People PEO Joint EmploymentA partnership approach to employment.
A joint-employment route designed to bring agency and PEO responsibilities together with clear documentation and oversight.
People PAYE and your agency jointly employ the worker and share the day-to-day responsibilities, while we discharge every statutory obligation. Workers feel a stronger sense of belonging with your agency.
Two minutes here, with a pay estimate — then our secure portal.
A better way to pay.
PEO stands for Professional Employment Organisation and is an employment solution originating in the USA. Our PEO has been developed for the UK recruitment market based upon legislation and input from governing bodies. We’ve operated the model since 2017 paying thousands of contractors across many agencies in different sectors.
Our PEO model provides a tried and tested outsourced PAYE solution. PEO offers full supply chain transparency. It’s a simple PAYE solution for recruitment agencies who prioritise customer satisfaction and contractor loyalty.
What is a PEO?
It’s one of several payroll options available to recruiters to outsource their payroll function. Based on PAYE, and providing a partnership approach to employing workers, there are benefits for all parties.
Origins
The model originated in the USA to offer affordable private healthcare cover for smaller employers. Small companies found it hard to source affordable life and medical cover for their employees, so a PEO combined all the small companies together to form a large group organisation and then access life and medical cover at corporate rates.
People Group Services has led the way in the sector, bringing the model over to the UK and innovating and modifying it to create a solution that is perfect for the UK market.
How does it work?
There is no rocket science. To fully understand the inner workings of PEO, we recommend downloading our Guide to PEO.
However, put simply it’s outsourced PAYE with some advantageous elements for both recruitment agencies and contractors.
When using People PEO payroll the contractor gets access to a wide range of benefits and a much simpler pay slip helping to maintain trust and minimise queries right from the start. And for recruitment agencies, they reap the benefits of hassle-free payroll, less contractor enquiries, cash flow and cost efficiencies and a positive increase in brand perception.
What is the difference between PEO Joint and PEO Sole?
Fuelled by unparalleled contractor demand and agency appreciation, PEO is our fastest growing payroll solution. Furthermore, the model can be customised to best meet the needs of agencies within the UK. There are two main options.
People PAYE and your agency jointly employ the worker
People PAYE Limited and the Agency both jointly employ the worker and collaborate to divide the day to day responsibilities and functions. Compared to other payroll models like umbrella, workers feel a greater sense of belonging with their Agency because of the employment relationship that now exists. People PAYE are responsible for discharging all of the statutory obligations which means that the agencies can continue to focus on their core functions. Please see the full guide to PEO joint employment for more information.
Direct worker engagement through People PAYE
People PAYE engages agency workers directly and supplies them to your agency. We manage PAYE payroll and the agreed engagement administration. The worker’s rate is the headline rate, with additional engagement costs and the PGS margin charged separately to the agency. The full breakdown is set out in the personal illustration and Key Information Document (KID).
The benefits of PEO
Protect your business
With the government recently confirming that their plans for a single enforcement body will go ahead, now is a good time to review your payroll and processes to ensure you remain totally protected. People Group’s PEO payroll is the most transparent and straightforward option available today. Fully approved by industry specialists Professional Passport and the only PEO product that has been reviewed by HMRC.
Happy contractors
When you’ve invested in your brand and built up your reputation, it’s important to maintain this across every touchpoint within your business. And it’s never more important to get it right than when processing your contractors’ pay. Our recruitment agency partners that have already switched to PEO have seen candidate satisfaction increase, payroll enquiries decrease and an overall improvement in brand perception.
“People Group protect our brand by providing transparent and efficient solutions like PEO, where no questions need to be asked.”MD, Educated Recruitment
Outsourcing the admin burden
You save time and money by mitigating the administration and hidden expenses involved in running in-house PAYE; including payroll & admin staffing costs, software, licensing, insurances, utility costs, statutory costs and legal/tribunal costs. When comparing these true costs, in-house PAYE is approximately 2% more expensive than outsourced PEO.
