2014 Iowa Employment, Training, Benefits & Wellness Conference. HR Outsourcing Makes Employment Easy FOR YOU

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1 HR Outsourcing Makes Employment Easy FOR YOU Christy Smith, SPHR VP HR Operations Merit Resources, Inc. HR Outsourcing Can Help You Before Outsourcing You... With the Support of your HR Team!!! HR Consulting v. HR Outsourcing through a Professional Employer Organization (PEO) HR Consulting As needed HR advice and expertise. Consultation related to best practices throughout the employment life cycle. Typically project based. HR Outsourcing PEO HR Consulting-advice and expertise in a co-employment relationship. Shared risk and liability. Strategic + administrative support. Administrative support for payroll, workers compensation, LOA administration, Unemployment administration and EPLI claims administration 1

2 The Co-employment Model What is Co-employment? The PEO relationship involves a contractual allocation and sharing of employer responsibilities between the PEO and the client. As co-employers with their client companies, PEOs contractually assume substantial employer rights, responsibilities, and risk through the establishment and maintenance of an employer relationship with the workers assigned to its clients. Who Controls the Employees? The Client Company is the worksite employer, directing work, scheduling, hiring, etc. The PEO becomes employer of record for tax and benefit purposes. 2

3 PEO Services Payroll & Payroll Taxes Employee Benefits Human Resources & Compliance Risk Management PEO and Payroll Access to payroll/hr technology without costs of maintenance and upkeep Separation of duties (compared to in-house) More cost effective than in-house Integrated with health insurance for ease of PPACA reporting Tax liability In-house payroll can cost as much as 3x more than outsourcing! 3

4 PEO and Employee Benefits Improved cash flow Bigger pool/economies of scale Rate Stabilization More Options Administration relief PPACA Bill reconciliation Eligibility tracking Adds, changes, deletes COBRA PEO and Workers Compensation and Risk Management Improved cash flow No year end audit Bigger pool/economies of scale Claims management shifts to PEO PEO and HR Outsourcing The Employment Life Cycle Relations Selection & On Boarding Management Development Transitions 4

5 HR Partnership Strategic and Operational HR Assessment Together, We review Current State: Strategic Priorities, Mission, Vision and Values Business Outcomes or Goals Current Workforce Structure, Process, Technology HR Partnership The Workforce Plan We create a plan to align your workforce with your business needs. We help you design your company s Employment Life Cycle by providing world class HR consultation in the development of organizational structure, HR policies and processes, training and development aligned with leading edge technology. Back Office HR Support We have the plan Now What? Your Back Office HR Team will help you with all of this and more! Payroll processing Benefit Administration Workers Compensation and Safety Administration FMLA administration and tracking Wage verifications Research Job Descriptions Performance Management Unemployment responses and tracking Background checks/drug Screening Handbook creation and updating New hire reporting Manager and employee Training Succession Planning Compensation Plan development Market Compensation Reports Employment Practices Liability claims management. Record Keeping Regulatory compliance consulting selection assistance Performance coaching and mentoring Employee engagement Assessments Continued workforce assessment as your business needs change. 5

6 Strategic HR Bottom Line Driven Cost Evaluation Hard Costs PEO s Administration Fee Any fee based services? Benefit premiums WC premiums Staffing? Cost Evaluation Opportunity Costs Staff time Increased productivity Increased profitability 6

7 Keys to Success Partnership between client and PEO Management buy-in and support Questions 7

PEO s: Friend or Foe to HR Professionals? What is a Professional Employer Organization (PEO)? The Co-employment Model

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