A major deadline for the Affordable Care Act (ACA), the healthcare reform law also known as Obamacare, is coming up quickly.  If a recruiter has even one employee, they will likely have to comply.

The ACA requires employers to provide employees with a notice about coverage options available through the Marketplace, which was created by the ACA to provide an online “one-stop shop” for individuals to compare private health insurance options.

Starting on October 1, employers must provide the notice to new employees.  In addition, it must be distributed to all existing employees by October 1.  The notice must inform employees of the following:

• The Marketplace will be available starting January 1, 2014.
• What services the Marketplace will provide and how to contact it.
• They may be eligible for premium tax credits if their employer doesn’t offer an plan that provides “minimum value” and that is “affordable,” as defined by the ACA.
• They may lose their employer’s healthcare contribution (if applicable) if they choose to purchase insurance through the Marketplace.

You can find more details about the requirements under this provision.

A common misconception about Obamacare is that employers only have to worry about it if they have 50 or more employees.  This stems from the law’s employer mandate, which will require employers with 50 or more employee to provide healthcare starting in 2015.  But even the smallest employers, including recruiting firms that have any in-house employees or contractors on their payroll, have responsibilities under the ACA.

This required notice is perhaps the best example.  The ACA actually created this provision as an amendment to the Fair Labor Standards Act (FLSA).  So if you are subject to the FLSA, as almost every employer is, you must comply with this provision regardless of whether you offer insurance to employees.  If you are not sure if the FLSA applies to you, you can find out by visiting this page on the Department of Labor website.

Fortunately, you don’t have to write this notice from scratch.  The Department of Labor provides Model Notices for employers who offer a healthcare plan and employers who do not offer a healthcare plan.

Regardless of your firm’s size, it’s important that you stay on top of the developments surrounding the healthcare reform law.  Not only could there be implications for you as an employer, but your clients could also look to you for answers to their staffing issues that may arise as a result of Obamacare.

SURVEY QUESTION:

With the third quarter of the year rapidly coming to an end and the fourth quarter on the horizon (and right behind it, 2014!), this is a good time for recruiters to analyze the activity in their niche.

The activity in a recruiter’s niche is one of the factors influencing whether or not that recruiter finishes the year strong and carries a sizeable amount of momentum into the next year.  It also might determine how much that recruiter works between now and the end of the year.

If they’re enjoying a good year, some recruiters take off nearly the entire month of December, at least in terms of sourcing and hard-core recruiting.

We recently conducted a survey of Top Echelon Network recruiters by posting a question in the Members’ Area.

That question was as follows:

How would you describe the activity in your niche right now?

SURVEY RESULTS:

The choice of answers that were provided is listed below, along with the percentage of recruiters who selected each answer:

• Red hot! — 16.9%
• Heating up fast! — 31.2%
• Eh, lukewarm — 44.2%
• Not that hot — 6.5%
• Pretty much ice cold — 1.3%

SURVEY ANALYSIS:

Okay, first the good news: 16.9% of survey participants indicated that the activity level in their niche is “Red hot!” and another 31.2% answered “Heating up fast!”  Put those together, and you’ve got nearly half of recruiters enjoying a heightened level of activity.

However, another 44.2% chose “Eh, lukewarm” as their answer, and another 6.5% indicated that their niche is “Not that hot.”  Thankfully, only 1.3% of respondents are of the opinion that their niche is “Pretty much ice cold.”

So as you can see, the answers are all over the place, which pretty much reflects what’s happening in the economy overall—some areas are hot, some are lukewarm, and some are not.

FEEDBACK:

How would you characterize the activity in your niche right now?  With one of the choices listed above, or do you have your own way to describe that activity?  Will you be taking the whole month of December off this year . . . or can you just not afford to do that?

From Staffing Industry Analysts to the Associated Press (AP), there seems to be one hot topic this summer: contract staffing.

