Co-Employment

Co-employment is the relationship between an employer and a firm specialized in employee leasing or a Professional employer organization (PEO).

Co-employment definition

Co-employment is the relationship between an employer and a firm specialized in employee leasing or a Professional employer organization (PEO). It includes the division of responsibilities for human capital management between an HR department and a PEO.

Advantages and disadvantages of Co-employment

Companies opt for co-employment to ensure they have qualified workers and to make it easier to hire industry experts. The PEO handles administrative and personnel-related activities while the employer controls their role in business such as daily job responsibilities.

Disadvantages of the practice include:

– unemployment potential increase due to a lowered need for labor

– confusion between two companies working with the same employee

– employees being unsure of whom they should speak to when a problem arises