Rewarding your contractors
My Wallet is a points-based platform offering a range of loyalty benefits for contractors. Your contractors will receive points each time they are paid. These points can then be redeemed for the rewards they want when they want them.
Cash flow
A feature of PEO is joint-employment, the benefit being that VAT is not due on disbursements billed between joint-employers. With 99% of our PEO invoice disbursed (salary, PAYE, NI, Pension etc.) only 1% of our invoice to agencies attracts VAT. Helping to improve cash flow, liquidity and materially reducing the cost of finance (when using invoice financing solutions).
How does PEO compare?
PEO versus ‘in-house’ PAYE
In recent years we’ve seen recruitment businesses and risk-averse end clients shift away from Umbrella payroll to ‘in-house’ PAYE, particularly following 2017 Public Sector Off-payroll. While this approach does remove some of the risk, it doesn’t necessarily represent the best option when it comes to efficiencies and administration. And for some end clients in particular the need to cap headcount can sometimes leave this option redundant.
When you delve deep into all of the costs associated with running in-house payroll you begin to understand the merits of partnering with a PEO payroll expert like People Group. On average ‘in-house’ PAYE costs 2% more than People Group’s outsourced PEO option.
PEO versus Umbrella payroll
There are plenty of similarities between PEO and Umbrella payroll. Both are based on the Pay As You Earn (PAYE) system. Both provide access to our additional benefits package. And both provide a totally compliant payroll option. However, PEO is fundamentally different when it comes to transparency. Contractors have clear and simple pay slips with deductions only for PAYE tax, worker National Insurance and a worker pension contribution. That’s it. No ENI, Growth and Skills Levy*, or Employer pension.
* From August 2026 the government renamed the Apprenticeship Levy the Growth and Skills Levy (G&S Levy for short). Payslips, Key Information Documents, invoices and contracts issued before the change may still call it the Apprenticeship Levy or App Levy.
When you factor in the potential cash flow and efficiency savings and consider the reputational damage we’ve seen with some Umbrella schemes, PEO payroll is a winner every time.
Amazingly responsive and everything is dealt with efficiently – not something you can say about every company. It’s important that we partner with businesses that protect our client relationships and brand reputation.
Our simple PAYE solution – with benefits.
Easy and convenient, our PEO solution is full PAYE with benefits, via your MyWallet platform. You don’t get charged a fee and will receive simple payslips. Giving you total transparency and reliability.
Payment is made each Friday, with cleared funds in your account by 9am. Plus, you’ll receive a text notification in advance of your pay. And your password-protected portal is available at any time, where you can check and download all your payslips. Our friendly Client Care team are on hand to help with any questions or further information.
All of this as standard
- Completely free to contractors
- Insurance cover up to £10 million
- Full holiday/statutory pay as standard
- My Wallet Reward package
- Simple and clear payslips
- Daily payroll runs, guaranteed in your account before 9am the following day by Faster Payments
- Dedicated Client Care team
- 24/7 Contractor Portal
- Anytime Wages service
- All statutory employment rights
- Continuity of employment for all assignments
- Work-based pension options
- Real-time checking against HMRC
- PAYE & VAT accounts available to you
- Live RTI, per-worker records
My Wallet benefits
What makes our payroll stand out? Well apart from our efficient service, transparent process and good value, it’s our rewards package. My Wallet is a points-based platform. You will receive points each time you are paid. These points can then be redeemed for the rewards you want, when you want them.
How do I register or switch?
We believe in making things as clear and straightforward as possible. No catches, hidden fees or surprises. Why not contact our specialist team today for a no obligation consultation see how we can help save you time and money.
Our sign up process takes minutes and you’ll be guided through every step by a member of our dedicated Client Care team.
So why not join thousands of contractors and freelancers enjoying hassle-free payroll today?
Got a question or need more information?
Request a payroll comparison or get in touch — our team will talk you through the options, free and with no obligation.
Chosen by contractors.
