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  • In today’s fast-paced and increasingly demanding work environments, managing leave of absence requests is crucial for maintaining operational efficiency and employee well-being. However, balancing your business needs with your team’s health and satisfaction is often difficult.

    Leave of absence, separate from paid time off (PTO), allows employees to take extended time off to address personal matters. Leave of absence can be unpaid; however, employees will continue to receive their healthcare package and have guaranteed job security.

    A leave of absence, whether for health reasons, family care, or personal development, is not just a logistical issue—it’s a critical component of an employee’s relationship with their workplace. How you handle these requests can deeply influence employee morale, trust in management, and your company’s reputation as a caring employer. In addition, with rising awareness of the importance of mental health and work-life balance, businesses are under increasing scrutiny to adopt leave policies that support their employees’ well-being.

    Beyond these factors, as a business owner, you also have legal responsibilities regarding employee leave. Employees are protected by laws such as the Family Medical Leave Act (FMLA), and failure to address leave requests appropriately or retaliating against an employee who takes leave can result in lawsuits, penalties, and reputational damage that will be difficult to recover from. While a leave of absence can be stressful, we’ve gathered some resources to help you navigate them with your team while ensuring compliance.

    Creating A Leave Of Absence Policy

    One of the most significant concerns among employees is the fear that taking leave might hinder their job security or career progression. This fear can discourage employees from applying for leave, even when they genuinely need it, damaging morale, productivity, and more. By establishing a clear leave policy, communicating it effectively, and fostering an environment of open communication, you can empower your team to prioritize their health without fear of negative repercussions. Your leave policy should include:

    • Request and approval procedures: Detail the process for requesting leave, including advance notice requirements, the use of official forms, and whom employees should notify regarding their absence. In addition, describe how leave requests are evaluated and approved, including who can grant or deny leave and under what circumstances.
    • Eligibility criteria: Clearly define who is eligible for leave of absence, including full-time, part-time, and temporary employees, as well as any specific conditions or probationary periods.
    • Reintegration outline: Outline and communicate a reintegration plan with your team. Return-to-work programs help employees ease back into their job roles, potentially starting with part-time hours or adjusted duties.
    • Anti-discrimination policy: Explicitly prevent discrimination in performance evaluations due to leave. This can help reassure employees that their absence will not hinder their career progression.
    • Documentation requirements: Specify any documentation employees need to provide when requesting leave, such as medical certificates for sick leave or proof of eligibility for parental leave.
    • Employee responsibilities: Communicate employees’ duties during leave, such as staying in touch with supervisors, adhering to company policies, and providing updates on their status.
    • Consequences of policy violations: Explain the consequences of violating the leave policy, including disciplinary action, loss of benefits, or termination of employment.

    Preemptively establishing a leave of absence policy not only protects employees but also contributes to a more loyal and productive workforce. Though it takes time and effort to generate, being caught without a plan can lead to stress and internal confusion that will impact your bottom line.

    Managing Workloads During A Leave Of Absence

    It’s crucial to have strategies to ensure operational continuity during leave. In certain situations, detailed planning may not be feasible, such as an unforeseen injury to a loved one that requires an employee’s leave for caregiving. Conversely, in cases such as parental leave, there may be more lead time to organize workloads. Regardless, ensuring you have a detailed plan will help ensure your team remains productive. You can do this through:

    Cross-training employees

    Cross-training your team is a practical approach to mitigate the risk of being caught without adequate coverage. It requires your team to learn the roles and tasks that may not be part of their day-to-day. By ensuring that every team member possesses a broad range of skills and knowledge, critical tasks can still be completed regardless of when leave is taken. This proactive measure safeguards against disruptions and fosters a collaborative and supportive company culture.

    In addition, cross-training promotes skill development and empowers team members to take on new challenges and responsibilities. It encourages flexibility and adaptability within the workforce, ultimately enhancing your organization’s overall resilience and productivity.

    Contract or temporary hires

    Another way you can ensure your team continues to operate at peak efficiency is by leveraging contract workers or temporary hires. Bringing in additional support can prevent existing team members from becoming overburdened with extra responsibilities and potentially burning out – particularly for longer leaves such as parental leave, which can extend up to three months or more.

    Delegate and communicate

    Leave can be a stressful time for employees. To mitigate employee stress, your leadership team should make a detailed plan and delegate important tasks to the remaining staff. After delegating tasks, establish regular check-ins with the team. These check-ins can assess not only task progress but also accurately gauge team morale and identify signs of burnout or discontent.

    Pitfalls To Avoid

    When an employee takes leave for an extended period, it’s essential to ensure you have your paperwork in order. Details such as payroll should be worked out ahead of time if possible. Mishandling payroll during an employee’s absence can result in over or underpayment, which can be difficult to fix later. Take the time to review and adjust payroll calculations accordingly, factoring in any changes to hours worked, leave entitlements, and benefits.

    In addition, keeping accurate records of employee leave dates is crucial for managing schedules and ensuring adequate coverage. Without proper tracking systems, you risk scheduling conflicts, understaffing, or overstaffing, which can impact productivity and workflow.

    Lastly, don’t forget about your employees on leave. Neglecting to support and communicate with your staff during their leave can impact their morale and loyalty to your organization. Don’t overload them with messages; a card or a quick message can go a long way. Showing empathy and understanding and providing necessary support where possible can boost employee engagement upon return.

    GMS Services

    Managing leave is complicated; from workloads to legal obligations, it’s stressful for your whole team. Professional employer organizations (PEOs) like GMS offer a range of services that help simplify your HR tasks.

    One of the services GMS offers is employee training and recruitment. Our human resources experts work closely with you, offering expert guidance on recruitment and training strategies. We alleviate the administrative burdens associated with the entire employee life cycle, allowing you to maintain complete control over hiring decisions while we simplify the process. Contact us today, and let us help you navigate the complexities of being an employer.

