Employee perks programs can include a wide variety of discount offers so that each employee has a chance to save. They include discounts on tickets for museums, tourist attractions, Broadway, movies, sport games, and special events, as well as reduced rates on hotels, merchant gift certificates, and specified online stores.

Having an employee perks program can affection several aspects of your business. Here are 5 major benefits of having an employee perks program for your company.

1.      Attract and retain employees

Employee perks programs can help maintain a low turnover rate by giving companies an advantage in retaining talented workers. Holding on to talent and good employees is necessary in order for you company to grow and stay competitive.

2.      Increase employee loyalty and satisfaction

Offering perks and rewards to employees can show an employer’s appreciation. By keeping workers engaged and happy, they are more likely to be motivated to work at optimal productivity.

3.      Help employees maintain a balance between work and personal life

Discounts on entertainment, shopping and more give employees opportunities to experience and buy things outside of work for a reduced price. Employees are thus more likely to keep a healthy balance between inside and outside the workplace, and an overall happier lifestyle, which will be reflected in their work.

4.      Ease of program administration and usage

Joining an employee perks program is generally easily affordable or even free of charge for the company. Many programs are easy to sign up for and use, with assistance available for all members. A company doesn’t need to worry about administrative questions or expenses, and an employee has full access to a user-friendly service.

5.      Provide a Valuable Tool During Economic Recession

In times of economic slumps, people regularly try to save as much as they can. Providing employees with shopping and other discounts can help their expenses and lessen financial strains.

Employee perks programs are usually offered only to large corporate businesses and have a minimum employee size requirement due to their vendor contracts. This means that for many businesses, especially small businesses, employee perks programs are not accessible. Employing a Professional Employer Organization (PEO) to outsource benefits can open the doors to these rewards programs for companies with only several employees. Because PEOs have a co-employment relationship with their client companies, all of their client companies’ employees are hired under one umbrella company—the PEO, and thus can qualify for participation in corporate employee perk programs. Outsourcing your company’s HR management and administration can provide your employees with perks and reward opportunities not previously available, and in the long run, greatly improve your business.

]]> http://www.peospectrum.com/5-reasons-why-employee-perks-programs-will-improve-your-business/feed/ 0 http://www.peospectrum.com/epli-insurance-why-employers-need-it-how-peos-provide-it/?utm_source=rss&utm_medium=rss&utm_campaign=epli-insurance-why-employers-need-it-how-peos-provide-it http://www.peospectrum.com/epli-insurance-why-employers-need-it-how-peos-provide-it/#comments Fri, 07 Oct 2011 19:53:25 +0000 admin http://www.peospectrum.com/?p=970 By Jaclyn Sung

In the last five years, 6 out of 10 employers have had to deal with employment lawsuits. There is a greater likelihood of a business being sued by an employee than by a third party or customer, with employees winning these employment litigation cases 68% of the time. Employment Practices Liability Insurance (EPLI) provides companies with insurance coverage, including cost of legal defense for facing discrimination, sexual harassment, wrongful termination, workplace torts and various other employment-related claims.

Employers need EPLI because…

In today’s unstable business world where employees are becoming more diverse, independent and knowledgeable, there has been a rise in employment-related lawsuits, making legal protection a must for any company. No matter how large or small, or how stable a relationship employers may seem to have with their employees, a business always runs the risk of being sued by its employees. In fact, small businesses face just as much risk of employment allegations as large ones, with 41% of all EPLI claims dealt against companies with 15 to 100 employees. This can stem from small and medium sized businesses placing low priority on supervisor training in HR legal matters (such as discrimination and sexual harassment) in order to focus more time and resources on overall business growth. This can often result in an increase in risk of employment-related lawsuits.

Case laws on employee rights to equal opportunity and treatment in a workplace pertain to every step of the employment process: recruitment, hiring, promotion and termination. The term “employee” applies to any past, present or potential hired personnel at your business. This means that any hired staff, from payroll employees to independent contractors, have the right to sue a company for violation of legal rights as employees.

Many companies believe that any employment-related claims they face will be covered by their general liability or workers’ compensation policies—this is not the case. Because these employment claims are not “bodily” or “personal injuries” nor are they accidental, general liability policy does not cover such instances. Worker’s compensation policy also specifically states that employment legal issues are not included under its coverage. Other business insurance, such as Directors & Officers (D&O) and Errors & Omissions (E&O), deal with lawsuit claims coming from only non-employees as well.

