HRPair
For providers
Service model comparison

PEO vs. ASO

Choose a PEO for a broader co-employment relationship; choose an ASO for outsourced administration without co-employment.

PEO

  • Co-employment arrangement
  • May include sponsored benefits access
  • Often bundles payroll, HR, risk, and benefits administration
  • Broader contractual relationship

ASO

  • No co-employment
  • Employer generally retains its own benefit plans
  • Administrative services can still be broad
  • More separation between service functions

How should you make the decision?

Start with the work your company needs performed, the decisions that require internal ownership, the amount of day-to-day capacity required, and the risks of changing models. Then ask providers to map their scope against that operating picture.

A model is not a quality guarantee. Service teams, implementation, systems, pricing, and contract terms differ materially within every category.