Establishing a seperate "new" company - 401 K Q

skippy · November 2001

We are a bank and we would like for our holding company to hire the key personnel from our bank and our affiliates, then lease them back out to the banks owned by our HC. The HC does not have a 401K plan - the bank's do. Would a 401K plan with a company different from the one we have at the bank level be possible? Is there a place you're aware of where I can research this? Thanks

OhioSmallEmployer · January 2002

That's a good question and you might already have an answer. I have one suggestion though that might meet your needs. There are organizations called PEOs or Professional Employer Organizations that actually hire employees of a company and lease them back to the employer for an administration cost. In exchange for this, they handle your payroll, withholding taxes, unemployment, workers comp., cobra administration, and benefits including health, dental, vision, 401k, life, etc. Basically, whatever your company needs are. The benefits can even be at a group discount since all the employees are now a part of a larger group (all the employees of all the client companies.)

susannaacosta · January 2002

We are a manufacturing company that is in transition of selling their two existing companies. One of which is the corporate office and the other being an offsite company. The Owner will then transfer to our location making this company the one and only Corporate Office. At this time we offer health, vision, dental, 401k, profit sharing, tuition reimbursment. But, when this change takes place I will have to provide my employees with proper benefits. How do I get started, and what are the steps of finding the right insurance coverage. At this time we have 40 full time employees.
Help! Thanks in advance.
Susanna, California.

kaad · January 2002

Be careful of "protected benefits" when you are terminating a plan and starting another plan. You may need a benefits attorney to work you through all of the notice and other ramifications of discontinuing, starting and merging plans. Also, be sure you cover all of the records keeping problems and requirements, which, depending on how many employees you have, can be a nightmare. A good source of free information on benefits, bunching and packaging benefits, pricing, etc. is to contact local insurance and benefits brokers in your community. I know they would love to come show their wares and leave all sorts of information to give you ideas. You could also price services of a variety of kinds--all for free--at least until you buy something. Another source of information might be local employers organizations which provide services.

Margaret Morford · January 2002

If you don't have time to go through all the brokers and providers, you might want to turn that job over to a benefits consultant. They do all the leg work including suggesting plan designs. They also are not tied to any one company by commissions, so they can negotiate so excellent deals for you. I can recommend one that is excellent and transitioned my last company when we were LBO'ed away from our parent company. Call me if you want his name.

Margaret Morford
theHRedge
615-371-8200
[email]mmorford@mleesmith.com[/email]
[url]http://www.thehredge.net[/url]

Establishing a seperate "new" company - 401 K Q

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