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Employee leasing definition

Question
What is "employee leasing"? 
Answer
Employee leasing is the practice of outsourcing the payroll and other human resources administration tasks by one company (client) to another company (employee leasing company) which provides those services. The employee leasing company and the client share what is known as a co-employment relationship with the employee. In recent years, the term employee leasing has often been replaced with professional employer organization, or PEO.

The leasing company has no management contact with the employee, while the client has full management responsibilities for the employee, including the ability to hire, compensate, discipline, promote and fire, and the leasing company administers payroll and other human resource functions.

Employee leasing companies switch their clients' payroll to their own system and become the legal employer of record for their client company. The client business is left with fewer administrative tasks, thus allowing it to focus on its core competencies. The leasing company is responsible for taxes and employment law and policy.

Search also employee leasing company, professional employer organization (PEO) and co-employment. 
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