What Is the Best PEO?

Choosing the right PEO (Professional Employer Organization) can be a game-changer for your business. A PEO helps small and medium-sized businesses manage hr functions, payroll taxes, and employee benefits more efficiently, allowing owners to focus on business operations. But with so many options in the market, business owners often wonder: what is the best PEO? The answer isn’t one-size-fits-all; it depends on your business’s unique needs, size, industry, and growth goals, and having a deep understanding of these needs is crucial.

Businesses of all sizes turn to PEOs (or professional employer organizations) for their HR outsourcing needs. According to NAPEO, there are nearly 500 PEOs operating in the United States. Although this deep well of PEOs creates a buyers market for interested companies, it also makes it difficult to determine what the best PEO is for your business.

As a PEO broker, NetPEO works to connect client business owners with PEOs that are right for them and their company. While most businesses require common services like payroll management and the application and handling of employee benefits packages, not all businesses have the same kinds of needs.

What Exactly Is a PEO?

A Professional Employer Organization (PEO) is a company that provides comprehensive HR outsourcing solutions. Through a co-employment relationship, the PEO handles essential administrative and human resources tasks such as:

• Payroll processing and tax filing

• Employee benefits and health insurance

• Workers’ compensation coverage

• HR compliance and risk management

• New hire onboarding

• Performance management support

Essentially, the PEO becomes the HR backbone of your company — managing all the time-consuming HR functions, so you can focus on your customers, employees, and business growth.

Why Working with a PEO Is a Game-Changer for Small Businesses

Small and mid-sized companies often struggle to compete with large corporations in providing competitive benefits and ensuring HR compliance. Partnering with a PEO can change that entirely.

Here’s why PEOs have become so valuable:

• Cost Savings: Access large-group health insurance rates and reduced workers’ compensation premiums.

• Compliance Confidence: Stay on top of ever-changing employment laws and tax regulations.

• Employee Retention: Offer Fortune 500–level benefits that attract and retain top talent.

• Time Savings: Free up countless hours from payroll, benefits, and HR paperwork.

• Growth Enablement: Focus your energy on scaling and profitability rather than administration.

According to the National Association of Professional Employer Organizations (NAPEO), businesses that use a PEO grow 7–9% faster and are 50% less likely to fail than those that don’t.

What Makes a PEO the Best for Your Business?

Not every professional employer organization (PEO) fits every company. The “best PEO” depends on your industry, company size, location, and goals. However, the top PEOs share several defining traits that set them apart in the PEO industry and help streamline your company’s day to day operations.

1. Comprehensive HR Services

The best PEOs manage all core HR functions — including payroll, benefits administration, risk management, compliance, and employee relations — creating a smooth and efficient HR outsourcing experience that supports your day to day operations.

2. Transparent Pricing

Reputable PEOs are upfront about costs. They clearly explain whether pricing is per-employee-per-month (PEPM) or based on a percentage of payroll, ensuring you understand exactly what you’re paying for and how it impacts your day to day activities.

3. Scalable Solutions

As your business grows, so do your HR needs. A high-quality PEO provides scalable solutions that adapt as your workforce expands and your operations become more complex — without disrupting your works.

4. Technology & Ease of Use

Leading PEOs invest in modern, user-friendly HR technology. With intuitive dashboards, you can easily access payroll reports, benefits data, and employee information — saving time and improving efficiency across your operations.

5. Strong Customer Support

Top PEOs provide dedicated account managers and responsive support teams. You should always have someone who understands your business and can provide quick, expert help when needed, ensuring smooth operations.

6. Industry Experience

Some PEOs specialize in specific sectors like healthcare, technology, or construction. Partnering with a PEO that understands your industry ensures compliance with relevant laws and improves performance in your day to day operations.

What to Look for When Searching for the Best PEO

The best PEO for your company will be able to take on any administrative task that your business needs assistance with. They should have a wealth of experience in the human resources industry, as well as experience handling payroll, compliance, and tax filing. 

Experience With Your Industry

There are a number of government business regulations in every state that dictate how certain companies are required to operate. These laws are often industry-dependent, meaning that they affect different businesses differently depending on the industry in which those companies are situated. 

The best PEO for your business will have experience handling the HR needs of companies that are in the same or similar industries as you. At NetPEO, our nationwide network of PEOs has helped companies across the entire spectrum of industries. Some of our previous clients have included:

• Law firms
• Construction firms
• Retail outlets
• Restaurants
• Aviation companies
• Real estate firms

Experience Handling a Range of Human Resources Issues

Not all HR outsourcing companies are made equal. In the growing PEO industry, startups are popping up seemingly every day. If you’re trying to find the PEO that best suits your business, you’ll want to select one that has extensive experience handling the kinds of issues that you’re struggling with. 

Many of the newer PEOs lack the knowledge and skills that more seasoned outsourcing companies have in spades. This can lead to errors and important tasks being mismanaged. Mistakes on payroll or employee benefits administration can lead to costly fines and lawsuits, so it’s best to avoid working with inexperienced PEOs.

