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Outsourcing Employee Related Tasks

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Or, How To Make The 4-Hour Workweek Work For You.

I listened to a podcast the other day  by Timothy Ferris, the author of the book, The 4-Hour Workweek: Escape 9-5, Live Anywhere, and Join the New Rich. In it he describes how he outsources anything that he can, allowing someone else to do the administrative, research, or follow-up work, frees him up for well, what ever he wants. This is a paid post that describes one way you can outsource some of the everyday tasks of your business.

Outsourcing is a critical component in the profitability, or degree of focus that a team can apply to a problem or task, and one of the hardest things I find to keep ticking along is all the paperwork associated with benefits, payroll, and just the task of hiring and managing the paperwork of the people that have been hired. Now I don’t have a good idea of the point where it becomes more efficient to outsource these tasks, but unless you’ve got yourself a pretty dedicated and efficient admin assistant, this resource management can eat up a lot of their time and energy. In some cases, particularly in smaller firms, privacy may be an issue as well, with admin staff holding all the information regarding pay and benefit rates for other members of staff.

The average annual cost of regulation, paperwork and tax compliance for small to medium-sized companies is about $5,000 per employee . For companies with more than 500 employees, the cost is about $3,500 per employee.
–Small Business Administration

Elite Business Solutions – Staff Leasing Company

Out of this situation, entrepreneurial firms have seen an opportunity for business as professional employer organizations, providing, the management of all aspects of payroll and employee data. It’s interesting that this mode of employee management is almost unheard of outside of the United States, as the concept of employee leasing has a unique method of creating benefit for the company.

Essentially, the staff leasing company becomes the employer of record, and the original company leases the employees back from them…

305362691_28d09b73d2_m Under a typical agreement, an employer contracts with a PEO and the employer and the PEO become the co-employers of the workers, with the PEO being the employer of record.

As the employer of record of the leased employees, the PEO company handles all of the employee-related tasks and expenses, such as:

  • Paying and filing federal payroll taxes and reports;
  • Paying and filing state payroll taxes and reports;
  • Paying and reporting on workers’ comp and workers’ comp injuries;
  • State unemployment tax assessment wage reporting;
  • Benefit claims handling; and
  • Other human resource issues.

Employees may gain access to benefits such as group health, 401(k) plans, cafeteria 125 plans, life and dental insurance options.

Professional employer organization – Wikipedia, the free encyclopedia

If you area  small company, assuming the fees were reasonable, would this be a good way to provide your employees excellent group benefits and insurance options, while saving you or your administrator the hassles of keeping all the employment and payroll files and documents in order? Maybe staff leasing is your first step towards achieving the The 4-Hour Workweek?

Mike Thomas

Mike Thomas P.Eng. ENV SP, is the author of UrbanWorkbench.com and Director of Engineering at the City of Revelstoke in the Interior of British Columbia, Canada. If I post something here that you find helpful as you navigate the world of engineering, planning and building communities, that’s wonderful. But when push comes to shove: This is my personal blog. The views expressed on these pages are mine alone and not those of my employer.