NAPEO: National Association of Professional Employer Organizations


What is a PEO?
What is a PEO?

NAPEO's Professional Performance Practices

As part of a long-term strategic planning process, NAPEO's members identified the adoption of voluntary professional performance practices as a key objective for the association. NAPEO's Professional Performance Practices are part of NAPEO's broader mission of enhancing the professionalism of the industry. Adherence to such practices is voluntary and not required as a condition for membership.

As part of their due diligence, PEO clients may wish to follow NAPEO's Guidelines for Selecting a PEO to determine if their PEO is following sound the sound financial, operational and ethical business practices recommended by NAPEO.

NAPEO's Professional Performance Practices were developed by a committee of NAPEO members representing a broad cross-section of the PEO industry. They are balanced, pro-competitive, and were developed in a careful and attentive manner to be obtainable by any PEO, regardless of size. They are regularly reviewed and updated to reflect changes in the business environment.

NAPEO's Professional Performance Practices offer specific and practical guidance on a variety of aspects of the PEO business model and provide a roadmap for running a financially sound, operationally solid, and ethical PEO. Highlights of NAPEO's Professional Performance Practices include…

Financial considerations related to:
  • Net worth, liquidity, and capitalization
  • Reserve levels
  • Insurance coverages
  • Audited financial statements
Guidelines on operational aspects including:
  • Client service agreements
  • Employment policies and procedures
  • Workers' comp coverage
  • Regulatory compliance
  • Sales practices
Recommendations on creating and maintaining an ethical business environment including:
  • Guidelines on controlling persons
  • Internal staff conduct
NAPEO members: For more information, please download the full text of NAPEO's Professional Performance Practices.

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