Ask most outsourced HR firms how they charge and you will hear one of two answers: a monthly retainer, or a per-employee fee through a PEO. Both have one thing in common. You pay the same in a month when nothing happens as you do in a month with two terminations, a leave request and open enrollment.
For a lot of small and mid-sized businesses, that is the single biggest source of wasted HR spend. Here is how the common models compare, and why we bill differently.
How the Typical HR Firm Charges
Retainers. Most HR outsourcing firms sell monthly packages, usually tiered by headcount. Published ranges for small businesses run from about $1,500 to $8,000 a month, with $2,500 to $6,000 a common planning number. Many come with an hours cap. Go over it and you pay overage or wait until next month.
PEOs. A professional employer organization becomes the co-employer of your staff and bundles payroll, benefits and HR into one contract. Admin fees typically run about $40 to $160 per employee per month, more for comprehensive plans, or 2 to 12 percent of payroll. That fee runs every month for every employee, whether you call them or not.
A full-time hire. In Massachusetts, the average HR specialist earned about $95,400 in 2025, and the average HR manager about $195,000. Benefits add roughly 30 percent of total compensation on top. That cost does not change in a slow month either.
The Problem: HR Work Is Not Steady
Think about how HR actually shows up in a typical year for a 40-person company:
- A hiring push in the spring
- Open enrollment in the fall
- A handful of hard conversations, one or two terminations
- A leave request or two
- Long stretches where payroll runs fine and nobody needs anything
A retainer charges you the same for every one of those months. If four months a year are quiet, a $2,500 retainer is $10,000 a year spent on months you did not need help.
| Option | How you pay | A quiet month costs |
|---|---|---|
| HR retainer firm | Fixed monthly fee, often with an hours cap | The full retainer |
| PEO | Per employee per month, or a percent of payroll | The full per-employee fee |
| Full-time HR hire | Salary, benefits and payroll taxes | The full salary |
| King & Co. | Hourly, for work actually done | $0 in hours |
How We Bill Instead
We bill hands-on HR, payroll and hiring work by the hour, with no retainer and no monthly minimum.
- Quiet month, no hourly bill. If you do not need us, there is nothing to bill.
- Busy month, no rationing. There is no hours cap to hit. You just call.
- Optional tools stay small. If you want an employee HR help desk or a text-to-ticket line, that is a flat monthly fee under $150. Skip it and the fee is $0.
- Everything in writing first. A simple service agreement spells out scope, team and rate before any work starts.
You still get what the bigger firms advertise: a dedicated HR specialist who learns your business, a backup team for coverage, leadership access by call or text on nights and weekends, and a quarterly review with clear recommendations.
When a Retainer or PEO Does Make Sense
We would rather you pick the right model than pick us.
- A PEO can make sense for a very small team that wants big-company benefit pricing and is comfortable with co-employment.
- A full-time HR hire makes sense once there is full-time HR work every single week, usually well past 150 employees.
- A retainer can make sense if your HR needs truly are steady every month and the firm's cap fits them.
For everyone else, paying by the hour is simply cheaper.
Run Your Own Numbers
Use our pricing calculator to see what a PEO, a retainer or a full-time hire would cost you in your quiet months. Then look at the full side-by-side comparison of King & Co. against a typical HR firm, a PEO and an in-house hire.
If you want a real estimate for your business, book a free 15-minute call. We will tell you what the work should cost, even if the answer is that you do not need much of it.
Josh runs HR, payroll and PBJ support for employers across New England and New York, from five-person offices to multi-building nursing home groups. He works in every major payroll system and answers the phone personally.
Book 15 minutes with Josh