  • For small business owners, sometimes the need for extra hands sneaks up unexpectedly. Whether it’s a sudden rush of customers, a seasonal demand, or a taxing project, the need for additional labor can be undeniable at times. Despite the necessity for extra help, it’s not always the right time or best financial decision to hire and onboard a new long-term employee.

    As your business faces the demand for more support, it’s essential to assess the situation carefully and explore alternative options such as leased employees. Hiring leased employees is a flexible and cost-effective way to address short-term staffing needs without committing to permanent hires.

    What Is A Leased Employee?

    A leased employee is contracted to work for a business through a staffing agency. While a leased employee performs tasks and duties for their assigned business, a staffing agency assumes responsibility for their salaries and associated HR administration. Leased employees offer flexibility and access to specialized skills without needing to go through the full hiring process. By improving efficiency and adaptability, employee leasing allows small businesses to remain competitive and keep up with industry demands.

    The Advantages Of Leased Employees For Small Businesses

    Leased employees offer numerous benefits for small businesses, serving as a strategic solution to address various operational challenges. When you opt for leasing employees, you have the ability to:

    Adapt to staffing fluctuations

    Leasing arrangements can vary from temporary to long-term based on your business’s needs. Temporary leased employees can resolve immediate staffing needs, addressing heightened demands during peak seasons, special projects, or sudden increases in workload. For businesses requiring a more permanent solution while still retaining flexibility, long-term leased employees are a favorable option. They can provide the skills needed or fill ongoing positions without the administrative burden of traditional hiring.

    Tap into expert skills without long-term contracts

    Employee leasing allows you to tap into a diverse talent pool with a wide range of skills and knowledge, all without the need to hire a full-time employee. This flexibility allows you to find a qualified leased employee that suits your exact project or need. Whether you’re in search of a temporary sales representative or a more long-term IT analyst, the flexibility of leased employment empowers you to acquire the exact skills you need precisely when you need them.

    Save on hiring costs

    Leasing employees is a cost-effective alternative to hiring full-time employees. With leased employees, you can save time and money on the recruitment process since this is handled by a staffing agency. You can also avoid the additional financial obligation of providing benefits like health care, retirement plans, and paid time off (PTO) because leased employees are not full-time employees. Additionally, you don’t need to worry about the associated financial burdens such as layoffs or severance packages.

    Lighten your HR load

    Since leased employees are managed by a staffing agency, you have fewer HR responsibilities on your plate. An agency takes care of HR tasks associated with leased employees, including processing salaries, administering benefits, and more. By entrusting experts to take care of staffing and HR duties, you can free up your own team’s time and resources. Plus, staffing agencies know the best practices and solutions for hiring, ensuring small businesses maximize the benefits of employee leasing.

    Comparing Leasing Employee To Traditional Hiring

    While leasing employees can offer numerous benefits for small businesses, it’s essential to consider all options. Before deciding on whether you want to lease employees, reflect on the following benefits of traditional hiring:

    • Stronger company culture: A part-time or full-time employee will become fully immersed in the company’s mission and values, fostering more loyalty and commitment. This cohesion enhances morale and cultivates a sense of unity among all employees.
    • Efficient integration of new hires: Traditional hiring allows for a smoother onboarding process, helping new employees quickly acclimate to company processes and dynamics. Bringing on a permanent employee can lead to better overall collaboration and teamwork.
    • Reduced legal and compliance risks: With traditional hiring, businesses have greater control over employment classification and compliance with labor laws. This reduces the risk of violating employment regulations, helping your business stay legally compliant.

    Deciding What Is Right For Your Business

    Leasing employees can be an advantageous decision for some businesses, but it’s crucial to identify your goals and assess compatibility with your business model beforehand. To start, evaluate your staffing demands and consider how a leased employee would fit in with your current employees. Think about what tasks or projects they could tackle and how their expertise could complement your existing team’s skills.

    Furthermore, determine whether employee leasing fits your budget and aligns with your long-term business goals. Compare the costs and weigh the benefits of all staffing options including contracting, part-time, full-time, as well as leasing. Contemplate how this position functions short-term and how it could evolve over time. If you’re debating between leasing an employee or hiring a full-time employee, consider the possibility of offering a leased employee a more permanent role in the future.

    How To Control Risks And Maximize Benefits

    When you decide leasing an employee is suitable for your business, set yourself up for success by adhering to the following:

    1. Establish clear communication and expectations: Encourage open communication with your leased employee to build trust and collaboration. Ensure you’re both on the same page regarding responsibilities and expectations as well as project goals and timelines.
    2. Monitor performance and provide feedback: Track and assess how your leased employee is fulfilling their role. Regularly check in and supply constructive feedback to promote improvement and growth.
    3. Offer targeted training and ongoing support: Provide specialized training sessions to enhance the skills related to their role. Give continuous support as your leased employee learns and adapts to the expectations of their role.

    Optimize Hiring With GMS

    If you’re considering expanding your team, a PEO like GMS can help you determine the best staffing option. From recruiting top talent to smooth onboarding, we make the hiring process simple and efficient. GMS can support your staffing needs and handle numerous HR responsibilities related to new employee management. Contact us today to discuss how GMS can enhance your hiring process!

  • Taxes are a fundamental part of running a business, and understanding employer tax obligations is critical to remaining compliant with federal and state regulations. Two employment-related taxes that often cause confusion are FUTA (Federal Unemployment Tax Act) and SUTA (State Unemployment Tax Act) taxes. These taxes are essential for funding unemployment benefits for workers who lose their jobs through no fault of their own. 

