Employers do not need to spend time and resources on HR tasks. Instead, they can focus on their core business and growing their bottom line. 

PEOs can provide consistent administration for larger companies, and often improved technology resources. 

Employers do not have to handle as many legal intricacies regarding HR tasks.  

PEOs can negotiate better insurance coverage because of the volume of business that they cover. 

Employers do not have to hire as many HR professionals in-house. 

When the PEO assumes its client’s payroll into its own accounts, it also assumes the liability for clients’ employees because it is technically now the legal employer. 

PEO assumes the liability of adhering to the legal tax and workplace standards. The PEO will ensure that its clients are knowledgeable concerning relevant standards in accordance with local, state and federal laws. 

A company no longer has employees after hiring a PEO. The company essentially fires all of its employees, who are then rehired by the PEO.  

By hiring a PEO, the company loses control and flexibility concerning compensation packages allotted to its employees. Though a company can decide how much to pay each of its employees, it has limited say on the benefits plans offered. 

Companies lose a bit of control over their workers since they are officially employed by the PEO. 

Employees may be confused by who truly is their employer; the PEO or the company that they report to each day. Employees may not know who to turn to when they have concerns regarding their compensation, benefits, etc.