee benefits administration, payroll, reporting, compliance assistance, online learning courses, workers’ comp and claims management, unemployment claims administration, and a team of dedicated support representatives with full-service implementationCustom quote
Popular Add-onsEnhanced talent suite (recruitment, performance and compensation management; succession planning, talent strategic support), full-service recruitment and resume search service, employee engagement and leadership training, time tracking and scheduling, ADP Marketplace with custom API integrationsCustom quote

  • ADP is a national company that has significant bargaining power with healthcare providers.
  • The platform has simple dashboards where you can view and modify your benefits.
  • ADP can automatically sync data between benefits carriers and the ADP platform, reducing the potential for human error.
  • ADP has a minimum employee requirement.
  • ADP does not list its pricing online, so you must contact a representative for a quote.
  • ADP TotalSource doesn't offer a free trial.

ADP TotalSource received a 6.1/10 rating from users who reviewed the platform on TrustRadius. Customers praised certain features, such as payroll processing and employee benefits administration. However, some users claim that the platform looks a bit dated and customer service is not as responsive as they would like.

Editor's Rating: 9/10

Papaya Global provides international businesses in more than 160 countries with PEO support and compliance, which is much greater than most competitors we reviewed. It stands out for its ability to serve employees across different locales. It’s one thing to support employees who are located in a single country, but if your workforce is dispersed across multiple international locations, there are several factors you must consider, such as making sure that all of your employees are paid appropriately and that their benefits are administered correctly. When we tested the platform, we found that Papaya can handle these responsibilities and more. For example, Papaya supports pay exchanges, so workers earn paychecks in their own currency, as well as provides talent acquisition and employee onboarding services.

Papaya Global analytics

Papaya Global provides one central location for global employers to manage their workforce. Source: Papaya Global

*If you sign up for more than one of these plans, you can manage all of your HR functions from one centralized Papaya Global platform.

Plan*Key ServicesStarting Price
PayrollPlusPapaya workforce platform, payroll, support for 160+ countries, automated payments in local currency, workforce wallets, authority payments, fraud protection, analytics, user permissions, integrations, employee self-service, time and attendance, employee support, dedicated HR support$15 per employee per month
Employer of RecordAutomated onboarding, certified CPA firms, EOR payments, secured funds wallet, contract generator, employee portal, full liability coverage, local compliance guaranteed, 24/7 support, country knowledge base$599 per employee per month
Contractor Payments & ManagementContractor payments, worker classification support, standardized invoices, automated recurrent invoicing, one-click approvals, bulk payments, payouts in 100+ currencies, reporting, automated payment reconciliation$30 per contractor per month
Global Workforce PaymentsPayroll wallets in 14 currencies, bulk payments, financial data connectors, split payroll payments, authority payments, account validation, fraud prevention, automated payment reconciliation, record-keeping and reporting$2.5 per transaction
Agent of RecordContractor classification and management, local compliance guaranteed, built-in payments, record-keeping, ongoing compliance checks, HR and legal support, full liability coverage, country knowledge base$200 per contractor per month

  • Papaya Global can support businesses in more than 160 countries.
  • The PEO provides local and global benefits.
  • The company supports all employee types, including full-time, part-time and contract-based workers.
  • Papaya Global is more expensive than some domestic PEOs we reviewed.
  • It has not been accredited by the ESAC, IRS or BBB.
  • Papaya Global charges setup and onboarding fees.

Papaya Global received a 2.7/5 rating from users who reviewed the platform on Trustpilot, and a 9.1/10 rating on TrustRadius. Customers like that the platform acts as a central location for their HR data and workflows. However, some users noted issues with the pricing.

What are PEO’s and How do They Work?

A PEO is a company that can take care of HR responsibilities, primarily for small and midsize companies. PEOs have drawbacks, but they can manage HR functions, like employee training and development, risk and compliance, workers’ compensation, payroll and benefits. Some PEOs bundle these services in a preset package; others offer customizable plans with a la carte features. When you partner with a PEO, you enter a co-employment agreement, which means the PEO is the legal employer of record (EOR) for your employees.

