Top PEO FAQs

August 29, 2019 Written by Oralie Chapman

While more and more small businesses are partnering with Professional Employer Organizations (PEOs), many more are in the process of deciding or may need help with HR functions but don’t know about PEOs or what they can do for their business. As a PEO, we know how much we have to offer small businesses and we are here to answer your questions.

Top PEO FAQs


What is a PEO?

A PEO is a company that provides a full range of HR services for small businesses through a co-employment agreement.


How does a PEO benefit small businesses?

Small businesses benefit from partnering with a PEO in many ways including compliance with labor laws, better quality benefits and workers’ compensation insurance (WIC) and saving time on payroll and HR administration. PEOs allow small businesses to benefit from the same types of affordable insurance and benefits plans normally only offered to large businesses.


What is the PEO business model?

Most PEOs charge a monthly fee per employee, including Makai HR. The idea is that PEOs bring big financial savings to small businesses in HR administration, the cost of employee benefits and WIC. In many partnerships, the savings are more than the monthly fee.


How many employees do I need to partner with a PEO?

PEOs work with companies of all sizes. At Makai HR, we cater our plans to the size of your business; working with companies with 2-4 employees to 80 plus.


What services does a PEO provide?

While services will vary a bit from PEO to PEO, most provide:

  • Employee benefits plans and administration
  • Worker’s compensation plans and administration
  • Payroll services
  • HR support (Makai’s is 24/7)
  • Compliance with HR laws and protection from claims


Makai HR also offer paperless technology and Visa paycards.


What does co-employment mean?

When businesses partner with a PEO, their employees become employed by the PEO when it comes to HR functions; this is called co-employment. Hiring, firing and other personnel decisions remain in the hands of the business owner.


What is the difference between employee leasing and co-employment?

Employee leasing is when a business supplies workers to a company, often for short-term work. Co-employment is an agreement between a PEO and a business that allows the PEO to manage the company’s HR administration without supplying labor or making personnel decisions for the business.


Will I still own my business / be able to make my own decisions If I partner with a PEO?

Yes! A PEO is there to support your business operations and decisions but does not take any ownership of your company or control over your decisions.


Partnering with Makai HR


When you partner with Makai HR you can get on with the business you are trying to grow while we take care of your employee needs from 401(k) plans to payroll, taxes, health insurance/benefits, and worker’s compensation. You also gain peace of mind that you are in compliance with all of Hawaii’s employer laws (if you’ve ever looked you know that the list is very long). When choosing a PEO to partner with, there are many things to consider including cost, services and technology solutions.


With the cost of doing business in Hawaii at record highs, we know how important it is to keep labor costs in line with revenue. Our plans are priced competitively and include value-added services like time-in/time-out systems. Our three tiers of PEO service plans are tailored to the size of your business and specific needs. We offer a 100% paperless solution which means that your employees can manage their needs through a computer, tablet or phone. We can truly improve your employees work benefits while freeing you up to run your business.


What are you waiting for? Companies who partner with a PEO benefit from 7-9% faster growth, 10-14% lower employee turnover; and they are 50% less likely to go out of business. Contact us today to get started!