Administration Fees - Absolute Pay Trust charges a low flat fee for payroll services.  Employee leasing firms bill administration fees as a percentage of your gross payroll, which almost always results in a significantly higher administration fee.  It also means that if you give an employee a raise or hire additional employees, you have just given the employee leasing company a raise as well.

 

State Unemployment Tax Rates - As a result of recent economic conditions, many employee leasing companies have seen a drastic increase in the number of unemployment claims filed against them.  Those leasing companies have also experienced a corresponding increase in the state unemployment (SUTA) tax rate that they bill to their clients.  Many business owners will find that it is advantageous to establish their own unemployment claims history.  Doing so allows employers to take control of their own SUTA tax rate rather than being assigned a higher rate by an employee leasing firm.  In most cases an employer with a positive unemployment claims history will have a much lower tax rate on their own than they will through an employee leasing arrangement.

 

Workers' Compensation Cost - Absolute Pay Trust offers the same pay as you go convenience of employee leasing arrangements, but without the added cost.  Did you know that Florida workers' compensation rates have actually gone down each year for the past 5 years?  On average workers' compensation rates in Florida are approximately 50% of what they were 5 years ago!  This has had a significant effect on the employee leasing industry as a whole.  Lower workers comp rates means lower profit margins for carriers that underwrite the master policies for leasing companies.  For this reason many leasing firms are unable to offer the discounted workers' compensation prices that made employee leasing such an attractive option in the past.  Now consider the mandatory discounts that traditional workers' compensation carriers are required to offer such as safety program discounts, volume discounts, drug free discounts, contractors credits, etc...  Add in the high claims fees charged and claim deductibles used by many leasing firms if a claim is filed.  Remember too that utilizing a standard workers compensation policy allows employers to establish a positive claims history, which can result in reducing workers' compensation costs even further.  The end result is that obtaining a traditional workers' compensation policy can be a significantly more cost effective solution than an employee leasing arrangement.