When you partner with a PEO, you enter a co-employment agreement, which means the PEO is the legal employer of record (EOR) for your employees. This allows PEOs to act as massive corporations with hundreds of thousands of employees. PEOs can negotiate contracts with employee benefits providers for more favorable rates on unemployment and workers’ compensation insurance. It also gives them the power and scope to build and leverage powerful time-tracking and payroll technology for small businesses.

When you sign on with a PEO, you’ll work closely with customer success managers (and other team members) to build the services you need for your small business. As your business grows, your PEO can adjust to meet your needs. Working with a PEO under the co-employment model essentially means that you’re partnering with a team of specialists to build out the administrative and back-end processes of your organization’s human resources needs. If it makes sense for your business financially, these organizations can take a lot of the stress out of running your business so you can focus on more pressing needs.

Roughly 208,000 small and midsize businesses partner with PEOs to get high-quality benefits and proper HR support to help their businesses run smoothly. A PEO must adhere to both state and federal regulations, so some companies are divided by region or state.

Did You Know?Did you know
There are nearly 500 PEOs serving and operating in all 50 states.

What Are the Benefits of Using a PEO Service?

There are many advantages of partnering with a PEO service. While the benefits you experience will depend on your reason for using a PEO, here are some of the most common benefits:

  1. Cost savings: A PEO can automate repetitive HR functions and streamline a variety of tasks, saving you time and money. Since a PEO can essentially replace the need to hire certain HR staff, you can save money on salary overhead as well. A PEO also provides more competitive and cost-effective benefits to small businesses than SMBs would otherwise be able to afford on their own
  2. Compliance assistance: A PEO is the legal employer of record for your workers, which automatically takes some of that legal pressure away from your business. They can also perform time-consuming legal tasks like workers’ compensation management, and advise you on certain processes and procedures needed to keep your organization compliant with labor and employment laws.
  3. Employee recruitment: One of the best ways to attract top talent is to offer a comprehensive benefits package, but the cost of putting together such a robust package can be difficult for many small businesses. A PEO makes this possible by providing you with competitive benefits at affordable rates.
  4. Employee experience: A PEO automates many of your repetitive HR processes, giving your internal HR staff more time to focus on employee experience measures like company culture and engagement. Additionally, a PEO platform can streamline payroll payments, benefits enrollment, and other self-service features for employees to manage their own HR functions.
  5. Peace of mind: Having a PEO manage your HR functions takes the burden of HR off your plate, leaving you with peace of mind that your employees are being taken care of. Although this benefit can’t be measured by numbers, it can be a great advantage for many small business owners.

How Much do PEO Services Cost?

PEOs offer two main pricing structures for small and midsize businesses: They charge either a per-employee fee (roughly $40 to $160 per month) or a percentage of your total monthly payroll (roughly 3% to 12%). There are advantages and disadvantages to both types of pricing. The best pricing model for your business depends on factors such as your business type, the number of employees you have and the PEO services you want.

PEOs typically do not offer free trials of their HR services, and contract lengths and structures vary by company. Some PEOs only offer long-term contracts, while others don’t require a contract at all. Cancellation policies also vary, but business owners typically need to provide at least 30 to 60 days’ notice before terminating their PEO service. Some companies allow you to leave at any time for any reason; others charge you a fee for leaving.

Below are other crucial items to address with the PEO service you’re considering. You should go over this information, even though it may be available on the company’s website, with a member of the PEO’s sales team to gain a complete understanding of the PEO’s services.

Plan Structure

One thing to pay attention to is how a PEO packages its services, like employee onboarding and development, insurance policies, workers’ compensation claims, payroll processing, risk and compliance management, and HR tasks. Some PEOs provide a one-size-fits-all solution, whereas others offer customizable services that you can add or remove to fit your small business’s needs. Both models have advantages and disadvantages. A bundled solution means you can grow into all of the features without changing the pay structure, while an a la carte option is more tailored to your business and can save you money if you need only a few services, such as payroll and health insurance.

Additional Fees

Inquire upfront about additional fees. For example, some companies charge a fee if you cancel service. Thoroughly review the materials the sales team gives you to spot any costs associated with service. If you’re not sure, ask the sales representative. Also, remember that the pricing model, whether it charges per employee or a percentage of income, does not include additional costs for healthcare and other employee benefits.

