P.A.C.E. Solo W-2™ Provides Superior Risk Management


P.A.C.E. Is In the Risk Management Business

  • P.A.C.E. Solo W-2™ Mitigates the Risks of Co-employment for Both Client and Contract Professional

    • The greatest single risk to a company that hires contingent workers is perhaps the risk that the IRS and other government agencies will reclassify it's contingent workers as the company's own employees. When this happens, the IRS assesses the company for back taxes, penalties, and interest on unpaid income tax withholdings and payroll taxes. The financial consequences of reclassification can be staggering.

    • In order to protect themselves from the risks of co-employment, companies seek two divergent solutions:

      • They attempt to sign contracts only with independent contractors that comply fully with the IRS common law factors defining independent contractor status, or

      • They make sure that their contingent workers are employed by a third-party company that qualifies as an IRS-compliant independent contractor.

    • Many companies simply adopt a blanket policy that all contract workers must be employed by a third-party employer of record.

    • The most common employers of record are temporary help agencies and other staffing vendors, that specialize in highly compensated temps.

    • Employers of record pay all payroll taxes plus local, state and federal withholding taxes, and because they also provide general liability insurance, workers compensation, and unemployment insurance they virtually eliminate most of the risks that may trigger an IRS audit.

    • As an employer of record, P.A.C.E. gives contractors the W-2 employment status that is most appreciated by government agencies.

    • P.A.C.E. also mitigates the risk of class-action lawsuits against client companies for benefits because P.A.C.E. offers what is arguably the best employee benefits package available to any independent professional anywhere in the USA.

    • Advantage to you: Client companies appreciate P.A.C.E. because P.A.C.E. Solo W-2™ significantly mitigates the risks of co-employment by offering W-2 employment status and excellent benefits, thereby greatly reducing any risk of reclassification by government agencies, and reducing as well the risk of class-action lawsuits by disaffected agency contractors.

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  • P.A.C.E. Solo W-2™ Protects Both Contractor And Client During Contract Assignments
    • Contract Professionals with inadequate or no liability insurance coverage pose a significant risk to their clients. There is the risk that a contractor might damage a client's property or the property of others, or injure someone while on the job. Or, a contractor may damage the client's business through willful negligence or incompetence. Many Contract Professionals do not carry liability insurance, so the liability could easily pass to the client.

      • General Liability Insurance protects both the contractor and the client from damage to persons or property.

      • Errors & Omissions Insurance (also known as Professional Liability Insurance) protects the contractor and client from financial harm to the client's business caused by the contractor's actions.

    • Adequate individual coverage for General Liability Insurance costs several hundred dollars per year, and Errors & Omissions Insurance can cost several thousand dollars per year depending on the contractor's occupation and exposure.

    • All P.A.C.E. Division Managers are automatically covered for both General Liability and Errors & Omissions Insurance up to $5,000,000 aggregate. This coverage is free to all P.A.C.E. Division Managers.

    • Advantage to you: P.A.C.E. pays for your liability insurance and assumes the full risk so that you don't have to. Client companies appreciate that P.A.C.E. protects them also.

     

  • Workers Compensation
    • Another risk arises when a contractor is injured on the job and files a workers compensation claim against the client company. Workers comp covers the client's employees. Independent professionals are rarely covered by workers compensation insurance.

    • P.A.C.E. provides workers compensation coverage for its Division Managers. P.A.C.E. workers compensation coverage indemnifies client companies from any claim that might be filed by a P.A.C.E. employee who is injured on the job.

    • Advantage to you: P.A.C.E. covers you for workers compensation and assumes the full risk so that you don't have to. Client companies appreciate that P.A.C.E. protects them from workers compensation claims.

     

  • Unemployment Insurance
    • Yet another risk arises when an out-of-work contractor decides to file an unemployment claim against a former client. If the State Department of Employment decides that an out-of-work contractor really was an employee of the client all along, it will alert the IRS to collect back taxes from the client for Federal unemployment insurance, and this may well trigger a wider audit involving Federal and State withholding taxes as well.

    • P.A.C.E. covers every P.A.C.E. employee with federal and state unemployment insurance.

    • Advantage to you: P.A.C.E. covers you for unemployment insurance and assumes the full risk so that you don't have to. Client companies appreciate that P.A.C.E. protects them from unemployment claims.

     

  • Federally Mandated Workplace Training
    • P.A.C.E. Division Managers receive documented training in the areas of harassment and workplace safety.

    • This means that P.A.C.E. Division Managers present a lower risk of workers compensation claims and workplace-related litigation than ordinary staffing agency temps.

    • Advantage to you: Companies are more likely to sign a contract for services provided by a P.A.C.E. Contract Professional than a self-employed consultant with the same skill set.

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