Who would benefit most from working with Paychex?
Startup with Founding Team
1-10 Employees
Startup to PEO: Have not had any of our clients under 10 employees move to either Oasis or Paychex's PEO service. Mainly because the HRIS and PEO technology is not marketed to as many clients outside the base of payroll clients. This creates a sales force focused on upselling payroll clients to 401k, ASO, or PEO when past 10 employees.
Reasons to buy: Assists in building foundational HR tailored to client, Dedicated HR team, scalable service and technology model, benefits administration, 401k, white-glove customer service for admin & employees.
SMB with an HR professional
10-49 Employees
PEO to PEO or Open Market to PEO or PEO to Open Market: Paychex as each model in-house (HRIS, payroll, ASO, 401k) and also a few Paychex companies like Oasis PEO or SurePayroll. Paychex has a great sales training program and if your rep has been there longer than 2 years, it should let you know they are highly competent in advising clients on their product. We do find when clients involve their broker, they tend to get more value out of the benefits administration tools available.
Many of the new PEOs focus on technology and scalability for their company's shareholders, not yours! Why? Having HR or any professional services in-house gets expensive for PEOs; however, it would be even more expensive for you to hire additional HR staff to cover what Paychex is able to handle. Do you really need more than one HR person under 50 employees? Depends, who on your team has time to create and execute a strategic workforce plan, shop and administer employee benefits, maintain compliance for local, state and federal laws, recruit talent, onboard or offboard employees, run payroll... The list is endless!
Truth is, unless you know the problem it is hard to seek help with HR matters without feeling like a solution is thousands of dollars away! You don't know what you don't know, and companies that see the value in growing a profitable business will truly benefit from a PEO like Paychex that focuses on proactive HR, which is a lost art in this PEO market!
Reasons to buy: Want a flexible provider who can easily transition you from PEO to HRIS or vice versa depending on your current budget or needs. Friendly customer service and a seasoned sales force of industry experts.
Quickly Scaling company with 2+ in HR Department
50+ Employees
PEO to PEO or Open Market to PEO or PEO to Open Market: Paychex does have an internal insurance agency; however, you will want to review if it makes sense to have them BOR your insurance. Business acumen and risk strategy is the most important piece of working with your broker.
Depending on the company's HQ state, your group may be ready to move to a large group plan on the open market or through level-funded plans. Employee benefits are priced differently for large groups versus PEO or small group ACA plans. How? Carriers for large group plans look at your employee demographics, premiums vs claims, and even what services or prescriptions are being used by your employees on the census provided.
In order to shop level-funded or large group plans against a PEO, you need access to an experienced insurance broker who understands the the PEO model. If you are or plan on being a large group in the next 18 months, benchmarking the PEOs to both large group fully insured and level funded plans directly with the carriers is extremely important.
A perk of being on a large group plan are the insights on claims for your group. A savvy broker will access your group's claims data and create a specific cost sharing strategy that allows the employer to correctly assist the carrier in pricing your group. Helping the three parities: employer, broker, and carrier avoid high renewals and properly manage rising insurance costs!
Reasons to Buy: Technology Platform streamlines HR, IT, and finance operations. Custom reporting makes it easy to leverage employee data points for workforce planning. Multiple insurance options allow for customized employee experience and creates consistent insurance renewals year over year. HR guidance live or onsite to support shaping company culture, compliance training, and enrolling in employee benefits.
How does Paychex deliver their services?
Technology Platform
HRIS Integrations/ APIs: Paychex's HRIS platform is very user friendly with an intuitive employee interface. Paychex has an App Shop with over 500+ integrations already prebuilt. The integrations cover a variety of services from HR, Finance, and IT. This solution is perfect for companies with a remote workforce.
HR Services
Admin Support: If you are an employer or account administrator, you will have access to a dedicated support team for your account. They typically assign you a main point of contact and connect you directly to a specialist if the issue requires special attention like a bonus check allocation or how to report a workers compensation claim. They are available via email, chat, or phone.
Employee Support: As an employee, you can expect assistance with locating your benefits contacts, accessing your 401k, questions on a technical issue with the platform, or even a walk through of how to select your health plans. Most employees call in because they are troubleshooting a simple problem or familiarizing themselves with the platform.
How does Paychex price their solutions?
Admin Pricing
Paychex prices their PEO and HR service platforms on a per employee per month basis. Paychex is customizable and you may not need all of their products, so they have designed the billing in a way that helps you forecast cost by knowing the cost per user. Some PEO models charge a percentage of payroll; however, many customers find this confusing and Paychex prides itself on offering transparent billing.
Benefits
Paychex does offer benefits through their PEO and they also allow you to carve out benefits and keep your current plans with your broker if needed. Paychex partners with third party providers and carriers so you can offer: health insurance, 401(k), commuter, and more.
Workers Compensation
You can get your Workers Compensation through Paychex or simply keep it with your current broker as a Workers Comp carve out. Paychex allows you to have a pay-as-you-go workers compensation payment each pay period versus the traditional quarterly or annual audit most companies use.
How to get a quote for Paychex's services?
Work with Broker
A good broker will manage quoting process, negotiate best terms and pricing, and assist in the collection of RFP documents. A great advisor will know which options to share with you, because they understand your business. Some brokers don’t understand PEO because It’s complicated and includes a ton of knowledge around how payroll and tax payments work so be sure to work with someone knowledgeable.
Direct to Company
Great if you know exactly what you want and understand how to financially engineer a PEO’s total offering from WC, fed + state payroll tax, retirement funds, employee benefits, HRIS software billing, and much more.
Conclusion
Paychex is a great option to consider and you can find out more about Paychex on their website at https://www.paychex.com/
If you would like us to help you compare Paychex to other providers schedule some time on our calendar here.
We typically save our clients between 50 and 70 hours while finding the best companies and services specific to their needs.
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