Administaff - An Employee's Prospective

By Bruce Silver, Founder

Employers Rx LLC

December 6, 2008

Administaff - An Employee's Prospective

I came across an interesting website this morning. It is aptly named JobVent.com .

The purpose of this website appears to be just that.

JobVent is the web site for anyone who has ever said 'I hate my job', or 'I love my job'. JobVent is the web site for people who are about to start a new job, and want to see what other people think of working there.

Topping the list for most hated employer was the Progressive Insurance Company, who scored a resounding minus -7708 from no less than 1181 reviewers. Coming in second place was, of all companies, the worlds leading human resource management and outsourcing organization, Hewitt Associates with a score of minus -4331.  There were 269 Hewitt employees who took the time to let their feelings be known. By doing the math, I calculate that the level of dissatisfaction among Hewitt's employees is much greater than at Progressive.

Guess you might call this a case of the blind leading the blind.

While were on the topic. I was surprised to find a posting from an employee who apparently works for Administaff, a leading professional employer organization based in Kingwood, Texas. I say apparently because all postings on JobVent are anonymous. Here is one insiders view of Administaff, another HR outsourcing company who claims to be an employee management expert.

You be the judge.

Posting on JobVent 12/06/2008 - Administaff

The pay is the most I've ever had and they can afford that because they charge more than any other PEO. The benefits are better than most, but not the best I've ever had. I'd like to have better, but honestly we're struggling in our economy. I rated the job security as 0, but that's because this company prides themselves on never having a layoff....however they will drive you to the point to where you quit or they'll make reasons to let you go. Work/life balance is pretty good. They are really involved in the community. The PTO is decent. Just a couple of people with a few loose screws that try to control when you take your time off and how. They preach how you can grow with the company, but all I've ever seen is friends of friends get promoted and praised. The few supervisors I've seen that weren't friends with anyone, ended up leaving. The location is good for me because I live so close, but that's with anyone who works around the corner from their job. My coworkers know their work, but this is all they know. They have never worked with real software or in a professional environment. This place is pretty similar to putting a bunch of hillbillies in suits and asking them to be pro's. The work environment is the worst. The management claims they don't want to micromanage, when they very well do. They walk around the work area to spy on you and see if you're at your desk. God forbid you have to use the rest room because they'll question where you have been.

It appears to me that Administaff knows how to "Talk the Talk", but do they really "Walk the Walk"?

Legislators Mull Professional Employer Organizations

Regulating employee leasing companies and professional employer organizations can be a formidable task. Elected officials of West Virginia's Government Organization Subcommittee C is learning just how difficult it can be. Mannix Porterfield, a reporter with the Register-Herald, provides us with an insight into examining the operations of these companies.

This article makes a strong case why business owners and executives should seek professional advice when considering the selection of an Employee Leasing, HR Outsourcing, or Professional Employer Organization for their company.

Legislators Mull Professional Employer Organizations

By Mannix Porterfield
Register - Herald

An emergency rule is coming in mid-June to govern how Professional Employer Organizations align with workers’ compensation coverage, but other issues affecting them don’t end there. In fact, based on Sunday’s discussion by Government Organization Subcommittee C, lawmakers had best plan on looking at PEOs during interims for the rest of the year. Taxes, labor laws and unemployment compensation are all matters the panel plans to look at, Sen. Evan Jenkins, D-Cabell, a co-chairman, assured members. Until last year, there was no regulation of the growing business, and it was the PEO industry itself that called on lawmakers for some standards.

“They are worried, in part, about the image an unscrupulous entity that would act like a PEO but not really be a PEO, and come in and spoil what an appropriately formed and structured PEO may do,” Jenkins said. Insurance Commissioner Jane Cline told the panel her office intends to file an emergency workers’ compensation rule governing PEOs with the secretary of state’s office next month. “The issue of health insurance coverage seems to be a big concern,” Cline said. Cline recalled “a disastrous situation” that occurred with a PEO in North Carolina when the company slipped into bankruptcy, leaving a number of employees in the lurch.

