Do business owners lose control of their businesses?
No. The client retains ownership of the company and control over its operations. As co-employers, the PEO and client will contractually share or allocate employer responsibilities and liabilities. The PEO will generally only assume responsibilities and liabilities associated with a “general” employer for purposes of administration, payroll, taxes and benefits. The client will continue to have responsibility for worksite safety and compliance. It is still the responsibility of the client to hire, direct and guide employees on a daily basis. The PEO will be responsible for payroll and employment taxes, will maintain employee records and will reserve a right to hire and fire. Because the PEO also may be responsible for workers’ compensation, many PEOs also focus on improving safety and compliance. In general terms, the PEO will concentrate on employment-related issues and the client will be responsible for the actual business operations.