The word is that contract hiring is going to continue increasing throughout the rest of 2013, as it becomes more evident that contract staffing has carved out a permanent place in the American workforce. Consider the following statistics from recent reports on the Internet:

• 31% of companies surveyed by CareerBuilder plan to hire contract workers, up from 21% last year. (ERE.net)

• The third quarter of 2013 is expected to mark the 15th consecutive quarter of year-over-year increases in contract hiring. (G. Palmer & Associates via ERE.net)

• Contact/temporary work accounted for 15% of all American job growth in the past four years. (CareerBuilder via Staffing Industry Analysts)

• The number of contract/temporary workers has jumped by more than 50% since the end of the recession. (AP)

• 3/4 of the economists surveyed by the AP believe the increased use of contract workers is the start of a long-term trend. (AP).

What is behind these statistics and all the buzz surrounding contract staffing?  The economy is still one of the biggest factors.

“Companies are adding more employees to keep pace with demand for their products and services, but they’re not rushing into a full-scale expansion of headcount in light of economic headwinds that still linger today,” said CareerBuilder CEO Matt Ferguson.  “The projected surge in temporary hiring from July to December is evidence of both a growing confidence in the market and a recession-induced hesitation to immediately place more permanent hires on the books.”

But Ethan Harris, global economist at Bank of America Merrill Lynch, does not believe the trend is tied solely to the economy.

“There’s been a generational shift toward a less committed relationship between the firm and the worker,” he said.

So the question is, with all this talk about contract staffing, are YOU talking about it with your clients?  If not, you could be missing out on a huge opportunity to increase your sales and create a steady stream of income for yourself.

Don’t assume that your clients aren’t using contractors or are not interested in them just because they don’t discuss them with you.  They may have just assumed you don’t handle contract staffing.  When you start talking about contract staffing, you might just be surprised by the results!

The Affordable Care Act (ACA), the healthcare reform law often referred to as Obamacare, is being credited for a spike in contract staffing, which is at its highest level since 2006 and is outpacing traditional, direct hiring.

The Bureau of Labor statistics reported that 2,679,800 workers were employed in contract/temporary positions in May, inching ever closer to the all-time record of 2,767,300 contractors working in October 2006, according to ere.net.

Moreover, year-over-year contract staffing growth was 7.5%, which is five times the growth of the overall economy’s jobs increase of just 1.56%.  The contractor penetration rate (the percent of workers who are contractors) has hit 1.98%, close to all-time high of 2.03%.

Investors Business Daily is pinning some of this contract staffing growth on what are being called ‘Obamacare-Dodgers’ — employers trying to get around the employer mandate portion of the ACA by utilizing contractors instead of direct hires.  The employer mandate, which begins in 2015, will require employers with 50 or more employees to provide healthcare insurance to their employees or pay a per-employee penalty.

Utilizing contractors who are W-2 employees of a contract staffing back-office is a legitimate strategy for reducing or eliminating an employer’s responsibilities under the employer mandate.  Basically, companies are outsourcing the employer responsibilities to the back-office.

Recruiter Joell Iskander of Select Hire Resource is seeing more of her clients go the contract staffing route as a result of Obamacare.

“When clients utilize contractors, benefits and other employer issues are no longer their problem,” Iskander said.  “If they put someone on as a contractor, it’s something the recruiting firm or back-office handles.”

This is a safer alternative to another popular Obamacare avoidance strategy — classifying workers as 1099 Independent Contractors.  Companies may use this technique to reduce their number of employees that must be counted to determine if they fall under the employer mandate.  However, simply calling a worker an independent contractor doesn’t make it so.

They must meet the IRS guidelines for independent contractors.  The Obama administration has been very diligent in targeting companies that misclassify W-2 employees as 1099 independent contractors because the proper employer taxes are not being paid on those individuals.  This is not an issue when companies utilize contractors employed through a back-office because that back-office classifies the workers as W-2 employees, pays the employer share of payroll taxes, and takes responsibility for Obamacare compliance.

The continued growth of contract staffing in light of Obamacare presents a huge opportunity for recruiters willing to place W-2 contractors.  Unfortunately, some recruiters will pass up this opportunity because they are reluctant to delve into contract staffing due to the misconception that it is more difficult than direct hire.

