The 90-Day PEO Transition Playbook

Whether you are joining a PEO, leaving one, or moving between PEOs, the transition is an operational project — not a paperwork exercise. The 90-day plan below assumes you've already made the decision and are now executing.

Days 1–30 — Stand up the new structure

• Confirm new payroll go-live date and parallel-run schedule
• Initiate carrier placements (medical, dental, vision, life, workers comp)
• Open or transfer state unemployment accounts
• Inventory all benefits enrollments and contribution histories
• Notify 401(k) recordkeeper of plan change or transfer

Days 31–60 — Run parallel and reconcile

• Parallel-process at least one full pay cycle on the new system
• Reconcile YTD wages, taxes withheld, and benefit deductions employee-by-employee
• Confirm carrier effective dates align to the day — no gap, no overlap
• Distribute employee communications about the change (timing, what to expect, what to do)
• Validate workers comp coverage continuity with state-by-state proof of insurance

Days 61–90 — Cutover and close out

• Execute cutover on the agreed effective date
• Issue first live payroll on new system
• Confirm tax remittance for the transition pay period (this is the highest-risk filing)
• Close former PEO accounts after final reconciliation
• File any required state notices (unemployment, workers comp)

The single most painful mistake

Letting medical coverage lapse for even one day creates real exposure — a catastrophic claim during a coverage gap is the worst possible outcome of a transition. Confirm carrier effective dates in writing twice.