Why CPAs Refer Small Biz Clients to Certain HR Service Providers, Such as TriNet
Outsourcing Employee Benefits Reveals Many Hidden Benefits to Smaller Employers, including Expanded Health Coverage - Plus Reductions in Cost, Time and Risk
SAN LEANDRO, Calif. (Oct. 05, 2004) Since the mid-1980s, small companies (10-50 employees) have been increasingly seeking outside solutions to their HR processing and compliance needs, including payroll, benefits, workers' compensation, medical insurance, and 401(k) administration—and for good reasons. Using the right human resources outsourcing (HRO) provider can cut costs, add benefits options and expertise, and allow over-burdened CEOs and senior management to focus on their core business functions. In response, a growing number of CPAs are now referring their clients to use recognized HRO providers.
"CPAs choose an outsourcing option when the HRO provider can demonstrate a legacy of customer satisfaction as well as proven cost reduction and risk management," says Lyle DeWitt, a certified public accountant and vice president of finance at TriNet, a nationwide human resources service provider.
Dewitt continues, "Unlike many other outsourced HR providers, TriNet contractually assumes certain legal and financial responsibilities, thus assisting a company regarding employer rights, legal compliance and some elements of employer risk management."
Even so, many still choose to work with an HRO provider for purely economic factors. Take for example Macias & Ryan, a successful finance and accounting consultancy firm in Fremont, Calif. The firm, which began in 1993 with less than 10 people, first met its HR needs by using a payroll service, plus a separate benefits broker. While the two independent services were adequate from a basic delivery standpoint, the firm's benefits costs started to rise since it had too few employees, and therefore no negotiating power in the marketplace.
In addition to the escalating costs, they also found they were unable to expand the menu of benefits offered to their employees. "Our people were mostly limited to Blue Shield and a single HMO," says Kathy Ryan, the firm's chief operating officer. "We have highly compensated employees, and they're used to having premium benefits. The combination of cost and availability factors forced us to reconsider our current HR practices."
After investigating several options, Ryan realized her firm needed a provider that could bring both an extensive and a cost-competitive benefits package. "We also wanted the entire HR function via a single point-of-contact, so we could control the amount of time we spent on these issues." For these reasons, Macias & Ryan selected TriNet.
"With TriNet," she explains, "we get more cost-effective benefits – and more of them. We are able to get tiered levels of a PPO plan, as well as additional HMO options, plus ancillary benefits such as flexible spending accounts. The result has been better employee satisfaction and productivity, thanks to a suite of benefits at a price point that we couldn't obtain on our own."
But the advantages of this type of HRO solution, she says, don't end there. "We have also found integrated HR beneficial from an administrative and reporting standpoint. As opposed to having multiple invoices/procedures in place with multiple companies, we can now review the entire HR function on a single report. TriNet's payroll register shows us the total cost of one of our employees – everything from payroll to benefits to workers' compensation."
Ryan points out that if your company has an employee population that doesn't necessarily need a rich suite of benefits, and your cost to provide these benefits hasn't significantly increased, you may not require a full-service HR provider. "You may be able to get along with a benefits broker and a payroll vendor," Ryan says. "But if you need top-quality benefits and you're a small company, you may lack the negotiating power to secure a benefits package that makes sense for your workforce."
In addition, Macias & Ryan is frequently in the position of advising clients who face the same challenges they did. "We actually recommend two options — the multi-vendor approach or integrated HR. If the client is interested in an integrated HR option, we recommend TriNet, because as a TriNet customer ourselves, we see the value first-hand." To date, Macias & Ryan – now with over 40 employees in three locations – has referred dozens of clients to TriNet, five of which have already become satisfied TriNet customers.
"When our clients choose TriNet over the multi-vendor approach, we find that they did so for the same reasons we did," says Ryan. "A full breadth of benefits that they can't obtain on their own, as well as the convenience of an ‘all-in-one' HR service."
Adds TriNet Group's president and CEO, Martin Babinec, "Beyond convenience and cost cutting, we are also helping them to manage certain HR risks and liabilities in the process, which in today's business landscape is a tremendous value-added consideration."
About TriNet Group, Inc.
Founded in 1988, TriNet (www.trinet.com) delivers comprehensive human resource services to small and medium-sized companies. Its offerings include human asset administration, employer risk management, online HR services and support, payroll processing, tax compliance, workers' compensation, group health and welfare products, and strategic human capital consulting services throughout the United States and Canada. More than simply an HR services provider, TriNet contractually assumes certain legal and financial responsibilities regarding employer rights, legal compliance and risk management.