About 14 states have some type of legislation on the books similar to West Virginia’s new law. “Are there places that have a track record of PEOs that we could somehow follow and not have to re-invent the wheel?” asked Sen. Ron Stollings, D-Boone, a doctor. Cline said the industry is interested in the Legislature providing some levels of regulation. “There are legitimate ones doing legitimate things out there,” the insurance commissioner said. “They’re concerned about the ones who might be doing it in a rogue manner.” Committee counsel Brenda Thompson said legislation “varies so greatly” in states that have enacted such legislation, “and it’s really a new creature.”

A lawsuit in Nevada over a PEO law has traveled through four courts already and remains unsettled after eight years of litigation, she pointed out. “This is pretty heavy stuff we’re going into,” Stollings said. “I wish someone had plowed a furrow for us to follow.”

PEOs function as a go-between for a business and its employees, such as in the operation of a firm offering temporary secretarial help, Jenkins explained afterward. “So that company writes one check to the PEO, who would cover all aspects of the employees,” the senator said. “It’s almost like having a dual employer situation. The PEO promotes itself as relieving that employer of the many traditional employer-employee management responsibilities.” A company may retain its right to discipline and fire its workers, but the PEO is the actual entity writing the checks, paying taxes on wages and covering the benefits, he said.

“As we studied this last year, we kept peeling back layers of what these PEOs did,” Jenkins said. “We realized it’s a very complex system.” Last year’s measure merely requires PEOs to register with Cline’s office to lay the groundwork for getting workers’ compensation coverage. “We were wanting to make sure employers weren’t dodging their workers’ compensation responsibilities by using a PEO, and a worker, if injured on the job, wouldn’t find himself in a Catch-22,” Jenkins said.

The 4 P's of HRO and PEO Evaluation

By Bruce Silver
May 4, 2008

All too often companies spend hours analyzing, assessing, and comparing the cost or savings that one HRO or PEO service provider offers versus another. While a detailed spreadsheet of costs may help to determine "hard dollar" expenditures, it very rarely accounts for the intrinsic value of the competing service models you are trying to compare.

Usually, items such as the co-pays of a health plan, workers compensation rates and administrative fees take precedence over far more important questions. Are you teaming up with a HRO or PEO partner who offers complimentary strengths or merely duplicative expertise and services? Is your corporate philosophy compatible?

Focusing on our 4 P's will help you to make the "right" choice.

People – Meet with the management and team you will be working with in person, by phone or tele-conference. What are their backgrounds, functions, qualifications, and responsibilities? What are the scope of services each will deliver, how, and how often?

Process – What is the plan for a smooth transition? Map steps for employee notification, orientation, and enrollment. Identify the who, what, where, and when of plan implementation. Set goals, time-lines, reviews and evaluations.

Platform – Human Resource Information Systems (HRIS) provide a robust set of tools for employee administration, benefits, compliance, payroll, and risk management. Identify levels of employee and management access, orientation, and training. How will you coordinate IT staff for system integration with automated attendance and Point Of Sale systems, 3rd party software and hardware?

Programs – Employee Benefit programs provide a competitive edge in attracting and retaining a highly motivated and productive workforce. Evaluate the quality, value, and choices of health, life, dental, disability and retirement plans. What employee communication, mediation, recognition, rewards, and relocation services are available?

Bruce Silver is the founder and managing member of Employers Rx LLC.
The author can be reached at 561.843.4333 or bruce@employers-Rx.com.
Your comments are welcome. For additional information visit our websites:
http://employers-Rx.com
http://peo-quote.com

Organizations Ripe for HR Outsourcing as They Seek Standardization, Ability to Focus on Business Issues

Hewitt Survey Finds Companies that Outsource HR are Realizing Benefits

Organizations are primed for human resources (HR) outsourcing as they look to standardize HR processes and focus on business issues, according to a new survey by Hewitt Associates, a global human resources services company. Hewitt’s research shows that companies that have already outsourced HR activities are satisfied with their outsourcing arrangement and are realizing the benefits they hoped to gain.

The survey of nearly 100 large U.S. companies representing 2 million employees finds that the top three pressures facing HR executives today are attracting, retaining and growing talent (67 percent), being able to better support the business by focusing HR on core capabilities (47 percent) and supporting business changes (41 percent). Talent issues and a focus on strategic capabilities continue to be priorities for the next two years.

