SWITCHING · LEAVING A PEO
Outgrown your PEO? Keep the benefits. Own the plan.
PEOs make sense at 20 employees. At 100+, you're often paying a bundled fee for things you can own outright: your health plan, your comp policy, your claims history.
ANNUAL COST · PREMIUMS + FEES
| PER YEAR | PEO | OWN PLAN |
|---|---|---|
| Medical premium, 126 enrolled | $967,680 | $1,088,640 |
| Admin fees, 180 employees | $237,600 | $56,160 |
POTENTIAL ANNUAL DIFFERENCE
$60,480
54 employees waive medical but still carry the PEO fee: $71,280 a year.
Premiums are yours to enter: your PEO's rate, and a quote on your own census. Workers' comp, state unemployment and the PEO's HR services are not included. Illustrative pricing.
WHAT CHANGES
From renting your HR to owning it.
| Topic | WITH A PEO | WITH WORKLIO |
|---|---|---|
| Employer of record | The PEO, as co-employer | You |
| Health plan | The PEO's pooled master plan | Your own plan and your own claims data |
| Workers' comp | The PEO's master policy | Your policy and your experience mod |
| State unemployment | Often the PEO's account and rate | Your own account and rate history |
| Pricing | Bundled per-employee or % of payroll | Software per employee; broker pay disclosed |
| If you leave later | Re-shop everything at once | Your plans and policies stay yours |
HOW THE MOVE WORKS
Timed to your PEO renewal, with no gap in coverage.
Start 90–120 days before your PEO contract renews so Worklio Insurance can quote benefits and comp on your own census.
- 01Quote on your own census. Medical, comp, and EPLI priced for your company alone.
- 02Register your state accounts. We open withholding and unemployment accounts where needed.
- 03Match effective dates. New plans and policies start the day PEO coverage ends.
- 04Move payroll with YTD intact. Worklio HCM imports year-to-date wages and deductions.
COMMON QUESTIONS
Before you give notice to your PEO.
Level-funded plans, ICHRAs and open enrollment, worked on your own numbers, in the benefits guides.
- Are PEO benefits cheaper than your own plan?
- On premium, sometimes: a PEO pools many small employers into one master plan. Add the PEO fee, charged on every employee including those who waive coverage, and the gap narrows or reverses. Around 20 employees a PEO often makes sense; at 100 or more, most companies can price their own plan and keep control of it.
- Does a PEO's health plan count as our ACA offer of coverage?
- Only if you pay the PEO more in total for an employee who enrolls than for one who waives, as you do when the PEO bills you the premium for enrolled employees. Otherwise the offer is not treated as yours under the employer mandate, which applies to you at 50 or more full-time employees, counting full-time equivalents.
- When should we leave a PEO?
- On January 1 if you can. Leaving mid-year can restart the Social Security and unemployment tax wage bases (with an IRS-certified PEO, a CPEO, the federal ones carry over), and employees' deductibles reset unless the new carrier credits them. Employees also get two W-2s for the year. Check your PEO contract's notice period, and start 90 to 120 days ahead so your own plan and policies begin the day PEO coverage ends.
- Can we keep the PEO for payroll and buy benefits elsewhere?
- Ask your PEO: many tie payroll and benefits together. The alternative is payroll and HR on Worklio HCM, with a plan placed by Worklio Insurance.