Two employees collaborating on laptops

A company just starting out can hit the ground running by using a PEO without any internal HR—the PEO lets the company to focus on growing their business and yet allows them to have the benefits of a Fortune 500 company. Just as common, many companies that work with a PEO may start with a single HR person or small team, but rely heavily on the PEO to handle the time-consuming HR tasks such as payroll, taxes and onboarding as well as benefits of lower benefits costs, a sophisticated HR platform and other Fortune 500-style benefits. But as the company grows, there comes a tipping point where the administrative costs of the PEO are no longer worth spending when they have the infrastructure to do most HR tasks inhouse.

So when is that tipping point to consider leaving the PEO model?

  1. You’ve grown enough to be a large group employer and can get competitive rates on medical benefits outside the PEO.
  2. You realize that as you are not utilizing many of the services the PEO offers, such as training, recruitment and onboarding.
  3. As your company grows, you may decide the one-size-fits-all model may no longer be enough for your business. Breaking from the PEO gives your company more flexibility to offer the benefits you want and tailor your HR products to best fit your
  4. With a larger company, it may be cheaper to have these services inhouse rather than pay increasing PEO administrative costs as your company grows.
  5. As your company grows, you may start hiring HR and finance professionals that are duplicating the services of the PEO.

How to Exit from Your PEO

When you leave your PEO, you need to procure all the required services you need on your own, including medical benefits, worker’s compensation and payroll. You can shop the market on your own, or utilize a free service like PEO Exit to do the work for you and help ensure your move away from the PEO goes smoothly and with minimal employee disruption. To learn more, contact us today and schedule an appointment  with one of our consultants.

Want to learn more? Contact us today and let’s get started.

Lori Frucht

Lori previously worked at DKG Media as the Marketing Automation Director. In this role, she created the company’s marketing calendar and helped lead the company to their highest sales month and quarter in its history. She brings extensive experience in both digital and traditional marketing as well as public relations and advertising. She studied Communications at Cornell University.

In her spare time, Lori enjoys spending time with her family, reading, shopping and exercising. She is a certified Rock Wall and Zipline instructor.

Related Posts

Blog Construction worker walking around site

Partial PEO Exit: When to Consider Dropping Your PEO’s Medical Benefits

Why would you leave the PEO’s Medical Plan? There are two main reasons why your company may consider leaving the PEOs medical plan:…

Read More
Blog Man in office wearing a facemask

Leaving a PEO? Here’s a checklist of what you need to know

In order to ensure a smooth transition, timing is paramount. All new services must be in place and ready to go the day…

Read More