Frequently Asked Questions
What is Emplicity?
Emplicity is a Human Resources (HR) outsourcing firm, offering flexible, comprehensive solutions for the small to mid-sized employer. We contract with businesses to manage their critical human resource and personnel responsibilities, and assume employer risks, while acting as a co-employer or administrator for their worksite employees; however, the company still retains responsibility for the day-to-day management of their employees.
Is Emplicity, as a PEO (Professional Employer Organization), recognized as an employer?
The Internal Revenue Service recognizes Emplicity as an employer for the purpose of federal income and unemployment taxes. Seventeen states provide some form of licensing, registration or regulation for PEOs; in addition, many states recognize PEOs as employers or co-employers of worksite employees for the purpose of workers’ compensation and state unemployment insurance taxes. Under our Administrative Services Organization (ASO) service model, Emplicity has NO employer relationship with your staff but continues to assist and support your employees as a third party administrator. The benefits may be similar to our PEO arrangement, though more control and flexibility is afforded to the Client.
Is Emplicity Certified by the IRS?
Yes, Emplicity is a Certified Professional Employer Organization (CPEO) with the IRS as of April 1, 2019. This certification program originated as a result of the Small Business Efficiency Act in 2014. PEOs with CPEO status have demonstrated their stability and financial well-being, as well as their ability to meet and maintain strict requirements for financial reporting, tax status, and bonding.
Does Emplicity need to be licensed as a PEO to provide insurance benefits to their workers?
Emplicity is licensed as a PEO where required by state law, and as such, may sponsor employee benefit plans for its worksite employees. This includes benefits that are mandated by law, such as workers’ compensation and unemployment benefits, as well as voluntary benefits such as health, life, dental and disability insurance. As an added service to our clients, we also have a complete Commercial Insurance Department to handle all aspects of business insurance, including WC insurance and health benefits, utilizing authorized insurers.
What is the difference between Employee Leasing and Emplicity's PEO Services arrangement?
Although many still view these two staffing arrangements as the same, they are, in fact, quite different. Employee Leasing is a poorly defined term that often means different things to different people. However, it is most often described as a situation in which employees are “fired, hired and leased back,” to their original employer (which does not occur in a PEO arrangement). With Employee Leasing, employees are usually assigned to a company for a fixed period of time or for a specific project, with little long-term equity or investment between the worker and company they work for. With Emplicity’s PEO arrangement, most or all of a company’s workers are employed in a long-term, non-project based relationship. Emplicity assumes responsibility for employment taxes, benefit plans and other human resource duties, including health insurance, retirement savings plans, and other critical duties and benefits usually provided by the employer. This allows the companies we work with to become invested in a long-term relationship with their workers, while allowing the workers to become more invested in their role with the company.
What is the difference between temporary staffing services and Emplicity's PEO Services arrangement?
A temporary staffing service recruits employees, then assigns them to various clients on a temporary basis to supplement the client’s own workforce. Employees are usually hired for short-tern situations such as employee absences, temporary skill shortages or to cover seasonal workloads, with few, if any, employee benefits. As a PEO, Emplicity operates under contract with an employer, assuming employer responsibilities for most or all of their workforce. In most case, this is a long-term relationship and in fact, nearly 90% of our clients and worksite employees have been with us for at least a year or more. Employees can participate in our full range of employee benefits including health, dental and life insurance, vision care and retirement savings plans.
How many Americans are employed under a PEO arrangement?
Experts estimate that 3 – 4 million Americans are currently co-employed as part of a PEO arrangement; PEOs currently operate in every state, while the industry continues to grow more than 10% each year.
Who uses Emplicity for its PEO services and ASO services?
Our average PEO client is a small to medium-sized business, with anywhere from 10 to over 250 worksite employees, though several larger businesses also use our services. Our client list includes an exceptionally wide range of businesses, from accountants to zoo keepers and virtually every profession in between, including doctors, distributors, retailers, mechanics and more. If you are an ASO client, chances are that you employ 75 or more employees and that you have 2-3 full-time dedicated human resources professionals on staff. Many of our ASO clients have found refuge and simplicity through the virtual handover-that is, having Emplicity fully outsource your HR department and reengineer your processes and procedures.
How does Emplicity's PEO and ASO arrangements work?
