What is Co-Employment?

Co-employment is a relatively new concept for businesses. It is the arrangement that allows PEO’s (Professional Employer Organizations) to provide bundled services and benefits to its clients and share certain employer liabilities.

The Power of PEO's

A PEO arrangement may involve all of a client’s employees in a long-term, non-project related employment relationship. The PEO assumes the employer’s responsibility for employment tax, benefit plans, and other human resources purposes. Through the use of a PEO relationship, client companies can make long-term investments in their workers, including health insurance, retirement savings plans 401(K), and other critical employer benefits for its employees.


PEOs reduce the number of vendors that a small business owner has to work with, thereby reducing the time spent on administrative tasks. The PEO contractually assumes and manages certain risk and critical human resources responsibilities for its small business clients by establishing and maintaining an employer relationship with covered employees.