Employee Minimums

Many of the PEOs we evaluated require a minimum number of employees — usually five — to qualify for their services. (Another type of minimum you may see is a minimum monthly salary if your business is below a certain employee threshold.)

If you don’t qualify, many companies offer administrative services organization (ASO) or HR outsourcing services. While these services may be similar to the PEO model, they do not have co-employment agreements.

Make sure you understand what your PEO expects from you. You don’t want to have to cancel your service or pay an additional fee for falling below the PEO’s minimum requirements.

How to Choose a PEO Company?

The first step in any buying decision is to understand exactly what your company needs. In the case of a PEO, are you looking for health benefits? COBRA administration? A seamless cloud-based platform to keep HR information organized?

It’s also important to look for an organization that fits your budget and can support your growth. That is one of the major advantages of working with a PEO: It can help your organization grow from an administrative perspective.

We spoke with business owners and CEOs to identify what deciding factors are most important when choosing a professional employer organization.

Payroll and Employee Benefits Administration

It’s not surprising that payroll and employee benefits administration rank among the top reasons why business leaders choose to partner with a PEO. Managing these functions is a major feat for any business, especially small businesses with limited money and resources.

Maxime Bouillon, co-founder and CEO of Archie, told us that working with ADP TotalSource helped simplify HR tasks so he could concentrate on expanding his business. In the buying process, he put an emphasis on taking care of employee benefits, payroll and compliance.

“From my perspective, in the business world, entrusting payroll and compliance management to another individual feels like a welcomed relief that frees up your time to focus on the core aspects of growing your business,” Bouillon told us.

In addition to freeing up your time on payroll and benefits administration, PEOs are especially valuable for small businesses that want to access competitive yet affordable employee benefits.

For example, one of the biggest reasons why Steven Rothberg, founder of College Recruiter, chose to partner with Insperity was because he wanted to provide his small team with top-of-the-line benefits.

“In addition to it simply being the right thing to do, we felt that [offering comprehensive benefits] would lead to better recruitment and retention, and it has,” said Rothberg. “We’ve heard from a number of employees over the years that a key factor in them choosing to join us instead of accepting a job offer from a rival was that we offered better benefits.”

In your search for choosing a PEO, review their payroll features and potential benefits offerings.

Compliance and Risk Management

Another critical feature to asses when choosing a PEO is its ability to help with legal compliance and risk management. Some PEOs specialize in certain industries, providing you with focused industry support. Look for a PEO that can help address your specific compliance needs.

Daniel Vasquez, owner of Dynamic Auto Movers, quickly realized just how vital risk management was when he partnered with Insperity.

“At Dynamic Auto Movers, we’re growing fast, and staying compliant with ever-changing labor laws can be a nightmare,” said Vasquez. “With Insperity, we didn’t just get HR support; we got a built-in safety net that shielded us from costly mistakes, like misclassifying employees or missing a compliance update. This saved us from potential legal headaches down the road.”

Simon Lee, CEO of Glance, shared similar insights when choosing a PEO for his mobile app development company. He needed legal and compliance support to employ developers in different countries.

“We operate in several states and countries, and the employment laws are different in all those places, which was something other than what an in-house team could manage,” said Lee. “The PEO’s capacity to manage international compliance and quickly bring new talent on board was precious as we grew.”

Platform Usability and Scalability

When choosing the right PEO, it’s important to consider how user-friendly and scalable the platform is. You want an HR solution that can be easily utilized by your workers and incorporated into current and future processes.

“If the PEO’s platform is not user-friendly or if it is not easily customizable, then it may end up hampering your productivity rather than helping it,” said Lee.

TipBottom line
When you’re choosing a PEO, consider your current and future needs. As your company changes and more people are brought on board, your PEO should be able to scale with you.

Customer Support

A factor that can make a world of difference, but is often over looked, is a PEO’s customer support. This includes the implementation process as well as ongoing support. Vasquez and Bouillon both noted this as a key factor to consider when choosing a PEO.

“I advise anyone considering a PEO to ask about how proactive they are in setup, not just how fast they’ll respond when things go wrong,” said Vasquez.

