Without a doubt, one of the costliest benefits enjoyed by employees today is health insurance. And although the Affordable Care Act (ACA) has made health insurance more affordable for some individuals, it has created major financial challenges for many employers. If your company is struggling to pay health insurance premiums for your employees, it may be time to consider alternatives.
The ACA essentially mandates that almost all employers offer health insurance benefits to their full-time employees, and companies with more than 50 employees that fail to do this will incur a penalty. According to the ACA, it is not necessary to provide part-time employees with health insurance, so many corporations have been cutting the hours of their employee, shifting them to part-time status to save money and balance their budgets.
Other employers have opted to cut down on the number of employees on their staff altogether, reduce benefits or increase deductibles. But even those drastic measures have not worked out as well as they had hoped, leading to challenges in balancing workloads and getting the work done. But there’s another way.
How Employer of Record Services Can Help
Companies outsource many services that are not core to their business, such as marketing, IT support and cleaning the office, so it makes sense to consider ways to outsource other parts of your workforce. Enterforce offers the option to transition a portion of your workforce to us as the employer of record. This means that the employees continue performing their same roles, but they are now employees of another organization and we take care of all the taxes and paperwork in an arrangement called Employer of Record Services. The employees are typically classified as temporary or contract employees, but they can also be per diem or co-op employees.
By moving a portion of your payroll to a third-party, you will realize tremendous cost savings in the form of reduced tax liabilities and benefits. And, you’ll also move all of the payroll deductions, unemployment insurance and workers’ compensation management to the payrolling service, reducing both the financial and the administrative burdens from your company. And by reducing your total full-time payroll, it will also curb your rising health insurance costs and reduce your potential penalties from the ACA.
We offer a free and handy calculator to help you determine if the cost savings for your organization are worth taking a closer look. If you would like some help determining how you can take advantage of pass-through payrolling to help you manage costs from the Affordable Care Act, just give us a call.