Recession realigns HR
Agencies fill the gap
By Len Strazewski
Do more with less—if you want to keep your job. That's the painful reality for many human resources management executives. Employee benefits agents and brokers hear the same sad tale every time they meet with their clients' HR executives. When the recession hit, human resource directors bore the responsibility for reducing the workforce—laying off employees to reduce costs and out-placing executives their companies could no longer afford.
When the bloodletting was done, human resource departments took their own cuts; and departments with HR directors, employee benefit managers and generalists were reduced, often to a single, overworked professional.
And if these lone wolves want to keep their job, they have to do it all: hiring, firing, employee benefits management, employee communications and regulatory compliance.
Desperate for help, they turn to their agencies that are responding to this need by adding human resources expertise as a value-added service. Some agencies have hired human resource consultants—many of them former employees of their clients—who can take on projects for client companies. Benefit agency networks, such as the St. Louis-based Benefits Growth Network, partners with human resource specialists, such as HR That Works in San Diego, California, that can provide services to clients of their members.
Others provide online databases of forms, documents and regulatory education delivered by popular employee benefits portal companies such as Zywave and Benergy.
Some agencies are doing a little of each option but also provide a more immediate option: telephone hotline access to human resource consultants on call to solve problems, provide training and suggest vendors for HR and benefits projects.
Brady, Chapman, Holland & Associates, Inc. (BCH), in Houston, Texas, subscribes about 50 employee benefits clients to ThinkHR, a human resource consulting company in Pleasanton, California. The consulting company provides a hotline service staffed by human resource experts as well as an archive of training programs.
Even though BCH partners with a professional employment organization that can provide payroll and other on-site services and a local HR project vendor, executives wanted to also provide an educational and consulting resource to manage a stream of day-to-day questions and concerns.
"As our clients' human resources needs became apparent, we looked at a lot of different solutions that we could provide," explains Traci Howell, employee benefits consultant at Brady, Chapman, & Holland. "ThinkHR was one of the only services available that provided a human-staffed hotline. We wanted our clients to be able to talk to a human resources professional when they had an issue arise and get immediate response. None of our clients have the time to look up a password to an online service, conduct a search and read though what could be hundreds of pages of documentation to find an answer to their problem."
The agency also liked the company's archive of Webinars that could provide just-in-time training for employers that needed a quick update on regulatory policies and procedures or best human resources practices in typical job situations.
ThinkHR was founded in 2004 as what Chief Executive Officer Peter Yozzo calls "a traditional HR consulting company" providing on-site outsourcing and project-based services in the San Francisco Bay area. But as the company engaged local clients and partnered with local insurance and employee benefits agents and brokers, executives realized that the need for HR services extended beyond occasional project assignments.
"We began to see the realities in the marketplace," Yozzo says. "As the economy trended down, employers struggled with performing more management activities with fewer trained professionals.
"At the same time, they turned to their trusted advisors, their agents and brokers for help, particularly with employee benefits-related services. We asked the brokers with whom we had a relationship what they really needed for their clients on a daily basis. The answer was access."
What the agencies really wanted, he says, was a way for their clients to pick up their phones when they had questions—and not call the agency directly but contact trained professionals who could respond quickly with information, advice and counsel.
The result, he says, was HR Hotline, a nationwide telephone response service, founded four years ago, staffed by 35 full- and part-time experienced and certified human resource professionals. The service is available during business hours and can respond to issues involving employee benefits, compliance, employee relations, levels of absence, policy and handbook questions and other human resource management concerns.
The average call involves about 35 minutes of consulting time including research and conversation. The company also provides 24/7 Web-based support with a database of news, compliance information, human resource and employee benefits forms, checklists and templates.
Hotline and Web-based services cost partner agencies about $12 per client per month with a volume discount available for agents and brokers providing the service to multiple clients. Most agencies provide the hotline as a value-added service at no charge although larger brokers that charge on a fee-for-service basis may build the services into their fee structure, says Joy Justus, vice president of sales and marketing for ThinkHR.
The company also provides online, on-demand training with more than 200 Webinar training modules available for a single flat fee. It also continues to provide some on-site project services in the San Francisco and Atlanta markets, where ThinkHR offices are located.
"Customized service is so important for agencies these days," Justus says. "By being able to provide human resources service to the table, they position themselves as a true business partner of their clients, rather than being branded simply as a broker and seller of insurance products."
The McCart Group in Atlanta, Georgia, also chose the ThinkHR service after observing a growing need among its clients, according to Cindy Covington, director of administrative services. About half of the full-service agency's revenues are derived from employee benefits services, and many of its small business clients do not have a human resources management department or professional on staff.
Benefits clients of The McCart Group are subscribed to the service, which is provided at no charge as a value-added service. Covington says users like the instant access to a live consultant who, in many cases, provides quick answers to questions. Or if they can't provide an immediate response, they can do necessary research and call back with guidance.
"If you don't have a human resources department, ThinkHR is a great service to provide resources for an owner or financial manager that has also taken on human resources functions," she says. "If you do have a human resources department, the hotline provides help on demand when questions come up in the day-to-day activities of the company," she says.
"We feel that by offering the service, we really differentiate ourselves from other employee benefits providers in the area."