56133 - Professional Employer Organizations
When navigating the complex world of business classification, NAICS code 56133 stands out as a vital category for companies seeking expert workforce management assistance. Known as Professional Employer Organizations (PEOs), entities under this code are pivotal in helping small and medium-sized businesses streamline HR processes, payroll, employee benefits, and regulatory compliance. If you're exploring how PEOs support efficient human resources management, understanding NAICS 56133 is essential.
What is NAICS Code 56133? — Defining Professional Employer Organizations
NAICS code 56133 identifies Professional Employer Organizations, businesses that deliver comprehensive HR outsourcing services. PEOs typically enter into co-employment arrangements, becoming joint employers alongside their clients. This unique setup lets businesses offload critical employment functions like payroll processing, employee benefits administration, and regulatory compliance management to experts, allowing them to focus on core operations.
Sector Overview: Where Do PEOs Fit?
- Sector: Administrative and Support and Waste Management and Remediation Services
- Subsector: Administrative and Support Services
- Industry Group: Employment Services
Professional Employer Organizations provide essential HR and administrative support, making them a crucial part of the administrative and support services sector. Their expertise benefits a broad range of industries by ensuring compliance with employment laws and efficient employee management.
Typical Business Activities Under NAICS 56133
Businesses classified under NAICS 56133 generally engage in one or more of the following activities:
- Payroll processing services
- Employee benefits administration
- Human resources management services (including recruitment, training, and compliance support)
- Co-employment and workforce management
- Risk management and workers' compensation services
These services help companies, especially small and medium-sized enterprises (SMEs), reduce administrative burden and mitigate risks associated with human resources.
Size Standards for NAICS 56133 Eligibility
For government contracting and SBA considerations, size standards play a crucial role. The size standard for NAICS 56133 is typically based on the average annual receipts:
| NAICS Code | Title | Size Standard (Annual Receipts) | Sector |
|---|---|---|---|
| 56133 | Professional Employer Organizations | $41.5 million (for most contracts) | Administrative and Support and Waste Management and Remediation Services |
Note: Size standards may vary depending on specific contract requirements and updates from the Small Business Administration (SBA).
Examples of Businesses Under NAICS 56133
- TriNet — Offering comprehensive PEO services including employee benefits and compliance solutions.
- ADP TotalSource — Provides payroll, HR management, and risk mitigation services as a co-employer.
- Insperity — Specializes in human resources outsourcing and employee benefit plans for SMEs.
- Justworks — Delivers payroll, benefits, compliance, and HR support tailored for growing companies.
These companies highlight the diverse applications of Professional Employer Organizations in supporting workforce management.
Detailed NAICS 56133 Code Overview Table
| Attribute | Details |
|---|---|
| NAICS Code | 56133 |
| Title | Professional Employer Organizations |
| Description | Provide comprehensive HR solutions including payroll, benefits administration, regulatory compliance, and workforce management through co-employment relationships. |
| Sector | Administrative and Support and Waste Management and Remediation Services |
| Typical Activities | Payroll processing, employee benefits administration, human resources management, risk management services |
| Size Standard | $41.5 million in average annual receipts |
| Common Business Types | Payroll service providers, HR management firms, benefits administrators |
| Employment Model | Co-employment |
Frequently Asked Questions (FAQ) About NAICS 56133
What do Professional Employer Organizations actually do?
PEOs act as co-employers, managing critical HR functions like payroll, benefits administration, compliance with labor laws, and employee risk management to help smaller businesses run smoothly and reduce administrative overhead.
Who typically uses PEO services?
Small to medium-sized businesses with limited internal HR resources often engage PEOs to ensure regulatory compliance and efficient employee management, allowing them to focus on growth.
How does co-employment work in a PEO arrangement?
In a co-employment setting, the PEO becomes the employer of record for tax and benefit purposes, while the client company maintains control over business operations and day-to-day employee activities.
Why is NAICS code 56133 important for government contracting?
Accurate NAICS classification is necessary for bidding on government contracts, reporting, and understanding industry standards specific to PEOs.
Conclusion
NAICS code 56133 - Professional Employer Organizations encapsulates a critical industry segment that empowers businesses through expert HR outsourcing. Whether you are a business owner seeking reliable employee management solutions or a contractor exploring government opportunities, understanding this NAICS code ensures you benefit from the best services and remain compliant in a complex regulatory environment.
For more information on NAICS codes and how they apply to your business, stay tuned to our blog for expert insights and updates.
