As your business grows, your HR needs evolve. Many companies start with a Professional Employer Organization (PEO) to simplify payroll, benefits, and compliance. But there comes a time when the one-size-fits-all model of a PEO no longer supports your unique growth trajectory.
If you’re thinking about making the leap, having a solid PEO exit checklist is key to a smooth and compliant transition. At EmphasisHR, we specialize in helping growth companies, on the Paylocity platform, break free from their PEO while gaining tailored HR support that fits their goals.
Why Companies Leave Their PEO
Common reasons for exiting a PEO include:
- Cost: PEOs often charge high administrative fees, sometimes bundled into opaque pricing.
- Control: Businesses want more control over their benefits and HR policies.
- Flexibility: As your company grows, a custom HR strategy becomes more valuable than a standardized solution.
- Technology Mismatch: Many PEOs restrict integration with other platforms, including Paylocity.
If you’re on Paylocity or plan to be, working with EmphasisHR allows you to keep the tech you love while gaining HR experts who understand how to maximize its potential, without the limits of a PEO.
✅ Your PEO Exit Checklist
Leaving your PEO is more than just giving notice. It’s a transition that requires planning across multiple departments. Here’s what to do:
1. Review Your PEO Contract
Start with the fine print:
- Termination notice period (typically 30–90 days)
- Offboarding fees
- Benefit end dates
Knowing your contractual obligations prevents unexpected costs and compliance issues.
2. Choose Your New HR Support Structure
This is where EmphasisHR comes in.
We provide dedicated HR outsourcing exclusively for businesses on the Paylocity platform, meaning we work with your tech, not against it. Whether you need full-service HR, compliance support, or help designing custom benefits packages, we’ve got your back.
3. Build Your Transition Timeline
Coordinate the following:
- Final payroll run with the PEO
- First payroll run with new provider
- Benefits cutoff and new plan activation dates
- Compliance dates and filings
We guide our clients through this timeline step-by-step to avoid any service gaps or penalties.
4. Secure Your Employee Data
Your employee data (compensation, benefits, time tracking, performance reviews) needs to move with you. Work with your PEO to export this data in usable formats, and ensure it’s:
- Accurate
- Complete
- Properly mapped into Paylocity if not already there
EmphasisHR’s Paylocity experts ensure data transfer and system setup are seamless and secure.
5. Communicate with Your Employees
Your team will have questions about changes in:
- Pay stubs
- Benefit carriers
- Enrollment processes
We help you develop clear internal communication plans, so your employees stay confident throughout the change.
6. Replace Group Benefits and Workers’ Comp
Many PEOs bundle your benefits and workers’ comp. You’ll need to:
- Select a broker or let EmphasisHR handle it
- Set up new policies and group numbers
- Transition COBRA, if applicable
We handle benefits administration and compliance, so your team doesn’t miss a beat.
7. Ensure Compliance Is Covered
Post-PEO, you’ll be responsible for:
- ACA reporting
- Payroll tax filings
- W-2 and 1095 distribution
- State and federal compliance
EmphasisHR takes over these responsibilities so you can stay compliant without lifting a finger.
Why EmphasisHR?
We’re not a PEO, we’re your HR partner. Unlike other HR providers, we’re mutually exclusive to the Paylocity platform, meaning:
- No competing technologies
- No outdated systems
- Deep Paylocity expertise
We help growth-stage companies get more out of Paylocity and eliminate the need for a costly PEO. Our motto?
Let us do the work, so you can grow your business.
Thinking About Leaving Your PEO? Let’s Talk.
Schedule a free consultation today and get a customized PEO exit checklist tailored to your business. Whether you’re mid-contract or already planning your transition, EmphasisHR is here to make your exit efficient, compliant, and stress-free.
