Innovation – noun in·no·va·tion ,i-nə-ˈvā-shən :the act or process of introducing new ideas, devices, or methods — Merriam Webster Dictionary
Recently, I googled “employer of record” (note the quotes) and my search returned close to 200,000 results. Clearly, there is no shortage of employers of record. Next, I googled “premium employer of record”. My search returned only about 300 results and they all referred back to Solo Workforce (www.soloworkfore.com). What is so unique about Solo Workforce? What makes it a “premium employer of record”? It’s our solo innovation and the unique Solo Workforce business model.
The Solo Workforce business model is a lean, elite, employment and benefits platform for independent-minded professionals. It features many innovations not found in ordinary employers of record. These innovations occur in the following areas:
- Focus on The Fully Burdened Labor Cost
- Unwavering Focus on The Soloist
- Tax-Advantaged Earnings
- Servicing All Stakeholders in The Contingent Workforce
- Crowdsourced Approach to Marketing
Few solo stakeholders appreciate how truly innovative Solo Workforce is and how the Solo Workforce business model stands alone as the nation’s most powerful employer of record platform. Below, I offer a brief explanation of the innovations that distinguish Solo Workforce from the thousands and thousands of ordinary employers of record.
Focus on The Fully Burdened Labor Cost
Innovation: Fully Burdened Labor Cost as Compensation
The key innovation in the Solo Workforce business model is the ability of each solo employee to control how their fully burdened labor cost is allocated to arrive at a highly tax-advantaged gross wage. For contract professionals, their fully burdened labor cost is their collected revenues. This means that each soloist can tailor their employee benefits, tax write-offs, contributions to their retirement plan and gross wage in order to provide the highest possible total compensation consistent with their unique needs. Ordinary employers of record cannot do this.
Unwavering Focus on The Soloist
Innovation: Best of Both Worlds
Solo Workforce gives soloists the best of both worlds:
- The tax-advantages, freedom and independence of the solo lifestyle plus
- The executive-level benefits and back-office support of elite corporate employment.
Only the Solo Workforce business model gives soloists the best of both worlds.
Innovation: Employee as Customer
Ordinary employers of record treat the employee essentially as a minion, serving the needs of the employer. Their only product is profit. Solo Workforce redefines the traditional employer-employee relationship. In the Solo Workforce business model, the soloist is the customer and elite, fully benefitted, tax-advantaged employment is the product.
Innovation: 100% Visibility
Solo Workforce gives soloists 100% visibility into the details of their professional activities. An ordinary employer of record will not, calling such vital knowledge proprietary and confidential information. Solo Workforce facilitates — and ordinary employers of record deny — the following:
- Full participation in contract negotiations
- Preparation of the statement of work (SOW)
- Setting billing rates, billing terms and payment cycle
- Knowledge of third-party fees and commissions
- Access to cash flow details
- Full, unfettered access to the client
Only Solo Workforce gives soloists 100% visibility into the details of their professional activities.
Innovation: Unparalleled Value to the Soloist
Ordinary employers of record maximize profit at the expense of service and benefits. They bill the client as high as possible, offer minimal employee benefits and pay the soloist as little as possible, making their money on the “spread”. This method invites abuse by the ordinary employer of record. In the interest of full transparency, Solo Workforce charges the soloist a modest service fee equal to just 3.75% of the soloist’s burdened labor rate. The service fee is so low, it is easily offset by the many financial advantages of the Solo Workforce business model. In other words, for the soloist, Solo Workforce nets out as virtually free or even better than free.
Innovation: Uninterrupted, Continuous Employment
Soloists employed by Solo Workforce enjoy continuous, uninterrupted employment over a succession of contract assignments and multiple clients. Ordinary employers of record generally employ a contract professional only for the duration of the contract assignment and then terminate employment when the job is done or the contract is up. Because employment is usually short-term, there is little incentive to provide more than the most basic of employee benefits, if any at all.
Innovation: Executive-level Benefits for Contingent Workers
Solo Workforce offers a comprehensive employee benefits package comparable to the executive-level benefits that elite corporations offer to their own employees. Ordinary employers of record typically offer only the most basic of employee benefits, if they offer any benefits at all.
Innovation: Personal Dedicated Business Unit
When a contract professional joins Solo Workforce they become the manager of their own one-person business unit, called a division. There are as many divisions as there are Solo Workforce soloists. Each division operates like a separate one-person business with its own dedicated revenue stream. Appointing each soloist as the manager of their own personal business unit is a key innovation of the Solo Workforce business model. Ordinary employers of record cannot track individual revenue streams.
Innovation: Dedicated Personal Assistant
When you consider all that a soloist does off the clock just to manage their solo business:
- Contract negotiations and administration
- Tracking reimbursable expenses
- Invoicing clients
- Collecting receivables
- Managing insurance coverage
- Handling a personal benefits package
- Processing payroll
- Reporting and paying taxes
You can appreciate the tremendous benefit of having a dedicated personal assistant to do it all for you. Soloists who work through Solo Workforce have a single point of contact, their own personal assistant, whose primary job is to protect soloists from the drudgery and risks of self-employment, freeing them to focus on their careers, their clients and their billable activities.