The cost of not being protected against these lawsuits on a business’s assets can become much greater than the cost of taking preventive measures. Typically, the sum of an employment claim’s expense, including settlement, compensatory award and defense cost, is greater than $250,000 without EPLI coverage. Having EPLI insurance can help protect and provide your business with legal defense aid and financial coverage in employment lawsuit claims.

PEOs provide EPLI coverage by…

Professional Employer Organizations (PEO) work to optimize HR practices for their client companies, and one such way is by offering EPLI insurance with coverage ranging from $1 to $2 million. A PEO that provides EPLI protection can also include other relevant services, such as access with employment law attorneys, background checks to reduce risks of future employment lawsuits, and training courses for managers and employers on proper ways to handle employment situations (hiring, termination, supervision, management). If these services were acquired separately from EPLI, the cost could be significantly greater than the PEO service cost.

Companies who employ a PEO have the advantage of paying lower EPLI rates. Like any insurance, EPLI insurance cost is rated accordingly to a company’s size and expected lawsuit risk, primarily depending on level of HR practices. PEOs can provide a broad, yet comprehensive range of HR functions, including writing employee handbooks, providing anti-harassment and anti-discrimination training, and much more practices that help decrease chances of employment lawsuit claims. Insurance companies understand that a business that has employed a PEO to manage its human resource duties will have better HR administration and consequently, less likely to be sued for violation of employee rights. As a result, insurance companies are much more likely to provide EPLI coverage for PEOs to include in their package services at a much lower rate. This is a win-win situation for many companies that hire a PEO—not only are they getting better EPLI coverage rates, but their HR practices will also improve and reduce future risks of employment claims.

Why does having an accurate payroll service matter to your company?

One of employees’ greatest expectations is to be paid appropriately and punctually; as a result, the problems and costs of not paying an employee correctly can be great. Since the changes in the Fair Labor Standards Act (FLSA) in August 2004 allowed for opportunities to increase wage violation claims, payroll examinations and lawsuits have also increased. A non-compliant business must be able to provide accurate records of wages from as far back as three years, or face high fines, legal sanctions and owed back pay. PEOs constantly stay abreast of these regulation changes to ensure that their client companies’ payroll management is compliant.

What specific payroll services can a PEO provide?

Payroll services vary accordingly with each individual PEO. However, common services provided often include, but are not limited to:

• *24/7 access to a web based payroll platform and Human Resources Information System (HRIS)
• *Employment tax processing and payments
• *Preparation and delivery of W-2 forms
• *Bonus & Commission tracking and processing,
• *Paid Time Off (PTO) tracking
• *Customized reports such as employee data, job costing, standard payroll, billing and human resources reports
• *Specialized payroll consultation, data analysis and strategic compensation plan development

What are some benefits of outsourcing payroll administration to a PEO?

As a business owner, outsourcing your payroll management allows you to have one less thing to worry about, along with many of the following benefits

• *Reliable, accurate and time-efficient payroll data entry
• *Reassurance that your payroll taxes and required legal forms are compliant with federal, state and local regulations
• *Having your company’s payroll details backed up by an outside source
• *Organized and transparent records of wage payments, incentive plans, and pay rules
• *Comprehensive reports to help you gain insight on your business and employees’ growth
• *Reduced likelihood of employee fraud and wage violations
• *Ability to track and measure your pay programs and compensation strategies towards your goals

When should a company begin to consider outsourcing payroll administration to a PEO?

There are a variety of reasons why companies turn to a PEO for its payroll services and specialists. Below lists several common situations

• *Limited resources: Whether it’s a company preferring to utilize their internal HR staff for other duties instead of tedious payroll keeping, or a small business without HR employees, many companies will outsource payroll functions to save resources.
• *Need for a payroll strategy: PEOs are able to provide in-depth and specialized compensation planning for a company. Many PEOS offer comprehensive payroll services, including strategies to establish a competitive wage rate to retain employees and analysis of a business’s productivity versus salaries.
• *Inexperience: Payroll administration is composed of much more than simply paying wages. Companies must also make sure their compensation management adheres to tax and compliance standards, accurate record keeping and knowledgeable reports, meaning either additional skill training for internal employees or the choice of employing a PEO.

