Administrative Services Organization (ASO)

ASO or Administrative Services Organizations are the type of employee leasing companies that offer their services in a limited way. There are numerous reasons for carving out services in this fashion, most importantly because some clients want it this way. In an ASO relationship, the employee leasing company steps in and performs the services that would otherwise be performed by the client company.

In an ASO relationship, the client company remains the employer of record. This means when the employee receives his paycheck, the employer is the client company, where the employee works at. From this, it follows that at year end, the employee will receive a W2 and his employer is the issuer of that W2.

Workers’ Compensation policy in an ASO relationship is issued to the client company and not to the employee leasing company. This has great advantages to the client company if it has a good safety record but has huge disadvantages if the safety records or claims history is dismal.