Bouillon echoed similar advice, stating that good customer support is essential.

“Spend time looking into the providers reputation and customer support services before making a decision, because they play a role in determining how successful the overall experience will be for everyone involved,” said Bouillon.

A great way to test the usability of the PEO platform is to perform a demo with the vendor before committing. During this demo, ask about scalability to ensure the PEO can evolve with your business.

“Scalability was crucial,” said Bouillon. “Having a partner that could evolve with us was essential for our growth journey.”

What Are Some Features of a PEO Service?

PEOs provide several beneficial resources for small businesses. Because they focus on HR tasks and administration, you are left with more time to focus on your business. On top of that, PEOs can offer better benefits to your employees than you might be able to obtain on your own. This can help you attract and retain top talent. Many employer organizations use mobile applications and online portals for small businesses and employees to easily access important information, like payroll, benefits and training courses.

Although not every business will need every PEO feature available, here are some of the top PEO features that could help your business.

Administrative HR Services

One advantage of partnering with a PEO is having a professional organization take care of all your HR services. PEOs can create your employee handbook and policies, onboard new hires, cover HR administrative tasks, offer unemployment assistance, and help with compliance reporting and employee termination. They often have online HR reporting tools, employee self-service options and advanced HR technology.

Deel analytics

Workforce analytics help to streamline HR functions and inform business decisions. Source: Deel 

Employee Benefits

Because PEOs co-employ multiple businesses’ employees, they can offer better employee benefits than you might otherwise be able to provide. PEOs typically offer medical, dental, vision, life, and long- and short-term disability insurance. Some offer additional plans, like flexible spending accounts (FSAs), health savings accounts (HSAs) and health reimbursement arrangements (HRAs).

Employees often receive retirement plans, such as 401(k) plans, as well as additional benefits, like commuter and parking discounts, home and auto insurance discounts, and access to employee assistance programs. Many employers receive guidance on Affordable Care Act (ACA) compliance, while their employees get access to consulting services by licensed benefits professionals. The benefits vary by PEO, as does the cost.

Payroll

PEOs offer small businesses an affordable way to package all of their HR responsibilities, including payroll processing and taxes. PEOs can process your employee payroll, prepare and distribute payroll checks, administer direct deposits, and process employee liens and garnishments. PEOs take care of your employees’ paid time off, track their sick and vacation time, and prepare and distribute their W-2s.

Many PEOs offer quarterly and year-end state and federal tax deposits and filing, along with detailed management reports. The PEO you partner with should be able to handle all of your employee payroll needs. By including this cost in the PEO’s total, you can ultimately save money on your payroll.

Risk and Compliance

Managing risk and legal compliance is an important part of running a small business. However, if you work with a PEO, it can manage much of that for you. Depending on your business’s industry, this could be a great deal of work handled by someone else. The level of compliance and risk that a PEO manages varies, but many PEOs perform tasks such as managing ACA coordination and compliance, running on-site safety inspections, performing accident investigations and job hazard analyses, allocating workers’ compensation coverage, and maintaining OSHA compliance for your business.

A PEO ensures that your business takes the appropriate measures to maintain workplace safety. Some PEOs provide employment practices liability insurance (EPLI) coverage, safety and loss prevention programs, Health Insurance Portability and Accountability Act (HIPAA) compliance, and Consolidated Omnibus Budget Reconciliation Act (COBRA) insurance. There are several other compliance measures that PEOs can take to keep your employees safe and ensure that your business abides by legal employment guidelines. This alone is reason enough for some businesses to partner with a PEO.

Did You Know?Did you know
According to the NAPEO, companies that partner with a PEO grow 7 to 9 percent faster, and are 50 percent less likely to go out of business, than companies that don’t partner with a PEO.

Training and Development

Some PEOs offer employee training and development. Many provide online and on-site training courses that your employees can take to enhance their skills. They can access courses on communication, sexual harassment and discrimination, hiring and firing, disciplinary actions, leadership, social media and workplace technology, as well as get industry-specific training.

Not all PEOs provide continuing-education courses, and the courses that PEOs do offer vary. However, at the very least, most PEOs can train your staff on necessary workplace concepts, like avoiding workplace discrimination and sexual harassment.

