3 Ways Outsourcing Employee Services Reduces Complexity

Employee services, which include health benefits and flexible pay options like earned wage access, are essential to any company’s ability to recruit and retain talented people. But they’re also difficult for in-house teams to manage. Benefits administration alone demands considerable time and effort just to keep up with regulatory requirements, and almost 3 in 4 employers cite compliance as the biggest challenge facing their benefits departments.

The stakes are high. HIPAA violations carry maximum penalties of more than $1.9 million per year. Staffing costs can add up, too, since a full in-house team runs roughly $100,000 per HR employee. And that assumes you can find people with the specialized expertise needed for delivering a great employee experience.

With more than half of employers expecting benefits administration to grow more complicated in the coming years, it’s no surprise that many organizations choose to outsource it. Among midsized and large companies alike, ensuring compliance is the most common reason for making this move, but the operational payoff extends well beyond that.