When you think about where the $$$ is, they DIRECTLY compete.
I think the thing people don't realize is that there is way more money in insurance than there is in payroll, ADP knows this and so does Paychex.
At my last company, I think we paid about $90 per employee per year for payroll processing, W-2s and employee self-service.
A broker commission for health insurance is conservatively 3% of the total annual premium. So with an average family premium (employee and employer) hovering around $17k a year, the commission on that plan would be $500+ dollars, well over five times what you could earn by actually doing payroll. an employee electing single coverage with a total premium around $7k a year is still far and away more valuable than "payroll"
If you look at ADPs earnings transcripts for the past year, you'll see this area is where the growth is at. It's even stronger at Paychex where benefits constitutes basically all of their growth.
I think the thing people don't realize is that there is way more money in insurance than there is in payroll, ADP knows this and so does Paychex.
At my last company, I think we paid about $90 per employee per year for payroll processing, W-2s and employee self-service.
A broker commission for health insurance is conservatively 3% of the total annual premium. So with an average family premium (employee and employer) hovering around $17k a year, the commission on that plan would be $500+ dollars, well over five times what you could earn by actually doing payroll. an employee electing single coverage with a total premium around $7k a year is still far and away more valuable than "payroll"
If you look at ADPs earnings transcripts for the past year, you'll see this area is where the growth is at. It's even stronger at Paychex where benefits constitutes basically all of their growth.