Customer Support

Make sure the PEO you partner with assigns you a designated team of experts who can handle your HR, risk management, benefits and payroll needs. Work with a company that provides specialists in each area, along with a relationship manager who can help you take advantage of all of the services the PEO offers. Sometimes, the HR consultant doubles as a relationship manager, which is also a good option. The best companies have HR consultants who are certified by the Society for Human Resource Management (SHRM). SHRM certification ensures that your account coordinator is more than just a company relationship manager.

Justworks customer support

We appreciate PEOs that provide online resources and knowledgeable customer support. Source: Justworks

How Do You Implement a PEO Service?

Once you have chosen a PEO provider and signed the necessary contracts, it’s time to begin implementation. While some PEOs provide white-glove implementation service, others take a more hands-off approach, putting implementation in your hands.

Either way, here are three general steps you can take to implement a PEO service:

  1. Inform and train your HR team. Ideally you’ve already involved key stakeholders in the PEO selection process, but now is the time to introduce the PEO to the rest of your internal HR team. Explain what services or functions the PEO and internal staff will handle, and schedule a training session for your team to become familiar with any new platforms or procedures.
  2. Integrate your HR data. Set up data integration with the PEO’s software to ensure that payroll and employee data are transferred accurately. If you opt for assisted implementation, the PEO may do this transfer for you.
  3. Transition the rest of your staff. Once your HR staff is trained and your PEO platform is integrated, inform the rest of your employees about the PEO arrangement. Get your employees on board by explaining the advantages, such as improved HR services or access to better benefits. Educate your workers on how to access their payroll information, benefits enrollment and other employee self-service features.

Once your PEO is implemented, the work doesn’t stop there. Regularly review the PEO’s performance, ensuring it meets agreed-upon service levels. If you notice any changes in your business needs or HR requirements, meet with the PEO to discuss potential modifications.

What Are Some Alternative PEO Service Options?

If you still haven’t found what you’re looking for in our best picks, don’t worry – there’s more! Here are a couple of other worthy contenders worth exploring.

Paychex

Paychex is a national company that offers customizable plans and flexible pricing. We like that it supports a wide range of business types and sizes, regardless of whether your employees are in the office, at home or a mix of the two. Businesses that partner with Paychex can receive essential HR functions, like HR administration, payroll processing, expense management, employee benefits information and risk-management support. And as your business changes or expands to multiple states, you can add or remove services accordingly. Read our full review on Paychex PEO to learn more.

AlphaStaff

AlphaStaff is a flexible PEO that offers a wide variety of HR services and features with tailored plans and pricing. It offers essential HR services, including employee training and development, strategy and handbook creation, compliance assistance, termination assistance, payroll processing and tax filing, and employee benefits administration. One of our favorite aspects of AlphaStaff is its support and guidance. When you partner with AlphaStaff, the company can review your organization to develop strategies that match your current and growing needs. The PEO also offers benefit advisory services to help you through the process of administering benefits in an efficient and compliant manner. Check out our complete AlphaStaff review to learn more.

Methodology

To determine the best professional employer organizations on the market, our team of HR experts and software analysts evaluated an initial list of 60 vendors. We examined all 60 and eventually paired down the list based on critical factors such as pricing, available PEO features, platform usability and customer support.

After whittling our list down to nine, we chose seven PEO services as our top recommendations. Our experts and analysts studied each solution’s functionality and evaluated the products on more than 125 factors.

These factors were broken down into categories and weighted differently in our overall conclusion. The weights were determined based on how much business owners prioritize these criteria when shopping for business software and services and making purchasing decisions.

