For the Business -

• Controls costs
• Saves time and paperwork hassles
• Provides professional compliance (e.g., payroll, IRCA, EEOC)
• Reduces turnover and attracts better employees
• Claims management (e.g., workers' compensation, unemployment insurance)
• Provides better benefit package(s)
• Provides professional HR services (e.g., employee handbooks, forms, policies and procedures)
• Reduces accounting costs

For the Employee -

• Comprehensive benefits previously unavailable
• Better employee/employer communications
• Payroll on-time and accurate
• Professional assistance with employment related problems
• Professional orientation and employee handbook
• Extends statutory protection to more employees
• Up-to-date information on labor regulations and workers' rights, worksite safety
• Efficient and responsive claims processing
• Portable benefits (employees can move from one PEO client to another without loss of eligibility for benefits
• Security

For the Government -

• Consolidates several small companies' employment tax filings into one
• More professional preparation and reporting
• Accelerated collection of taxes
• Extends medical benefits to more workers
• Expands the communication of government requirements and changes to small business
• Resolves many problems before they reach court
• Allows government agencies to reach small business through a single-employer entity

Source: www.napeo.org