In a likely effort to make HR more efficient and freed up to tackle the top issues facing HR executives, 91 percent of companies surveyed have undertaken steps within the last two years to improve the internal HR function, such as HR process re-engineering or standardization. In fact, nearly six out of 10 companies surveyed believe HR processes and policies must be standardized before implementing outsourcing activities.

“Companies are realizing that they need to standardize HR processes and policies as a first step in their HR transformation,” said Mark Oshima, director of HRO strategy at Hewitt Associates. “This is often a precursor to outsourcing, since outsourcing enables both HR and line management to focus on issues vital to the business’s strategic initiatives, instead of being burdened with HR administration.”

The Motivation to Outsource

Hewitt’s research finds that organizations consider outsourcing primarily to improve service quality (ranked 4 or higher on a scale of 1 – 6 by 74 percent of respondents). Other key drivers include access to outside expertise, the opportunity for cost savings and a desire to focus resources on core business (all ranked 4 or higher by 60 percent or more of respondents).

Of those companies that have outsourced, 65 percent surveyed reported that they are satisfied or very satisfied with their current HR outsourcing arrangement. Furthermore, 70 percent of respondents say their companies have realized the benefits they hoped to gain from HR outsourcing.

Still, barriers to HR outsourcing remain. Nearly two-thirds of respondents say there are barriers to HR outsourcing at their organizations, with the top three being concerns about losing control of key processes, concerns about employee reactions to an external service provider and difficulty building a business case.

“By and large, companies that have taken the leap and outsourced their internal HR activities are realizing the results and goals they hoped to attain,” said Oshima. “Remember, though, that outsourcing is a major commitment. Companies considering HR outsourcing should identify the business issues that outsourcing is expected to address, build a solid business case, involve key decision makers, learn from the experiences of their peers and proactively manage the change from delivering services internally to partnering with an outsourcing provider. These important steps can help make the outsourcing arrangement a successful one.”

Other key research findings:

* The majority of respondents (78 percent) prefer an HR outsourcing provider with in-depth HR consulting expertise versus a broad outsourcing provider that can provide services to multiple parts of the organization.
* Forty-four percent of respondents indicated that cost savings was not one of the primary objectives they hoped to gain by outsourcing. Among those for whom cost savings was a primary objective, nearly three-quarters (73 percent) said they had achieved their cost savings objectives.
* The majority of survey respondents include service level agreements in their HR outsourcing contracts. Data delivery and transaction accuracy are the most common standards included in agreements, each cited by more than two-thirds of companies surveyed.
* The CEO is the final decision maker when considering HR outsourcing, cited by more than half (52 percent) of respondents

http://home.businesswire.com/portal/site/google/index.jsp?ndmViewId=news_view&newsId=20061206005056&newsLang=en

PEOs cover ABCs of Human Resources

Akron Beacon Journal

Companies take care of hiring, payroll and benefits

For many small businesses, the administrative burdens of hiring, managing and paying employees can be overwhelming. As a result, many business owners are turning to alternative methods of hiring staff, including something called the "professional employer organization'' or "PEO''.

PEOs are companies that help businesses find and hire people, plus manage such things as health benefits, workers' compensation claims, payroll, unemployment insurance and more. As a business owner, you contract with a PEO to assume these and other responsibilities, allowing you to concentrate on the revenue-producing side of your operations. PEOs establish and maintain an employer relationship with the workers assigned to you and assume many employer responsibilities and risks.

Most small businesses are new to the ``human resources'' or ``HR'' field. One advantage of using a professional employer organization is that they already have experienced HR pros who can handle benefits, payroll, Occupational Safety and Health Administration compliance and just about everything else you will need. By bringing employees into a larger overall group, a PEO can offer your workers benefits, such as health insurance and retirement plans, that you would be hard-pressed to deliver on your own.

Pre-employment testing is another area where PEOs can help. Without a screening process, you risk placing the wrong person in the job, leading to lost productivity and costly turnover. PEOs tailor pre-employment tests to predict loyalty to you as well as success on a specific job. The tests aren't foolproof, but they can have a big impact.

Small-business owners often dread the prospect of reading stacks of resumes and conducting interviews for prospective hires. PEOs can reduce this burden and deliver candidates quickly, then handle the paperwork for the new hire. Some PEOs have entire divisions devoted to recruiting and helping small-business owners gather information to make the right hiring decisions.

