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ADP TotalSource Exceeds Half Million Worksite Employee Mark, Maintaining its Position as a Leading Professional Employer Organization for Clients Like Contegix

By Brian Michaud, senior vice president of ADP TotalSource® and ADP Resource®

ADP TotalSource® has a long history of helping small and midsized businesses overcome HR challenges. We believe that our focus, resolve and diligence help make us a valuable partner for our clients. And we work hard to assure companies like Contegix® that they’re working with a trusted partner and receiving top-notch services that adhere to the highest standards.

Seeing that commitment have a tangible impact is why it’s especially gratifying to reach the milestone we announced today: ADP TotalSource now co-employs more than half a million worksite employees. This is an especially impressive achievement when you consider that if ADP TotalSource were an independent employer, its more than 500,000 worksite employees would rank it second among private sector employers in the United States.

We’re not entirely surprised by our progress, however. We’re seeing a growing trend for small and midsized businesses to outsource their HR and employee benefits administration responsibilities. We’ve found that this is, in part, due to the practice of many businesses assigning HR tasks to someone who’s not trained in this profession. And that approach for business imperatives like compliance, hiring, compensation, retention and leadership development programs can have a startling downside and tangible hidden cost.

Clients who partner with ADP TotalSource, however, get access to strategic, day-to-day HR support that enables their business to focus on their priorities while providing their employees with access to a larger suite of HCM offerings, including access to the same quality and selection of benefits offered at Fortune 500® companies, a top-flight 401(k) retirement savings plan, and career development training.

Being a trusted partner and delivering high-quality services like those are the reasons Contegix adopted the ADP® PEO model.

“Our relationship with ADP is a true partnership,” said Arlyn Small, senior vice president of Human Resources for Contegix. “Whenever issues arise, they are here to collaborate in real time and rally around us with a sense of urgency.”

And while Small says the caliber of benefits Contegix gets from ADP TotalSource is important, it’s the attention to personal worksite employee concerns that makes Contegix a fan.

“Our benefit plans under ADP are very good, but it’s the extra resources they make available that set them apart from other service providers,” Small said. “If I learn of a situation that’s not exactly covered under our plan, there are more resources we can access through ADP TotalSource to help find a solution. I’ve had numerous unique situations with employees and ADP was able to help them find a solution. Service like that is absolutely phenomenal and brings value to the table.”

Sadly, not all small and midsized businesses have adopted the PEO approach.

Often, out of necessity, small and midsized business owners, or senior business managers, become what ADP calls the “ad-hoc HR managers.” Using ad hoc HR managers may inadvertently expose business owners to additional expenses and risk when they manage crucial business functions themselves.

According to an ADP study, only one in five of these ad hoc HR managers say they are confident in their ability to complete HR duties without making a mistake, and 90 percent of them say they would give up the responsibilities if they could.

Additionally, according to the study, ad hoc HR managers spend 20 percent of their time each week managing HR duties. That nets out to more than $18,000 a year to have untrained staff manage HR tasks, which equates to an annual total cost of $27 billion across the small business market.

The value of the PEO approach is supported by other independent research.

A study by the National Association of Professional Employer Organizations® (NAPEO) shows that small businesses that use a PEO to manage HR for their employees see double the annual revenue growth compared to a company that doesn’t. According to the NAPEO® research, small and midsized businesses that used a PEO were significantly less concerned about their ability to handle a number of business challenges, such as hiring employees, increasing revenues and raising capital.

ADP TotalSource is a Certified* Professional Employer Organization (CPEO), which gives business owners confidence that it has met specific standards set by the U.S. government. To qualify for IRS certification, the business had to adhere to very specific bonding and independent financial-review requirements and is required to participate in ongoing reporting and record-keeping to maintain its status as a CPEO.

We are proud and excited to support half a million worksite employees. And we’ll continue to do whatever it takes to preserve the trust they and our clients have placed in us.

*The IRS does not endorse any particular certified professional employer organization. For more information on certified professional employer organizations go to www.irs.gov.

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