PEO Cost Savings Calculator
See how much a Professional Employer Organization could save your business across payroll taxes, benefits, workers' comp, and HR administration. Enter your numbers for an instant estimate.
How much could my company save with a PEO?
A Professional Employer Organization changes the economics of employing people. Instead of buying payroll, benefits, workers' comp, and HR separately at small-business rates, you tap into a large-group platform that lowers the cost in every category. Here is where the savings come from.
Workers' Comp
PEOs pool thousands of employers into a single large-group workers' comp policy. Small businesses that pay high manual rates on their own often see 15 to 25 percent reductions through group pooling, with no down payment and pay-as-you-go premiums.
Payroll
PEOs handle payroll processing, tax filing, and garnishments as part of their service. You stop paying separate payroll software and processing fees, and you eliminate the risk of costly payroll tax mistakes.
Benefits
Through a PEO, your employees access Fortune 500-level medical, dental, vision, and 401(k) plans at large-group rates. Small businesses typically see a 20 percent reduction in benefits spend while offering better coverage than they could buy alone.
HR
A PEO gives you a full HR department, including compliance, employee relations, onboarding, and handbook support, for less than the cost of one in-house HR hire.
Payroll Taxes
PEOs implement Section 125 cafeteria plans and other IRS-approved strategies that save roughly $1,100 per employee per year in payroll taxes, with no change to take-home pay.
Administrative Costs
PEOs consolidate payroll, benefits admin, HR, and compliance into one platform and one monthly invoice. You eliminate overlapping software subscriptions and the admin time spent coordinating multiple vendors.
Turnover
Better benefits and professional HR support reduce turnover. Businesses that move to a PEO typically see a 20 to 30 percent drop in departures, which saves thousands in recruiting and training costs.
Compliance
PEOs share liability for employment law compliance, including FLSA, ACA, I-9, and OSHA. You get expert guidance and documented processes that protect your business from audits, fines, and lawsuits.
Your savings estimate will appear here
Enter your employee count and average salary, then hit calculate to see your estimated annual PEO savings across four cost categories.
How this works
This calculator estimates savings from four areas where PEOs typically reduce costs: payroll tax optimization (Section 125 plans and FICA savings average about $1,100 per employee per year), group benefits purchasing power (roughly 20 percent reduction on benefits spend), workers' comp rate pooling (roughly 20 percent reduction on premiums), and HR administration overhead (approximately $750 per employee). Actual savings vary based on your industry, location, current provider, and employee demographics.