PEO Services for Small Business | NetPEO HR & Payroll Solutions

Running a business today is more complex than ever. Between managing payroll, keeping up with HR compliance, offering competitive employee benefits, and staying on top of employment laws, small and mid-sized business owners often feel buried in paperwork instead of focusing on growth.

That’s where peo solutions come in.

A Professional Employer Organization (PEO) provides businesses with comprehensive HR outsourcing solutions through a co-employment model. Instead of handling every HR function in-house, you can partner with a PEO that takes care of payroll, benefits, compliance, and more—while you focus on what really matters: growing your company.

But here’s the catch: not all PEOs are the same. Choosing the wrong one can cost your business money and create frustration. That’s why NetPEO, as a trusted PEO broker, exists—to match your business with the right PEO partner from our nationwide network.

In this complete guide, we’ll break down everything you need to know about PEO services, the benefits, who needs them, and why thousands of companies trust NetPEO to find the perfect fit.

By the end, you’ll see exactly how outsourcing HR through a PEOs work (with NetPEO as your guide) can transform your business—and how to get started with a free consultation today.

What Is a PEO?

A Professional Employer Organization (PEO) is a company that provides small and mid-sized businesses with outsourced HR services through a co-employment model.

Here’s how it works:

• Your business keeps full control over daily operations and employee management.

• The PEO handles administrative HR functions like payroll, benefits, workers’ compensation, and compliance.

• This creates a co-employment relationship, meaning both your company and the PEO share certain employer responsibilities.

Example:

You still decide who to hire, how much to pay, and how to manage your employees. The PEO takes care of paying them correctly, managing taxes, hr tasks, providing health insurance, and ensuring your business follows labor laws and overall performance management.

This model allows smaller companies to access big-business benefits and compliance expertise without hiring a full in-house HR department.

A Professional Employer Organization (PEO) allows businesses to outsource their administrative needs to an outside company. Hiring a PEO allows a company to focus on their core business model or business operations instead of worrying about administrative tasks. For example, a doctor’s office can focus on providing quality medical services to their clients while the PEO makes sure that all employees are paid on time.

Some of the services provided by a PEO include:

• Brokerage Services: Connecting businesses with other PEO specialists.
• Human Resources: Hiring, hr services, managing hr, hr tasks, training and retaining employees, hr staff, other time consuming task, including creating onboarding materials and completing any required background checks.
• Payroll Assistance: Paying employees and handling tax obligations such as payroll services, providing W2 and 1099 forms.
• Benefit Planning: Medical, vision and dental insurance, employee handbook, payroll tax, employer of record, benefits administration, health insurance, payroll and benefits, paid time off, life insurance and retirement planning.
• Reviewing Workers Compensation Claims: A PEO specialist can review all claims to make sure that all proper forms are completed and investigate employee claims as well.
• Risk Assessments: Managing government regulations and reviewing ways to decrease workplace injuries.

How PEO Services Benefit Small Businesses

Now let’s break down the core benefits of using a PEO for your small business.

Payroll and Tax Administration

• Accurate and on-time payroll processing

• Direct deposits for employees

• Filing of federal, state, and local taxes

• Year-end W-2 and 1099 management

PEOs ensure payroll errors (which can result in hefty fines) don’t derail your business.

HR Support and Compliance

• HR policy development

• Employee handbooks

• Compliance with labor laws (FLSA, FMLA, ADA, etc.)

• Harassment and discrimination training

With a PEO, you reduce the risk of lawsuits and penalties, while building a professional HR foundation.

Employee Benefits

One of the biggest selling points of a PEO is access to big-business benefits at small-business prices.

• Health, dental, and vision insurance

• 401(k) retirement plans

• Life and disability insurance

• Employee wellness programs

This makes it easier to attract and retain top talent—something small businesses often struggle with.

Risk Management and Workers’ Compensation

• Workers’ comp insurance at lower group rates

• Safety training and workplace inspections

• Claims management and return-to-work programs

A PEO helps you keep your business safe and your costs under control.

Recruitment and Retention

Some PEOs even assist with:

• Job postings

• Candidate screenings

• Onboarding processes

This creates a smooth experience for new hires and strengthens your employer brand.

4. PEO vs. Traditional HR Outsourcing: Key Differences

Bottom line: A PEO is not just outsourcing—it’s a partnership that gives small businesses a competitive edge.

