When you use a PEO, it pays your payroll taxes, insurance premiums, and retirement contributions on your behalf. ESAC accreditation is the industry's independent answer to one question: can this PEO be trusted with that money? Here's what it actually requires, and what it protects.
Verify Spirit HR's accreditationIn a co-employment arrangement, your PEO collects funds from you and pays them forward: federal and state employment taxes, health and workers' compensation premiums, 401(k) contributions, and your employees' wages. If a PEO is financially unsound or simply doesn't pay what it collected, the client company can be left exposed to taxing authorities, insurers, and its own employees.
State licensing checks some of this, and only for the PEO entity operating in that state. IRS certification covers federal employment taxes. Neither looks at the whole picture across every entity, every state, and every category of payment. That gap is what the Employer Services Assurance Corporation (ESAC) was created in 1995 to close.
Ongoing verified compliance with more than 40 financial, ethical, and operational standards, at the PEO's own expense.
Every quarter, an independent CPA confirms that federal and state employment taxes, health and workers' comp premiums, and retirement plan contributions were actually paid.
An independent CPA audit covering all related PEO entities, demonstrating adequate net worth, working capital, and reserves.
The competency, honesty, and reliability of the PEO's owners and key managers are verified and monitored, including background checks on controlling persons.
Accreditation verifies the PEO holds the required licensing or registration in every state where it operates, not just the ones that check.
Surety bonds backed by an A-rated carrier and held in trust at a national bank, protecting clients and worksite employees if an accredited PEO ever fails to pay what it owes.
ESAC describes its client assurance program the way banks describe deposit insurance: if an accredited PEO defaults on wages, payroll taxes, retirement contributions, or insurance premiums, the bond program stands behind those obligations for the PEO's clients and their employees. In ESAC's own words, it has operated since 1995 without a single accredited PEO default.
Two practical features matter day to day. First, you can verify a PEO's accreditation status yourself at any time, and download its certificate, through ESAC's public verification site. Second, ESAC proactively notifies a PEO's clients if accreditation is ever terminated. You are never relying on the PEO to tell you.
Roughly 73% of all PEO industry wages are paid through ESAC-accredited PEOs, according to ESAC. The accredited group is where most of the industry's payroll actually runs, which tells you how seriously larger clients take the credential.
Spirit HR earned ESAC accreditation on December 30, 2016, less than two years after the company was founded, and has maintained it through every quarterly verification since. Our public accreditation record and downloadable certificate are available on ESAC's verification site.
The commitment runs deeper than a badge. Co-founder and Executive Chairman Dale Hageman currently chairs ESAC's Board of Directors and is a past Chairman of NAPEO, the National Association of Professional Employer Organizations, which means Spirit HR's leadership helps shape the very standards the industry is measured against. We hold ourselves to them because we helped write them.
With an accredited PEO, ESAC's bond program, more than $15 million held in trust, stands behind the PEO's obligations for wages, employment taxes, retirement contributions, and insurance premiums. With a non-accredited PEO, your protection depends on the PEO's own finances and whatever your state requires.
No. IRS certification (the CPEO program) addresses federal employment tax obligations. ESAC accreditation also verifies state employment taxes, health and workers' comp premiums, retirement contributions, licensing in every state, audited financials, and more than 40 operational and ethical standards. They answer different questions.
Use ESAC's public verification site, peoreliability.org. Enter the PEO's name to confirm current status and download its certificate. Spirit HR's record is at peoreliability.org/SpiritHR.
No. The PEO bears the cost of accreditation and the ongoing verification. The protection extends to you and your employees at no charge.
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Spirit HR · 3817 Northwest Expressway, Suite 400, Oklahoma City, OK 73112 · (405) 951-5300
