trusted formPEO vs Payroll Service Providers |
PEO Vs Payroll
قائمة المحتويات

PEO vs Payroll Service Providers

PEO vs Payroll Service ProvidersPEO vs Payroll Service Providers

Many business owners confuse PEO companies with payroll software companies and providers and believe them to be alike in services or features. While both offer their services for businesses of any size and a hefty number of benefits, they do have major differences, all of which we will discuss in this article.

Before getting into the benefits that PEOs can offer businesses, we will briefly explain what a PEO is.

What is a PEO?

PEO is short for Professional Employer organizations, also known as employee leasing companies. PEO companies help businesses perform their operations more efficiently with the aid of their team of dedicated experts. When a business hires a PEO to work with them, the PEO assumes responsibility and liability for the operations they offer their services and provides them with a team of experts to work closely with their in-house departments.

Some PEOs also provide their clients with software solutions and the technology to assist them further and boost their operational efficiency. It is worth noting that not all PEO companies are the same, many may offer similar services, but only the best are accredited by the Employer Services Assurance Corporation (ESAC) Client Assurance Program.

Benefits PEOs Can Offer

PEOs offer businesses a range of services, such as:

  • HR functions
  • Payroll and tax administration
  • Benefit plans and administration
  • Talent acquisition
  • Technological solutions

When a business hires a PEO, they will take the burden off most of their administrative functions, assume responsibility, and reduce the chances of liability. With a team of professionals at its disposal, the business will acquire valuable knowledge on the best HR and hiring practices. They help them with staffing and requirements while staying compliant with laws and regulations.

The best PEO companies are also partnered with the top insurance carriers to offer businesses a set of comprehensive benefit plans at lower prices, especially for small businesses that cannot afford top-tier benefits.

As for the payroll and tax administration, PEO's team will assign the business with a payroll expert or consultant to handle all related paperwork, timesheets, taxes, and compensations and ensure their processes comply with laws and regulations.

Benefits Payroll Service Providers Can Offer

As for payroll software providers, their benefits and services are slightly different. PEO companies lease their employees or teams of experts to their business clients, while payroll service providers provide their clients with sophisticated software to manage their operations on.

Payroll software immensely differs from the services a PEO can offer, as it is only a software solution that an expert does not accompany, nor can it help businesses develop new hiring strategies or acquire new talent.

The benefits that payroll software offers are intuitive automation for payroll runs, tax filing, payment, and benefit deductions. More features and services that payroll software offer include the following:

  • Document management
  • Tax compliance
  • Time tracking software
  • Reporting and analytics
  • Mobile applications
  • Employee self-service portal
  • Benefits management


PEOs' services are much more comprehensive than payroll service providers, as they come with a team of dedicated experts that will transform the way your business functions and how your in-house team handles its processes. Some PEOs also associate their services with technological solutions and software, which could include payroll software.

Best PEO Company Recommendations

Now that you are familiar with the difference between PEO and payroll software providers and the benefits they both can offer your business, we will present you with our top PEO recommendations and a brief about their services and prices.

1. Paychex

For our first and top recommendation, we present you with Paychex. Paychex PEO is accredited by the IRS and ESAC and offers its standalone comprehensive payroll software. As a PEO, Paychex will offer you extensive HR guidance to simplify your employee management processes.

Some of the services Paychex offers as a PEO include:

  • Payroll Processing
  • Employee Benefits and Administration
  • HR Services
  • Time and Attendance
  • Business Insurance
  • Learning Management System and Training
  • Risk Management
  • Employee Performance Management

Paychex does not advertise any prices for its PEO services, as they will be customized according to your business's needs. As for its payroll software, these are the subscription plans it offers:

Paychex Flex Essentials - $39/month, + $5 per employee

Paychex Flex Select – Quote-based

Paychex Flex Pro – Quote-based

Read our full Paychex PEO review to know more about its employee-leasing services.


As for our second recommendation, we present you with BBSI. ESAC also accredits BBSI, and it offers a comprehensive set of services that will transform your business operations. Some of its PEO services include the following:

  • Business Strategy Development
  • Human Resources
  • Payroll Administration
  • Retirement Benefits
  • Risk and Safety
  • Staffing and Recruiting
  • Technology Solutions
  • Workers' Compensation

BBSI will customize its PEO costs depending on your business' size and needs, so we recommend reaching out to their team by phone at 1-800-494-5669 or submitting a form on their Contact Us page.

Read our full BBSI review to know more about its employee-leasing services.

3. Justworks

Justworks is our third pick for the best PEO companies. Not only does it offer PEO services, but also its own comprehensive payroll software. Its PEO services include the following:

  • Hiring and onboarding for remote teams
  • Automation and employee self-service
  • Payroll and taxes
  • Benefits administration
  • Software integrations
  • Contractor payment
  • Employment Practices Liability Insurance

Justworks tailors its PEO pricing according to your number of employees. Two plans are provided, and for simplicity's sake, we will present you the prices for 25-99 employees:

Basic plan: starts at $44/month/employee

This plan comes with Payroll services, Benefits, HR tools, and Compliance.

Plus plan: starts at $89/month/employee

This plan packs everything in the Basic plan, plus access to Medical, Dental, and Vision health insurance plans.

Read our full Justworks PEO review to know more about what it can offer your business.

مواضيع ذات صلة