How Much Do PEO Services Cost for Small Businesses?

Cost is always a concern. The good news is, PEO services often pay for themselves through savings on benefits, reduced risk, and increased efficiency.

Typical Pricing Models:

1. Per-Employee-Per-Month (PEPM): $150–$200 per employee.

2. Percentage of Payroll: 2–12% of payroll.

While that may sound like an added expense, consider this:

• Without a PEO, health insurance costs can be 30–40% higher.

• Compliance mistakes can cost thousands in fines.

• Employee turnover (from lack of benefits) is one of the most expensive business problems.

PEOs turn fixed costs into predictable, manageable expenses.

Real-World Examples: How Small Businesses Thrive with PEOs

Example 1: A 15-Employee Tech Startup

Before: No HR staff, payroll errors, and struggling to recruit developers.

After partnering with a PEO: Streamlined payroll, access to Fortune 500-level benefits, and improved retention.

Example 2: A Family-Owned Restaurant

Before: High workers’ comp premiums and compliance headaches.

After partnering with a PEO: Lower premiums, reduced claims, and peace of mind.

Example 3: A Marketing Agency

Before: Losing talent to bigger firms with better benefits.

After partnering with a PEO: Able to offer health insurance and 401(k), keeping employees loyal.

How NetPEO Helps You Find the Right PEO Partner

Not all PEOs are created equal—and choosing the wrong one can be just as stressful as going it alone.

That’s where NetPEO comes in.

We’re not a PEO ourselves—we’re a PEO broker. That means:

• We listen to your business needs.

• We compare options from our nationwide network of top-rated PEOs.

• We help you choose the best fit—at no cost to you.

• We stay with you as a partner to ensure ongoing satisfaction.

Instead of spending weeks researching and negotiating with PEOs, let us do the heavy lifting.

📞 Call NetPEO today or request a free consultation to find the right PEO for your small business.

Frequently Asked Questions (FAQs) About PEOs

Q: How big should my business be before considering a PEO?

A: PEOs work well for companies with as few as 5 employees up to hundreds.

Q: Will I lose control of my employees?

A: No. You still make all decisions on hiring, firing, promotions, and company culture.

Q: Is switching to a PEO complicated?

A: With the right partner (like NetPEO), the transition is smooth and stress-free.

Q: Can I still use my current health insurance provider?

A: In most cases, yes—but PEOs often provide better options at lower costs.

PEO Services and Co-Employment

Another term you are likely to come across when you are considering utilizing a PEO is co-employment. This refers to when your company retains control over its core business services or products but the PEO handles all employee-employer issues that you outline in your agreement.

What this does is create two sets of employers over all of your employees. In this way, the PEO is an employer in the sense that they handle all administrative functions for the business. On the other hand, the business is the employer when dealing with all other tasks. This creates a symbiotic relationship between the PEO and business where the business can focus on its mission and the PEO has the authority to handle administrative employment issues.

Core PEO Services

PEOs offer a wide range of services, and the best part is that you can often customize them based on your business needs. Here are the most common PEO solutions that NetPEO clients benefit from:

1. Payroll Administration

• Processing employee paychecks accurately and on time.

• Handling federal, state, and local tax withholdings.

• Providing year-end tax forms (W-2s, 1099s).

• Managing direct deposits.

2. HR Compliance

• Keeping up with constantly changing labor laws.

• Staying compliant with OSHA, EEOC, and DOL regulations.

• Reducing risks of fines and lawsuits.

3. Employee Benefits

• Access to Fortune 500-level health insurance at small-business prices.

• Retirement plans (401k).

• Dental, vision, and life insurance.

• Flexible spending accounts and employee wellness programs.

4. Workers’ Compensation

• Coverage and claims management.

• Lower workers’ comp rates through pooled buying power.

• Risk management strategies to reduce accidents.

5. Risk Management & Safety

• Workplace safety programs.

• Employee handbook creation.

• Sexual harassment and compliance training.

6. Recruiting & Onboarding Support

• Job posting and candidate screening.

• Background checks and new-hire paperwork.

• Smooth onboarding processes.

7. Employee Training & Development

• Online learning modules.

• Professional development resources.

• Employee performance tracking.

With a PEO, you can choose a full-service package or specific solutions, depending on your company’s goals.

