8 Best PEO Companies for Small Businesses in 2023

Like Rippling and Papaya Global, Justworks lets you do out-of-cycle pay runs at no extra cost. The five other PEO companies on our list charge for each pay run. Aside from processing payments for employees, contractors, and vendors, Justworks handles the applicable federal, state, and local tax payments and filings, including year-end tax reporting. However, its payment options are limited—Justworks pays only via direct deposits and paper checks. For a pay card option, check out ADP TotalSource, XcelHR, Paychex, and Insperity.

In addition to viewing pay slips and benefits, Justworks’ online self-service portal makes it easy to onboard new hires. It allows employees to complete online forms, access tax and payroll documents, read company policies, request paid time off (PTO), and more. However, it doesn’t have mobile apps for its self-service tools. We recommend ADP TotalSource, XcelHR, Rippling, Paychex, or Insperity if you need an employee portal on mobile.

Justworks offers competitive medical plans from top carriers like UnitedHealthcare, Kaiser, and Aetna. It also has enterprise-level options for dental, vision, accidental death, disability, and life insurances, including flexible spending accounts (FSAs) and health savings accounts (HSAs). It even has Teladoc solutions, gym benefits, and medical advocacy services. While Justworks’ benefits offerings are competitive with the PEO companies on our list, ADP, TriNet, and Paychex have employee discount programs, and XcelHR has unique benefits options like home insurance and legal assistance.

Justworks’ “Benefits Center” lets you and your employees select and enroll in benefits plans.
(Source: Justworks)

In addition to having HR experts who keep you up-to-date on labor laws and compliance, it proactively works to keep you compliant. Justworks does this by providing free sexual harassment prevention training videos that meet state regulations. It even has some state policies preloaded into its software. Further, Justworks (along with TriNet, ADP, Paychex, and Insperity) is an IRS- and ESAC-certified PEO.

Unlike ADP TotalSource and XcelHR, which look dated, Justworks is user-friendly and aesthetically pleasing. Its platform also contains in-app links to articles that explain points of law and compliance, including how to use the software. If you need assistance, its customer support personnel are available 24/7 through email, chat, phone, SMS, and Slack.

Rippling offers full-service payroll and tax filing services (federal, state, and local taxes), including year-end reporting (W-2s and 1099s). It tracks PTO, handles deductions, and pays garnishments. You can pay employees through direct deposits and checks, but not by pay card. For that option, consider ADP TotalSource, XcelHR, Insperity, and Paychex.

Rippling offers Fortune 500-level medical, dental, and vision insurance. It also has FSA, HSA, commuter benefits, and EPLI coverage, and handles Affordable Care Act (ACA) and COBRA administration as well. It even offers one-on-one expert healthcare support to employees who have benefits plan questions, medical bill disputes, or a need for help in finding the appropriate type of care/clinic for their symptoms. However, it lacks some specialty benefits, such as XcelHR’s non-standard legal assistance or pet insurance, Justworks’ medical advocacy services, and ADP’s, TriNet’s, and Paychex’s employee discount plans.

While Rippling doesn’t have an ESAC or IRS certification, it nonetheless offers tools and advice to help you stay compliant with payroll, safety standards, and labor laws. However, if you need strong compliance support to conduct safety audits and meet Occupational Safety and Health Administration (OSHA) requirements, we recommend you partner with ADP TotalSource, Paychex, TriNet, or XcelHR.

For technical companies that use a lot of different software, Rippling is the best for onboarding. In addition to the usual new hire documents, it lets you assign computers and software licenses to employees. It can even provide the computers with software preloaded and helps with the return of hardware at termination. Only Rippling offers essential IT tools for device and business app management among the PEO companies we reviewed.

With Rippling, you can manage company-assigned computers and business software access with ease.
(Source: Rippling)

If you no longer require PEO services, you can quickly switch Rippling’s PEO off and use its HR platform. This differs from all the others on our list, which don’t have an easy on/off option and a seamless transition to HR software.

