With the majority of the “Obamacare” Affordable Care Act (ACA), mandates going into effect in 2014, executives and human resource professionals across the country are scratching their heads trying to figure out the best strategy for labor compliance and cost improvements. nGROUP Performance Partners, a national on-site outsourcing provider, is answering their call with a business model that offers solutions in both critical areas.
“Our proven business model guarantees cost savings in labor, meets the ACA mandates, and eliminates most compliance and co-employment issues,” says David Hair, President of nGROUP Performance Partners.
nGROUP provides labor and process management services to companies with labor intensive operations. nGROUP oversees entire operations or a singular work cell. For example, a client may outsource an entire manufacturing facility to nGROUP, or nGROUP may only be responsible for one work cell within the facility, such as packaging.
According to Hair, it is the role of assuming responsibility that sets nGROUP apart from other industrial engineering efficiency consultants and other flexible workforce options, such as temporary staffing. “This year our clients are expressing concerns about a number of labor compliance issues, particularly those aimed at temporary employment. At the end of the day our job is to not only produce the results we guarantee but to also deliver a workforce that is motivated, trained, and in compliance.”
When it comes to compliance regulations, the ACA has gained a lot of attention from critics, citing that the law offers little guidance as to how mandates will be regulated. For example, one of the most controversial regulations of the ACA is the mandate that companies with more than 50 full-time employees shall provide “qualified” health coverage for all their full-time employees, or pay an annual penalty of $2,000 per full-time employee. If a company does provide such coverage but it’s not “affordable,” the penalty is $3,000 per employee. (Affordable is defined as less than 9.5% of the employee’s family income.) Many economists have reported that the financial impact of the penalties associated with this mandate will reduce profit margins and drive higher prices.
Regardless of any direct financial impact, the ACA will most certainly increase compliance burdens. As reported on the Committee on Ways and Means website, the ACA will add nearly 80 million man-hours each year to individuals and businesses. Critics point out that the IRS compliance burden is the tip of the iceberg. With agencies such as Health and Human Services and the Department of Labor, the fear is that additional and duplicate oversight and regulations will continue to add unparallel compliance burdens on corporations, small businesses, and individuals.
“Whether or not the ACA is here to stay or is destined for mass revision, one solid truth remains,” Hair says. “Companies throughout the United States need to take measures now to ensure compliance when the majority of its mandates go into effect in 2014.”
In instances involving the need for cost improvements, risk protection and a flexible workforce, companies are looking for new business models that ease compliance burdens. A performance based partnership is an emerging example of how companies are adopting alternative workforce models on U.S. soil.