Advantages of Hiring PEOs

Companies that work with Professional Employer Organizations have significantly increased their core strengths. Some of the biggest advantages of partnering with a peo services are:

• Benefit Access– small to midsize businesses often lack the resources to provide benefits to attract the employees they want, peos typically have established relationships with insurance companies so they can provide access to a much more rewarding benefits package.
• Lower Costs– hiring PEO solutions allows a company to reduce costs by outsourcing all administrative tasks.
• Reduced Liability– having specialists reduces your chances at liability because each PEO will focus on their specific task and the laws that surround it (ex. HR and employment laws).
• Lower Turnover– constantly hiring new employees can take a financial toll on any business, however companies that use PEOs have a much lower rate of employee turnover.

However, to sum it up the biggest advantage of working with a PEO is that it offers business owners a little bit more peace of mind. Along with running their business, owners are also expected to be HR managers or accountants. Yet, most business owners do not have the kind of experience required to handle these tasks accurately which runs the business into potential risks. Not only will working with NetPEO save a company time and resources it will also ease concerns about accurate reporting, filing paperwork and following regulations day by day.

Who Needs this Services?

PEO services aren’t just for large companies—they’re ideal for:

• Startups → Need HR support but can’t afford full-time staff.

• Small Businesses → Want affordable benefits and payroll management.

• Mid-Sized Companies → Struggle with compliance and turnover.

• Industries like Healthcare, Construction, IT, Retail, Hospitality, and Manufacturing → Where compliance and employee benefits are critical.

If you have between 5 and 500 employees, a PEO can likely save you money and help your business grow faster.

Real NetPEO Case Studies

Case Study 1: A Tech Startup with 25 Employees

A growing IT firm in Austin, TX, came to NetPEO struggling with payroll errors and losing talent to larger competitors offering better benefits.

• Challenge: High turnover and payroll mistakes.

• Solution: NetPEO matched them with a PEO that offered Fortune 500-level health insurance and streamlined payroll.

• Result: Employee retention improved by 30%, payroll errors dropped to zero, and the company saved $45,000 annually on benefits.

Case Study 2: A Construction Company with 80 Employees

A construction firm in Florida faced rising workers’ comp costs and compliance headaches.

• Challenge: Workers’ comp premiums and OSHA compliance.

• Solution: NetPEO connected them to a PEO with industry-specific safety programs and pooled workers’ comp coverage.

• Result: Workers’ comp premiums dropped 22%, and compliance fines went to zero.

Case Study 3: A Healthcare Practice with 40 Employees

A medical clinic in California needed help managing payroll, HIPAA compliance, and employee training.

• Challenge: HR compliance and employee training gaps.

• Solution: NetPEO matched them with a healthcare-specialized PEO.

• Result: Clinic avoided a $75,000 compliance fine, reduced turnover by 18%, and employees gained access to competitive health benefits.

Related: What Workforce Solutions Does a PEO Provide?

How NetPEO’s Brokerage Services Can Help Your Business

NetPEO differs from other Professional Employer Organizations because we match companies seeking PEO assistance with those that have PEO specialities. Another way to think of it is that NetPEO matches “buyers” (business owners that have specific PEO needs) to “sellers” (PEO specialists). Not only can NetPEO find the best HR outsourcing services that your business requires but also negotiates on your behalf. This service also allows clients to avoid having to handle administrative tasks completely in-house.

Clients have the option of choosing an a la carte or full coverage package. With a pick and choose option companies can create a specialized plan that bests fits their companies unique needs. Alternatively, a full package will find PEOs that can handle all of the administrative needs for a business. Using NetPEO’s brokerage services, companies can save time searching for and hiring several different companies because the entire process will be handled by NetPEO. NetPEO will find you PEO specialists for each problem area, ranging from human resources to workers compensation assistance. As a trusted partner recognized by the national association of professional employer organizations, NetPEO ensures that each recommended PEO meets the highest industry standards.

NetPEO offers assistance to a variety of companies throughout the United States, any company that has employees would benefit from NetPEO’s brokerage services. Using NetPEO’s services allows a person to focus on their strengths while filling in the weaknesses for their businesses with PEO specialists. Most business owners already have to juggle tasks directly related to their services and products, PEO outsourcing allows owners to not have to also worry about learning the intricacies of payroll or how to put together a comprehensive benefits package.

Whether you run a small and mid sized business with 5 employees or 100 employees, allow yourself to grow your company without being bogged down with administrative problems. Contact NetPEO today!