In today's rapidly evolving business landscape, companies are increasingly turning to outsourcing solutions to manage their human resources needs.
Three popular options have emerged: Employer of Record (EOR), Administrative Services Organization (ASO), and Professional Employer Organization (PEO). But what exactly are these services, and how do they differ? Let's dive in and explore each option to help you make an informed decision for your business.
Employer of Record (EOR): The Global Hiring Solution
An Employer of Record is a third-party organization that takes on the role of the legal employer for your workers. This model has gained significant traction in recent years, especially for companies looking to expand internationally or hire remote global teams.
Key features of an EOR include:
- Full legal employment responsibility
- Comprehensive services including payroll, benefits, HR, and compliance
- Ideal for international hiring without establishing local entities
- High flexibility for scaling teams up or down quickly
EORs are particularly valuable for businesses venturing into new markets or those seeking to tap into global talent pools without the complexities of setting up local subsidiaries.
Examples: Deel, Remote, Thera
Administrative Services Organization (ASO): Tailored HR Support
An ASO offers a more selective approach to HR outsourcing. With this model, your company remains the legal employer while outsourcing specific administrative tasks.
ASO characteristics include:
- Client retains legal employer status
- Provides selective administrative support (e.g., payroll processing, benefits administration)
- Typically operates domestically
- Offers moderate flexibility in services used
ASOs are well-suited for companies that want to maintain control over their employment relationships while offloading certain HR functions to experts.
Examples: Paychex ASO
Professional Employer Organization (PEO): Comprehensive HR Management
PEOs offer a unique co-employment model where they share employer responsibilities with your company. This option provides a comprehensive suite of HR services.
PEO highlights:
- Co-employment model
- Offers full-spectrum HR services including payroll, benefits, compliance, and risk management
- Shares legal liability with the client company
- Primarily focused on domestic operations
PEOs are often the go-to choice for small to mid-sized businesses looking for all-encompassing HR support without the need to build an extensive in-house HR department.
Examples: Justworks, Vensure
About Rollfi
Rollfi provides the fastest way for Banks, Vertical SaaS companies, Accounting Firms, and Fintechs to integrate payroll and benefits into their offerings through our white-label solutions + robust APIs. By leveraging Rollfi’s infrastructure, businesses can quickly unlock new revenue streams, increase customer retention, and access valuable payroll data insights wether you choose to launch an EOR, ASO or PEO. With rapid deployment and comprehensive coverage, Rollfi transforms your platform into a one-stop-shop for essential services, driving growth and enhancing customer satisfaction.