    Although these taxes both fund unemployment compensation, they differ in their calculation methods, who is responsible for paying them, and their impact on businesses. Understanding these taxes can help employers avoid penalties, manage tax costs, and stay compliant with federal and state regulations. 

    What Is FUTA Tax? 

    The Federal Unemployment Tax Act (FUTA) is a federal payroll tax that employers pay to fund unemployment benefits at the national level. This tax helps support state unemployment programs and covers administrative costs for running unemployment systems nationwide. 

    FUTA ensures that state unemployment agencies have the resources to provide temporary financial assistance to unemployed workers. It also funds extended unemployment benefits during economic downturns when states may run out of money. 

    Key details of FUTA tax: 

    • Who pays it? Only employers pay FUTA tax. Employees are not responsible for contributing. 
    • 2025 FUTA tax rate: The standard rate remains 6.0% on the first $7,000 of each employee’s annual wages. 
    • Potential FUTA tax credit: Employers who fully pay their SUTA taxes on time can receive a tax credit of up to 5.4%, reducing their effective FUTA rate to 0.6%. 
    • Purpose of FUTA: These funds go toward unemployment insurance (UI) programs and help states during high unemployment periods when state funds are depleted. 

    What Is SUTA Tax? 

    The State Unemployment Tax Act (SUTA) is a state-mandated payroll tax that funds unemployment benefits for eligible workers within that specific state. Unlike FUTA, SUTA tax rates, rules, and wage bases vary by state. 

    SUTA taxes directly fund state unemployment benefits for workers who lose their jobs through no fault of their own. These programs ensure financial stability for workers while they search for new employment. 

    Key details of SUTA tax: 

    • Who pays it? Employers are responsible for SUTA taxes, though in some states (like Pennsylvania, New Jersey, and Alaska), employees also contribute. 
    • Tax rates vary by state: SUTA rates depend on state laws, employer industry, and individual employer experience ratings (how often they’ve had former employees claim unemployment). 
    • State-specific wage base limits: Unlike FUTA, which has a fixed wage base of $7,000, each state sets its own wage base for SUTA tax. In 2025, these limits range from $7,000 to over $50,000, depending on the state. 
    • Purpose of SUTA: These funds are used to provide unemployment benefits to workers in that specific state. 

    Key Differences Between FUTA And SUTA 

    Why Employers Must Stay Compliant 

    Employers must accurately calculate, report, and pay FUTA and SUTA taxes to avoid penalties, interest, and increased tax liabilities. FUTA credit reductions can occur if a state fails to repay federal loans for unemployment benefits, leading to higher FUTA tax liabilities for employers. Frequent layoffs can increase an employer’s SUTA tax rate due to a higher “experience rating,” resulting in higher state unemployment taxes. 

    Late payments, incorrect filings, or misclassifying employees can lead to severe penalties from the IRS and state agencies, including fines, interest, and even criminal charges. States with outstanding federal loans may face FUTA credit reductions, causing employers to owe more in FUTA taxes until the loan is repaid. Ensuring compliance with FUTA and SUTA tax requirements is essential to avoid these costly consequences. 

    How to Ensure Compliance 

    • Stay updated on state tax rates: Because SUTA rates and wage bases change annually, employers should monitor state updates. 
    • File reports on time: FUTA taxes are reported quarterly using IRS Form 940, while SUTA filings vary by state. 
    • Work with a payroll partner: Outsourcing payroll tax management to a professional employer organization (PEO) ensures compliance and reduces the risk of penalties. 

    How GMS Can Help 

    Managing unemployment taxes can be challenging, especially for multi-state employers navigating different SUTA rates and regulations. Group Management Services (GMS) helps businesses: 

    • Accurately calculate and file FUTA and SUTA taxes 
    • Stay compliant with state and federal tax laws 
    • Reduce their SUTA tax burden through proper claims management and best practices 

    GMS can provide expert guidance and comprehensive payroll services if you’re unsure about your company’s FUTA or SUTA tax obligations. Contact us today to learn how we can simplify payroll tax management for your business. 

  • Running a business involves countless moving parts, from managing payroll and taxes to ensuring compliance with federal and state employment regulations. Professional employer organizations (PEOs) exist to ease this burden, handling administrative and human resource (HR) functions so employers can focus on growth. Now, certified professional employer organizations (CPEOs) take this service to another level by meeting stringent requirements set by the Internal Revenue Service (IRS) and offering clients unique financial protections and tax benefits.

     

    CPEO vs. PEO: What’s the difference?

    A CPEO is a PEO that successfully completes the IRS’s voluntary certification process, an extensive evaluation that examines a PEO’s history, financial responsibility, and compliance record. While standard PEOs can offer many benefits, CPEOs stand out because:

    1. They assume full liability for federal employment tax payments on wages paid to worksite employees.
    2. They must post an annual bond (up to $1 million) that guarantees payment of federal employment tax liabilities.
    3. They undergo rigorous and ongoing IRS reviews and financial reporting requirements.

    By contrast, in a typical PEO relationship, both the client and PEO share liability for certain tax obligations. When partnering with a CPEO, the liability may fall solely on the CPEO for federal employment tax on wages they pay to your employees. That’s a significant peace-of-mind factor for business owners.

     

    IRS guidelines and processes

    Thanks to the Tax Increase Prevention Act of 2014, the IRS established a formal CPEO program. This was recently clarified by Revenue Procedure 2023-18, which replaced earlier guidance and laid out steps, processes, and requirements in more detail. Key points for PEOs aiming to become or remain CPEOs include:

    • Maintaining proper bonding.
    • Ensuring continual compliance with federal, state, and local tax laws.
    • Submitting annual financial reports and IRS verifications.
    • Verifying ownership and management meet all criteria (e.g., U.S. citizenship/residency and extensive knowledge of employment tax requirements).