Customization and Flexibility

One of the hallmarks of the best PEOs is their ability to provide full service solutions that are customized to your business needs. Every company has unique hr functions, payroll structures, and benefit requirements. A PEO that can tailor its offerings—ranging from payroll benefits to comprehensive hr services—ensures that your business operations run smoothly and efficiently, without forcing a rigid, one-size-fits-all system.

Technology and Accessibility

Modern PEOs leverage technology to simplify everyday management. Features like a mobile app make it easy to handle payroll taxes, manage employee records, and access hr services on the go. By integrating technology with full service offerings, the best PEOs provide a seamless experience that empowers business owners and employees alike, allowing them to stay on top of hr functions without extra stress.

Long-Term Business Growth

Partnering with the right PEO is not just a short-term solution—it’s an investment in sustainable growth. A PEO with a deep understanding of your business can optimize hr functions, streamline payroll benefits, and support complex business operations as your company scales. With access to professional hr services, accurate payroll taxes management, and tools like a mobile app, businesses can focus on strategic priorities while leaving administrative tasks in capable hands.

Services Offered by PEOs

When looking for the PEO that best suits your business, it’s important to make sure they provide all the services you need a hand with. Ultimately, you’ll want to find one that specializes in all the administrative tasks you need to outsource. Here are some of the services you might want to look out for when choosing a PEO:

Recruitment Enhancement

Many PEOs work with client business owners to strategize better recruiting techniques. These recruitment methods can enhance your ability to attract top-tier talent for critical positions. The best PEO will also be able to develop onboarding packets and new hire informational booklets you can use to inform your new workers of company culture and best practices.

Payroll Administration

The best PEO for your company is one that can handle all your payroll needs. Instead of struggling with the endless paperwork and hours of tedious organization that payroll requires, let an experienced PEO deal with those matters. If you do, you’ll be able to focus more on expanding your business and providing quality goods and services to your clientele.

Employee Benefits Administration

Retaining employees is important for a number of reasons. Not only can it help you hold onto your top talent, but it can also allow you to avoid costly turnover rates. Through the co-employment relationship, PEOs can negotiate better employee benefits packages at a lower individual cost, keeping your workers happy and content to work for your company.

Comparing PEOs

When comparing PEOs, look beyond surface-level features. Review client testimonials, case studies, and independent ratings. Assess their track record in payroll taxes and compliance, since mistakes in payroll or benefits administration can lead to significant penalties. Comparing multiple PEOs side-by-side helps you understand the strengths, weaknesses, and value propositions of each option, making your decision more informed.

The Best PEOs Are Certified

Certified PEOs are PEOs that meet standards put forth by the IRS. While PEOs aren’t legally required to attain certification, accredited providers are far more likely to operate with a high level of integrity. 

Certified PEOs are also able to take on responsibility for your company’s tax payments. That means if there are any mistakes with your tax filing, your PEO will be held liable for penalties and lawsuits, not your company. If you think you’ve found the best PEO for your business, make sure they’re included in the IRS’s public listing of certified providers.

PEOs can also receive certification from the Employer Services Assurance Corporation. The ESAC is a non-profit organization that offers accreditation to PEOs that live up to specific ethical and financial standards. 

Look for a PEO With a Payment Plan That Works for You

The best PEO for your business is one that accommodates your payment preferences. Smaller businesses, due to financial reasons, might want to pay their PEO differently than mid-sized and large companies do. The two most common PEO payment methods are as follows:

• Per employee, per year. Businesses that like to keep their PEO payment predictable will likely choose to pay per employee, per year. If you opt for this payment method, you’ll probably pay between $900 and $1,500 for each of your workers.

• Percentage of payroll. The first payment method requires businesses to pay a lump sum every year, but that might not work for small businesses that don’t have that much capital at a given moment. In that case, paying a percentage of payroll is the better option. Companies who choose this payment method usually pay between 3% and 10% percent of their overall payroll for a given pay period.

Although PEOs virtually pay for themselves with the amount of benefits and savings they come with, it’s important to find one that allows you to pay the way you want to. Remember to ask potential providers about payment methods when searching for the PEO that best suits your organization.

Why Choosing the Best PEO Is So Challenging

You might think: “I’ll just research and compare PEOs myself.” But here’s the problem — every PEO presents their services differently, hides different fees, and focuses on varied industries.

It’s not easy to compare apples to apples. You could spend weeks or even months researching, only to end up confused or unsure which option truly fits your business.

That’s where NetPEO simplifies everything.

Related: How Will a PEO Arrangement Affect Control of My Employees?

The Best PEOs Let You Customize Their Services

While some companies may prefer to outsource their entire HR or payroll department to their PEO, many like to have the freedom to choose what they receive support for. These businesses will usually continue to perform select administrative duties in-house and outsource the tasks they need help with to a provider.