But contract staffing does not have to be any more difficult than direct hire placements when you utilize a contract staffing back-office.  The back-office becomes the legal W-2 employer of the contractors and handles all of the financial, administrative, and legal details of the contract placement.  This leaves you to handle the traditional recruitment tasks: get the job order, find the candidate, and negotiate the rates.

Additional placements are yours for the taking IF you are willing to stretch a little outside of your comfort zone.  Not only can you increase your sales, but you can also become a valuable partner by providing clients with a viable solution to one of the most challenging staffing issues they’re facing.

(Editor’s note: this article is for informational purposes only and should NOT be considered legal advice.)

Many recruiters and employers are still trying to wrap their arms around Generation Y (or Millennials, if you prefer) and their unique look at the workplace.

Now, according to Workforce, recruiters may want to start bracing for the next generation in the workplace.

The article “Another Generation Rises: Looking Beyond the Millennials” states that there are a number of monikers used to refer to these individuals born in 1995 or after: Pluralists, Re-Generation, Generation Z, and Homelanders.

The youngest of this generation are just turning 18, and some are already making their way into the workforce.

Of course, with any new generation, experts have predicted some characteristics they think will come to define this generation:

• Environmentally conscious
• Fiscally conservative and willing to delay gratification
• More likely to rent than own
• Indifferent to technology: they grew up with it, so they aren’t as obsessed with it as Millennials
• More likely to stay close to home due to the domestic and international turmoil they have witnessed (hence the name “Homelanders”)

There is some debate among experts whether these individuals really constitute a new generation or if they are just “late-wave Millennials.”

One thing is clear, though: the life experiences of people correlate strongly with how they work, so it is helpful to consider the events and environmental factors that have shaped their lives.

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888.627.3678
dfledderjohann@topecheloncontracting.com
Connect with Debbie Fledderjohann on LinkedIn.
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Think you don’t have to worry about healthcare reform because you don’t have 50 or more employees? Think again!

Most of the hype about the Affordable Care Act (ACA), the healthcare reform law better known as Obamacare, has been surrounding the employer mandate.  Employers with 50 or more employees will have to provide affordable health coverage to those employees by 2014.

If you have contractors who are on your payroll, they count towards your total employee count.  Many recruiters, even those who employ some contractors, won’t get anywhere near this 50-employee threshold.  But that doesn’t mean they are out of the woods when it comes to Obamacare.

There are administrative tasks tied to the ACA, even for the smallest of employers.  For example, even if you only have a couple of employees (in-house, contractors, or a combination), you will have to provide those employees with a notice about the healthcare exchange, which has now been dubbed “The Marketplace.”

The Marketplace is supposed to provide individuals with a place where they can compare and select healthcare plans.  Depending upon their income, they may qualify for premium tax credits to reduce the cost of the coverage they select.

Any employer who is subject to the Fair Labor Standards Act (FLSA), which is almost EVERY employer, must provide a notice to employees letting them know that the Marketplace will be available starting January 1, 2014.

The notice must let them know what services the Marketplace provides and how to contact it.  It must also inform them that they may be eligible for a premium tax credit and that they may lose the employer contribution (if applicable) if they choose to purchase their insurance through the Marketplace.  You have to provide this notice even if you do not offer insurance.

On October 1, 2013, employers must begin providing this notice to new employees at the time they are hired.  All existing employees must receive the notice by October 1, 2013.  For details on how to implement this, the Department of Labor has provided a Technical Release.

Very small firms and companies may have other responsibilities under Obamacare, as well, especially if they offer health insurance.  For instance, the health reform law mandates some changes to the COBRA notices employers send to plan participants who lose their coverage.  The law also has certain reporting requirements for employers who offer health insurance, regardless of how many people they employ.

For these reasons alone, it’s important that recruiters don’t ignore Obamacare.  Be sure that you are aware of your responsibilities based on the number of employees you have, and make sure you educate your smaller clients about these provisions, as well.

Editor’s note: This article is for informational purposes only and should NOT be considered legal advice.

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888.627.3678
dfledderjohann@topecheloncontracting.com
Connect with Debbie Fledderjohann on LinkedIn.
Follow Debbie Fledderjohann on Twitter.