Employer Of Record Archives • NexusCW

The Three Buckets of Contingent Workforce

HR professionals in today’s ever-changing workforce climate are told to accomplish more with less. Tightening talent pool, changing technologies and trying to keep your employees happy are calling for more flexible and creative ways to solve your workforce challenges. Fortunately, becoming more strategic is in our DNA. For many, that increasingly means who we hire to help build the future of our companies. The contingent or contract worker has exploded in the last few years, growing from 10% of the workforce in 2010 to a predicted over 40% of the workforce by 2018, according to reports by the U.S. Government Accountability Office. This can certainly be credited to the rise of the gig economy in global markets. There are many categories of contingent workforce, below I drill down and try to categorize 3 common members of this labor pool. The Temp Worker This category… [Read More]

Get Real Savings Through Third-Party Payrolling

As organizations increasingly rely on contingent or contract workers to fill mission-critical roles, business leaders are looking for ways to boost their company’s bottom line savings. One scenario where this can be the case is the MSP/Vendor rate of third-party payroll utilization – the percentage of spend for contingent or contract workers who are sourced directly by the organization and W2 payrolled by a third party vendor. Increasing third-party payroll utilization offers many benefits to companies, from driving down costs to streamlining the talent acquisition processes and even reducing risk. Not all vendors, however, are structured for or support this approach. For example, when utilizing a staffing firm or staffing-aligned MSP to source for your open positions, be prepared to face markups that can range from 35% to 50% for agency-supplied workers. Rather than accept these markups unconditionally, business leaders should look for opportunities… [Read More]

What is an Employer of Record?

What exactly is Employer of Record (EOR) payrolling anyway? And why has a word that isn’t a word at all become so popular? While we can’t answer the second question, we can give insight into the first. EOR payrolling is a common, but often misunderstood service. Businesses are often unaware that they need or, in fact, are using this service. EOR payrolling is a service provided by third party companies. These companies become the employer of record. They handle the employment life cycles of workers, including onboarding, payroll processing, and offboarding, while they are on assignment with another company. While payroll processing or “payrolling,” an EOR pays payroll taxes, withholds federal and state taxes, administers benefits and maintains compliance. A company benefits from outsourcing these services by saving the time and money expended on these services. Who Can Be Payrolled? Payrollees are temporary workers on… [Read More]

The Differences Between an Employer of Record and a PEO

When you hire workers who live in other states, you are required to fulfill the legal requirements of each state. Most employers do not have the resources or expertise to handle this. These companies choose to partner with either a professional employer organization (PEO) or employer of record (EOR). Understanding the difference between the two will show you why using an EOR, such as NexusCW, is the more beneficial option. Compliance When you hire out-of-state workers, you must comply with that state’s laws and regulations. This includes reviewing proof of worker eligibility and paying taxes in the proper states. Compliance requires you to be familiar with all rules relating to labor and unemployment, document retention and storage, upfront costs and proper forms. Maintaining compliance yourself is a headache and carries the risk of potential IRS fines and legal fees. When you decide to reduce this… [Read More]

Difference Between an Employer of Record and a Staffing Agency

It is not uncommon to hear employer of record services equated with staffing services. Although the two are mutually beneficial, an employer of record is a separate entity from a staffing agency, each with distinct functions and responsibilities. Roles A collaborative relationship exists between an employer of record and its client, which can be a business or a staffing agency. While an employee works for the client, the employer of record assumes the role of employer for tax purposes. The employer of record handles all administrative functions, such as payroll processing, tax withholding and filing, and recordkeeping. The employer of record also conducts pre-employment screening such as background checks and drug testing, in addition to human resources functions such as administering benefits, termination of employees and all other worker issues. On the other hand, a staffing agency recruits candidates to meet the temporary workforce needs… [Read More]

Why Compliance Matters in 2017

With a new era of quickly changing regulations and market trends, compliance is now the top challenge and focus for employers in 2017. The year began with a change in administration, bringing along an overhaul of employment law. In addition, the increase in utilization of contingent labor has continued. Contingent and contract workers, freelancers and independent contractors are flooding the labor market in more numbers than ever before, a trend known as the “gig economy.” With this trend, the risks of non-compliance grow. The federal government is now eager to enact more stringent policies to ensure compliance with tax and regulatory standards. In particular, the United States Department of Labor is more focused on misclassification of workers and has heightened reactions to these cases. Businesses today cannot afford to overlook the importance of maintaining compliance in managing their contingent workforce. It is easy for an… [Read More]

How to Recruit The Right Talent and Avoid Hiring Catastrophes

Recruiting the right talent is essential to the success of a business, while bad hiring decisions are exceedingly expensive in terms of both time and money. Additionally, high employee turnover lowers morale and creates discouragement within a company. These hiring disasters could have been avoided and the lost resources could have been invested in the right candidate. To that end, companies like Google have adopted the “law of three” for interviewing candidates. This recruiting technique and ones like it are designed to avoid costly hiring mistakes. The “law of three” encompasses the following rules: (1) Always interview a minimum of three candidates. Managers are tempted to end their search early when a suitable candidate is found. Discipline yourself to continue interviewing. The more people you interview, the greater the pool you can select from and the greater your chances of finding the right person. (2)… [Read More]

Employer of Record Services

Assuming the role of Employer of Record gives rise to a complex set of rights and responsibilities. To protect the rights of employees, labor laws and regulations impose numerous duties on an employer. These same rules also impose costly penalties for employers who breach these obligations. For this reason, the role of Employer of Record carries an inherent risk of liability. To mitigate this risk and maintain positive employee relations, an employer must have a clear understanding of the legal obligations involved. The Employer of Record assumes a wide range of administrative, legal and financial responsibilities. Processing payroll is a primary function of the employer. The Employer is responsible for compensating employees for services rendered. However, payroll entails much more than simply issuing a paycheck for wages earned. It involves maintaining strict compliance with wage and hour laws. An employer is also responsible for determining… [Read More]