by David Schek | Nov 27, 2012 | Healthcare Insurance, News, Professional Employer Organization (PEO), Staffing Company, Workers Comp, Workers' Compensation Insurance
Another Good Reason To Consider Partnering with a PEO
Successful staffing company owners have always been able to adjust their business models to continue to make a profit. With the new Healthcare laws starting in earnest in 12 months, our industry will have a new set of challenges and opportunities!
The article below from Staffing Industry Review discusses these challenges and opportunities and is well worth a read.
http://www.staffingindustry.com/Research-Publications/Publications/Staffing-Industry-Review/September-2012/2014
In terms of workers compensation costs, it is quite possible that long term costs will be going down because workers will not be using the workers compensation system to take care of basic health needs which happens now to some degree. Also as workers become healthier and more knowledgeable about ways to maintain good health, workers compensation accidents should become less frequent.
A second positive trend resulting from the new law is an opportunity for you to become your clients “expert” on these new healthcare laws so that everyone’s labor costs are kept to minimum. To be sure, there will be a level of complexity to these regulations that is unprecedented; but with a Professional Employer Organization (PEO) as your human resource – payroll and work comp partner, you will be able to help your clients better understand the new healthcare laws.
Please feel free to contact us for a workers compensation quote today and to find out about how Professional Employer Organizations (PEO’s) can improve your profits.
Happy Holidays.
David Schek
President
StaffingCompSolutions.com
American Staffing Association Member
California Staffing Association Member
Exclusive PEO Broker for the United States Staffing Association
by David Schek | Nov 12, 2012 | News, Professional Employer Organization (PEO), Staffing Company, Workers Comp, Workers' Compensation Insurance
Work Comp Staffing Solutions has succeeded in becoming the premier PEO/workers compensation consultant, exclusively servicing the staffing industry. After I sold my national staffing business where I used PEO services extensively throughout the country with my 60 offices, I wanted to share my great PEO experiences with other staffing company owners. Bottom line– I wanted to help my industry friends save money.
We started Work Comp Staffing Solutions in November of 2007. In the last 5 years, Work Comp Staffing Solutions has serviced nearly 30 staffing clients, totaling about 40M in annual payroll– with the a 90% retention rate. Some clients have been start ups and some have been larger staffing companies with Millions in payroll. They all had a common problem before they called Work Comp Staffing Solutions… their workers compensation rates (usually from the State Funds) were driving them out of business and they needed a staffing/PEO professional who understood their unique challenges.
Thank you for all your support.
David
David Schek
President
StaffingCompSolutions.com
American Staffing Association Member
California Staffing Association Member
Exclusive PEO Broker for the United States Staffing Association
by David Schek | Nov 5, 2012 | News, Staffing Company, Workers Comp, Workers' Compensation Insurance
As a former staffing company owner, I would look at my annual work comp rate increases and immediately think about my workers compensation claims and how they affected my rates. But rates reflect a combination of micro and macro events in our world.
To be sure, my firm’s safety record was very important; but the profitability of the entire insurance industry also impacted my workers compensation (as well as my other business insurance) rates.
For example, if the insurance industry finds that it is not making enough money for it’s investors, it may hike your premiums to increase returns for its shareholders — regardless of your particular work comp loss history. Or if significant natural disasters happen like Katrina, Irene, and now Sandy, where the industry has to make huge payouts to policy holders, you might find your rates increasing to cover these payouts.
Below is an excellent short article that discusses these issues. I recommend it and ask that we all begin to think about how Sandy (now expected to top 25B in insurance related losses) may affect rates for years to come.
http://www.propertycasualty360.com/2012/10/05/workers-comp-rates-climbing-but-more-rate-needed?t=workers-compensation
All the best
David Schek
President
StaffingCompSolutions.com
American Staffing Association Member
California Staffing Association Member
Exclusive PEO Broker for the United States Staffing Association
StaffingCompSolutions.com—- Work Comp Specialist
by David Schek | Oct 26, 2012 | Professional Employer Organization (PEO), Workers Comp, Workers' Compensation Insurance
Just like staffing companies, PEO’s (Professional Employer Organizations) are not created equal. In the United States there are over 700 PEO’s that manage about 90B of payroll. And while these numbers may give you the impression that there are many PEO’s with experience to partner with light industrial staffing companies, the reality is that there are only a small minority of these 700 PEO’s that have the experience, and are willing to work with light industrial staffing companies.
Here are the reasons why most PEO’s do not work with staffing companies–especially light industrial firms.
- The insurance carriers that underwrite PEO’s have moved away from underwriting staffing companies in the last 18 months because of the risk involved
- PEO’s find it more profitable to work with non staffing companies.
- The high turnover of employees (associated with staffing) increase internal costs for most PEO’s.
Not coincidentally these are all reasons that insurance carriers working directly in the staffing industry have become much more selective with the staffing firms they underwrite; and therefore forcing more staffing firms into the State insurance pools or funds. In turn, these State Pools have become the dumping ground of very high risk staffing firms, resulting in these Pools raising rates to all staffing companies. Effectively your rates will increase because you are “guilty by association” when you are in the State Fund or Pool.
This reduction in the number of PEO’s willing to service staffing companies over the last 18 months has unfortunately led to the increase of “phony” or fake PEO solutions in the market place. What I mean here is that some staffing companies will act as a PEO (to other staffing companies) and “share their work comp insurance policy” with another staffing firm without the carrier being aware of this inter staffing company arrangement.
