A plain summary of the Resourcing Edge quote, the alternatives, and the handful of facts that change the answer. Written so the decision can be made on the numbers rather than on the sales call.
The proposal from OneDigital uses industry terms throughout. None of them are complicated once unpacked, and a couple of them carry real consequences.
A Professional Employer Organization co-employs your staff. On paper they become the employer of record: their name goes on the tax filings, their insurance covers the crew, and their unemployment account is the one the state looks at. You still hire, direct and fire the people. It is a paperwork and liability arrangement, not an operational one.
State Unemployment Insurance is a payroll tax that funds unemployment benefits. Your rate is meant to reflect your claims history, and Northwell's is currently 6.32%, close to the Texas maximum, on an account with no claims history to speak of.
Texas is unusual in that workers' compensation is optional. Going without it means losing your legal defences if someone is hurt, and it also fails vendor credentialing, since apartment owners will not let uninsured vendors on site.
Every option below is really two purchases, and separating them is the clearest way to compare. Bucket one is the software that runs payroll and files the taxes. Bucket two is the person who watches the deadlines, chases the hours and notices when something is wrong.
All three get five people paid correctly and on time with the filings done. The difference is who does the work, and what you are committed to.
They do the work. Workers' comp included under their policy, all filings theirs, and the strongest story to tell a property manager. Twelve month term, renews automatically, sixty days notice to leave.
We do the work. Month to month with no notice period. Adds cost and margin per apartment unit, which neither of the other options provides. Workers' comp bought separately, pay as you go.
Terry or Nathan does the work. By far the cheapest in software, and entirely viable. The question is whether there are hours available each month to watch the calendar, chase punches and file on time, because that is what has not happened for the last two years.
These are quoted from the Client Services Agreement received on 2 September. None of them are unusual for a PEO, but two of them differ from what was said on the call and are worth raising before signature.
One year initial term, then automatic annual renewal unless you give at least sixty days advance written notice. On the call, thirty days notice was mentioned. The document says sixty and the document governs.
The agreement grants Resourcing Edge a security interest in all of the company's present and future receivables, cash, equipment, inventory and personal property, described as "tangible and intangible (including software embedded therein), now owned or hereafter acquired."
In practice that is a lien across the whole business as security for the payroll fees. It is worth asking whether they will narrow it, and worth your attorney reading it either way.
The 19% billing rate on class code TX9014 is reasonable on its own. It replaces the roughly 14.6% currently paid in employer taxes and adds workers' comp and all the filing work on top, so as a percentage it is close to fair.
At current payroll, 19% comes to about $228 a month. The schedule sets a $500 monthly minimum, so that is the real number until wages pass roughly $31,600 a year, which is about three times the hours booked so far this year.
Every add on box on Schedule B is marked No, including Time & Labor, despite the covering email saying the timekeeping feature can be activated. If timekeeping is wanted it is $4 per employee per month plus a $500 setup, and the accounting interface into QuickBooks is a further $1,500 one time.
Worth having those added to the quote in writing before comparing prices, so the comparison is like for like.
Fix the registration and the pay schedule first. Both are cheap, both are owed under every option, and the registration may quietly fix the unemployment rate as well. Then answer the NetVendor question, because it decides whether the PEO is buying something that matters or something that does not.
If the answer comes back that a PEO is acceptable and the hours genuinely are not there in house, Option A is a defensible purchase. Ask them to re paper it first: thirty days notice as discussed, the security interest narrowed, and the timekeeping and accounting add ons priced into the quote.
If there is any appetite to keep this in house, Option C is genuinely the cheapest thing on the table and we would say so plainly. Option B exists for the middle case, where the software should be cheap but somebody still has to watch it every month.