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How to Successfully Escape a PEO: A Guide for Trucking Companies

Have you ever felt stuck, unable to manage your drivers, payroll, and operations effectively because of your PEO? You’re not alone – many trucking companies face this same challenge.

At Superior Trucking Payroll Service, we’ve worked with many trucking companies that face this problem. We understand the frustration that comes with not having full control over your employees and business and are here to help..

In this article, we’ll show you how to leave your PEO, step by step, without disrupting your business. By the end, you’ll know exactly what to do to make the change smooth and stress-free.

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Why Would You Want to Leave a PEO?

Many trucking companies decide to leave a PEO because:

  • They lose control over hiring, firing, and managing drivers.
  • The hiring process with a PEO is too slow, and it affects business.
  • The cost of using a PEO ends up being more than expected.
  • A PEO doesn’t understand the specific needs of trucking companies

If any of these problems sound familiar, it might be time for your company to leave the PEO and handle things in-house or with a more trucking-focused service.

4 Essential Steps Trucking Companies Must Take to Leave a PEO

Leaving a PEO (Professional Employer Organization) can be a significant decision for trucking companies, especially when it comes to maintaining control over payroll, employee management, and compliance. To ensure a smooth transition, follow these steps:

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Review Your PEO Contract

Before doing anything, check your PEO contract. Look for:

  • End of contract terms:

    Does your contract have early exit fees? How much notice do you need to give before leaving? When does your contract expire?

  • Employee records:

    How will you get employee files back from the PEO, like payroll records and benefits information?

  • Benefits:

    Make sure you understand how your employees’ benefits will change during the switch.

  • Worker’s Comp Policy:

    If the PEO handles workers’ compensation insurance, failing to secure a new policy on time could leave your drivers uninsured.

By knowing these details, you can avoid any surprises during the process.

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Get Ready for the Change

Once you decide to leave, start preparing your company for the transition:

  • Set up payroll:

    You’ll need a system to pay your drivers once you leave the PEO. Figure out how to handle payroll in-house or find a payroll provider that understands your needs.

  • Gather employee files:

    Make sure all employee records, like tax forms and benefits details, are updated and ready for the switch.

  • Talk to your team:

    Let your employees know about the change. They may worry about their pay or benefits, so make sure they understand what will happen and reassure them.

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Wrap Up Payroll and Benefits with Your PEO

During the transition, it’s important that your drivers don’t experience any delays in pay or loss of benefits.

Here’s how to avoid problems:

  • Final payroll:

    Work with the PEO to ensure their last payroll is completed correctly.

  • Transfer benefits:

    If the PEO handled benefits like health insurance or worker’s compensation insurance, make sure you have new vendors selected and ready to go.

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Choose a New Payroll Provider

Make sure you take the time to find a payroll provider that understands your needs as a trucking company. After leaving your PEO, you’ll need to work with a provider or decide to handle payroll yourself.

When choosing a payroll service, look for:

  • Experience in trucking:

    Your new provider should understand the unique needs of trucking companies. Finding one that has helped transition other companies from a PEO will be helpful.

  • Clear and Detailed Pay stubs for Drivers:

    Drivers should easily see all details on their pay stubs, including wages, deductions, reimbursements, and load information, so they know exactly what they’re being paid for.

  • Compliance support:

    The new payroll provider should help with payroll tax compliance.

Possible Challenges When Leaving a PEO

Transitioning away from a PEO can present several challenges that may disrupt your business if not handled properly. It’s not just about switching payroll providers—careful planning is a must to avoid payroll delays, gaps in benefits, and administrative headaches. In the fast-paced trucking industry, even small disruptions can lead to problems like driver dissatisfaction or missed deliveries.

Understanding these potential challenges ahead of time allows you to prepare and make the transition as smooth as possible.

  • Payroll Delays

    Switching payroll systems can cause delays if not managed carefully. To avoid missed paychecks, make sure your final payroll with the PEO is processed accurately, and your new system or provider is set up before the next pay period.

  • Gaps in Benefits

    Switching benefits like health insurance can be tricky. Work closely with your benefits provider to make sure there are no gaps in coverage. If needed, ask the PEO to extend benefits temporarily during the switch.

  • Managing Employee Files

    Regaining control of employee records, like tax forms and benefits info, can be time-consuming. You may need extra help to handle these tasks that the PEO used to manage.

Is Leaving a PEO the Right Choice for Your Trucking Company?

Deciding to part ways with a PEO is a significant choice. If your PEO is no longer meeting your needs or the costs have become too high, it might be time to make a change. Taking control of your payroll, hiring processes, and benefits allows you to run your trucking company on your own terms.

While the process can seem overwhelming, with the right plan, you can transition smoothly and avoid the pitfalls that many businesses face. By following the steps we’ve outlined, your trucking company will regain control, leading to faster hiring, smoother payroll, and happier drivers.

By leaving your PEO and following the steps we’ve outlined, your trucking company will regain control, leading to faster hiring, smoother payroll, and happier drivers.

At Superior Trucking Payroll Service, we know trucking inside and out. We’ve helped many clients successfully transition out of PEOs, and we’re ready to help you do the same. Our team understands the unique needs of trucking companies and how to avoid the common pitfalls of leaving a PEO. Don’t just take our word for it—watch our video testimonials and read written reviews from satisfied clients who have made the switch with our help.

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Written by Mike Ritzema

Before founding Superior Trucking Payroll Service, Mike was the CFO of a trucking company with 80 trucks and a thriving brokerage. This experience gave him the perspective that a payroll solution has to make the lives of the office people better.  All the solutions he has designed are to benefit everyone.  Our company mission is to help trucking families and that includes the company owners, the drivers, and the office.