How does an Employee Leasing company help me?

A leasing company's economy of scale enables each client company to lower employment costs and increase the bottom line. The client can maintain a simple in-house HR infrastructure or none at all by relying on the leasing company. The client also can reduce hiring overhead. The professionals at the leasing company can provide critical assistance with employer compliance, which helps protect the client against liability. In many cases, the client can pay a small up-front cost for a significant technology and service infrastructure or platform provided by the leasing company. In addition, the leasing company provides time savings by handling routine and redundant tasks for its clients. This enables the business owner to focus on the company's core competency and grow its bottom line. For a list of services, click here.

Why use a Leasing Company?

Business owners want to focus their time and energy on the "business of their business" and not on the "business of employment." As businesses grow, most owners do not have the necessary human resource training; payroll and accounting skills, the knowledge of regulatory compliance, or the background in risk management, insurance and employee benefit programs to meet the demands of being an employer. Leasing companies give small-group markets access to many benefits and employment amenities they would not have otherwise.


Do the business owners lose control of their businesses?

The client retains ownership of the company and control over its operations. As co-employers, the leasing company and client will contractually share or allocate employer responsibilities and liabilities. The leasing company 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. The leasing company will be responsible for payroll and employment taxes. Because the leasing company also may be responsible for workers' compensation, many leasing companies also focus on and improve safety and compliance. In general terms, the leasing company will focus on employment-related issues and the client will be responsible for the actual business operations.


Who uses Employee Leasing services?

It is estimated that 2-3 million Americans are currently co-employed in an employee leasing arrangement. The average leasing company has grown more than 20 percent per year for each of the last six years, according to a survey of NAPEO members. Employee leasing companies have an 88 percent client retention rate due to strong client satisfaction. NAPEO member companies are estimated to account for more than 70 percent of the industry's gross revenues.