As a team of benefits strategists, we work hard every day to make sure we’re exceeding client expectations and providing the most innovative and value-generating plan designs and advisory services.
Mitigating the Potential Impact of COVID-19 on Organizational Health
Our first priority at Apex Benefits is the health of our employer clients and their employees. Our team of experts has identified many near-term and long-term opportunities for companies to consider in order to generate cost savings or create greater operational efficiencies.
How Can Apex Help?
Proactive strategic planning to identify and implement cost-savings measures isn’t a luxury during times of crisis. As a result, it is very important to quickly and carefully consider the consequences of adopting cost savings measures to organizations and their employees. If your organization needs assistance in identifying or evaluating your options, we’re here to help.
Apex clients — please contact your account executive. Otherwise, please use this contact form and we will respond promptly.
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Opportunities Through Legislation
Paid Sick Leave and FMLA Obligations: FFCRA
Claim all FFCRA tax credits. The Families First Coronavirus Response Act allows employers to immediately recoup the cost of the new emergency paid sick leave and the emergency paid family medical leave obligations of the new law. These credits can be taken immediately by offsetting the cost against the employer’s federal payroll tax payments. Please note that this credit is not available to our governmental entities. More information can be found on our landing page here and here.
Small Business Protection Loans
Apply for an SBA Paycheck Protection Loans (PPP). At up to 2.5 times average monthly payroll costs, the loan can be used for benefits, rent and utilities in addition to payroll. PPP has a forgiveness provision – but it’s reduced by any reduction in employees or wages. More information can be found on our landing page here.
Employee Retention Tax Credits and Payroll Tax Deferral
Explore the CARES Act Employee Retention tax credit and payroll tax deferral. Businesses may apply a 50% credit towards their payroll tax liability on up to $10,000 in wages per employee. It is a deferral, where half will be due later — half at the end of 2021 and half at the end of 2022. Only businesses that suffer from suspended operations or experience at least a 50% decrease in gross receipts compared to the same quarter from last year are eligible. Caution: If a business takes advantage of this credit, it would be ineligible for a PPP loan. The business could still make an offsetting payroll tax claim for emergency paid sick leave and emergency family medical leave, but not use the same employee(s) for retention credit calculation.More information can be found on our landing page here and here.
Small Business Disaster Relief Loan
CARES Act Disaster relief loan. Otherwise known as EIDL loans. Most businesses with 500 or fewer employees are now eligible for disaster loans of up to $2 million for working capital. Those businesses will also be eligible for an emergency cash advance of $10,000 within days of making the application, which is not repayable even if their loan application is denied. These loans cannot be used for payroll but can be used in conjunction with the options above for other working capital needs. Check out more information here.
Articles on Cost Savings
30 in 30:
Cost Savings in Times of Crisis
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Layoffs or Furloughs?
Do you think layoffs are a possibility? Use our checklist to explore your options, and let us know how we can help.
Workforce Reduction Strategies
Furloughs vs. Layoffs
Consider Furloughs as an Alternative to Layoffs. A furloughed employee is not a separated employee, even if the hours are reduced to zero. Depending on the employee benefits plan design, a furloughed employee’s reduction of hours may still allow eligibility, or a Plan amendment could fix that issue and allow the employer to save the hourly costs but still make benefits available. Call your Apex Benefits consultant for more information or find more information here.
Alter Worker Pay or Number of Hours
Consider Different Pay, Hour, and Assignment Scenarios. The Fair Labor Standards Act rules all still apply, but there are actions employers can take to save costs and keep their employee’s healthcare benefits.
Employee Benefits Strategies
Change Your Benefit Plan Design
Change contributions toward health plans. In order to save costs so as to retain employees, a re-balancing of employer and employee contributions to the plan could be helpful and minimally disruptive. Good data analysis and negotiating skills with carriers are important now more than ever.
Add or Promote Telemedicine
Not only a necessity during COVID-19, but the concept comes with some real cost savings for company health insurance plans. The savings can be used to retain employees.
Add Another Benefit Option at a Lower Cost to Members
Add a lower cost health plan option. An Apex advisor can walk you through all the options.
Alter Ancillary Coverage
Change ancillary coverages to all voluntary employee paid benefits like dental, vision, disability and others.
Change Your Rx Formulary
Any and all options previously thought to be too lean, including a change in formulary should now be on the table.
401k Contributions or Retirement Benefit Suspension
Temporarily suspend your contributions or the worker’s share of 401k or retirement benefits.
Operational and Administrative Strategies
Is Office Space a Negotiable Overhead Cost?
Close down or re-purpose unused space. Ask your landlord to defer payments or see if you can renegotiate terms; they’d rather have some rental income than none.
Revisit Previous Conversations
Odds are good you’ve had to deploy other cost savings measures over the years, or had conversations about such measures. Review all previously explored or deployed cost cutting measures.
Renegotiate Vendor Contracts
You vendors are likely in the same position of looking for cost savings opportunities, however, may be willing to renegotiate terms or defer payments in order to keep your business.
Employee Engagement Strategies
Have You Asked Your Employees for Their Ideas?
A healthy corporate culture is one is which employees are empowered to be part of the solution. Ask them for their ideas for creating cost savings opportunities of creating efficiencies.
Are You Communicating Often and Openly With Your Team?
Honesty is the best policy in times of crisis. Even communicating “I don’t know” is better than not addressing issues at hand. Reassure your team that you are doing the best you can to answer their questions and that you will communicate the answers once you have them.