Many entrepreneurs who have used PEOs credit the choice with helping grow their businesses quickly. The National Association of Professional Employer Organizations (NAPEO) is a good source of information and help. The organization's Web site at www.napeo.org describes how PEOs work, the benefits of using one and guidelines for selecting one that's right for your business.

Is It Time to Outsource Your HR?

By Layne Davlin

When the time comes to start hiring staff, a lot of entrepreneurs fail to give much thought to all the responsibilities that come with being an employer. The average small-business owner isn’t equipped with either the knowledge or the time to comply with the mountain of regulations required by the government. Fortunately, HR outsourcing--hiring a PEO to oversee your HR tasks--is a solution that not only provides help with compliance issues but can also provide assistance that’s tailored to your company’s specific needs.

A PEO, or Professional Employer Organization, can offer HR solutions tailored to small and midsized businesses in all industries. For an annual fee, usually 2 to 7 percent of the dollar value of your annual payroll, a PEO will take care of everything from recruiting and hiring to managing your health benefits. Since many smaller businesses can’t afford to hire an HR professional, PEOs can be a cost-conscious option. For instance, if a company has a $1 million payroll, a PEO can provide the equivalent of a full HR department for roughly $20,000 to $70,000 a year, considerably less than a fully staffed HR department or even one qualified executive.

Generally, a PEO will legally hire a company's current employees, thereby making the PEO the "employer of record" for taxation and insurance purposes. Having the employees of multiple businesses “on staff” allows PEOs to enjoy lower benefits’ costs because more employees mean better rates. The employees are then leased back to the original employer (now a PEO client) under a shared-employment contractual relationship, which sets out the powers, responsibilities and liabilities of the parties. This practice is also known as “employee leasing” or “staff leasing".

The PEO then assumes responsibility for all payroll obligations, workers’ compensation coverage and tax filings. Additionally, health, welfare and retirement benefits can be contracted as well as all associated administrative work. Because they take over most of the headaches of being an employer, PEOs are ideal for small businesses. In fact, most PEOs target companies that have 150 employees or less.

Many times, a PEO arrangement is the only way a small business can offer benefits like health insurance, dental and vision care, life insurance, retirement saving plans like 401(k)s, Section 125 cafeteria plans (flexible spending accounts for healthcare and childcare), job counseling, adoption assistance and educational benefits. Most small businesses just couldn’t afford or manage these benefits on their own.

Finding the Right PEO for Your Company

Ideally, a PEO will relieve its client companies of the time-consuming and money-draining burdens associated with HR. Because PEOs offer many different types of services, choosing the right PEO is essential. If you’re thinking about hiring a PEO for your business, consider the following factors to find the best possible PEO arrangement to meet your needs:

• Conduct a basic needs analysis. Lay out exactly what type of HR and risk management concerns your company has.
• Review the services of all the PEO firms you’re considering. Find out which firms can meet all your needs and will do so in a manner that meets--if not exceeds--your expectations.
• Perform extensive background research to find out if the PEOs’ sales pitches are really what they deliver.
• Check out the companies' staff. Does it have the depth and expertise to deliver on its promises?
• Find out how the firms deliver their services. In person? By phone? Via the web? A mix of all three?
• Determine what kind of consulting the PEOs provide on strategic HR issues like recruiting, HR procedures and processes.
• Ask for a few references, and then check them. If a particular PEO can’t relieve your HR burden, one of the other ones certainly can.
• Find out if the PEOs charge any upfront fees and how those fees are determined. What about pre-payments? Do you have to put up a deposit?
• Ask for some demonstration that payroll taxes and insurance premiums are being paid properly, and that any past clients’ legal issues have been correctly and efficiently handled.
• Once you’ve selected the PEO you’ll be hiring, lay the foundation for a lasting relationship with your PEO by meeting the people you’ll be working with face to face. An open line of friendly communication ensures you won’t be lost in the in-box.

The bottom line is, PEOs can help small and midsized employers enjoy the same HR benefits as large companies without the considerable overhead. A PEO costs less than hiring an internal HR employee and will maintain critical employment records and payroll reports, as well as provide the forms needed to make sure you’re in compliance with all required employee regulations. Being an entrepreneur is difficult enough without all the accompanying HR hassles, so find a PEO for your company today.

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