The vocabulary, in plain language
Every industry hides behind terms. Here are the ones you will actually hear, defined so a sales call cannot use them against you.
PEO (Professional Employer Organization). A company that becomes the co-employer of your workforce for administrative purposes and provides payroll, benefits, HR, and workers’ comp under one relationship.
Co-employment. The contractual arrangement where employer responsibilities are split between you and the PEO. You keep management and decisions; the PEO takes defined administration. See how co-employment works.
Client service agreement (CSA). The contract defining the whole relationship: responsibilities, fees, and exit terms. Read it. We will read it with you.
CPEO (Certified PEO). A PEO certified by the IRS, which involves financial and reporting requirements and affects how employment tax responsibility is treated. Certification is worth asking about by name.
ESAC. An independent accreditation body for PEOs. Accreditation involves financial assurance standards and is a meaningful reliability signal.
Administrative fee. What the PEO charges for its services, quoted per employee per month or as a percentage of payroll. See what a PEO costs.
Employer of record. The entity listed as the employer for administrative purposes such as payroll tax filings. In a PEO arrangement, that is the PEO, while your company remains the worksite employer.
Worksite employee. You and your staff, in PEO vocabulary: the employees who work at your company under co-employment.
Master plan. A benefits plan sponsored by the PEO that all its client companies’ employees can join, which is what creates large-group access for small teams.
Pay-as-you-go workers’ comp. Premiums calculated on each actual payroll instead of an annual estimate, which reduces or eliminates year-end audit surprises.
Experience rating. The claims-history factor that influences what workers’ comp costs an employer over time.
Open enrollment. The annual window when employees elect or change their benefits selections.
Transition (in or out). The onboarding process joining a PEO, or the exit process leaving one. Both follow standard playbooks and both have timing that matters, usually quarter and year boundaries.