What responsibilities are typically assumed by PEOs?
PEOs assume responsibility and liability for payment of wages and compliance with all rules and regulations governing the reporting and payment of federal and state taxes on wages paid to its employees. The Internal Revenue Service recognizes the PEO as the employer for federal income and unemployment taxes, and case law affirms the principle that the PEO is responsible for payroll taxes. As the employer for employment tax and employee benefits, PEOs assume responsibility and liability for payment of state unemployment taxes. Most states recognize the PEO as the employer of record for UI purposes. Many states also recognize the PEO as the employer for purposes of providing workers compensation coverage. Additionally, PEOs provide worksite employees with coverage under the entire spectrum of employment laws and regulations, including federal, state, and local discrimination laws, Title VII of the 1964 Civil Rights Act, Age Discrimination in Employment Act, ADA, FMLA, HIPPA, Equal Pay Ac
