Posted At: Apr 01, 2023 - 302 Views

By Ashley Kinsey2023-03-21 

Co-employment is a concept that has gained popularity in recent years, particularly in the realm of human resources management. Essentially, co-employment refers to a situation in which two or more employers share responsibility for the management and oversight of a single employee or group of employees. In this blog post, we’ll explore what co-employment is and the benefits it can offer to businesses.

What is Co-Employment?

Co-employment is a contractual relationship in which two or more employers share the responsibility of employing a worker. In this arrangement, one employer is typically the primary employer, responsible for providing wages and benefits, while the other employer is the secondary employer, responsible for managing day-to-day work activities and performance. The primary employer retains legal liability for the employee, while the secondary employer provides management and support.

Benefits of Co-Employment

There are a number of benefits that co-employment can offer to businesses, particularly in the areas of human resources management and cost savings. Here are some of the key advantages:

Enhanced HR Support

Co-employment arrangements typically involve a professional employer organisation (PEO) that provides HR support and services to the secondary employer. This can include assistance with recruitment, hiring, payroll administration, benefits management, and other HR-related tasks. By outsourcing these functions to a PEO, businesses can save time and resources and ensure compliance with labour laws and regulations.

Cost Savings

Co-employment arrangements can also offer significant cost savings to businesses. When utilising global talent there is a significant difference between currencies, meaning savings can be huge, even whilst employees are paid extremely fair wages. Additionally, with a PEO handling all the HR and recruitment, businesses can save on expensive agency costs when it comes to bringing on new staff members.

Risk Mitigation

Co-employment arrangements can also help businesses mitigate their legal and financial risks. By sharing the liability for employee-related issues, such as discrimination claims, wage and hour disputes, and employee benefits lawsuits, businesses can reduce their exposure to legal and financial liabilities. Additionally, by working with a PEO that has expertise in employment law and compliance, businesses can ensure that they are operating in accordance with all applicable laws and regulations.

Focus on Core Competencies

Finally, co-employment arrangements can allow businesses to focus on their core competencies and strategic priorities. By outsourcing HR functions to a PEO, businesses can free up time and resources to focus on revenue-generating activities and growth initiatives. Despite employees needing to be managed day-to-day, this is a much less time-consuming method of work than traditional in-house recruitment.


Co-employment is an innovative HR management strategy that can offer a range of benefits to businesses of all sizes. By sharing responsibility for employee management with a PEO, businesses can access enhanced HR support, cost savings, risk mitigation, and increased focus on core competencies. If you’re looking to streamline your HR management and improve your bottom line, co-employment may be worth considering. If you’d like to find out more, don’t hesitate to book a chat to see how we can take your business to new heights.

If you found this useful, you may enjoy reading about how to effectively manage your remote employees.