Employee Lesaing, PEO, Or Payroll Leasing - What's In A Name

In a world where it is increasingly common for business owners to outsource their payroll, workers' compensation insurance, and HR to guys like me, a more appropriate question is "why all the names?", when all three of the terms in this title correctly describe exactly what we do.

That's right. You can pick your favorite of the three, and use the second as a definition, and the third for...well, I guess, redundancy! This confuses PEO prospects, PEO referral sources (insurance agents and accountants), and if you are reading this than it probably confuses you, too. (Chances are that you are familiar with one of the three terms, and the other two sounded like sort of distant half cousins, right?) Now you know that you are in good company.

Therefore, having clarified this situation for you, you may now use whichever term you prefer to describe my industry. (We PEO-owners & enthusiasts just hope it's nice!) For the traditionalist, the term "employee leasing firm" is what the founding fathers used when the industry began in the mid-80's.

The contemporary may opt to address us with the term "PEO" which is the most commonly used term and most searched term for my industry on Google. (It is worth mentioning that "PEO" stands for "professional employer organization" and that our industry association and lobbyist is NAPEO).

The progressive-minded may prefer the more edgy term "payroll leasing firm" which just recently has come into vogue.

Not to digress, but PEO brokers offer the same 3-name ambiguity, too. (PEO brokerage firms are businesses that represent several different PEOs. The relationship is similar to the way in which insurance agencies represent a multitude of carriers).

PEOs and PEO brokers somewhat informally agreed several years ago to phase out the term "employee leasing". In theory, it made sense at the time to simplify the verbiage, favoring the term used within NAPEO's name. In practice, most industry insiders, including me, agree that it is too risky from a marketing standpoint to abandon the older term, although it is often relegated to parenthesis, next to the term PEO.

In closing, you are always welcome to check out the terms HRO, ASO, and BPO if you want to get confused all over again.

Source: http://ezinearticles.com/?Employee-Lesaing,-PEO,-Or-Payroll-Leasing-Whats-In-A-Name&id=944611
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