How An Ex-Mod Projection Can Help Control Work Comp CostsOn-Demand workers are all the buzz with technology companies creating new apps daily to join the movement as economists predict a major workforce shift. Call it what you will, but the On-Demand workforce is nothing new. The origin of the staffing industry is a bit murky, but some evidence suggests it started with Mrs. A.E. Johnson Employment Agency in 1890!
The staffing industry is now at an all-time high and temporary employment accounted for more than 2 percent of U.S. employment in 2015. Nearly 16 million Americans worked as a temp or contractor for a staffing agency last year, generating over $120 billion in revenue. Almost every company experiences a fluctuation in product or service demand. Many of these companies explore the use of staffing firms to maintain lean labor supply during these times.
Reduce Costs
Fatigued workers are prone to mistakes and injuries. More often, productivity suffers. Hiring a temporary staff to handle the extra work load allows full-time employees to focus on their main job while maintaining their productivity. Mistakes not only require extra time and money to correct, but they also can damage your reputation with clients.
Injuries resulting in worker’s compensation claims severely increase premiums and make it more difficult to remain competitive. Fortino Rivera, CEO of Staffing Solutions adds, “A good staffing company can become your eyes and ears with respect to filtering out predators that can make false worker’s compensation claims.”
Try Before You Buy
Stacey Crumrine, CEO of Go-Staff, built her staffing company in one of the most challenging niches – Residential Construction. Turnover is very common in construction. Injuries can quickly spiral out of control.
Stacey explains that builders choose Go-Staff because, “Staffing agencies are the perfect vehicles for test driving your staff before you commit to them for the long haul. We do all the up-front work, screening, reference checks, testing, etc., and if for some reason the person gets in there and is not the best fit, companies now don’t have to “try to make things work” because they invested so much time and effort in the person on the front end. Companies can literally, move onto the next person without too much impact on their business.”
Increase Flexibility
Karl Hardesty, of Hardesty, LLC, built his staffing firm focusing on C-suite (typically CFO’s), positions nationwide. “Speed and Capability are two of the reasons we are called upon to help companies. We are selling very experienced CFOs and controllers with at least 10 years of experience and are typically CPAs and/or MBAs. The usual situation is a delayed, but important project with a deadline and the current staff simply cannot get it completed in time, or may not have the skill set. Bringing in professionals that have performed these tasks before makes good business sense. Companies that have undergone rapid growth or are preparing themselves to be sold are typically ill prepared to handle what is coming their way.”
Hiring and Firing
Employing workers has gotten a lot harder over the years. In 1900, there were two U.S. employment laws. In 1980, that number increased to 125. Presently, there are 2,200 different laws or clauses that employers have to comply with. Employers now have to comply with the Affordable Care Act, Workers’ Compensation, health insurance, paid sick leave and the EEOC (Equal Employment Opportunity Commission). There can be multimillion-dollar penalties for noncompliance and Cal-OSHA has warned 2016 will likely have the largest fines in history.
Jordan Markuson of Heffernan Insurance Brokers – an insurance expert for staffing firms – warns of lawsuits and claims that seem all but inevitable after an employee termination. He explains that labor laws are always changing and require a comprehensive management plan. Jordan states, “California businesses are being forced to deal with more regulation than just about any other state. Human Resource professionals are reacting daily to a fluid environment of ever changing and complex laws. Companies can shift their risk to staffing companies, whom are experts in employee relations.”
Expertise
There are staffing agencies and recruiters that specialize in any industry or position you can imagine. The TriStaff Group of Companies has an impressive wide range of niches. Denise Ferraris, Director of Staffing in San Diego explains, “Staffing agencies provide recruiting services to organizations which might not have the expertise and/or knowledge to find niche specific candidates. Our expertise and resources allow us to manage the entire employment process.
This process also reduces cost, creates a larger pool of pre-qualified and vetted candidates, and helps with employee retention.”
Jordan Markuson, CPCU
Assistant Vice President, Heffernan Insurance Brokers
[email protected]
Jordan Markuson of Heffernan is an Insurance Broker specializing in placing Workers Compensation and Liability Insurance for Temporary Staffing Agencies. Jordan champions a proprietary holistic approach to the claims process that ultimately leads to significantly reduced premiums.
