HR Infrastructure That Scales With Your Business

Our calculator uses a conservative, research-based methodology to avoid overestimating savings:

1. Administrative Efficiency Savings ($710/employee): NAPEO research shows $1,775 average savings per employee. We conservatively allocate 40% of this to administrative efficiencies including benefits administration, payroll processing, and compliance management.

2. Benefits Cost Savings ($621/employee): We allocate 35% of the NAPEO average to group purchasing power for health insurance, 401(k) administration, and other benefit costs.

3. HR Staffing Optimization: Only calculated if you have existing HR staff. Research shows companies need 2.6 HR FTEs per 100 employees on average, but only 1.6 with a PEO (38% reduction). We use a conservative $55,000 average salary (lower than national averages) and cap the reduction at your actual HR staff count to prevent impossible scenarios.

4. Turnover Reduction Value: PEOs reduce employee turnover by 10-14% (we use 10% to be conservative). Replacement cost is calculated at 50% of average salary multiplied by your turnover rate, then improved by 10%.

5. Workers' Compensation Savings: Based on 4% cost reduction (NAPEO research) on estimated $1,000 per employee workers' comp costs.

Maximum Cap: Total savings are capped at $2,200 per employee (125% of NAPEO's average) to ensure realistic estimates even for higher-cost businesses. This prevents the calculator from showing unrealistic results.

Time Savings: Conservatively estimated at 20 hours per month for business owners (reduced from industry estimates of 30+) plus 300 hours annually per HR FTE reduced.