High Tech Case Study
Industry
Nationwide Managed Health Care
Company Profile
$11 billion in sales; 8,000 employees in the US; publicly traded
Background
The client had been assessed multiple seven-figure fines for noncompliant contingent workforce practices. They received several official warnings from the IRS to move towards compliance or face even more severe penalties.
Challenge
The client engaged ICon in December of 2003 while it was undergoing an IRS audit. The client had no visibility into its contingent workforce or annual spending for independent contractors, suppliers or consultants, making it impossible for them to produce accurate headcounts or to determine the tenure of their contingent workforce. The client was incurring further risk of federal and state penalties by internally providing payroll services without benefits to the non-sourced contingent workers.
ICon Outcome
ICon provides web-based contingent workforce management of independent contractors and payroll solutions, including premium benefits and 401(k) plans and administration. ICon has assigned dedicated on-site personnel to help facilitate day-to-day operations, ICon stabilized and provided valuable insight to the clients contingent workforce practices by providing customized billing, divisional and consolidated company wide reporting, independent contractor compliance, payroll and benefits, audit support, government mandated reporting and background checks for all contingent engagements across the company.
The ICon suite of services allows internal human capital resources to focus on strategic business management while ICon focuses on contingent labor, saving the company significant costs. The client has received no further assessments from state or federal agencies since the program commenced.
ICon Suite of Services
ICon provided the client with a dedicated website and on-site management to facilitate its on-demand nationwide solutions, including:
- Independent Contractor Compliance
- Payroll and Benefits
- Audit Support
- Independent Contractor Consolidated Billing
- On-Site Management
- Background Checks
With on-site personnel to help facilitate day-to-day operations, ICon stabilized the clients contingent workforce practices by providing customized billing, divisional and consolidated company wide reporting, independent contractor compliance, payroll and benefits, audit support, government mandated reporting and background checks for all contingent engagements across the company.
Results
- ICon provides monitoring of business rule application and stop-gap services for all departments.
- The client has access to financial and historical data that can be used for benchmarking and forecasting purposes
- ICon implemented a pre-engagement approval process to ensure that all contractor assignments are appropriately authorized before an assignment begins.
- ICon substantially reduced the cycle time from interview to start time.
- ICon provided in-depth organization training to develop a grass roots understanding of compliance, consequences, risks and best practices.
- ICon identified the client managers who engage independent contractors, the departments that contractors are associated with and the tenure of the contracted workforce.
- ICon provided the client with the ability to cross-reference its database to eliminate double payments or inappropriate classification.
Estimated Retained Profits
In the first year alone, the ICon suite of services has helped the company to avoid assessments of more than $1.7 million.
We've had an excellent experience. ICon has an extremely pleasant staff able to respond to inquiries and to help our independent contractors. And, of course, our compliance issues have all but gone away.
- Health Care Director