Frequently Asked Questions


What is a PEO?

Professional employer organizations (PEOs) enable clients to cost-effectively outsource the management of human resources, employee benefits, payroll and workers' compensation. PEO clients focus on their core competencies to maintain and grow their bottom line.


How does a PEO arrangement work?

Once a client company contracts with a PEO, the PEO will then co-employ the client's worksite employees. In the arrangement among a PEO, a worksite employee and a client company, there exists a co-employment relationship in which both the PEO and client company have an employment relationship with the worker. The PEO and client company share and allocate responsibilities and liabilities. The PEO assumes much of the responsibility and liability for the business of employment, such as risk management, human resource management, and payroll and employee tax compliance. The client company retains responsibility for and manages product development and production, business operations, marketing, sales, and service. The PEO and the client will share certain responsibilities for employment law compliance. As a co-employer, the PEO will often provide a complete human resource and benefit package for worksite employees.

Why would a business use a PEO?

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 backgrounds in risk management, insurance and employee benefit programs to meet the demands of being an employer. PEOs give small-group markets access to many benefits and employment amenities they would not have otherwise.


How are these new employee benefits communicated to my employees?

LEGACY assigns a Human Resource Representative (HRR) to each of our clients. The HRR will schedule benefit presentations at your worksite(s), including Section 125, 401(k) and medical benefits. The HRR will also handle orientation and benefit enrollments at that time.


What pay schedule does LEGACY use to pay my employees?

LEGACY will not dictate your pay schedule. You may choose to stay on your current pay schedule or select a new one.

What does it take to get started, and what are the contractual agreements?

It's simple: we work with you to develop a client service agreement outlining mutual responsibilities, rates and terms. Upon agreement, LEGACY begins to work on your behalf to make your workplace the best it can be.


What will my employees think about getting their paycheck from LEGACY?

Communication is key during this change process. LEGACY will work with you to get to know the employees and develop a rapport with them. In reality, they probably won't notice a big change, other than they begin to enjoy the advantages of having a professional human resources department. As an employer, you can feel good that you have made it possible for your employees to access a benefits package that is typically only available at large companies.

It does IRS forms, pays payroll taxes, writes paychecks and handles the acres of paperwork that big companies have staff to handle but small business owners and their spouses often do late in the evenings or weekends.