The biggest misconception about “Employee Leasing” is its name. Employee Leasing implies “the leasing of employees”; the staffing by another party such as a “Temp Agency”, or “Staffing Company”. This is not what an Employee Leasing Company does.
An Employee Leasing Company, also known as a Professional Employer Organization (PEO) is a company providing a service where an employer can outsource employee administrative tasks. These tasks include payroll, employee benefits, workers’ compensation, risk/safety management and healthcare. A PEO bundles all of these services together in one convenient bill.
A key service provided by a PEO is securing work comp insurance coverage at a lower cost than most small to mid sized businesses can obtain on their own.