Despite the modularity of the software and the extreme number of integrations, Rippling is very user-friendly, with helpful menus and icons for both in-app and third-party tools. All of its solutions “talk” to one another, so you don’t have to enter any information twice. However, while it has an online help center, its how-to articles are a bit limited.

XcelHR automates payroll, integrating benefits and deductions in its calculations. Like Paychex, Insperity, and ADP, it pays employees either by check, direct deposit, or pay card. It handles federal, state, and local taxes, including all the required tax forms. It also files end-of-year paperwork and maintains IRS compliances. However, as of this writing, XcelHR is not on ESAC or IRS certification lists (it was IRS-certified in the past).

Its job costing tool computes employee wages per job or department, something not many PEO providers handle naturally. Rippling, for example, has job costing tools but the calculations are based on the employees’ work hours instead of total wages (which includes additional earnings like bonuses and allowances).

It uses MetLife’s Preferred Provider Organization (PPO) plans for dental and runs a 401(k) option through Slavic401k. In addition to FSAs, it has disability, critical illness, and group accident insurance plans. However, if you want HSA options, we recommend partnering with Justworks, ADP TotalSource, Insperity, or Rippling.

XcelHR’s wide selection of nonstandard benefits are what sets it apart from the other PEO companies on our list. You can select legal assistance plans, auto and home insurance, telehealth services, hospital indemnity insurance, and pet insurance. You are also granted access to exclusive travel and entertainment discounts. It even offers an employee assistance program to help workers cope with stress, get legal or financial advice, and more.

You can get assistance on job description writing, resume reviews, and phone interviews, including drug testing, background checks, and pre-employment testing. Advisers can help craft policies and assist in performance management. Unlike Justworks, XcelHR can help create specific reports if the options provided in the software don’t meet your needs.

XcelHR advises you on all aspects of compliance—from fair hiring practices to legally terminating an employee. It excels in safety, with workers’ compensation teams that help you develop OSHA-compliant programs, manage a safety training library, and conduct safety audits (Paychex offers safety assessments as well).

If your regular payroll doesn’t change, Paychex lets you run payroll in as few as two clicks. It can pay via direct deposit and pay card—note that not all the PEO companies on our list offer a pay card option, which is becoming more popular with GenZ workers. Like ADP, it also supports paper checks and even offers check stuffing services. However, you have to pay extra for check mailing services.

Paychex offers international payroll through its partner vendor, FMP Global. For global payroll services, we recommend ADP TotalSource, Rippling, and Papaya Global.

Paychex offers several benefits plans, such as dental, vision, dependent care FSA, financial benefits, and a Paychex-run 401(k). It has enterprise-level insurance that includes health maintenance organization (HMO) coverage, PPO options, and high deductible plans. Like ADP, it has an employee discount program, but for nonstandard benefits like pet insurance, you need to go to XcelHR.

You get a team of experts, with each member specializing in an area of your PEO plan, plus an HR generalist. Not every PEO on our list (except ADP) offers a team setup like this. In addition to onboarding and offboarding tools, you can get other HR solutions like an AI-powered learning management system (LMS) that recommends courses based on the employee’s position and work goals.

Paychex offers employment practices liability insurance (EPLI) and cyber liability insurance. Further, its HR team provides proactive updates on legislation changes, and a Paychex safety rep can even help you assess and mediate risks and meet OSHA requirements. This is similar to XcelHR, which also offers safety reps through its workers’ comp programs.

Paychex PEO is managed with the Paychex Flex software, which is easy to set up and use. Aside from granting you access to a team of HR experts, it offers 24/7 phone support.

Aside from Paychex Flex’s user-friendly interface, its tools are designed to automate HR tasks, which include managing employee-related documents.
(Source: Paychex)

TriNet offers paperless W-2, calculates and manages payroll, and takes care of federal, state, and local taxes. TriNet even handles unemployment claims for you. What sets it apart from the other PEO providers we reviewed is that it allows employees to import W-2s directly into TurboTax.

