PEO (Professional Employer Organization) and ASO (Administrative Services Organization) are both third-party HR solutions that can help businesses with their HR-related tasks. Here are the top three reasons to use a PEO over an ASO:
When a business partners with a PEO, the PEO becomes the employer of record for the employees, which means that the PEO assumes certain employer responsibilities, such as:
- payroll processing,
- taxes, workers’ compensation,
- and benefits administration.
This allows the business to focus on its core operations, while the PEO handles HR-related tasks. With an ASO, the business remains the employer of record and maintains full control over HR tasks.
PEOs assume some of the risks associated with HR tasks, including legal compliance and employment-related lawsuits. By partnering with a PEO, businesses can transfer some of these risks to the PEO, which can help them mitigate potential legal and financial liabilities. With an ASO, the business retains full responsibility for HR-related risks.
PEOs often offer access to a wider range of employee benefits, such as health insurance, retirement plans, and other perks, which can help businesses attract and retain top talent. PEOs can negotiate better rates for these benefits due to their purchasing power, which can result in cost savings for the business. ASOs typically do not offer benefits administration as part of their services.
Ultimately, the choice between a PEO and an ASO depends on the needs and goals of the business. While PEOs offer more comprehensive HR solutions, they may not be the best fit for every business. It is important to carefully evaluate the options and consider the specific needs of the business before making a decision. Atlantic Payroll Partners is a PEO that proudly serves local and out of state customers. Read more about our solutions here.