What is a PEO? What are its advantages and disadvantages of using a PEO In Thailand?


As Thailand is a county in Southeast Asia that is experiencing a continual growth of companies entering the Thailand market, many companies face long waits and bureaucracy in setting up an registered company in Thailand and often do not have the time to wait and need to hire or bring an their first employee to Thailand. A solution to this is for companies both large and small to hire and employee through a Professional Services Organization or more commonly known as an PEO.

What is PEO


A professional employer organization (PEO) is an organization that enters into a joint-employment relationship with an employer by leasing employees to the employer, thereby allowing the PEO to share and manage many employee-related responsibilities and liabilities. This allows employers to outsource their human resource functions, such as employee benefits, compensation and payroll administration, workers' compensation, and employment taxes and also in Thailand a PEO company like Smart Search Recruitment can also sponsor a non- Thai National’s Work Permit and Business Related Visa.

PEOs typically serve as a professional employer of their clients' employees. The client company reports its wages under the PEO's Thailand Social Security Insurance, and employee liability shifts to the PEO. Employers gain economies of scale by having more benefits options, sometimes at lower rates and can hire an employee in Thailand is a matter days as compared to the months of setting up a registered company in Thailand.

Depending on the PEO and the contract, a few or all of the HR functions can be outsourced. An administrative services outsourcing (ASO) agreement provides options for companies that are not interested in co-employment but want some of the outsourcing benefits.

There can be significant advantages of a PEO, especially for a small employer that may not have the breadth of HR expertise or systems capabilities for functions such as payroll and HRIS, or the time and resources available to focus on many of the transactional HR functions.

Advantages of a PEO

The burdens a PEO can relieve from HR include the following:

  • Compensation and Benefits Administration.
  • Recruitment and Employment
  • Payroll Administration.
  • Unemployment / Severance Administration.
  • Workers' compensation Administration.
  • Thailand Employment Compliance Assistance.
Disadvantages of a PEO


Some of the disadvantages might include the following:

  • Loss of control of essential processes and people.
  • An outside company's influence on your culture.
  • Diminished value of internal HR department.
  • Lack of control and security over employee paperwork.
  • A loss of institutional knowledge.
  • Security issues with the vendor's system.
  • Resistance from employees.

While using a PEO is not for every company in Thailand, it does allow many companies already in Thailand and entering Thailand for the first time many advantages and Smart Search Recruitment has been providing PEO Services in Thailand since 2008

Smart Search Recruitment is Bangkok's leading executive recruitment consultancy. We serve multinational and local companies, sourcing high-caliber candidates and placing them in mid and senior-level roles. For recruitment service inquiries contact us. If you are looking for a new job please drop your CV. We are committed to meet our client’s needs by delivering an exceptional level of service. We have insightful HR resources updated everyday. Please keep in touch with us via our social media.

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