    With these enhanced guidelines, businesses can now easily verify a CPEO’s status by checking the IRS’s public listings of active, suspended, or revoked CPEOs.

     

    Requirements to become (and stay) a CPEO

    The IRS lays out clear prerequisites to qualify as a CPEO:

    1. Be a business entity with at least one physical location in the United States.
    2. Demonstrate a history of financial responsibility, organizational integrity, and federal/state tax compliance.
    3. Be managed by individuals (mostly U.S. citizens or residents) who have knowledge and experience in employment tax compliance.
    4. Maintain certification annually through online verification, financial reporting, and compliance monitoring.

    Failure to meet these standards could result in losing the CPEO designation.

     

    Why partner with a CPEO?

    1. Stronger financial protections: As noted, a CPEO can take on sole liability for federal employment taxes on wages they pay, backed by a significant surety bond, helping protect you from potential tax risks.
    2. Clear tax benefit retention: If you’re claiming tax credits, a CPEO relationship can help ensure you retain those credits without interruption.
    3. Enhanced compliance: CPEOs are regularly monitored and regulated by the IRS, which can give you extra assurance that payroll, HR, and tax compliance issues are handled accurately.
    4. Administrative relief: The day-to-day HR and administrative tasks (payroll, benefits, compliance, risk management) are managed by a professional entity, freeing you up to drive strategy, revenue, and team building.

     

    Special note for the transportation industry

    Many businesses in transportation must partner with a CPEO if they choose to outsource certain HR functions, specifically due to the liability implications tied to compliance rules. If your sector requires or strongly recommends partnering with a CPEO, understanding these benefits becomes even more crucial.

     

    A CPEO you can count on

    At Group Management Services (GMS), we’ve taken the extra steps to become a CPEO recognized by the IRS. What does that mean for you?

    • Reduced risks: We assume the primary liability for federal employment taxes for our clients’ worksite employees.
    • Time and cost savings: From payroll administration to benefits management and HR compliance, we handle the details, allowing you to focus on growing your business.
    • Ongoing compliance expertise: We stay on top of 2025 IRS regulations and beyond, ensuring your organization meets updated standards.

    Contact us today to learn more about how GMS can deliver peace of mind and improve your bottom line.

  • Hiring the right person is a crucial step toward building a successful team. However, hiring the wrong candidate, what we call a “bad hire,” can be costly, both financially and culturally. A poor hiring decision can impact morale, productivity, and even your company’s bottom line.

    Let’s explore the real cost of a bad hire and what effective strategies you can utilize to minimize the risk.

    What Does A Bad Hire Cost?

    The financial impact of a bad hire is more significant than you might think. Research shows that the average cost of a bad hire is about 30% of the employee’s first-year earnings, a figure that can rise depending on the role’s seniority and the onboarding resources involved. CareerBuilder’s data found that a single bad hire can cost a business around $17,000, while higher-level hires can cost even more.

    Hidden Costs Of A Bad Hire

    A bad hire can create additional costs beyond direct financial impact. These hidden costs include:

    • Decreased team morale: Working with a disengaged or underperforming colleague can reduce team morale and lead to dissatisfaction among other employees.
    • Lost productivity: Time and resources spent on correcting mistakes or managing performance issues can pull focus away from core business objectives.
    • Reputational damage: Customer-facing errors or delays due to a poor hire can damage the company’s reputation, impacting customer retention.

    How To Avoid The Cost Of A Bad Hire

    Understanding the high stakes, companies need a clear strategy to mitigate hiring risks. Here are several best practices to improve hiring success rates:

    1. Clearly define role requirements

    Clearly defining job expectations and qualifications is essential. Vague job descriptions often lead to a mismatch between candidate skills and role requirements. A well-defined job description should differentiate between “prerequisite” skills (those the candidate must have) and “trainable” skills (those that can be developed on the job).

    1. Implement objective assessment tools

    Reducing subjectivity in hiring decisions can help avoid costly mistakes. Objective assessment tools, including AI and machine learning, allow companies to evaluate candidates based on data-driven insights rather than gut feelings. This approach not only increases accuracy but also helps eliminate unconscious bias from the hiring process.

    1. Conduct thorough reference checks

    Reference checks are essential to verify the candidate’s work history, skills, and cultural fit. Speaking with past employers provides valuable insights that may not come up in interviews, helping to avoid last-minute surprises.

    1. Focus on objective interview techniques

    Rather than relying on open-ended questions that may yield little insight, tailor your interview questions to require candidates to demonstrate essential skills. For instance, “What experience do you have with [specific skill]?” is more effective than broad questions about handling workplace challenges. Keeping interviews skill-focused helps identify candidates who meet the role’s technical requirements.

    1. Prioritize cultural fit in a measurable way

    While cultural fit is essential, it’s equally important to define what that means within your organization. Break down qualities like “team player” or “cultural fit” into specific, measurable traits. This clarity helps prevent misunderstandings about what you’re seeking in a candidate and allows you to evaluate them objectively.

    1. Don’t rush the hiring process

    While urgent hiring needs can make it tempting to fill a role quickly, a rushed process often leads to mistakes. By taking the time to vet candidates properly, you can avoid repeating the process when a hasty hire doesn’t work out. Remember, a poor hire is costly, so it’s worth investing in a thoughtful and deliberate selection process.

    1. Utilize professional employer organizations (PEOs) for hiring support

    A trusted PEO can help you streamline the hiring process by managing essential functions like job postings, candidate screenings, and background checks. This support allows your team to focus on core responsibilities while the PEO’s expertise ensures you’re connected with high-quality candidates.

