PEO brokerage offers the opportunity to make commissions with the successful placement of an account with a Professional Employer Organization. Much the same as an insurance agent would make commissions with the placement of an insurance policy with a client account. Many PEOs offer some type of financial incentive program to people who refer them business.
For prospective PEO brokers who approach PEOs directly, the fee plans vary widely by PEO. Some may offer a “referral fee” while others may offer to share a portion of the PEO’s ongoing “administrative fee” with the broker. Many PEOs will ask the prospective broker to sign an exclusivity agreement that commits the broker to refer accounts only to their PEO. In addition many PEO referral agreements will give the PEO the right to stop paying the broker ongoing commissions at their pleasure. While these terms may be acceptable when a broker is just starting out, they often result in conflict once the relationship is underway.
StaffMarket advises anyone considering brokering directly with a PEO to carefully review and understand the terms of their agreement with the PEO.
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Patent Pending
1/6/2009
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