Innovation: Transparent Tracking of Individual Revenue Streams
The revenues Solo Workforce collects on behalf of each contract professional enters the employee’s division as a pre-tax revenue stream. These pre-tax funds cover the very small administrative service fee, purchase the employee’s benefits, cover personal expenses, pay the employer’s share of payroll taxes, reimburse the employee for out-of-pocket business and medical expenses and contribute the employer’s match to the employee’s 401(k) account. The remainder of the revenue stream makes up the employee’s highly tax-advantaged gross pay.
Innovation: Detailed Cashflow Reports
With every paycheck, Solo Workforce prepares a complete cash flow report, essentially a profit & loss statement, providing a detailed accounting of the financial activity and current status of the soloist’s division. This report gives 100% visibility into the billing rate to the soloist’s client and to the gross revenue stream to the soloist’s division, as well as a full accounting of how collected revenues are allocated to arrive at the soloist’s highly tax-advantaged gross pay. This level of transparency is virtually unheard of in ordinary employers of record.
Innovation: Tax Write-Offs, Same as if Self-Employed
A contract professional employed by Solo Workforce enjoys the same tax-free write-offs for business and medical expenses as a self-employed professional. A soloist employed by Solo Workforce can save thousands of dollars in taxes, substantially increasing their total compensation. Ordinary employers of record deny their contract employees this tax benefit, potentially leaving thousands of dollars unnecessarily “on the table”. Only the Solo Workforce business model gives soloists tax write-offs the same as if self-employed.
Innovation: Best-in-the-Nation 401(k)
The Solo Workforce 401(k) plan is hands-down the best option for anyone who wants to load their 401(k) with tax-deferred dollars as fast as possible and as fully as possible with the lowest possible gross pay. In the years 2015 and 2016, for example, Solo Workforce employees can contribute up to the IRS maximum of $53,000 ($59,000 if over age 50) on the first $75,000 of declared gross wage. This is better than a self-employed professional and better than virtually any other employee in the United States.
Servicing All Stakeholders in The Contingent Workforce
Innovation: “As a Service” Times Three
The Solo Workforce business model is arguably the nation’s most powerful employer of record platform, uniquely serving the interconnected nexus of soloists, companies and recruiters, providing:
- Employment as a Service: For skilled soloists
- Compliance as a Service: For companies that engage soloists
- Back Office as a Service: For recruiters who place soloists on company projects
Solo Workforce is the engine that powers the beneficial relationships among all stakeholders in the contingent workforce. No ordinary employer of record can deliver the level of integrated service provided by Solo Workforce.
Innovation: Employment as a Service for Soloists
Solo Workforce offers advantages to its soloists that are simply unavailable through an ordinary Employer of Record. The option of continuous, uninterrupted employment, detailed cash flow reporting, tax-free write-offs of out-of-pocket business and medical expenses, an aggressive 401(k) with IRS maximum employer match and an executive-level benefits package let soloists employed by Solo Workforce keep far more of their revenues as tax-advantaged income. In fact, soloists employed by Solo Workforce can earn higher total compensation and better benefits than a self-employed professional with the same gross receipts.
Innovation: Compliance as a Service for Companies
The Solo Workforce business model provides the staffing industry’s strongest affirmative defense against claims of co-employment and other legal challenges to worker status. Solo Workforce has an excellent reputation for safe and efficient engagement of contract professionals. While managing contingent workforce compliance throughout the United States since 1998, no contingent worker managed by Solo Workforce has ever been reclassified as an employee of the client company. Solo Workforce compliance is 100 percent effective.
Innovation: Back Office as a Service for Recruiters
Back Office as a Service from Solo Workforce is FREE, on-demand and nationwide. The Solo Workforce premium employer of record is the nation’s most powerful payroll, benefits and compliance platform, ideally suited as the preferred back office for contingent recruiters and contract staffing professionals who place highly compensated soloists on projects anywhere in the United States. Recruiters are assured to receive their full profit margin, whether Solo Workforce subcontracts through the recruiter to the client or contracts directly with the client. Back Office as a Service from Solo Workforce safely and efficiently transforms an ordinary recruiting business into a very competitive, highly profitable and more efficient contingent recruiting and contract staffing enterprise.
Innovation: Back Office Support for Recruiting Firm Staff
Solo Workforce provides back office support for recruiting firm staff as well as the soloists the recruiting firm places on projects with client companies. Staff members enjoy the same executive-level benefits, the same tax-free write-offs and the same tax-advantaged income as the soloists they refer to Solo Workforce. Ordinary back-office support providers cannot offer the same level of back-office support that Solo Workforce delivers to soloists and recruiting firm staff.