Outsourcing payroll responsibility to a PEO can allow a business to utilize its time and employees much more effectively. Many Professional Employer Organizations have the expertise, experience and reliability to not only provide, but also protect their client companies’ payroll administration services. PEOs can offer data analysis, strategy development and payroll planning that best suits your business. The payroll services a PEO can provide, along with its resulting benefits, are important things to take into consideration when making a decision on a business’s payroll administration.

As a small business owner, do you provide your employees with an updated, legally-sound employee handbook that not only defines your company’s policies and guidelines, but also protects it from legal liabilities? With the staggering amount of work and responsibilities a business owner must take care of, HR duties many times are pushed towards the bottom of a to-do list. However, neglect of HR tasks can indirectly affect a business and negatively impact its growth. The employee handbook is one HR function that every company needs.

An employee handbook is a record of a business’s policies and how the business is to be managed. The book often covers the following topics specific to the company:

·         Job responsibilities and rights expected from employees

·         What employees expect from employers’ authority and obligations

·         Entitled employee benefits, conduct guidelines, and workplace expectations

·         Company and government policies and resulting actions on drug and alcohol abuse, harassment, electronic communication and social media, safety and health, attendance, and discipline, etc.

No matter how small a business is, it should always have its company rules in writing, even if it’s only a couple pages. Below are 5 reasons why every small company should have an employee handbook.

1. Prevention and protection from legal liabilities: Employee handbooks are a vital way to help reduce legal responsibility and protect companies against an employee’s claims in court on matters ranging from harassment to employee mistreatment. Handbooks are often considered a contractual obligation in court, and thus should not only be carefully worded, but also updated annually to stay compliant with company and government regulations. This is especially important these days in the age of widespread social media use. According to a Strategy Analytics report, by 2012 there will be an estimated 1 billion social media users, so companies must take action in risk management now by establishing rules and policies.

2. Tangible guidelines: By having a concrete list of business policies and expectations that are clear and unambiguous, an employee handbook allows for neutral and objective treatment. Statements of acceptable and expected behavior from both employees and employers, along with regulations and procedures located all in one book, provide a common, physical source for everyone within a business to refer to.

3. Minimize employee and employer misunderstandings: The employee handbook can become an important communication tool between a business and its employees. Many companies require their employees to sign an agreement stating they have received and read their employee handbook, which allows for everyone to be on the same page regarding uniform policies. Specifications on workplace expectations and directives allow both employers and employees to practice accordingly, which may help reduce many disputes.

4. Provide a comprehensive answer to frequently asked questions to save time and money: Instead of having to repeatedly answer the same questions to employees, from a company’s mission statement to its provided benefits to its disciplinary regulations, an employee handbook will take care of that problem for you. Not only will a small business be able to save both time and money, employers can also be rest assured that everyone will be receiving the same information.

5. Create an overall better working environment: An employee handbook stating a small business’s guidelines on employee benefits, bonus programs, attendance rules and many other points that project a company’s culture will affect the overall office environment. A company managed with unbiased and reliable rules will foster greater employee satisfaction, leading to an increase in efficiency and productivity.

Many Professional Employer Organizations can offer employee handbook services that personalize and design handbooks tailored specifically to a business’s protocols and needs. For small businesses, this is often a cost effective and time-efficient alternative solution in publishing and updating their employee handbooks. Because employee handbooks play such a crucial role in reducing a company’s legal liabilities, these publications must be revised yearly with legal updates to remain compliant with company, state and federal regulations. A PEO can help companies remain constantly informed on any change in government laws that affect business policies and procedures.

We thought it was the LIRR, which is located close by, but the screams of other tenants in the office quickly confirmed our fears, “This is an Earthquake! In New York!”

Earthquakes that can actually be felt by humans are rare in New York, however this one was felt, as the magnitude reached 5.8.

Office buildings in New Jersey and New York were evacuated.

We remind all employers to be cautious of Earthquakes, and to confirm your building is safe before reentering.

