Tag: Temporary Employee

The ACA and Employer Mandates. They’re Back!

by Jeanne Knutzen | May 22, 2014

0 ACA Affordable Healthcare, Blog, What's New in Staffing? Affordable Care Act, Affordable Healthcare – ACA Smart, Seattle Staffing, Seattle Staffing Agency, staffing services bellevue, staffing services tacoma, Temporary Employee

Are You Ready?  

With the first tier of the “postponed” ACA employer mandates just around the corner, (January 1, 2015), large employers (defined as employers with 100 or more employees) are once again getting poised to offer healthcare insurance to their eligible workforce or be subject to penalties. This time the requirement is that 70% of their eligible employees need to be offered coverage – a slight break to account for issues with Medicaid eligible employees. Less large employers (defined as employers with 50-99 employees) have until January 2016 for the employer mandates to kick in.

It has been a long winding road getting us to this place with regulatory guidance filled with potholes of uncertainty and confusion. There are over 15,000 pages of rules and another 45,000 pages of guidance. The delay in the employer mandate gave regulators one more year to clarify their intent, and those of us in the staffing industry one more year to prepare ourselves and our clients for what lies ahead. Most of us are just now getting back into the ACA saddle. With the new deadline only six months away, we need to start our readiness count down now!

As a context for our clients with large flexible workforces, there are several unique features of the ACA that are specific to the staffing industry and need to be shared with our customers as part of their readiness process. We are subject to the law as are all employers - but the difference is that most staffing companies have further to go to become compliant. As an industry we have never been benefit rich. Our workforces are short lived and transient, with most employees coming to us for interim work, with no expectation of benefits. The low levels of healthcare insurance specifically written for staffing companies fall well below ACA minimums and are being discontinued as we speak. The ACA will significantly impact our cost structures whether we elect to pay or play.

Your staffing provider faces three big challenges which hopefully by now they are discussing with you.  They face the challenge of 1) new cost structures that are likely not absorbable, 2) limited access to insurance solutions that fit the needs and requirements of flexible workers, and 3) an enormous amount of new administrative complexity. Not all staffing companies will have the capacity to comply with the new ACA regs, even if they wanted to.

Most of our issues as well as some of our customers revolve around issues of employee eligibility – who is and who is not eligible to receive benefits. Our employees work for our clients in so many different ways – short, long term assignments, full time, part time, auditioning for hire, project work, day labor – it is hard to get our arms around who will not be considered full time, eligible for benefit coverage at point of hire.

In the last three months, regulators have offered several new employee classifications that are exempt from ACA mandated coverage:

Seasonal Employees – employees who have been hired into positions where the customary duration of the job is six months. Agriculture, retail, and other highly cyclical industries will not be required to offer coverage to employees who meet the “seasonal” requirements.

Part Time Employees – employees who work less than 30 hours a week. While some employers, like Home Depot and Trader Joes, have announced plans to cut back the hours of work for all their part time staff to contain their benefit costs, other employers like Starbucks, Costco etc. have renewed their commitment to provide benefits to their large and loyal part time workers.

For staffing companies and their customers, greater attention must be given to nailing down the actual number of hours our employees will be required to work each week so as to properly classify them as part or full time employees. An employee’s classification as either full or part time while working on assignment can impact your bill rate your staffing provider has to charge you just to cover increased costs!

“Variable Hour” Employees – are employees whose hours of work or the duration of their  ongoing work assignments are such that we cannot be “assured” they will average 30 hours of work each week for the number of weeks in the “measurement period” used to baseline the employee's work patterns. Measurement periods can vary from no less than 3 months to no more than 12. Most employers will elect the 12 month measurement period option.

The "variable hour" employees is the classification most applicable to staffing company employees but is also the most difficult to administrate. While on the surface most temp and contract workers are by definition “variable,” the IRS requires the staffing agency to classify each employee as either “full time” or “variable hour” at the time of hire, considering several factors which they have listed in examples and regulatory comment.

Get it wrong and not offer benefits when you should, your staffing company can face serious penalties. Get it wrong and offer benefits not required, and your staffing company's costs can sky rocket, making significant price increases to you, a given.

The gain for both you and your staffing provider comes when employees can legitimately be classified as "variable hour" employees because of the unique position they have under the ACA mandates. Employers are not required to offer variable hour employee's healthcare benefits until their “measurement” period is completed – which can be a delay of up to 13 months. The “variable hour” employee provision can be used to contain costs but only if specific administrative and eligibility requirements are met at the point of hire.

At minimum, employers should expect their staffing providers to work with them to make changes in how they place requests for staff. In the bigger picture, it is more important than ever for employers and their staffing providers to work together to ensure ACA compliance while keeping a sharp eye on ways to contain unnecessary costs!       

Jeanne-KnutzenThe PACE Staffing Network is a network based recruiting and staffing company headquartered in the Pacific Northwest with particular expertise in the development and management of flexible workforce strategies. The ACA is of particular interest to us because of its projected impact on workforce organization and cost containment strategies.  Our goal is to help employers become ACA compliant while taking full advantage of the special provisions of the law that can provide competitive advantage. For more information on the ACA and its impact on your company contact us at 425-637-3312 or e-mail us at infodesk@pacestaffing.com.

