PEOs enable small businesses to attain insurance and other benefits at lower costs because the PEO absorbs the small company's employees into a larger insurable group.

Question

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The PEO becomes the legal employer of a small firm's employees, and the employees are absorbed into a much larger insurable group. As a result, a small business owner may be able to get insurance (as well as benefits like 401(k))for its people that it couldn't otherwise.

PEOs Enable Small Businesses to Attain Insurance and Other Benefits