PEO Cost Calculator

Estimate potential savings by using a Professional Employer Organization (PEO) for HR services.

Enter the total number of employees.
$
Enter the average salary for each employee.
$
Enter the total annual payroll if known, otherwise it will be calculated.
%
Enter the current PEO fee percentage.
%
Enter the new PEO fee percentage you are considering.
%
Enter the current workers' compensation rate.
$
Enter the current health insurance cost per employee.
%
Enter the current unemployment insurance rate.
Estimated PEO Savings
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Current Total PEO Cost
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New Total PEO Cost
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Savings
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Total PEO Administration Fee
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Key Takeaways

  • PEOs can offer significant cost savings compared to internal HR management.
  • This calculator helps estimate potential savings by switching to a new PEO.
  • It considers various factors like salary, PEO fees, and insurance costs.
  • Understanding these costs can help businesses make informed HR decisions.

How to Use the PEO Cost Calculator

To use this calculator, input the number of employees, average salary per employee, and any known payroll details. Adjust the PEO fee percentages to see potential savings. The calculator will provide an estimate of current and new PEO costs, along with potential savings.

Formula

The formula calculates total payroll if not provided, applies PEO fee percentages to determine costs, and calculates savings by comparing current and new PEO costs.

Example Calculation

Consider a company with 10 employees, each earning an average salary of $50,000. If the current PEO fee is 5% and a new PEO offers 4%, the calculator will show potential savings by switching.

Tips for Using the Calculator

  • Ensure accurate input of employee numbers and salaries for precise calculations.
  • Consider all HR-related costs when evaluating PEO options.
  • Use the Salary Calculator for detailed salary breakdowns.

Considerations

While PEOs can reduce HR costs, consider the quality of services and support provided. Evaluate both cost and service quality when choosing a PEO. For more insights, check our Paycheck Calculator and ROI Calculator.

Frequently Asked Questions

What is a PEO?
A Professional Employer Organization (PEO) provides comprehensive HR services to businesses, including payroll, benefits, and compliance management.
How does a PEO save money?
PEOs can save money by leveraging economies of scale to offer lower costs on benefits and reducing administrative burdens.
What factors affect PEO costs?
PEO costs are influenced by the number of employees, average salaries, and the specific services provided by the PEO.
Can I use this calculator for any business size?
Yes, this calculator is designed to accommodate businesses of various sizes, from small to large enterprises.
Are there other calculators that can help with HR costs?
Yes, calculators like the Salary Calculator and Paycheck Calculator can provide additional insights.