How Much Does Paychex Employee Leasing Cost?
Last Updated: August 16, 2022
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Employee leasing is a form of HR outsourcing in which an employee leasing company becomes a co-employer of your workforce. For companies that are dedicating excessive time and energy to administrative and legal human resources (HR) processes, or for those without a dedicated HR department, employee leasing through a Professional Employer Organization (PEO) can provide some much-needed assistance.
As the legal employer of record, a PEO is responsible for payroll, filing taxes, supplying benefits, and other HR functions. This is in addition to assuming the legal liabilities associated with managing employees. The main benefits of human resource outsourcing through a PEO is that it allows you to offer better benefit packages to workers, control costs, and free up time to focus on business operations.
One of the premiere professional employer organizations is Paychex, Inc. Paychex is an industry-leading provider of human resource solutions that serves more than a half million businesses across the country. To learn more about Paychex employee leasing, including what services they offer and how much they cost, continue reading this buying guide.
An Overview of Paychex Employee Leasing #
Paychex staff leasing can offer your business the following HR solutions:
- Payroll: Paychex payroll, one of the most used payroll outsourcing services in the country, is included with your PEO personnel leasing package. Let the experienced HR professionals of Paychex handle every phase of payroll, including handling new hire reporting with the government, making payroll tax payments, and providing your company with management reports and supplies.
- Benefits: Paychex benefits professionals will see to it that you can offer your employees exceptional benefit packages, including 401(k) and retirement services. This will help lower your tax burden and retain staff.
- HR Administration and Compliance: With more than 100 agencies that regulate business, keeping up with HR requirements can be an administrative nightmare. With Paychex employee outsourcing, however, you need not be concerned about creating handbook and policy documents, managing workers' compensation, processing unemployment claims, meeting insurance continuation requirements, and keeping up with other HR administration and compliance processes.
- In-House Support: When you enter into a PEO agreement, one of the Paychex services you receive is on-site support through a primary contact who'll provide training, employee benefits orientation, and much more. You'll also have access to a team of HR specialists including an account manager and a safety and loss control representative.
- Other services: A number of optional services are also available through Paychex staff leasing, such as employee background checks, drug testing, time and labor solutions, and tax credit services.
Paychex Employee Leasing Average Costs #
Actual Paychex employee leasing costs can vary significantly based on the size of your business, the industry you work in, and the services you require. Because of this, the following prices for human resource outsourcing are only meant to serve as a general overview.
There are multiple aspects to pricing PEO services. The first is a setup fee, which costs around $1,000 to $5,000 dollars. In addition to this one-time charge, you will also be assessed a percentage of gross payroll, typically around 2% to 6% per employee per pay period (though this amount could be closer to 15% for comprehensive employee leasing solutions). Finally, Paychex may charge you between 1 and 10% of each worker's salary for workers' compensation.
For additional Paychex employee leasing services like drug screening and background checks, expect to pay around $50 to $100 per employee. Tax credit services and time and labor solutions also cost extra.
Paychex Employee Leasing Sample Costs #
For a better idea of what real world PEO costs might be, consider what these businesses paid for employee leasing:
- A New Jersey education company paid approximately 15% of payroll to lease its entire workforce.
- An insurance company from Arkansas with two employees paid $70 per month for benefits, payroll, and taxes.
- A Tennessee business services company paid around 20% for workers' compensation, payroll, and taxes.
- A Texas manufacturer was charged about $100 per month for each employee.
- A consulting business from New Jersey pays roughly $120 per employee per month and was also charged an initial $3,000 fee.