A New Way to Save More with Third-Party Payrolling Services

Corporate United members can realize cost savings on this crucial source of non-employee labor through our exclusive contract with Populus Group.

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Corporate United members can realize cost savings on this crucial source of non-employee labor through our exclusive contract with Populus Group.

Today’s workforce demands flexibility, and employers continue to embrace various forms of contingent or non-employee workers to meet their evolving business needs. An important and growing part of many companies’ contingent workforce is payrolled workers—workers who have been identified or sourced by the company and placed on the payroll of a third-party supplier which acts as the “employer of record.” These third-party suppliers, often referred to as a professional employer organizations (PEO), enable companies to reduce cost, mitigate risk, and scale their workforce as business demands it.

Corporate United has partnered with Populus Group, a nationally certified diversity supplier in all 50 states, to offer payrolling and independent contractor compliance services. The services, offered independently or hand-in-hand, enable companies to engage a critical and growing segment of a company’s contingent workforce.

Innovative Pricing Means Big Savings

While many recruiting companies or managed service providers (MSP) offer payrolling services, it’s often not core to their business and it almost always cost more than it should. The most common pricing method for third-party payroll services is a mark-up model, whereby a supplier mark-ups the worker’s pay rate by a percentage that accounts for federal and state payroll taxes, its expenses, and profit. The traditional mark-up model, while simple to understand, doesn’t account for the varying federal and state payroll tax rates and caps. The simplicity of the traditional mark-up rate often means that buyers are leaving money on the table.

Corporate United, along with the help of its strategic partners, Brightfield Strategies, has devised an innovative pricing model that accounts for federal and state payroll tax thresholds (e.g., FICA & SUTA) and ensures its members pay the lowest price possible for payroll services from a specialist payroll firm. As the tax cap is reached for an individual worker, and the federal or state government no longer requires those payroll tax dollars to be withheld, third-party payroll providers shouldn’t put those dollars in their pockets. By effectively rebating a company when various taxable wage bases has been hit, Corporate United’s Statutory Plus pricing ensures members reduce spend with Populus Group.

When Brightfield compared pricing from suppliers in a statutory plus model versus a national tiered mark-up as a percentage model, the long-term savings opportunities were very compelling.

Interested in learning more about the payrolling agreement with Populus Group? Visit the payrolling category sheet or watch a webinar.


Nicole Shedden: Marketing Strategist at Corporate United
As a marketing strategist for Corporate United, Nicole's goal is to get the word out about group purchasing organizations – CU in particular. Since GPOs free up time, money and resources for indirect procurement teams, she focuses most of her blogging on those three elements. Nicole has been marketing to a procurement audience for nearly a decade; prior to that, she worked in sales and marketing consulting.