    Handling A Bad Hire

    Despite best efforts, sometimes a bad hire still happens. In such cases, it’s essential to act quickly and strategically. First, identify the issue, whether it’s performance, attitude, or cultural fit, and address it directly with the employee. Implement a performance improvement plan, if applicable, or adjust the employee’s role to better align with their strengths. For more insights, explore our comprehensive guide to simplifying performance management.

    If the employee still isn’t improving, it may be necessary to terminate the employment. Make sure to follow legal guidelines to avoid wrongful termination claims. Many companies implement a probationary period to evaluate an employee’s fit before committing to long-term employment. This period allows you to ensure new hires align with your organization’s goals and standards.

    Partner With GMS To Reduce Hiring Risks

    Hiring is both an art and a science, and the consequences of a bad hire are too costly to ignore. At Group Management Services (GMS), we specialize in helping businesses strengthen their hiring practices to attract and retain the right talent. From writing accurate job descriptions to conducting comprehensive screenings, our services allow you to avoid the pitfalls of bad hiring decisions.

    Contact GMS today to learn how our experts can support your business in recruiting effectively and efficiently.

     

  • As a business owner, offering excellent health care benefits is key to attracting and retaining top talent. However, the rising costs of health care premiums can make it challenging to find a group health plan that balances quality with affordability. In 2024, this challenge is more significant than ever as health care costs continue to rise.

    This is where partnering with a professional employer organization (PEO) like Group Management Services (GMS) can make a substantial difference. By leveraging the collective power of a PEO, your business can access premier group health insurance coverage without breaking the bank. Let’s explore how GMS can help you secure better group health coverage for your employees.

    Enhanced Buying Power And Cost Efficiency

    A PEO provides your business with the buying power typically reserved for large corporations. GMS represents more than 50,000 employees, which allows us to help small businesses purchase group health insurance for an average of 26% lower for employee premiums and 15% lower for family premiums than the U.S. average.

    GMS combines the collective strength of all its clients, allowing small to midsize businesses to gain access to the same competitive premiums as large companies. This means your business can benefit from lower health insurance premiums while still offering comprehensive coverage to your employees. With health care costs rising, this buying power is more valuable than ever, allowing you to provide top-tier benefits without sacrificing your bottom line.

    Diverse Group Health Coverage Options

    One of the biggest advantages of partnering with GMS is the ability to offer your employees a wide range of group health coverage options. Contrary to what some might believe, lower premiums through a PEO do not mean compromising on the quality of the health plans available to your employees. GMS partners with many major insurance carriers to provide various options tailored to meet the diverse needs of your workforce. These options include:

    • Medical insurance
    • Dental insurance
    • Vision insurance
    • Group life insurance
    • Short-term and long-term disability
    • Flexible spending account (FSA)
    • Health savings account (HSA)
    • Employee assistance program (EAP)
    • 401(k) plan
    • Telemedicine
    • Accidental death and dismemberment (AD&D)

    These options allow you to customize a benefits package that meets your employees’ needs, helping you stand out as an employer of choice in a competitive job market.

    Streamlined Administration And Compliance

    Managing group health insurance can be complex and time-consuming, especially with the ever-changing landscape of health care regulations. GMS not only helps you access better group health coverage but also takes on the administrative burden. This includes managing enrollments, handling claims, staying on top of Affordable Care Act (ACA) regulations, and ensuring compliance with federal and state regulations.

    You gain access to a team of experts who can train your employees on how your plan works and answer difficult health plan questions. With GMS, you can focus on growing your business while we manage the intricacies of your employee benefits program.

    Lower Your Group Health Care Premiums With GMS

    In today’s economic environment, maximizing every dollar spent on employee benefits is crucial. By partnering with GMS, you can offer high-quality health care benefits at the reduced premiums typically enjoyed by larger businesses. This partnership not only improves the health and satisfaction of your employees but also enhances your company’s financial health.

    By leveraging our collective buying power, diverse coverage options, and comprehensive administrative support, you can significantly lower your group health care premiums while providing your employees with top-tier benefits. Contact GMS today to speak with one of our health care experts and learn more about how partnering with a PEO can benefit your business.

  • Employee classification is the backbone of workforce management, impacting everything from payroll to compliance and employee satisfaction. For human resources (HR) professionals and business owners, keeping up with evolving laws and regulations is crucial to protecting your business and supporting your workforce. This blog will equip you with the knowledge you need to confidently navigate employee classification and avoid common pitfalls. 

    What Is Employee Classification And Why Does It Matter? 

    Employee classification defines the legal relationship between a business and its workers, determining their eligibility for benefits, wage protections, and tax obligations. The two most common distinctions are: 

    Employees: Employees have a formal employment relationship with the company, usually documented through an employment contract. They are entitled to various protections, including minimum wage, overtime pay, unemployment insurance, and workers’ compensation. The company withholds taxes from employees’ paychecks and can contribute to their retirement accounts. Employees typically work for one employer, either full-time or part-time, and can be classified as exempt or non-exempt. Their tenure lasts until they resign, are terminated, or the role ends. 

    Independent Contractors: Independent contractors are self-employed individuals who provide services to a company but do not receive the same protections as employees. They typically have greater control over how they complete their work, including setting their own schedules and using their own tools and methods. Unlike employees, contractors are responsible for paying their own taxes, including self-employment taxes, as companies do not withhold taxes from their payments. Additionally, businesses must complete Form 1099-NEC to report payments made to contractors during tax season. 

    Proper classification ensures: 

    • Compliance: Reduces legal exposure to penalties or lawsuits.  
    • Fair compensation: Supports worker rights and builds trust. 
    • Business stability: Avoids audits and fines that disrupt operations. 

