For the last five and a half years staffing agencies have wondered what the true impact of the legislation will be on their margins and their internal workflows. 2016 will be the first year agencies are called to account for their compliance with these new laws. This will cause a shift in priorities when it comes to selecting technology says Dave Dourgarian, CEO of TempWorks Staffing Software, an Eagan-based company that provides software and payroll funding services.
Below Dourgarian outlines some considerations and concerns staffing companies should be aware of in 2016:
- Printing form 1095 for each full time equivalent employee requires data pulled from quite a few sources such as payroll, insurance carrier and program administrator. How flexible is the staffing software when it comes to pushing out and pulling in data from foreign sources on the fly? Can it do this easily without a long-tailed consulting engagement?
- Worksites will begin to realize that the cost of staffing has increased as a result of Affordable Care Act (ACA), but not all worksites are created equal. The ones with lower turnover will expect lower rates and they will expect their staffing suppliers to tell them where they stand with regard to their peers. In effect, the cost of healthcare insurance will become a variable in the cost to serve just as workers comp insurance always has been. How easy can the technology make it to communicate this accurately to the staffing user?
- ACA carries a bag full of carrots and sticks to incent certain employment practices. Nobody knows how aggressive enforcement will be on documenting the offering of coverage; it could become the next version of the I-9 audit. The true cost of keeping an employee from converting to full time or of rewarding him for transitioning from part to full time also isn’t understood yet. A lot of these consequences will depend on the federal government’s appetite for enforcement, but rest assured their consequences will be disproportionally large to staffing agencies, who employ in bulk. The technology to manage this will be crucial when it comes to CFO’s avoiding audit or at the very least, sleeping through the night.