PEO vs. ASO
- Professional Employer’s Organization – Our PEO solution provides services under which an employer can outsource employee management tasks, such as employee benefits, risk/safety management, orientation and termination processing payroll, and workers’ compensation. We do this by hiring your company’s employees, thus becoming their employer of record for tax and insurance purposes. This practice is known as co-employment.
The use of a PEO saves time; potentially alleviating the stress that comes with administering payroll, benefits plans, and may reduce legal liabilities.
- Administrative Services Organization – Our ASO solution provides a variety of bundled packages of administrative solutions for your business, including payroll and tax compliance, human resources consulting, and employee benefits administration among others.
Unlike our PEO Solution, our ASO model does not include a co-employment relationship thus you remain the employer of record and we manage business critical processes on your behalf.
Q: What’s a PEO, and why should I use one?
A: A Professional Employer Organization (PEO) is one of the best-kept secrets of many successful small businesses. Essentially, PEO’s handle all your HR needs, including payroll and administration, employee health and retirement benefits, workers’ compensation insurance, state and federal compliance issues and even employee orientation.
All you’re left to do is hire, supervise and promote (or fire) your employees as needed. Consider this list of positives:
- PEOs manage several employees and can therefore purchase insurance and benefit plans at a significant savings or allow you to offer higher-quality plans to attract and retain skilled employees.
- The PEO will provide HR manuals for your employees, and the employee orientation process will be maintained in compliance with ever-changing state and federal laws and regulations.
- A PEO will help with employment-related regulatory compliance (ADA, payroll, OSHA, EEOC, etc.), a huge advantage that can be worth more to your business than the money saved on benefits costs.
- The PEO can provide effective management and access to payroll records, benefits, personnel data, vacation and sick-time accruals and specialized reports.
The PEO model is most attractive to small and mid-sized businesses. And don’t forget the peace of mind that a PEO offers.
Q: What is the difference between an ASO and a PEO?
A: An Administrate Service Organization (ASO) allows you to maintain control as you purchase your employee benefits and workers compensation. You govern employee compliance and reporting is under your tax identification number. However, you are able to outsource several of your administrative tasks to us to release payroll and HR burdens, just like a PEO. Outsource Management offers a wide range of services to fit your needs and budget.
- Using the ASO solution, Outsource Management is considered a payroll processing agent, not the employer as in a PEO relationship.
- Under an ASO arrangement, there is no employment relationship between Outsource Management and your employees.
- Tax filings and deposits are paid through the ASO tax identification number. With a PEO, they are filed under Outsource Management’s tax id number, as they are the employer of record.
- With the ASO solution, you customize a package of services. With the PEO solution, you receive all of our services in one low price.
Q: Why outsource?
A: Outsourcing using a PEO or ASO solution provides a variety of benefits, from cost savings to access to specialized expertise on taxes, payroll, HR, workers’ compensation and more. Outsourcing can enable you to focus on your business and free up your time and resources. You decide which arrangement best suits your company and budget needs.
Have more questions? Call us at 858.217.1490.