PEO: When an employer contracts with Emplicity, we enter a co-employment relationship in which both Emplicity and our client act as employers for the worker. Under the contract, some traditional employer responsibilities and liabilities are assigned to either Emplicity or the client company, while others are shared. Emplicity assumes responsibility and liability for the business of employment, such as risk management, personnel management, human resource compliance, payroll and employee tax compliance; at the same time, we establish an employment relationship with the client’s worksite employees, while providing a complete human resource and employee benefit package. Meanwhile, our clients retain full responsibility for their daily business operations, such as product development, production, marketing, sales and service.
ASO: In our Administrative Services Organization model, we provide a comprehensive approach to many of the human resources functions supported in our PEO model. The most significant difference lies in the absence of any direct employer relationship with your staff. Your company retains 100% management and employer responsibility with Emplicity as your administrator for human resources, payroll, workers’ comp. and risk management and benefit administration. Your Emplicity service plan is flexible, custom-tailored to just what your company needs. Under our ASO model, our Clients enjoy the simplicity and protection that has become the hallmark of Emplicity’s world-class human resources team.
Why should I use Emplicity for HR outsourcing?
As a business owner, Emplicity allows you to focus your time and energy on the business of your business, and not on the business of employment. As business grows, most small business owners don’t have the necessary training and experience in human resources, payroll and accounting, and regulatory compliance, as well as risk management, insurance and employee benefit programs to meet the demands of being an employer, let alone stay in compliance with a myriad of ever-changing state and federal regulations and reduce their exposure to fines, penalties and lawsuits.
Will I lose control of my business?
As a co-employer under our Professional Employer Organization (PEO) model, Emplicity will become your partner in the employment of your workers. Although your staff will receive their benefits and a form W-2 from Emplicity, you will still retain full ownership and day-to-day management of your company. As co-employers, Emplicity will contractually share employer responsibilities and liabilities with you. Emplicity assumes a real and factual employer role, with most of the responsibilities and liabilities associated with a general employer, while our clients usually retain the rights and responsibilities of a special employer. We are responsible for payroll and employment taxes, and maintaining employee records, while reserving the ultimate right to hire and fire, and to resolve employee disputes. By shifting the burden of these responsibilities to Emplicity, you’ll have more control over the core revenue-generating aspects of your business. Under our Administrative Services Organization (ASO) model, your company retains 100% employer responsibility and control. Emplicity acts as your administrator and continues to support you in the critical HR functions, but only as a third party. Although we will NOT have an employer relationship with your staff, we will continue to provide them with the utmost highest degree of service.
Why would my workers want Emplicity as their employer?
Chances are, your employees, like most workers, want genuine financial security, quality health insurance, a safe working environment and opportunities for retirement savings and things that most small and medium sized companies struggle to provide. Acting as their co-employer, we can provide your employees with a competitive benefits package, comparable to a Fortune 500 company. At the same time, they’ll enjoy better job security, since our economies of scale allow you to lower your overall employment costs. Emplicity can also help improve job satisfaction and productivity by providing your employees with quality human resource services like employee manuals, grievance procedures and improved communications.
Who is responsible for our employee's wages and employment taxes under the PEO services arrangement?
We assume responsibility and liability for payment of wages, as well as compliance with all rules and regulations governing the reporting and payment of federal and state taxes on wages paid to your employees. The IRS recognizes Emplicity as an employer for federal income and unemployment taxes, and case law affirms the principle that PEOs are responsible for payroll taxes. Who is responsible for state unemployment taxes under the PEO services arrangement? We assume responsibility and liability for payment of state unemployment taxes. Most states recognize Emplicity as the sole responsible entity, while few states require us to report unemployment tax liability under its clients’ account number. In addition, four states have laws that hold both parties; the client and Emplicity jointly liable for unemployment taxes.
Who is responsible for compliance with employment laws and regulations under the PEO services arrangement?
We assume responsibility for complying with the entire spectrum of employment laws and regulations, including all federal, state, and local discrimination laws, Title VII of the 1964 Civil Rights Act, Age Discrimination in Employment Act, ADA, FMLA, HIPAA, Equal Pay Act and COBRA.
Who is responsible for workers' compensation under the PEO services arrangement?
We are generally recognized as the employer for purposes of providing workers’ compensation coverage, although the exact responsibility depends on various factors, including individual state statutes and insurance carriers.
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