HRIS can help with benefits administration, compensation management, information analysis, company report writing, and many other HR processes. While HRIS service varies between software companies, one of its most important features is its automation technology, which can make numerous HR tasks simpler, punctual and time-efficient. An HRIS generally provides the following services within its online software:

·         Payroll administration and monetary allocation systems

·         In-depth reporting capabilities on payroll, benefits, HR and business analysis

·         Accounting management and conclusions

·         Master employee information database

·         Electronic general account books and chart of accounts

·         Access for employees to their payroll updates, benefit programs, PTO status, direct deposit accounts and more

·         Password-protection, encryption and firewall-monitored security

Benefits

For small businesses, having an HRIS can offer the following benefits:

1.    Anywhere, Anytime Access As a web-based HR service system, HRIS offers you the flexibility of accessing the program 24/7, from anywhere with internet connection. Managing HR processes will never have been more convenient!

2.    Simplify Your HR Tasks By Compiling It All To One Place Your desks will be neater, files more condensed and life overall easier by streamlining all HR-related administrative duties to one location: HRIS.

3.    Automation Technology HRIS’s automation technology lets companies enable both customized and pre-set programs, as well as access specification. With automated regular updates, business employers can feel confident that their internal policies, compliance issues and other HR processes will be managed and enforced.

4.    Valuable Data Analysis and Report Writing One of the most useful service HRIS provides is its report writing capabilities. With a company’s information almost all located in one central online system, employers are able to get the insight and answers needed to run a business. HRIS can analyze its fact-based HR data to provide reports, predictions and metrics to help companies become more competitive and find cost-saving deals.

5.    Reduce Employee Fraud Research claims that businesses typically lose 5% of their revenue to employee fraud and abuse. Wage and hour violations, as well as other various employee fraud situations, can happen to companies of any size, but can be prevented and thus greatly reduced with the implementation of a HRIS. By making many HR tasks such as attendance electronic and automatic, employees have fewer opportunities for instances like buddy punching and charging for false hours.

6.    Reduce Human Error In Manual Data Entry Besides employee fraud, unintentional human misunderstandings, miscalculations and data errors from manual entry can become costly mistakes. HRIS technology will aid in preventing mistakes such as double entries from different departments and other human errors.

7.    Increase Employee Convenience Give your employees a pain-free, easy way to access information and updates on their benefits, compensation and more. HRIS offers a timely and accurate alternative for employees to manage their own HR tasks, such as direct-deposits of their payroll checks to online accounts.

8.    More Opportunities For Employer Leadership A streamlined, automatic HRIS can eliminate the need for employers to deal with much of the tedious HR work. Employers and managers are then able to spend more time working on leadership roles such as projects and employee management for the benefit and growth of the company

9.    Time & Cost Efficient Time-consuming, manual HR tasks such as data entry will be replaced by automation technology with a HRIS. A 2009 survey found that a company spent an average of $28.21 to manually process an expense report, as opposed to $6.19 by a fully automatic and integrated system—a 78% decrease. In addition, the time needed for payroll processing can be reduced by up to 75% with a HRIS.

10.  Eliminate Majority of HR Paperwork With the growing awareness for environmental sustainability, many companies are looking for ways to “go green.” Implementing a HRIS will help reduce almost all of the paperwork associated with HR tasks.

How a PEO Comes Into Play

Why should your company employ a PEO if it’s decided to implement a HRIS? Typically, purchasing and building a HRIS customized to your company requires an exorbitant capital expenditure. With a PEO, a HRIS is oftentimes included within its package services, meaning that the costs of HRIS installation, licensing, maintenance and upgrades are included within the PEO price. Many PEOs are also responsible for all HRIS-related duties, for example employing an IT staff, tech support and necessary upgrades. Not only can employing a PEO provide a small business with considerable savings, it can also give them the advantage of receiving the expertise and resources of advanced HRIS programs. PEOs have contract agreements with state-of-the-art HRIS software companies. Smaller companies are able to receive HRIS from major software companies, which wouldn’t be available had they purchased one independently. Hiring a PEO to take care of your Human Resource Information System can provide your company with numerous cost-saving benefits and self-assurance.