    The Key Types Of Employee Classification 

    Employees Vs. Independent Contractors 

    Businesses must correctly classify workers as employees or independent contractors. The U.S. Department of Labor’s updated rule, effective March 11, 2024, helps clarify this process. The rule focuses on several factors, such as how much control a business has over a worker and whether the work is a permanent part of the business. These changes aim to reduce misclassification, ensure workers get the wages and protections they deserve, and provide clear guidelines for businesses. 

    Exempt Vs. Non-Exempt Employees 

    For employees, the Fair Labor Standards Act (FLSA) governs whether employees are entitled to overtime pay.  

    Key factors include: 

    Exempt Employees: Generally salaried workers who meet a “duties test” and are not eligible for minimum wage and overtime pay. These employees are typically salaried and hold executive, administrative, or professional roles. 

    Non-Exempt Employees: Typically hourly workers who are eligible for overtime pay for hours worked beyond 40 per week and must earn the federal minimum wage.  

    Full-Time Vs. Part-Time 

    While “full-time” and “part-time” are not strictly legal terms, they are crucial in determining eligibility for benefits such as health insurance, retirement plans, and paid time off. Employers should clearly define these terms in their handbook and any other key distinctions to ensure consistency and compliance with company policies and applicable laws. 

    Full-time employees: Typically work 35 to 40 hours a week, are eligible for benefits, and may qualify for overtime pay. 

    Part-time employees: Typically work fewer than 35 hours a week, are less likely to receive benefits, and often have more flexible schedules. 

    Seasonal Employees Vs. Temporary Workers 

    Seasonal employees: Hired for specific times of the year when demand increases, such as lifeguards in the summer or retail workers during the holidays, typically for six months or less.

    Temporary workers: Fill short-term needs, like covering for someone on leave, with contracts ranging from a few days to several months.  

    It’s important to distinguish between these types of workers because the Affordable Care Act (ACA) requires large employers to offer health insurance to full-time employees working 30 or more hours per week. Both seasonal and temporary workers may qualify as full-time if they consistently work 30 hours per week for several months, entitling them to health insurance. For more details on ACA requirements, consult legal counsel. 

    Remote Employees And Multi-State Compliance 

    With remote work normalized, businesses must navigate state-specific labor laws for employees working across the country. Some states, like California, have stricter worker classification standards, including wage theft protections and mandatory overtime laws. Employers must ensure proper tax withholding and reporting based on the worker’s state of residence. Explore our guide to managing a remote team for more information.  

    The Risks Of Misclassification 

    Misclassification can expose your business to serious risks, including: 

    • Tax liabilities: Misclassification can result in unpaid payroll taxes, which can lead to significant tax liabilities and penalties from the IRS. 
    • Back wages and benefits: Employers may be required to pay back wages, overtime, and benefits to misclassified workers, which can be substantial. 
    • Legal disputes: Employees misclassified as contractors may sue for unpaid wages, benefits, or wrongful termination. 
    • Fines and penalties: Federal and state agencies are increasingly aggressive in auditing businesses for compliance. 
    • Reputational damage: Misclassification issues can tarnish your company’s public image, deterring talent and clients. 

    How To Ensure Proper Employee Classification 

    • Conduct a classification audit: Regularly review employee and contractor relationships to ensure compliance. Focus on roles with unclear or evolving responsibilities. 
    • Reevaluate job descriptions. Clearly define each role’s scope, expectations, and reporting structure. Align job descriptions with FLSA and ABC test criteria. 
    • Understand state laws: Pay close attention to labor laws in the states where your employees work, especially those with stricter classification standards, such as California, New York, and Illinois. 
    • Train your team: Equip HR and management teams with the knowledge they need to spot and address potential classification errors. 
    • Consult experts: Partnering with a professional employer organization (PEO) like Group Management Services can provide your business with access to legal, HR, and payroll expertise to manage classification challenges. 

    How GMS Supports Proper Classification 

    Navigating employee classification is a complex process, but GMS simplifies it. We provide: 

    • Comprehensive classification audits: Identify and correct any misclassification issues. 
    • Multi-state compliance management: Ensure your workforce is compliant across all states where you operate. 
    • Payroll and benefits administration: Streamline your processes with tools and resources tailored to your needs. 

    Proper employee classification is not just about avoiding penalties; it’s about fostering a fair and compliant workplace. As 2025 brings new challenges and stricter regulations, businesses must stay proactive to protect their workforce and bottom line. Connect with GMS today to explore how we can help you manage employee classification and drive your business forward. 

  • Safety management is something all business owners must consider. Ensuring your team’s health and safety is a top priority and a legal obligation. Compliance with OSHA regulations is essential; ignoring them can lead to serious consequences. However, achieving and maintaining compliance can be challenging, especially if you aren’t around to supervise 24/7.

    Building a culture that values safety is a proactive way to help ensure compliance. When safety is ingrained in your company’s culture, employees are more likely to adhere to safety protocols, even in your absence. This cultural shift makes compliance more manageable and less reliant on constant supervision.

    Moreover, a strong safety culture is a strategic initiative that can significantly boost your company’s recruitment and retention efforts. Prospective employees are attracted to workplaces that prioritize their well-being, and current employees are more likely to stay with a company that demonstrates a genuine concern for their safety.

    Safety Management For Compliance’s Sake Doesn’t Work

    Managing safety for compliance can often lead to a reactive approach that uses rules and discipline to gain compliance from your workforce. This type of communication, which can feel more like policing than genuine concern, not only undermines your compliance efforts in the long term but also results in a disengaged and disillusioned workforce, which is detrimental to your organization’s overall productivity and morale.

    If your approach to safety is merely to check a box, ensuring safety compliance when you’re not around will be a continuous struggle. You’ll likely find yourself incessantly harping on your employees to wear their provided personal protective equipment (PPE) or complete their tasks as they were trained. While this might be effective while you are present, your goal should be to create a culture where you don’t need to micromanage your team to remain compliant.