This article was written by Jeanne Knutzen, founder and CEO of the PACE Staffing Network.

Need Your Temporary Employee to Make A Difference? Try Beefing Up Your Onboarding Process!

by Jeanne Knutzen | May 6, 2014

0 Blog, Management.Supervision Contract Employee, contract staffing, Flexible WorkForce, hiring, Onboarding, Orientation, Seattle Staffing, Seattle Staffing Agency, Seattle Temporary Staffing, Temporary Employee

Speaking as a company who takes the time to 1) understand the work our temporary employees will be doing for our customers, 2) determine the skills, knowledge, and experience our workers need to have to do the work at the levels needed, and 3) evaluate each employee in terms of the soft skills important to placement success – we know that even the “right fit” isn’t always good enough to ensure that a temporary employee will hit the floor running. If our clients have high stakes work in play and need our temporary employee(s) to perform at high levels right out of the gate, we suggest a thorough onboarding process to get our employees up and running quickly. It goes without saying that the days of greeting a temp, showing them their work station, lunchroom and bathrooms, and then leaving them alone to figure out what to do next, are long gone – if they ever existed. Work is much too complex, the importance of following work policies too critical, etc. to leave a temp’s orientation to chance. While temps are known for the ability to figure things out, because work environments are almost never the same, when it comes to temporary or contract workers more time needs to be spent up front, explaining all those things that are unique about you, your work environment, and your expectations of their work. In some ways, because you need/expect productivity quickly from your temporary/contract workers, the timing and importance of their orientation may even be more important than the timing and importance of the orientation you provide to your core workforce. The two orientations are, of course, quite different. Orienting your temporary/contract employees must be done quickly and efficiently, requiring a clear roadmap or checklist of what they need to know. Here are FIVE THINGS you likely will want to cover: 1.  The Circumstance – the reason why you chose to hire a temp rather than a core worker.  Why does their job, even if temporary, exist? What goals must be reached in order for the employee’s work to be considered successful? You might be amazed at how important it is to share your reasons for hiring a temp instead of a core employee – it gives the temp a sense of purpose, sometimes showing them how they are both a unique and special contributor to an important team goal, “I chose to bring on as a temp, because I needed a level of skill and experience I didn’t have with my current team. Your skills are so strong in (describe) we are going to let you take the lead in those areas where that skill is needed.” A temp, who clearly knows you value them as a “contributor” if only for a short period, is an employee you can count on to go out of their way to “make a difference.” 2.  Your Expectations and Priorities.  “In order for our time together to be considered successful, I need you to__________________.” Define the work outcome you are trying to achieve, how success will be defined and the impact of success. Examples of goals might be, 1) “I need you to complete this project within the time frame frames we’ve discussed,” 2) “I need you to work very cooperatively with our accounting team who is watching this project with a very critical eye” or, 3) “I need you to bring any issues to my attention right away as it is important that we work through any and all problems very quickly. Senior management has their eyes on this project.” The impact of their work is also an important element to be communicated, “This project is one of three projects we will be working on this year that are most related to our company’s ability to compete for business in South America.” 3.  Explain when, how and how often they need to be checking with you.  If you need quick updates at the end of each day, let them know. If you want them to stop by your office at least once a week, let them know. Knowing what you expect from them in terms of keeping you informed is a key element of placement success. We’ve seen very talented temporary or contract employees not meet our customer’s expectations simply because they didn’t know when or how often to communicate with our client. 4.   Identify challenges and what they should do when they encounter them.  “I want you to know you are likely to uncover challenges with_______________________. When that occurs, I want you to get help from George who knows how to push through these types of obstacles.” Fill in the blank, honestly and completely, so that your temporary worker knows what to expect and how to get issues resolved. 5.  Your hiring policies. The employees’ chances of being hired.  Don’t beat around the bush – implying there is a chance your temporary employee can be hired if that chance is minimal. At the same time, if the chances are good that their time as a temp is looked on as an audition for a direct hire opportunity, let them know. Describe the policies and processes in place that allows a hiring manager to consider (or not consider) hiring a temporary employees and what they would need to do in order to be considered. If you have clear policies, you can expect your staffing vendor to have shared this information with their employee prior to their placement, but re-stating these policies during an onboarding process, is a good way to reinforce the rules. Some hiring managers will imply a higher probability of hire than actually exists as a way to keep the temporary employee motivated. In fact, just the opposite is what’s created when the offer of employment isn’t forthcoming. Kyle Update SignatureThe onboarding of temporary employees is another area of managing a flexible workforce that needs careful planning and preparation. The PACE Staffing Network typically works closely with our employer clients to share the responsibility of a well engineered communication process where both PACE and our clients need to pay a role. For more information about employee onboarding and other factors important to managing a high impact flexible workforce, contact me, Kyle Fitzgerald, at kylef@pacestaffing.com. I am PACE’s Director of Business Operations and part of what I do is consult with employers on how to use temporary/flexible employees in ways that create a competitive advantage.