According to NAPEO, the average PEO client has 19 employees. However we find the sweet spot for the Professional Employer Organization industry is anywhere from 10-100 employees. These are 5 major reasons why the PEO value proposition works well for this sized companies:

• For a company with less than 100 employees, hiring a full-time, competent HR professional can be too costly to justify ($60k-110k per year). PEOs provide small businesses with access to SHRM certified HR consultants to guide with company policies, strategy, and HR compliance. Companies can rest assured they’re in compliance with all Federal and State regulations for a fraction of the costs.

• Companies with more than 100 employees begin entering the size range where economies of scale work in their favor when purchasing health insurance, workers comp insurance, and many other HR related expenditures; the need for a PEO’s buying power is mitigated in this case.

• When a company has less than 10 employees they may struggle  to find a PEO that will accept them on their group health insurance policy. Certain PEOs are more flexible in this regard, and will provide the full range of services for companies with less than 10 employees, but it will limit the options in the market. Check out our case study of how we helped a newly funded startup company win big with a PEO.

•  If a company has less than 10 employees Human Resources may not be a prioritized initiave for the company, so the need for outsourcing HR isn’t yet realized.

• Many of our clients utilize a PEO primarily to save money, companies with less than 10 employees are less likely to be investing in Human Resources services, tools, and benefits. The marginalized savings per employee is typically less for smaller companes when compared to larger companies that are already spending major dollars on payroll services, 401(k) services, HRIS systems, EPLI insurance, and other various HR expenditures.

Employee Benefits

Many Professional Employer Organizations work with thousands of small businesses; through co-employing with each one of them they operate as one large conglomerate for the purposes of purchasing group health insurance – buying in bulk. PEOs leverage their discounted health insurance premiums to offset their administrative fees, often this can result in a net cost savings. The traditional PEO benefit offering provides easy access to:

• National Health Insurance Plans
• Group Dental Insurance
• Group Vision Insurance
• Group Life Insurance
• Group Short Term Disability Insurance
• Group Long Term Disability Insurance
• Company Wellness Programs

Most PEOs offer more than one health care plan design, so an employee is able to decide which type of insurance plan fits their budget. Having the option of multiple POS (Point of Service) plans, HMOs (Health Maintenance Organizations), and High-Deductible Health Plans with Health Savings or Reimbursement Accounts (HSAs & HRAs) is common practice for PEO clients. Supplemental benefits such as vision, dental, and life insurance are commonly offered to employees in a cafeteria format, which allows the employees to choose whatever plan they like, usually with a base stipend offered by the employer to help offset employee costs.

Retirement & Savings

Professional Employer Organizations also offer various investment vehicle options ranging from retirement plans (401k) to child’s college education plans (section 529). PEOs also offer health savings accounts (HSA) and flexible spending accounts (FSA) for out of pocket medical expenses such as co-pays, child care, and dependent care expenses.

Most 401(k) plans PEOs offer employees the ability to customize investment strategies through diverse groups of funds in order to satisfy different thresholds for risk and personal retirement goals. In most cases employees can monitor and manage their investment account through an account representative or online 24×7.

Seamlessly being able to offer such comprehensive benefits without the administrative burden of procuring and managing each plan is extremely valuable for a business that wants to focus on their core competencies. Compare the typical benefit package offered by a PEO to that of a typical 15 person company and the differences will most likely be staggering, not only in price, but in richness, and ease of use.

Be sure to bring up looking into a PEO the next time your company gets a double-digit health increase, you won’t regret it!

Seems scary right?

Most Entrepreneurs go into business to follow a passion or make money, or both!

Keeping up with all of the rules can distract us from our core competencies and driving revenue.

Thankfully Professional Employer Organizations (PEOs) helps small businesses deal with all labor laws in order to maintain HR compliance.

ADEA was put into place in order to protect people and make workplaces more fair. However, it creates major risks and boundaries for small companies to comply with.  Without a formal HR department, which is usually the case in companies of 2-50 employees, staying abreast of laws like ADEA creates cost and an obligation to comply and manage to the satisfaction of the law. Employers that do not know this will quickly wind up in a courtroom.

Observance of the Law:

The ADEA is a federal law that forbids discrimination in the workplace of employees or prospective employees that are 40 years of age or older. Enforced by the Equal Employer Opportunity Commission (EEOC), it is illegal to deprive someone of being hired, being offered promotions, or receiving benefit packages based solely on age. It is also illegal to fire someone based solely on age.