    Moreover, your team is adept at detecting inauthenticity. Employees crave to feel valued and supported by their leaders. If your safety policies lack sincerity, employees will likely notice, which can harm your workplace culture, making employees feel undervalued and disrespected by management.

    Develop A Culture Of Safety Management

    Shifting from micromanaging safety compliance to building a culture that values safety is a necessary and rewarding step. One way to do this is to inform your workforce of the ‘why’ behind your safety directives and ensure your leadership team fully supports and believes in this ‘why.’ This helps foster a shared sense of responsibility and empowerment among your team.

    Leadership plays a crucial role in promoting a culture of safety and compliance. If your message is clear and, more importantly, from the heart, then culture can spread like wildfire throughout the ranks of your organization. Let your workforce know you enforce safety policies because you care about their health and well-being. Communicate your dedication to creating a safe environment so they can go home in the same health they arrived in. 

    Engage Employees Throughout Safety Development

    Coach your team rather than boss them around. Including your staff in conversations and asking them how they can safely achieve tasks will encourage a collaborative environment. This improves safety and fosters a sense of community and teamwork. Employees are more likely to feel valued and respected when they are part of the process, which can significantly boost morale.

    In addition, peer training from model employees can have a positive effect. Safety initiatives may seem less authoritarian when coming from a coworker, and this approach can help foster stronger camaraderie and a sense of belonging. Employees often relate better to their peers, making the training more effective. This sense of belonging can also enhance retention as employees feel more connected to their team and the company.

    Beyond training, using positive reinforcement and showing appreciation toward employees who follow safety protocols is crucial. Recognition and rewards, no matter how small, can significantly impact motivation. We all want and need that pat on the back, and we are driven by being noticed or rewarded for our efforts. By recognizing and celebrating these behaviors, you reinforce the importance of safety and encourage others to follow suit.

    Safety Management With GMS

    Fostering a safe and compliant culture can be difficult and time-consuming. Regulations are subject to change, so even if your employees maintained a compliant work environment, an unnoticed regulatory change could open your business to penalties.

    Partnering with a professional employer organization (PEO) like GMS can help alleviate these concerns. GMS has a team of experts who stay updated on your industry’s latest laws and regulations, ensuring your business remains compliant and avoids potential pitfalls associated with regulatory changes. 

    As a business owner, you have many responsibilities to juggle. Let GMS take compliance off your plate, allowing you to focus on other critical aspects of your business. GMS not only helps with compliance but also aids in developing a culture of safety through employee training and risk management services. Contact us today to learn more!

  • QuickBooks software remains one of the most widely used accounting applications for small and midsize businesses, according to Forbes. Over the years, it has evolved from an on-premise solution to a comprehensive cloud-based system, which competes with several other online payroll and accounting software.

    QuickBooks remains a popular accounting solution, but outsourcing payroll to a Professional Employer Organization (PEO) offers significant advantages, especially for growing companies. Let’s explore the key differences and benefits of outsourcing payroll:

    Software And Add-On Costs

    While QuickBooks offers various versions tailored to different business needs, the advertised pricing structure differs from a PEO. Essential payroll features often require additional monthly fees and per-employee charges. For instance, some of QuickBooks’ payroll options come with extra costs for direct deposit, tax filing, and W-2 processing. In contrast, PEOs typically offer more comprehensive services with transparent pricing structures, covering a wider range of functions without hidden fees.

    Automation And Efficiency

    QuickBooks automates some payroll functions, but outsourcing to a PEO takes efficiency to the next level. PEOs handle all aspects of payroll processing, significantly reducing manual work and saving business owners time to focus on core business activities. Partnering with a PEO allows your business to streamline processes, reduce administrative burdens, and gain access to additional HR services.

    Tax Compliance And Liability

    Relying on one internal employee or QuickBooks user to manage payroll can carry a high margin for error. One of the most significant benefits of outsourcing payroll is tax assistance. PEOs take responsibility for paying all federal and state taxes and handling wage garnishments. With QuickBooks, these responsibilities fall on the business owner, increasing the risk of errors and penalties. PEOs ensure compliance with ever-evolving payroll regulations, reducing the probability of costly mistakes.

    Scalability And Flexibility

    PEOs are better equipped to handle rapid business growth and increasing employee headcounts. They offer greater scalability and can adapt to changing needs, including complex pay structures and multi-state compliance. This flexibility is crucial for businesses expecting significant growth or seasonal fluctuations in staffing levels.

    Comprehensive HR Services

    Unlike QuickBooks, which focuses primarily on accounting and payroll, PEOs offer a full range of HR services. This includes benefits administration, workers’ compensation, hiring and termination support, compliance assistance, and more. PEOs provide pooled rates for employee benefit plans, which can be particularly beneficial for startups and small businesses looking to offer competitive benefits without incurring high costs.

    Expertise And Support

    PEOs provide access to dedicated payroll specialists who can answer complex financial questions and offer personalized support. This level of expertise is not always available with software solutions like QuickBooks. GMS’ payroll experts will handle all the details, from filing the necessary paperwork to the ongoing maintenance of tax records. Our team will also keep your business up to date with the complex tax filing requirements as they inevitably change and complicate your payroll processes.

    Cost-Effectiveness For Growing Businesses

    While QuickBooks may seem cheaper initially, PEOs can be more cost-effective for growing businesses. PEOs handle the complexities of scaling without requiring additional in-house resources. PEOs also offer your company greater buying power for employee benefits through economies of scale and reduced administrative overhead.

