PEO Comparisons
PEO vs. Staffing Agency: What's the Difference?
A staffing agency finds workers for you. A PEO manages HR for the workers you already have. They solve different problems — and confusing them is one of the most common mistakes businesses make when evaluating HR solutions.
Talk to a PEO ExpertThey Solve Different Problems
A staffing agency solves a talent acquisition problem. If you need workers — temporary, contract, or permanent — a staffing agency recruits, screens, and places them with your business. The staffing agency is typically the employer of record for those workers, handling their payroll and benefits. You pay the staffing agency a markup on the workers' wages, and the agency handles the employment relationship.
A PEO solves an HR infrastructure problem. If you already have employees but are spending too much time on payroll, struggling to offer competitive benefits, or worried about compliance — a PEO co-employs your existing workforce and handles the administrative employer responsibilities. The PEO does not recruit or place workers; it provides the HR infrastructure for the team you have already built.
These two models are not mutually exclusive. Many businesses use a staffing agency to find workers and then bring those workers onto a PEO's payroll once they become permanent employees. The staffing agency and the PEO serve different stages of the employment lifecycle.
In Florida, both PEOs and staffing/employee leasing companies are regulated under the Florida Employee Leasing Companies Act (Chapter 468, Part XI, Florida Statutes). However, the regulatory requirements and operational models are distinct. KeyHR operates as a licensed PEO under Florida law.
Side-by-Side Comparison
| Feature | PEO | Staffing Agency |
|---|---|---|
| Who hires the workers | Client business | Staffing agency |
| Who controls daily work | Client business | Client business |
| Primary employer | Co-employment (shared) | Staffing agency |
| Provides group benefits | ||
| Workers' comp at group rates | Agency's policy | |
| HR compliance support | ||
| Recruiting / talent placement | ||
| Temporary / project workers | ||
| Client retains employer identity | ||
| ESAC accreditation available |
Frequently Asked Questions
What is the difference between a PEO and a staffing agency?
A staffing agency recruits and places workers with client businesses, often for temporary or project-based work. The staffing agency is the primary employer. A PEO co-employs your existing workforce — the employees you have already hired. The PEO does not recruit or place workers; it provides HR infrastructure and employer-of-record services for your current team. You retain full control over hiring, firing, and operations.
Can a PEO help me find employees?
Most PEOs, including KeyHR, do not provide recruiting or staffing services. A PEO manages HR administration for your existing workforce. If you need help finding employees, you would work with a staffing agency or recruiter separately, then bring those employees onto the PEO's payroll once hired.
Is a PEO the same as employee leasing?
The terms are sometimes used interchangeably, but they are technically different. Employee leasing historically referred to arrangements where a staffing company placed workers with client businesses on a long-term basis. Modern PEOs use a co-employment model where the client hires their own workers and the PEO provides HR administration. Florida law specifically regulates both PEOs and employee leasing companies under the Florida Employee Leasing Companies Act.
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KeyHR: HR Infrastructure for Your Existing Team
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