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Guide

How to Hire and Manage US Employees as a UK Business

PEO

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What the guide covers
  • The realities of US compliance: Why US employment is decentralized, how multi-state rules work, and what that means for payroll, benefits administration, and employer risk
  • How a PEO simplifies US expansion for UK teams: What co-employment is, the responsibilities a PEO assumes, and what remains with you
  • When to use PEO vs other models: A clear comparison of PEO, EOR, direct entity setup, and contractors, including best-fit scenarios and trade-offs
  • How Deel supports UK to US hiring: Learn about Deel’s certified HR and payroll specialists, built-in compliance tooling, benefits access, and hands-on onboarding support

Expanding your UK business into the United States can unlock major opportunities for growth. But hiring and managing employees in even one state introduces a level of HR, payroll, and compliance complexity that most UK teams aren’t prepared for.

Each US state layers its own rules for taxes, benefits, and labor standards on top of federal requirements. Missteps—like incorrect payroll filings or benefit deductions—can lead to costly penalties.

As a result, many UK companies seek out a partner that can bridge the gap between their team and US compliance. That's where a PEO comes in.

This guide breaks down the realities of US employment compliance, explains how a PEO can simplify payroll, benefits, and HR operations, and shows how Deel supports UK companies through every stage of US expansion.

What is a PEO?

PEO stands for Professional Employer Organization. A PEO is a third-party company that provides comprehensive HR, compliance, payroll/tax, employee benefits, and benefits administration for US employees.

Professional employer organizations can be used by domestic and international organizations to simplify the complicated process of compliantly hiring and paying US employees.

Watch the video below for an in-depth explainer on what a professional employer organization is, and how it can help you manage your US team.

How Deel helps UK companies hire in the US

Deel helps UK companies hire and manage employees in the US through a comprehensive, compliance-led PEO model. Deel PEO provides complete coverage across all 50 states, handling payroll, benefits, and filings within a single platform.

Through Deel PEO, UK companies gain access to high-quality employee benefits for US employees, giving small businesses an enterprise-level benefits infrastructure. You’re supported by certified HR and payroll experts who specialize in US employment regulations, including a dedicated HR Business Partner and Payroll Manager.

Plus, you’ll see built-in compliance features that deliver real-time alerts, state-specific guidance, and automated checks to reduce risk. Deel’s experts can also help with state registration and entity set-up.

As an all-in-one global payroll and HR platform, Deel enables you to centralize UK, US, and international workforce management into one place. This includes direct employees, independent contractors, and EOR employees, all over the world.

Learn more about how Deel PEO supports US expansion.

FAQs

Yes. PEOs are designed for companies with a US entity that want to outsource HR, payroll, benefits, and many compliance tasks. If you don’t have the time or resources to set up an entity yourself, consider an Employer of Record (EOR), such as Deel EOR.

The UK operates under a single national framework. In the US, compliance must be managed across multiple authorities simultaneously, making it far more complex.

US employment and labor regulations are divided across federal, state, and sometimes city levels, each with its own tax, payroll, and employment requirements. Hiring even one employee in a new state can trigger additional registrations for payroll, state unemployment insurance, and workers’ compensation, along with unique wage, overtime, and leave rules.

The PEO manages HR administration, payroll, and federal/state tax processing, benefits administration (if elected), workers’ comp and unemployment claims, certain compliance support, and termination processing. You retain business control, hiring decisions, day-to-day management, and non-payroll taxes/fees. Responsibilities are typically defined in a Client Service Agreement (CSA).

US talent expects their employers to comply with all mandatory employee benefits, such as Social Security and Medicare contributions, unemployment insurance, workers' compensation, and FMLA and health insurance (for applicable employers).

When it comes to optional benefits, US employees typically look for paid vacation and sick leave (required in some states), retirement plans like 401ks, dental and vision coverage, disability insurance, and life insurance.

Learn more about what employee benefits you should offer in the United States.

This depends on your entity infrastructure, expansion goals, timeline, and internal resources. Here’s a quick comparison:

  • PEO: You have a US business entity and want scalability and shared compliance support

  • EOR: You don’t have a US entity and are looking for the fastest market entry/market testing

  • Direct setup: You want full control and have in-house HR/payroll capacity

  • Contractors: Useful for specific projects and flexibility

Learn more: PEO vs EOR: The Difference (And Why It Matters)