Side by side
| PEO | Fractional CHRO | |
|---|---|---|
| What it is | Co-employer that runs payroll, benefits, workers' comp and HR admin | Part-time senior executive who owns people strategy and decisions |
| Typical cost | Per-employee monthly fee, plus benefits premiums | Monthly retainer; FlexHR from $4,000–$8,000/mo |
| Strong at | Benefits access, payroll tax filings across states, admin | Comp, leveling, performance, org design, hiring, ER judgment |
| Weak at | Strategy, comp architecture, manager development | Payroll processing and benefits administration |
| Who you talk to | A service team or ticket queue | One named leader who knows your company |
When you need which
- Under ~15 employees: a PEO or payroll platform alone is often enough
- 15–150 employees, growing fast: PEO (or payroll plus broker) for admin plus a fractional leader for strategy
- Past ~100–150 employees: many companies leave the PEO for in-house payroll and benefits and hire a full-time People lead
How FlexHR works with your PEO
We don't replace your PEO; we make it work for you. That includes choosing one, renegotiating the renewal and, when you outgrow it, planning the exit. Mona Dhillon led OpenX's move from TriNet to in-house benefits, 401(k) and payroll.
Frequently asked questions
Can a PEO replace an HR leader?
No. PEOs provide HR administration and compliance support, and some offer HR advisors, but they don't own your comp strategy, performance system, org design or leadership decisions.
Is a fractional CHRO more expensive than a PEO?
They are priced differently. A PEO charges per employee per month on top of benefits; a fractional CHRO is a flat retainer. For a 40-person company the two are often in a similar range, and they cover different work.