  • Pricing (30%): Our experts and analysts compared and contrasted each vendor’s plans, judging which packages offered the best bang for your buck. They took into account plan structures, employee minimums, costs per employee, contract length requirements, and additional fees like implementation and cancellation fees.
  • Features (25%): We looked for standard PEO service functions like administrative HR services, employee benefits administration, payroll and tax administration, employee training and development, legal compliance assistance and risk mitigation. We also assessed the available integrations and awarded extra points for advanced services, like global PEO services.
  • Ease of Use (20%): Each PEO service includes HR software, so we tried the software solutions themselves, gauging each platform’s learning curve, user-friendliness and customization options. We also considered whether there was a fully featured mobile app to manage HR details on the go.
  • Customizations (10%): No two business HR needs are exactly the same, which is why service customization is key. We evaluated not only how customizable each PEO service plan was (including number of options and add-ons) but also how customizable the software was itself. We also took a look at how many third-party applications each vendor is compatible with.
  • Customer Service: (15%): We evaluated the range of customer service options, including whether phone, email and web chat assistance was provided with all package tiers. We also examined each vendor’s online resources for businesses interested in self-guided help.

Based on these criteria, we not only determined which professional employer organizations our readers could trust but also the ways in which each solution could best serve different business needs. Some services were better at certain tasks than others or more suited to a particular type of company. These takeaways informed the “Best for” use cases you see on this page.

To learn more about our methodology, see our full editorial process.

Professional Employer Organization FAQs

Yes, a PEO can help you hire great employees. When small businesses offer competitive benefits to potential employees, they are in a better position to attract and retain top talent. This is where PEOs come in. A PEO allows you to offer your employees affordable health benefits with reputable health insurance companies, as well as additional benefits, such as supplemental insurance plans (e.g., FSA, HSA and HRA), employee perks (e.g., home and auto insurance discounts, parking and commuting benefits), and retirement savings accounts, like 401(k) plans.

Additionally, a PEO can help you maintain risk and legal compliance. This can reduce legal problems for your business, helping you earn a positive reputation in your community and reduce employee turnover. Because many employees seek an employer that can offer continued education, partnering with a PEO that provides training and development courses can entice top talent as well.

When you partner with a PEO, that company is technically a co-employer of your staff. This can cost you some internal control over your team and processes, and possibly result in an outside influence on your company culture. Having an outside company manage your payroll and taxes might make you feel a lack of security as well. For these reasons, it is important to partner with a PEO you can trust. The right PEO can be a great asset to your company.

Although they seem similar, PEOs and staffing companies serve different HR needs. The primary benefit of a PEO is that it handles tedious and time-consuming HR tasks, such as administrative work, payroll, employee benefits, risk and compliance, and employee training and development.

A staffing company, on the other hand, primarily serves short-term or temporary employment needs. Staffing companies handle other HR-related tasks, such as payroll and unemployment taxes, but often with much higher fees for these services. Small businesses should consider partnering with a staffing company only if they need temporary staffing.

A PEO is an affordable HR option for many small businesses because it can handle all of your HR functions under a co-employment model. A PEO removes the burden of many HR tasks and assures small businesses that critical functions such as risk and compliance are being managed by HR experts.

HRO services can handle many of the same HR functions as a PEO can, but they operate as separate entities instead of forming an employer partnership. Businesses that use an HRO can choose the HR functions they need to outsource — for example, only payroll and employee benefits or a full-service HR suite. HR outsourcing is better for larger companies that need assistance only with specific HR tasks.

Yes, a PEO will require you to use them for payroll if you want to partner with them. In this case, a PEO processes payroll and administers payroll taxes for your business.

Yes, a PEO service can be beneficial for some small businesses; however, that doesn’t mean it’s a necessity for all. A PEO is often a good choice for small businesses that need assistance with managing their routine HR functions, accessing better benefits and maintaining legal compliance.

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Written By: Skye SchooleySenior Lead Analyst & Expert on Business Operations
Skye Schooley is a dedicated business professional who is especially passionate about human resources and digital marketing. For more than a decade, she has helped clients navigate the employee recruitment and customer acquisition processes, ensuring small business owners have the knowledge they need to succeed and grow their companies. At business.com, Schooley covers the ins and outs of hiring and onboarding, employee monitoring, PEOs and HROs, employee benefits and more. In recent years, Schooley has enjoyed evaluating and comparing HR software and other human resources solutions to help businesses find the tools and services that best suit their needs. With a degree in business communications, she excels at simplifying complicated subjects and interviewing business vendors and entrepreneurs to gain new insights. Her guidance spans various formats, including newsletters, long-form videos and YouTube Shorts, reflecting her commitment to providing valuable expertise in accessible ways.
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