This “piggy backing” scheme is essentially defrauding the insurance company (and the staffing company clients!) When the insurance company finds out this is happening (and they do find out) then claims are denied, and legal action may be taken by the insurance company against all staffing companies involved. Staffing firms may engage a piggy back staffing firm (versus a legitimate PEO) because the piggy back staffing firm’s rates may be very very low (sometimes as a result of misclassifying employees- hence another fraud) — and not realize the consequences of their action.
So how does a staffing firm find a legitimate PEO to work with? First, the staffing firm should use a seasoned PEO broker that has years of experience in dealing with PEO’s that service staffing firms, and has many clients that they can use as references. Second, a legitimate PEO relationship will allow the staffing company to have their name on the insurance “certs” to show the staffing firms clients. A piggy back relationship will not allow this– hence the fraud. Lastly, ask for a copy of the current insurance policy from the PEO– make sure it is from a good carrier and is current.
As a PEO broker for 6 years, a former client of a PEO for 10 years, and a staffing company owner for 16 years, I really enjoy matching staffing companies with the few choice PEO’s still servicing staffing companies.
Please feel free to contact me at 202-302-1212 to get a free PEO quote.
All the best
David
David Schek
President
david@StaffingCompSolutions.com
www.StaffingCompSolutions.com
American Staffing Association Member
California Staffing Association Member
Exclusive PEO Broker for the United States Staffing Association
StaffingCompSolutions.com—- Work Comp Specialist
by David Schek | Oct 22, 2012 | Professional Employer Organization (PEO), Staffing Company, Workers Comp, Workers' Compensation Insurance
Workers Compensation State Funds are often called the “Insurance of last resort”. Since all employers need workers compensation by law, each State has set up a State Fund or Pool that has to accept all employers–no matter their risk profile or insurance loss history. This means that, if you are using the State Fund, and you are not a super high risk, but could not secure or afford insurance through a direct carrier, you are probably paying for someone’s else’s poor work comp history.
Instead of using the State fund, a staffing firm should consider a Professional Employer Organization (PEO) to keep workers compensation costs to a minimum.
By using a PEO or Professional Employer Organization for your workers compensation coverage, you get these benefits:
- Usually lower rates than the State Funds.
- Assistance with managing your work comp claims.
- Payroll and human resource support.
- You have less employer liability
- No deposits/usually no deductible- all payments are pay as you go.
- Paychecks printed in your office
- Administration of new healthcare plan (if needed)
PEO’s enable staffing companies to outsource payroll administration, employee benefits, and worker’s compensation benefits, while reducing cost and saving labor.
Essentially, PEO’s provide payroll-processing services combined with worker’s compensation benefits at rates that are often below State funds and direct carriers.
A PEO’s assumes the responsibilities of payroll tax compliance, unemployment insurance claims, and worker’s compensation claims and provides expert advise on human resource related issues.
In fact, before starting Work Comp Staffing Solutions in 2007, I owned and operated a 60 office staffing company I partnered with a PEO for about 25 of my staffing offices for about 10 years. So in addition to promoting PEO services for staffing companies, I am a very happy former client of a PEO.
Contacts us at https://StaffingCompSolutions.com/contact-us/ (202-302-1212) and let us help you start enjoying the benefits of partnering with a PEO.
All the best
David
David Schek
President
www.StaffingCompSolutions.com
david@StaffingCompSolutions.com
American Staffing Association Member
California Staffing Association Member
Exclusive PEO Broker for the United States Staffing Association
by David Schek | Oct 15, 2012 | News, Professional Employer Organization (PEO), Staffing Company, Workers Comp, Workers' Compensation Insurance
Last week I attended the American Staffing Association Conference. There was a wonderful key note presentation by Jim Collins http://www.jimcollins.com/about-jim.html about how to successfully manage in these dynamic economic times. I found this topic very germane to dealing with today’s workers compensation environment. Between rising work comp rates in 2013, and the strong possibility of Obamacare occurring in 2014, the seas of change seem to be crashing in around the industry.
Jim pointed out how invaluable developing a strategy to sell “value” over price will separate the winners from the losers.
For many staffing companies, looking at all options for keeping back office and workers compensation rates as low as possible, will also be imperative so they can focus on selling value. Working with a PEO / Professional Employer Organization partner will invariable be the solution for some Light Industrial staffing companies that want to stay in business but have challenges in the workers compensation area.
Firms that are only willing or able to look at traditional solutions for keeping workers compensation costs in line may be victims of these monumental changes in the staffing world. Working with a generalist insurance broker may not suffice. working with a specialist like Work Comp Staffing Solutions makes all the more sense. One big takeaway that Jim emphasized is that the business world, especially the staffing world is changing quickly.
Let’s chat about your workers compensation situation before you feel the pain of higher rates or worse, policy cancellation. With our 25 years of helping staffing companies solve their workers compensation issues, we can apply that experience so you are a winner in the turbulent staffing environment.
Contact us at david@leastaff.com or 202-302 1212
David Schek
President
StaffingCompSolutions.com
American Staffing Association Member
California Staffing Association Member
Exclusive PEO Broker for the United States Staffing Association
StaffingCompSolutions.com—- Work Comp Specialist
