What Is Employee Leasing?

Employee leasing is when an employer moves employees from his or her payroll onto the payroll of an employee leasing company. The employee leasing company becomes the employer of record for the employees and then "loans" the employees back to the original employer for a fee. This fee includes payroll costs and usually includes benefits. The employee leasing company handles all human resources functions for the employees including but not limited to payroll, legal compliance, record keeping and benefits. Employee leasing firms work with any size company and normally offers an employer a significant cost savings.