Unlike most of the providers on our list, which either don’t have time clock software or charge extra for it, TriNet has time and attendance features. It offers a scheduling solution that can generate schedules with your policies in mind and optimizes staff mix. It also lets you set employee work shifts by client, department, and location.

Like most PEOs, TriNet leverages the power of all its small business customers to get excellent rates on major medical insurance. Unlike some, however, it offers plans from a variety of providers, including Aetna, Kaiser Permanente, UnitedHealth, MetLife, and Aflac. It has retirement plans, critical accident and illness policies, and nonstandard benefits, such as home and pet insurance. Like Paychex and ADP, it offers a discount plan and also invites its customers to add products to the program, giving them a marketing boost as well.

You’ll have access to HR advisers, performance management tools, and training programs that include professional courses for online learning and certifications. Like Insperity, it even offers leadership training. TriNet also has employee culture surveys and a team engagement tool to help you develop better employees and working groups. However, some of these solutions may increase the price of your overall plan.

TriNet can provide industry-specific guidance on compliances and labor rules, keeping you up-to-date on the latest employment laws and regulations. Similar to XcelHR and Paychex, it has a team that can assess your workplace for hazards and violations. In addition, TriNet can provide active management of claims against you for employment practices, including pre-negotiated legal fees and caps with external counsels if needed.

Insperity pays by direct deposit, pay card, and checks. It also comes with 50 prebuilt payroll-related reports (including job costing), and you can request a customized report. However, it doesn’t support global payroll, so we recommend using either ADP, Papaya Global, or Rippling if you have international workers.

Apart from an employee assistance program, you can access enterprise-level health, dental, and vision plans, FSA/HSA, life and accident insurance, and basic disability insurance. You can use an Insperity-run 401(k) plan or sponsor your own Insperity Customized 401(k) designed for your specific situation with various options for eligibility, enrollment, vesting, and more. However, it lacks a health reimbursement arrangement (HRA) program like Paychex has. And if you’re looking for nonstandard benefits, XcelHR has a diverse range of options that include automobile, home, and pet insurance plans.

A snapshot of Insperity’s benefits module
(Source: Insperity)

Compared to Justworks and XcelHR, Insperity’s employee engagement and training tools are more robust. In addition to the usual HR support (such as handbooks and onboarding), Insperity provides excellent employee development and engagement tools. It assists with conducting culture surveys, crafting mission statements, and customizing a rewards program for your staff. Plus, it helps keep employees learning with over 30,000 online books, 2,000+ audiobooks, and more than 5,000 self-paced courses in business, technology, and compliances, among others.

Its reps can help keep you compliant with various regulations, such as hiring, tax, payroll, and termination rules. It also supplies labor law posters and even has an Equal Employment Opportunity Commission (EEOC) hotline for employee grievances. However, it doesn’t have ADP TotalSource’s legal defense benefit or Paychex’s cyber liability insurance coverage.

Insperity’s self-service solutions let your staff view and make changes to their benefits from a computer or mobile device. If your employees have questions about a plan’s coverage, they can contact Insperity’s benefits specialists 24/7.

Insperity grants you access to dedicated reps and a team of HR specialists. While it has how-to articles, the guides are basic and difficult to find online.

With Papaya Global acting as the EoR, it can hire international employees and pay them on your behalf. It also provides benefits and workforce management through its network of partners located across 160+ countries.

Aside from calculating withholdings and deductions, it can handle payroll for both employees and contractors. Papaya Global pays your employees (via direct deposits and bank transfers) in their local currency with pay stubs in their local language. It also handles payroll taxes—from documentation to payments and year-end filings—wherever you have employees. Moreover, its platform lets you view payroll information in one location, by country, and as a whole business.

Papaya Global analyzes your benefits plans by country to help you come up with attractive packages. In addition to standard benefits, it can help you create incentives for executives or equity rewards for workers. Not every PEO offers this high-level focus. It works between you and the EoR to deliver the plan.

