Competing Against a PEO

[stuy119]

Does anybody have any info on ADPs PEO set up??
Specifically their 401k??

I can get it (I think).

One of my friends works for them and doesn't want to any longer. But he does want to reap the benefits of having a client list and some knowledge of the industry, so he's "referring" me to a few people.

I think it's ADP. If so, I'll see what I can find out when we meet next week.

 

[scagnt83]

I can get it (I think).

One of my friends works for them and doesn't want to any longer. But he does want to reap the benefits of having a client list and some knowledge of the industry, so he's "referring" me to a few people.

I think it's ADP. If so, I'll see what I can find out when we meet next week.

That would be awesome if you could!

I have a really big defferred comp client that was moving from a SIMPLE to a 401k this year (end of year of course).

I knew that the comp was a PEO, but I didnt know which one exactly.

Also, I thought that they where just looking at starting with them. Turns out, they where already with them and just not utilizing their 401k platform. So basically they where already paying the fees to do so, so they felt like they needed to go with the PEO 401k just to justify the fee at that point.

Long story short, I was told month ago that from them that they where 90% sure that I was getting the business.
Now I am told that since it wont cost them any extra than what they are paying now, they are going with Totalsource (ADPs PEO).

If I cant save this somehow its bye bye to a $20K commission plus big time trails!!!!!!
- - - - - - - - - - - - - - - - - -
Specifically im looking for the total asset charge on the 401k and what company is providing the 401k platform.

Also, I need to know anything at all about their profit sharing plan.

What kind of fees do they charge?
I heard that they charge a set percentage of payroll, so the more high earners you have the more cost prohibitive it is to work with them... I dont know this for a fact though...

How does their servicing stack up? etc. etc.

If you can find out any of this I would be very grateful!

 

[HRExpert]

You have to get the client to look at the cost of everything - SUTA/WC/Admin fees and benefits.

If they can get a 401(k) and save more money overall could be your next step. Also, how do you carve out a 401(k) plan when th employer of record is the PEO?

 

[scagnt83]

You have to get the client to look at the cost of everything - SUTA/WC/Admin fees and benefits.

If they can get a 401(k) and save more money overall could be your next step. Also, how do you carve out a 401(k) plan when th employer of record is the PEO?

Good question. Im not sure if you can, although the courts have ruled that the arrangement is technically "joint" ownership of the employees. So maybe you could get by with that technicality... idk.

But all they said was that their payroll was with ADP and that they where considering the PEO option.
Apparently there was a communication breakdown somewhere, because they where already with the PEO....

 

[stuy119]

Also, find a good service to run a Work Comp review on the PEO plan. From someone else in the PEO arena, he tells me they consistently overbill and mess up Work Comp AFTER the contract is in place, so it's tough to find.

Another good tip is to point out that if anyone gets a raise, or a new person is hired, the PEO makes more money with little to no added effort.

SC, I'll check in on the ADP stuff tomorrow and have some word for you (hopefully).

 

[ABC]

I a know a local PEO that is just getting crushed on claims.

Every year they try to shop out the entire block and none of the big carriers will touch it.

I am bidding on 2 group plans that are on right now and the rates are very high. They do offer the cafeteria plan which I can not duplicate but the premium is high and I am not sure what admin cost are.

 

[scagnt83]

They do offer the cafeteria plan which I can not duplicate but the premium is high and I am not sure what admin cost are.

Why can you not duplicate the 125 plan?

 

[ABC]

Why can you not duplicate the 125 plan?

Section 125 is no problem. Every group plan should have a section 125 in place.

A cafeteria plan is offering multiple plan designs


Its offering 10 plan designs to a small group. I have one carrier that can do that but they are not the most competitive under 50 lives. The most competitive will only offer up to 2 plan designs for small groups.

 

[Franz Kafka]

That would be awesome if you could!

I have a really big defferred comp client that was moving from a SIMPLE to a 401k this year (end of year of course).

I knew that the comp was a PEO, but I didnt know which one exactly.

Also, I thought that they where just looking at starting with them. Turns out, they where already with them and just not utilizing their 401k platform. So basically they where already paying the fees to do so, so they felt like they needed to go with the PEO 401k just to justify the fee at that point.

Long story short, I was told month ago that from them that they where 90% sure that I was getting the business.
Now I am told that since it wont cost them any extra than what they are paying now, they are going with Totalsource (ADPs PEO).

If I cant save this somehow its bye bye to a $20K commission plus big time trails!!!!!!
- - - - - - - - - - - - - - - - - -
Specifically im looking for the total asset charge on the 401k and what company is providing the 401k platform.

Also, I need to know anything at all about their profit sharing plan.

What kind of fees do they charge?
I heard that they charge a set percentage of payroll, so the more high earners you have the more cost prohibitive it is to work with them... I dont know this for a fact though...

How does their servicing stack up? etc. etc.

If you can find out any of this I would be very grateful!

I've used ADP as a 401K TPA before. Their service sucks in general (unless you're a mega customer) but CHEAP and you get to pick your own commission schedule on SunAmerica group VA that we used. I'm pretty sure you can help them save a ton of money by using them as a TPA and not as a PEO. JMO

 

[FL Agent 55]

We are not only an Insurance Agency, but a Payroll Company as well. We specialize in writing the comp and providing the payroll services to Construction Companies, but we can provide our services to any industry.

In reality, PEO is a much, much more expensive option for bells and whistles that look and sound cool, but most small-family owned companies do not need them.

Their group benefit rates will be better, but combine their payroll admin cost and their minimum and/or comp surcharges, you can be less expensive than the PEO.

I would suggest teaming up with a Payroll Company that is local and that does NOT write comp. This way, they can provide the pay-as-you-go program and you can write the comp and group benefits.

Good Luck!