    Risk Reduction

    Outsourcing payroll to a PEO significantly reduces the risk of errors associated with manual entry and limited training. This is particularly important as payroll involves sensitive data and complex calculations. PEOs have systems in place to ensure accuracy and compliance, mitigating the risk of costly mistakes and penalties. GMS’ payroll software integrates with other platforms, allowing us to seamlessly calculate and apply deductions for health insurance and other employee benefits. Meanwhile, all your data and documentation are securely stored online so that you can eliminate countless paper copies and waste.

    Time Savings

    The basic version of QuickBooks is designed for users with limited accounting and financial needs. This gives them less of a learning curve, but it also means that they aren’t likely to have all the functionality and features that a business owner needs.

    On the other hand, more advanced versions of QuickBooks require significant ongoing training to ensure they are being used correctly. Having an in-house, credentialed QuickBooks user means that ongoing training will need to be planned for, due to continuous updates to the software.

    By outsourcing payroll to a PEO, business owners can free up significant time previously spent on data entry, tax filings, and ongoing software training. This allows them to focus on core business activities and growth strategies.

    GMS Connect

    GMS’ online payroll software, GMS Connect, makes running payroll simple. Our online technology streamlines the payroll process to create less paperwork and give users access from anywhere with an internet connection. GMS Connect is an SOC 1-certified human resources information system (HRIS) that helps business owners manage the entire lifecycle of their business. These capabilities give you access to cutting-edge payroll management software that helps you improve your bottom line. GMS Connect has many features, including:

    • Easily calculate payroll deductions with built-in benefits and time-tracking features
    • Generate on-demand payroll reports
    • Keep track of payroll records in one central repository
    • Electronic payroll processing via direct deposit
    • Streamlined payment for all types of workers (e.g., salaried, hourly, contract)
    • Effortlessly submit payroll taxes and process W-2s
    • Simplify workers’ compensation calculations and payments

    Streamline Payroll Processes With A PEO

    While QuickBooks has its merits for small businesses with simple needs, outsourcing payroll to a PEO like GMS offers substantial benefits for growing companies. PEOs provide comprehensive payroll and HR solutions, reduce liability, ensure compliance, and offer scalability to match your business growth.

    PEOs handle complex tasks such as multi-state tax compliance, benefits administration, and workers’ compensation, allowing you to focus on your core business operations. By partnering with GMS, you gain access to expertise, reduce risks, and position your company for efficient growth and success in the future. Contact GMS today to learn how our PEO services can streamline your payroll processes and support your business’s expansion.

  • As a business owner, you likely didn’t start your venture with the excitement of managing payroll. Managing payroll is a daunting task due to its complexity and the meticulous attention to detail it requires. Staying compliant with the changing payroll tax regulations and labor laws adds another layer of difficulty. Mistakes in payroll can lead to significant financial penalties and damage employee trust, making accurate payroll management crucial but challenging.

    The time-consuming nature of payroll management can also detract from focusing on core business growth strategies. Fortunately, online payroll software offers a solution to streamline this process, allowing you to redirect your efforts toward business expansion. However, some business owners remain skeptical about transitioning to digital payroll solutions. Let’s address three common myths about online payroll software and reveal the truth behind them.

    Myth 1: Switching To Online Payroll Software Is Complicated

    Fact: While manual payroll management is indeed complex and time-consuming, transitioning to an online system is designed to simplify the process. The right software can streamline payroll tasks for both employers and employees, reducing the burden of paperwork and manual calculations.

    For instance, GMS’ online payroll is tailored to meet your specific needs and facilitate a smooth transition. We provide a dedicated payroll specialist to guide you through the setup process, answer questions, and ensure both you and your employees are comfortable with the new system. Our team collects necessary employee information to build your custom payroll system and offers personalized walkthroughs. Should any issues arise, dedicated support is readily available.

    Myth 2: It’s An Unnecessary Expense

    Fact: While there is a cost associated with online payroll software, it’s important to consider the time and resources it saves. According to The Business Journals, a survey found small business owners spend five hours or more each pay period, or 21 days each year, managing payroll. Online payroll software significantly reduces this time investment, allowing you to focus on core business functions.

    GMS’ online payroll system offers features that streamline the payroll process, including:

    • Easy tracking of deductions
    • Simplified workers’ compensation calculations and payments
    • Generate on-demand payroll reports
    • Direct deposit setup
    • Scan signed documents for compliance needs

    Moreover, access to payroll experts can help prevent costly errors, potentially saving your business from IRS penalties. The flexibility to manage payroll remotely is another significant advantage, enabling you to handle payroll tasks from anywhere with an internet connection.

    Myth 3: I’ll Lose Control Over My Payroll

    Fact: Investing in payroll software through a Professional Employer Organization (PEO) does not mean relinquishing control over your payroll. Instead, it provides you with enhanced tools for easier payroll management and access to expert support when needed.

    With GMS’ online payroll software, you maintain full control. The software doesn’t replace your accountant; it simply provides efficient tools to streamline payroll management. You can even customize what employees see when they log into the payroll site, ensuring you always stay in charge while benefiting from simplified processes.

    Take Your Time Back With Online Payroll Services

    In today’s fast-paced business environment, leveraging technology to streamline operations is crucial. GMS understands this need and offers comprehensive payroll solutions designed to save time, reduce errors, and provide expert support. Our online payroll software, combined with our team of payroll experts, ensures that you can manage your payroll efficiently while maintaining full control.

    By choosing GMS, you’re not just getting software; you’re gaining a partner committed to your business’s success. Our payroll services, backed by cutting-edge software and knowledgeable professionals, can help you navigate the complexities of payroll management with ease. Whether you’re looking to improve efficiency, ensure compliance, or simply free up more time to focus on growing your business, GMS has the tools and expertise to support your goals.

    Don’t let payroll management hold your business back. Contact GMS today to learn how our online payroll solutions can benefit your business and propel it toward greater success.