The ADEA applies to any company with 20 or more employees for each working business day in at least 20 weeks during the working year. However, certain states have their own anti-age discrimination laws to stop companies from getting around this, including forbidding discrimination of a person of any age.

In the Supreme Court’s ruling in Meacham, et al. v. Knolls Atomic Power Laboratory 31 employees were laid off due to an involuntary reduction-in-force (RIF) after a voluntary buy-out offer fell through. Of the 31 employees, 30 were in the age group of 40 or older. Even though the company collected performance, critical skills and flexibility scores prior to termination; twenty-eight of them filed a disparate impact claim under the ADEA. A jury ruled in their favor, awarding them more than five million dollars. The 2nd Circuit Court of Appeals confirmed the verdict, ruling that the company failed the “business necessity” test; that is, the employees alleged at least one substitute, non-discriminatory method for achieving the RIF without having a different impact on older workers.

How PEOs help with ADEA:

It is important to understand that with all of the following services we will touch upon below, it is not just a job for the Professional Employer Organization to perform them well, it is in their best interest. All PEOs co-employ with their clients, which basically means they’re splitting the risk of managing your employees. Be sure to check out our other articles to learn more about co-employment.

Making sure it doesn’t happen:

HR Policy Audit

At the onset of a relationship with PEO, they will perform a complete audit of their client’s policies and procedures as it pertains to hiring, firing, promotion, demotion, etc. This will ensure that underlying structure of the company complies not only with ADEA, but every other regulation that pertains to that company. They will develop an employee handbook in order to properly communicate company policies to employees. Often PEOs identify problems before they happen, which is ideal for all parties.

Management Training Courses

PEOs regularly provide training to managers and supervisors not only on employee relations and employee communication, but also the various laws that are required to be followed. ADEA is certainly one of them. Training on proper interview techniques and managing through a lay-off are just a few that are offered. PEOs also offer training on discrimination and harassment for the entire workforce to learn, and it can be company policy for all employees to complete the training. As a business owner, it’s not just your actions that can lead to trouble, but the actions of any one of your employees. Employee education and training is critical to running a safe and stable company.

Ongoing HR Support

Throughout a client’s relationship with a PEO there are bound to be some sticky situations to manage through. PEOs provide continuous support to their clients in order to manage for success, but maintaining proper compliance. For example, what are the proper and safest steps for terminating a non-performing employee that is in a protected class such as being over 40 or a minority? PEOs will consult clients on how to properly document performance, employee warnings, and exit interview.

COBRA, Unemployment, and Workers Comp Management

So an employee was terminated. They are not suing the employer, but there is still a workload that is created. PEOs maintain all COBRA administrative obligations for their clients and ex-employees—however, be sure to know the additional costs for this, as PEOs usually charge extra for COBRA administration.

PEOs all help manage faulty unemployment claims–if an employee makes a claim, it is up to the PEO to fight the claim in court. In most cases, if the employee is awarded unemployment benefits, it will affect the PEOs rating, not the small business.

Workers compensation insurance is ranked as having the one highest propensities for insurance fraud, often faulty claims are made by employees who know they’re on their way out. Since a Professional Employer Organization co-employs with their clients, their clients will usually operate on the PEOs workers comp policy, so again, its not just a service, its in their best interest to manage and investigate all claims properly. Be sure to ask your PEO in fact you will be on their workers comp policy, sometimes a client will not be without the point being properly addressed.

Employment Practices Liability Insurance (EPLI)

So the worst scenario is upon us, an employee has filed a claim in court for wrongful termination due to ADEA. Most PEOs offer EPLI insurance to their clients with protection ranging from $1-$2 million to offset legal fees, settlements, and claims. Again, be sure to make sure the PEO you’re dealing with is in fact building EPLI into their price. Getting EPLI coverage separately can be very expensive, estimated numbers would be about $5,000 per year for a 10-20 person company, however that can vary.

These services are just a few things that Professional Employer Organizations offer their clients. In fact, there are many other services that will help manage employees in compliance. There are over 700 PEOs throughout the country, and they are not created equally. Having expert advice on how to screen and select the right PEO is becoming more important. Find a quality PEO broker to help with the analysis, they usually provide free service and can drastically help reduce risk and price.