A better question would be, is time = money?
If you recognize that time is money, then a company that engages a PEO or ASO or other HR outsourcing solutions will definitely save money. In particular, there are areas where a company employs staff to handle time consuming hr functions. This time can be freed up with a PEO or ASO, allowing more time on strategic functions or revenue generating areas of the business.
A PEO or ASO will save a company time by writing employment policies and producing employee handbooks, researching medical insurance plans, implementing a loss control program, providing HR and compliance training for managers and supervisors, benefits administration, vacation and sick leave tracking, responding to unemployment claims, records administration, and many other hr functions.
In addition, you will possibly see hard dollar savings by consolidating your current hr functions to one provider. For instance, instead of separate payroll provider, 401(k) administrator, workers’ compensation and unemployment claims management, Section 125 administration, insurance plans, COBRA administration, etc., and paying fees for these services as a small business to multiple vendors, with a PEO or ASO, you are paying one vendor. Thus, eliminating margins to various vendors and saving money.