The Human Resource (HR) aspect of running a company — from hiring,

retaining and terminating staff to managing payroll, taxes, benefits, unemployment claims and worker’s compensation insurance — is often challenging and bur-densome for businesses.

Employee Resource Admini-stration (ERA) was founded in 1999 as a professional employer organization (PEO) for the pur-pose of providing professional HR and administrative services to small and mid-sized employers.

“The great majority of small- to medium-sized companies don’t know which regulations they should be complying with, so they outsource it to us,” says Frank Timmins. “Most companies have different reasons for hiring us. A CPA or law firm, for example, has very little worker’s compensation risk. It isn’t a large part of their employer/employment contract. Oil field workers, roofers and other blue-collar workers face more danger, so their worker’s compensation rates are a huge part of overall employment costs.

All employers may have an issue with their unemployment rate, and just about everybody can be tripped up if they aren’t handling their HR correctly.”

“We have never targeted just one type of company,” says Diane Axline. “The clients under our umbrella run the gamut. We work with everything from manufactu-rers to retailers, law firms and doctors. Some clients are riskier than others and it’s very hard for that type of company to manage the day-to-day functions that they’re outsourcing to us. We are updated daily on the court cases in their particular state so we can keep them in compliance.”

BizNet: How can companies benefit by outsourcing certain aspects of their human resources (i.e., hiring and termination, managing EEOC, State Employment Commission and OSHA issues) to ERA?

Diane Axline: We take the burden and responsibility for certain HR-related functions off our clients. For example, we can handle their payroll obligations.

We receive payroll information from our client, and we are responsible to initialize and issue that payroll in any form — whether direct deposit, payroll cards or whatever format they want. Payroll is probably the least of what we do, but the most important to our client.

We also manage their worker’s compensation by paying the true worker’s compensation based on their payroll, so they won’t have any issues down the road. We also handle their state unemployment claims (SUTA), and we are responsible for those hearings. This saves our clients the time and expense of mana-ging these claims on their own. The basic mission of a PEO is to remove unnecessary burdens from employers so they can spend their time and energy on their core competency (running their business).

Our own in-house professio-nal HR department works with clients in each state in keeping employee personnel manuals up to date, advising on company protocols employees must meet

Cover Story

I N T E R V I E WDiane Axline and Frank Timmins, co-founders of Employee Resource Administration (ERA), talk with BizNet Magazine’s Executive Editor Leslie Stone about the company’s role as a PEO (professional employer organization) providing human resources and administrative services to companies across the country.

before they are eligible for paid time off, vacation, or paid family leave and helping with everyday questions about how to hire or termi-nate. These and many other HR related services help keep our clients informed and efficient regarding personnel issues.

Frank Timmins: The biggest benefit is our clients don’t have to hire individual HR specialists and risk managers. For example, a machine shop with 25 employees isn’t going to hire a professional HR person because it is cost prohibitive given the size of the company. However, in the absence of such a professional they most likely will have an employee who is designa-ted (many times an owner) as a sort of jack-of-all-trades payroll, risk manager and HR person. Inevitably they are going to make mistakes. When they outsource these critical duties to professionals like ERA, they don’t have to worry about those issues.

Clients who come to us have many times have had an awakening. Maybe they had an employee who sexually harassed another employee resulting in a big lawsuit simply because they didn’t have proper HR guidance. Or maybe somebody slipped and broke their hip and filed a claim that cost the company a lot of money simply because they didn’t have a risk manager.

Small companies can sometimes get away with ignoring OSHA requirements and failing to submit required paperwork for years, but when it catches up to them it usually means penalties and possible lawsuits. Companies definitely don’t want to get sideways with the IRS simply because they haven’t properly done their tax filings. The employer learning curve in these matters is often not worth the cost when it is much easier to outsource instead.

BizNet: How has the industry changed over the last 20 years?

Diane Axline: The biggest change is the new software technology that makes PEOs more efficient for their clients. Employer responsibilities have increased instead of decreasing, making the navigation of rules and regulations more difficult. While software solutions have

addressed these issues, the technological help is not easily available to smaller employers and these solutions are very expensive. PEOs handling multiple employer clients can avail this technology to its clients much more effectively.

Frank Timmins: It’s really a simple applica-tion of logic. Because of critical mass we can buy insurance for our clients more efficiently than they can buy it for themselves. At the same time, we can provide professional HR services that our clients cannot reasonably be expected to provide for themselves.

BizNet: What are your duties with the com-pany? Diane Axline: We are involved in everything. There is nothing that we aren’t involved in from a day-to-day standpoint. We are definitely hands-on ownership, not absentee ownership.

BizNet: How many other states do you operate in besides Texas? Diane Axline: We are domiciled here in Texas and we operate in 46 out of 50 states.

BizNet: What do you consider your greatest accomplishments in building ERA? Frank Timmins: Making it through the morass of all the competition and growing the company. Apart from the competition, there are

“Clients can call at any time and actually talk with

the person who handles that account in person and does payroll for them. They

won’t be talking with an auto attendant.”

—Frank Timmins

regulations you have to deal with and software issues you have to stay on top of. We rely heavily on our software, obviously, because we are taking on a lot of responsibility for our clients.

Diane Axline: I would say just the journey of being in business for almost 20 years. Lots of things have happened during the last two deca-des. Things in every state change so you’ve got to be flexible and adapt to those changes.

BizNet: Have you experienced any challenges along the way?

Diane Axline: There are always challenges in the PEO business. Each of our employer clients has individual everyday problems. Sometimes the challenges are related to cleaning up issues for new clients that may be the result of Workers Compen-sation problems or payroll/HR related snafus that have emerged over a period of time. Once we partner up with our clients, we make sure the problems are resolved.

BizNet: What do you consider the company’s competitive advantage?

Diane Axline: Definitely our customer service. We aren’t transient owners or owned by a larger corporation. Our goal is to always answer the phone before the third ring. We know how to keep our clients happy. We still have clients on the book from 2000. That says a lot about how our clients feel about our services.

Frank Timmins: All PEOs, if they’re doing their job, are pretty much providing the same basic services. The customer service aspect is where you make it or break it.

Leslie Stone is an award-winning writer, editor and journalist with more than two decades of experience covering business, finance, real estate and lifestyle issues for newspapers, magazines and online pub-lications. Originally from Virginia, she currently resides between Florida and Michigan.

We assign an individual client repre-sentative to each one of our clients. Clients can call at any time and actually talk with the person who handles that account in person and does payroll for them. They won’t be talking with an auto attendant. They don’t want to talk to a robot. They want to talk to some-body who knows what the problem is and who has answers. That’s what separated ERA from most of the compe-tition.

BizNet: What do you enjoy most about your work?

Diane Axline: I think you’re either going to love it or hate it. There isn’t really any in-between. As a customer service driven organization, you enjoy having a purpose to do something for your clients. That’s what it is for me. You either have an aptitude for it or you don’t. It’s a duck shoot every day. You never know what your clients are going to be asking of you on any given day.

BizNet: Where do you see ERA in the next five years?

Frank Timmins: A PEO should be flexible and have the ability to adjust to changes that will most surely come in the future. Employer related laws and regulations are always changing, and ERA will be in the forefront of dealing with these changes for each of our clients. As long as there are entrepreneurs who want to build companies and sell products and services, ERA will be a valuable asset for employers and new clients. We are very excited about the future. BN