In addition to managing payroll, Papaya Global provides access to HR documents, sends monthly employee status reports, and reminds you of birthdays and work anniversaries. However, it doesn’t have 24/7 support. This is unlike ADP TotalSource, Justworks, and Paychex, which offer round-the-clock support.

As an EoR for foreign businesses, it provides local expertise to ensure compliance with local regulations and laws. Papaya Global also monitors global tax laws to keep you compliant and even tracks work permits, residence permits, and family permits. Other PEOs (like Rippling and ADP TotalSource) don’t offer immigration-related services.

Papaya Global has an online “Countrypedia” that contains helpful information about a country’s standard salary rates, basic labor regulations, and more.
(Source: Papaya Global)

You get a dedicated onboarding manager to get you started and access to in-country experts for questions. It also integrates with your existing HRIS, ERP expense management, and time and attendance systems. However, its integration options aren’t as robust as Rippling’s 500+ partners.

With ADP TotalSource, pay processing takes minutes to calculate, and its system flags potential errors. In addition to payroll tax filing (federal, state, and local taxes) and year-end reporting (W-2s/1099s), it manages withholdings and benefits. Plus, if you have questions, you can call a payroll expert 24/7.

ADP TotalSource supports several employee payment options, such as via direct deposits, paychecks, and the Wisely pay card. Similar to Paychex, it also offers check signing and stuffing services. For employers with preferred payment options of only direct deposits and checks, then Justworks and Rippling are good alternatives.

ADP TotalSource leverages the power of over 500,000 client employees under its PEO to get Fortune 500-level healthcare options for your business. It also conducts an annual comparison against your competition to ensure you offer the best benefits to your employees. Benefits options include COBRA administration, commuter benefits, medical, 401(k) plans, life and accident insurances, FSA and HSA accounts, health advocacy services, a work-life employee assistance program, and even a discount program. Nonetheless, XcelHR’s benefits selection is more diverse with general legal services and even an insurance option for your employees’ pets.

ADP provides hire-to-retire support to recruit and track applicants, onboard new hires, manage employee information (including performance reviews), and offboard or terminate employees. It has training and development programs, employee survey management, and more. However, you have to pay extra for time tracking, employee engagement tools, and full-service recruitment. This is unlike Insperity’s services, which include a complete HR solution with strong employee development tools.

ADP TotalSource offers an intuitive onboarding solution that streamlines essential processes.
(Source: ADP)

ADP TotalSource’s HR experts have decades of experience and are constantly learning. They can advise you on compliances in everything from COVID-19 legislation to terminating employees. Its compliance services can help you avoid potential legal issues. Further, ADP may provide legal assistance if an employee sues your company—provided you followed its recommended processes. ADP TotalSource is the only PEO that we reviewed that has this feature.

Employees can onboard through the portal and enroll in benefits. They can also use the portal to raise PTO requests, clock in/out, create timesheets, view pay stubs and benefits, and contact colleagues. And unlike Justworks, it has employee mobile apps (for iOS and Android devices) with intuitive controls.

A PEO company provides businesses with a co-employment option, allowing it to share and manage employee-related responsibilities and liabilities with you. Typically, PEOs serve as your employees’ professional employer for payroll and tax purposes. However, you still have complete control over business decisions and operations.

With its full-service human resource outsourcing services, a PEO company handles your day-to-day administrative tasks—from pay processing to benefits administration and workers compensation management. Risk mitigation and HR compliance support are also included in a PEO’s services. Some PEO companies even provide end-to-end talent management solutions, such as hiring, training, and employee performance reviews.

PEO companies follow different pricing schemes, most of which are based on employee headcount. Some have flat monthly per-employee fees, while others charge a percentage of your worker’s salary. A few PEOs also consider your company’s credit rating and your employees’ health benefits history to determine pricing.

For PEOs with flat monthly pricing, expect to pay somewhere between $40–$160 per employee monthly. For PEOs that charge a percentage of payroll, the fee is about 2%–12% of payroll.