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Entries in staff leasing (3)

Monday
Dec102012

Employee Management Help For Business Owners

HR Outsourcing Firms Ease The Pain

Business owners and executives have many areas of their business to focus on. Opening the door every morning with a to-do list of tasks is challenging enough, having to be concerned with employee administration and compliance can be overwhelming for most. A recent article in The NY Times highlights some of the issues facing corporations larges and small. 

 

Look at the wide-ranging duties of human resources, it’s no wonder that companies are seeking outside help. “H.R. is supposed to be responsible for finding, developing, retaining and training the best people,” Suzanne Lucas, author of a blog called the Evil HR Lady. “It can also be responsible for benefits, compensation, employee and labor relations, business partners, data collection and legal issues.”

Fortunately, there are companies whose mission is to help small and midsize business owners and executives comply with the myriad of local, state and federal employment regulations.

Human Resource Outsourcing is a broad term that defines the performance of an HR service by a third party provider. It could be simply an ASO - Administrative Service Organization that provides a single service such as payroll processing, COBRA or 401k administration. Some are Information Technology firms who have developed software programs to ease the burden of employee administration and HR compliance. Many HRIS - Human Resource Information Systems, Labor Management, Recruiting and Staffing software platforms can be customized to the requirements of any businesss or association. Some firms offer a hybrid of technology combined with professional HR support services.

Employee leasing or  PEO - Professional Employer Organizations deliver a comprehensive integrated model called co-employment which enable business owners and corporations to transfer most of their personnel administration, benefits and human resource compliance to a qualified HR partner. The entire focus of these companies is making sure your business operates a safe and secure workplace, and complies with all of the latest employment rules and regulations.

“Outsourcing firms can take up various tasks, from payroll to benefits to recruiting, to free up a client to focus on its strengths, said Don Weinstein, senior vice president for product management at ADP, a large H.R. outsourcing firm. The new health care reform legislation, for example, will have a big impact on employers, some of whom may be overwhelmed by its complexities.”

It is important that business owners, executives and HR directors determine what services they require today and in the future, or as I like to say “identify what’s broken”. There are many providers to choose from, offering different HR service models and pricing formulas. Trying to identify the right fit for your organization can be a daunting task, but once you do, you will never go back to managing your employees on your own.

Monday
Nov192012

Workers Compensation Rates Will Increase In 2013

Small Business WC Premiums To Rise By 25% For Some Industries

Many small and midsize companies will experience an increase in their workers compensation insurance premiums in 2013. The effects will not be felt equally across the broad range of industries. Companies and business owners who employ blue-collar occupations may see increases of 25-30 percent.  Business operations that involve staffing, home health care, landscaping, and maintenance may find that they are unable to obtain workers compensation coverage in the standard insurance markets. Companies who are faced with this situation may be forced to consider their state’s Joint Underwriters Association (JUA), the insurance pool of last resort, where premiums could be triple.

Workers’ compensation insurance provides coverage for an employee who is injured on the job. Coverage for injured employees typically includes medical and rehabilitation costs, as well as lost wages. In Connecticut, some employers are facing another significant rate increase for workers compensation insurance next year, potentially as high as 30 percent, if approved by state regulators. The proposed rate changes would go into effect January 1st 2013. Businesses in the manufacturing industry, for example, face an average rate increase of 6.8 percent, but the range includes increases as high as 27 percent and rate decreases of 13 percent, according to the rate filing submitted by National Council on Compensation Insurance (NCCI). The contracting industry faces an average 9.9 percent increase in premiums, with rate increases topping out at 30 percent.

The goods and services industry faces an average 7.6 percent rate increase, with the maximum rate hike of 28 percent and a rate decrease as low as 12 percent. Employers in Connecticut are grappling with the second highest workers compensation costs in the nation, until now.

In Delaware, a 40 percent increase in their workers comp premium rates is set to take effect on December 1st, making that state’s rates the second highest in the nation, behind Illinois.  The greatest concern is the effect an increase of 40 percent will have on small business owners. A business now paying $20,000 in workers’ compensation rates will be paying nearly $30,000, and a company paying $70,000 would be paying close to $100,000. This is conditioned on a business owner’s ability to find coverage at all.

  After Hurrican Sandy - Capacity May Dry Up

Hurricane Sandy swept across the East Coast destroying businesses and homes in Connecticut, New Jersey, and New York. The damage is expected to be billions of dollars. The industry states it can withstand claims of $50 billion dollars. What if claims exceed current projections? Insurers and investors allocate reserves to the various lines of coverage. When significant claims are paid, all lines of insurance are affected. Here is the current view of the market by Marsh, the world’s largest insurance broker.

Tracey Ant, primary placement leader in Marsh U.S. casualty practice, says that the workers compensation line of business “leads all commercial lines with the highest combined ratio” and results continue to deteriorate. The result is workers’ comp rates are on the increase. Insurers are taking other measures besides increasing rates by placing tighter controls over placements. “Profitability is more of a priority than growing their book of business.”

Business Owners Should Consider Alternative Options

Although, workers compensation will cost more next year, and some employers in blue-collar industries may not be able to secure coverage, there are still options available. Some employee leasing or staff leasing companies and professional employer organizations are still accepting certain risks at affordable rates. Companies who are faced with skyrocketing workers comp rate increases or non-renewals should consider working with an experienced PEO broker or employee leasing consultant for an alternative solution to their worker compensation problems.

Sunday
Jul252010

PEO Group Health Insurance Premium Renewal Rates Increase

Professional Employers Experience Double Digit Increases Again

Group health insurance premium renewals are going out and the reports are not encouraging. It’s that time of the year when employee leasing companies and professional employers send small business owners their new health rates for the coming year. Employers across the nation are being told what to expect, and it’s not exactly what they want to hear. Especially now, when the economy is starting to stabilize.

Many of our small business clients who have been relying on their PEO partner to keep their health insurance rates low, are finding out that it’s no longer the case. Business owners with some of America’s best known and largest human resource outsourcing firms, Administaff, ADP Totalsource, and TriNet / Gevity HR have experienced another round of double digit increases. CFO’s and HR managers have complained about increases from Alphastaff HR, another “Top 10” provider. Their clients renew in September, and a few said they received cost masters with 35% rate increases across the board from Aetna.

Bait and Switch?

Many of our small business clients are learning that some of their health plan choices have been replaced with new healthcare plans that offer more limited networks with fewer in-network providers, or of medical plans that are restricted by geographical location. Just last week we were contacted by a primary care practice with 3 offices in West Virginia. They told us how  their current PEO had just informed them that an entire network of plans was  being eliminated. The majority of their employees will be left with just one  option, and a very expensive one at that. Needless to say, they are now looking to us to help the doctors find a better option for their staff.

It May Only Be RoundOne ?

The worst may be yet to come. September through January is when over 75% of group health insurance plans are set to renew. This includes most of the nation’s largest and most successful staff leasing, HR outsourcing, and professional employer services firms. Yet to announce their new health plan renewals are leading HR and employee benefits providers Advantec HR, Oasis Outsourcing, and SCI Staffing Concepts, who are scheduled to renew in the month of October, Frank Crum’s health rates are good until November, and Accord HR and Fortune Business Solutions renew in January 2011.

It is important to note that while these industry giants, and their highly compensated employee benefits advisors, are still battling it out with their health insurers, the fate of hundreds of thousands of small and midsize businesses are being decided. Combined, these PEOs and employee leasing companies represent about two hundred and fifty thousand (250,000) business owners and about five million (5,000,000) employees nationwide. Let’s hope for the best.