Back to top


What is a PEO?

A professional employer organization (PEO) provides integrated services which enable business owners to cost-effectively outsource the management of human resources, employee benefits, payroll and workers' compensation, and workplace safety and risk management for covered employees. Services of a licensed PEO are regulated under Hawaii Revised Statutes Section 373-L and qualify for the Hawaii State general excise tax exemption for PEOs.

ESAC Accredited

HRAH is proud to be the only PEO based on the big island that has been accredited by the Employer Services Assurance Organization (ESAC). ESAC accreditation confirms that our PEO continues to meet important ethical, financial and operational standards including an independent CPA's quarterly verification of the timely and accurate payment of payroll taxes, employee benefit contributions and insurance premiums. Our performance is also backed by over $15M in surety bonds, similar to the FDIC for the banking industry. Our PEO's accreditation demonstrates our commitment to protecting our clients and to promoting a high level of integrity and responsibility within the PEO industry.

What is Employee Leasing?

HRAH relieves its client companies of certain employer responsibilities and risks for Covered Employees. Under a professional employer agreement, HRAH:

  • Is deemed the "employer of record" for all Covered Employees for purposes of complying with all laws relating to unemployment insurance, workers' compensation, temporary disability insurance, and prepaid health care coverage;
  • Maintains all employee files and documentation, including W-4, HW-4, and I-9, withholding authorizations, fringe benefit eligibility, prepaid health coverage, accrued vacation, sick leave and paid time off.
  • Pays wages and employment taxes of the employee from its own accounts
  • Files all monthly, quarterly, and annual tax reports including Forms 940, 941, 942, 943, W-2, W-3, HW-3, UC-B6, etc...
  • Creates employee handbooks according to policies and procedures elected by Client.
  • Shares or allocates with the client employer responsibilities in a manner consistent with maintaining the client's responsibility for its product or service
  • Reports, collects and deposits employment taxes with state and federal authorities
  • Establishes and maintains an employment relationship with its employees that is intended to be long term and not temporary


In an employee leasing model, the client company continues to direct covered employees' day-to-day duties and activities and is only responsible for compliance with jobsite or worksite laws and regulations. The PEO takes on the administrative HR chores and the client company is freed to focus on the production and delivery of its products and/or services.


How can HRAH help your business?

Employees Will Benefit From:

  • Accurate and timely payroll services
  • Comprehensive employee benefits
  • Professional assistance with employment related problems
  • Improved worksite safety
  • Improved employer/employee communications
  • Professional orientation and employee handbooks
  • Regulatory compliance and statutory protection


Businesses Use HRAH to:


  • Control Costs
  • Focus on core competencies
  • Ensure regulatory compliance
  • Keep and attract employees with employee benefits
  • Manage workers' compensation risks
  • Improve workplace safety
  • Reduce payroll and accounting costs
  • Offer advanced Human Resources services including employee handbooks, company policies, etc.


What about HRAH billing and accounting?


One of the best features of using HRAH is the single payment made. One payment (made with each payroll cycle) is all that is required. The client company reports the amounts to be paid to each employee and HRAH does the rest. HRAH offers the ability to report detailed labor related costs to the client company in a form that provides easy integration with internal accounting software.

What responsibilities are generally assumed by HRAH?

HRAH is responsible for maintaining compliance with all regulations regarding the reporting and payment of federal, state and local taxes on wages paid to the workers. HRAH is recognized by the Internal Revenue Service as the "employer of record" for liability for federal income and unemployment taxes and is responsible for these payments. HRAH is also responsible for compliance with the broad range of employment laws and regulations including: Fair Labor Standards Act, Hawaii Wage and Hour Law, COBRA, Title VII, ADA, FMLA, HIPAA, Equal Pay Act, and Age Discrimination in Employment Act.