If your company wants to keep some of its payroll or HR in-house, you’ll want to look for a PEO that allows clients to customize their services. These types of providers let their client companies choose a la carte style which services they want to outsource, so they only have to pay for the HR and payroll support they need.

Related: How Can I Generate a List of PEO Companies for My Business?

The Role of a PEO Broker

Working with a PEO broker like NetPEO can simplify your search for the best PEO. Brokers analyze your business needs and match you with PEOs that fit your requirements. They provide objective guidance, negotiate terms, and help you avoid common pitfalls in hr functions and business operations. This ensures that you select a PEO that not only fits your current needs but also supports long-term growth.

The Benefits of Using NetPEO Instead of Searching Alone

When you use NetPEO, you’re not just saving time — you’re protecting your business from bad fits, hidden costs, and compliance risks.

Here’s what makes our service stand out:

1. Unbiased Recommendations

We’re not tied to any one PEO. We objectively compare dozens of options to find the best one for you.

2. Access to Exclusive Rates

Because of our partnerships with national PEO providers, you may receive better pricing and benefits than going directly.

3. Save Weeks of Research

Instead of filling out multiple quote forms and chasing sales reps, we handle the legwork. You get all the data in one place.

4. Expert Guidance

Our PEO specialists have decades of experience in the HR outsourcing industry. We’ve helped thousands of businesses find their perfect fit.

5. Ongoing Support

Even after you’ve chosen a PEO Services, we stay in touch. If your needs change or you want to switch providers later, NetPEO can help you re-evaluate and adjust.

How to Know Which PEO Is Right for You

When comparing PEOs, consider these key questions:

• What HR services do we truly need help with?

• How many employees do we have now, and how fast are we growing?

• Do we need industry-specific HR expertise?

• What’s our budget per employee for HR outsourcing?

• How important is access to top-tier benefits packages?

• Do we prefer a local provider or a national brand?

Your answers will guide which PEOs are the most suitable. And when you use NetPEO, we help you navigate all of these questions — ensuring your decision is clear and confident.

PEO Services That Drive Real Results

The best PEOs provide more than administrative support. They become strategic HR partners who drive real results for your organization.

Here’s a quick look at the core services top PEOs (and NetPEO’s partners) provide:

These functions are what make PEOs so transformative — and through NetPEO, you can connect with the providers who excel in each of these areas.

Industries That Benefit Most from PEOs

While any company can use a PEO, some industries gain exceptional value:

• Healthcare & Medical Practices — compliance-heavy HR management

• Construction & Trades — workers’ comp and safety management

• Technology Startups — HR automation and benefits access

• Retail & Hospitality — multi-location workforce management

• Professional Services — payroll accuracy and benefits retention

No matter your field, NetPEO can find PEOs that already specialize in your industry — ensuring compliance, cost efficiency, and tailored support.

How Much Does a PEO Cost?

PEO pricing varies, but most charge in one of two ways:

1. Per Employee Per Month (PEPM): Typically ranges between $100–$200 per employee depending on services.

2. Percentage of Payroll: Usually between 2–6% of total payroll costs.

The key is understanding what’s included — benefits administration, taxes, compliance, etc. Some PEOs offer a la carte services, while others bundle everything.

When you work with NetPEO, we help you understand every quote, compare total costs, and avoid hidden fees before you sign anything.

Why Thousands of Businesses Trust NetPEO

Over the years, NetPEO has helped thousands of business owners across the U.S. find their perfect HR outsourcing partner. Our clients range from 5-person startups to 500-employee companies — and every one of them saves time, money, and stress by using our service.

Here’s what makes our process trusted nationwide:

• We partner only with certified and vetted PEOs.

• We provide side-by-side comparisons of multiple PEOs.

• We ensure transparent pricing and no-pressure guidance.

• We offer free, personalized consultations for every client.

Our mission is simple:

To help business owners focus on growth while we handle the HR complexity.

Related: What Is a PEO Company? Benefits & How It Helps Your Business

Finding the Best PEO for Your Company Has Never Been Easier

Finding the best PEO requires research, careful comparison, and understanding your business’s unique challenges. It’s not just about cost—it’s about the value and peace of mind a PEO can bring with full service solutions, payroll benefits, and robust hr services. With the right partner, you can streamline HR operations, manage payroll taxes, improve employee satisfaction, and focus on business operations without worrying about administrative burdens. Ultimately, the best PEO is the one that becomes a true extension of your team, offering tools like a mobile app to simplify everyday management and providing a deep understanding of your business needs.

Your company deserves a PEO with the experience to handle any issue that comes your way. As PEO brokers, we will develop a profile of your company’s needs and provide you with a list of potential providers. Once you’ve partnered, we’ll stay in touch throughout the duration of your relationship to solve problems and ensure your satisfaction.

At NetPEO, our nationwide network of partner PEOs has more than two centuries of combined experience in the HR world. To get a free consultation and start learning about how we can match you with the best PEO for your business, call us today or fill out the form on our contact page.