A few days ago I shared the possibility of the WOTC for employees that you rehire as your business recovers.

The traditional WOTC regulations prohibit the WOTC for previous employees however there is strong and growing indication in Washington that WOTC may be temporarily approved to incent employers to hire back employees asap.  At this point, WOTC relief is not approved but the point of the message was to make you aware and to have you consider applying for WOTC for each employee that you rehire and bring back to work from furlough.  It may be a waste of time but there is no cost to do the application and the application must be processed promptly.  Harrisburg may reject it but there is a 28 timeline from the date of rehire.

Alternatively, if you did not receive PPP, the ECR (Employee Retention Credit) credit is approved and ready for your application.   Read the summary here.

Many thanks to HIREtech for keeping us informed on these types of best practices.  Work through Mike McCorkle at HIREtech to get the preferred pricing.

All    This may be very valuable to your firm especially if your firm furloughed employees and are now hiring them back.

There are tax credits for hiring new employees-known as the Work Opportunity Tax Credit (WOTC) and worth $1,000 to $2,450 for each qualifying new hire.  A candidate will likely qualify if they have been eligible or received state unemployment compensation in the last year, been on Food Stamps, been on a similar welfare or welfare to work program or a recently Veteran.  There are some other possible qualifying factors-such as working part time jobs with no career future or no healthcare.

One SME partner is HireTECH-a Texas based firm that is leader in the firm for these services AND they work on a contingency/success fee basis.   As a referral of CFO Solution, their fee is capped at 15% and it is payable ONLY if your firm receives a tax credit.

I just spoke to our contact, a Director with HireTECH, and they advise that all employers register anyone they hire OR REHIRE from furlough.   Each state will make the decision is a rehire is eligible-current thinking is that states are doing whatever they can to incent employers to hire and rehire so there is a fair probability that the states will approve the application.

Contact me and I will introduce you to our contact (so your firm receives the rate discount).

Process is fairly simple-an engagement letter explaining roles and the 15% success fee paid out of the approved credit.

Each employee is registered with two weeks of rehire-they answer a few questions-on line (phone, tablet or computer) and the application is processed to the corresponding state office SO this works for multi location employers. HireTECH takes care of the getting the application to the right state office and expediting review and approval, and in some cases, arguing for approval if the credit is denied.   Credit letter authorization, or denial, is sent to company contact and to HireTECH and the credit, if approved, is processed.   Then the firm is invoiced for the 15% payment.

Some of our firms have praised HireTECH for efficiency, professionalism and intervention assistance.

IF you want to know more, let me know.  THIS IS VERY TIME SENSTIVE-TAKE ABOUT A WEEK TO GET COMPANY ENGAGED AND ACTIVE AND THEN EACH EMPLOYEE APPLICATION MUST BE RECEIVED IN THE CORRESPONDING STATE OFFICE WITHIN 28 DAYS OF THEIR START DATE.  NO TIME TO WASTE AND HIRETECH IS VERY BUSY.

Honestly an HR department can apply for WOTC credit on their own but it is easy to mess it up and really easy to allow the state office to find an error or reject it.  Miss the deadline and the application is rejected.   For 15% success fee, use the expert! (obviously the best practice)

This can work for one employee hire (I just enrolled my engineering firm) or for hundreds across the country.   These are for full time positions with reasonable minimum wage requirements-generally 12 dollars or higher so worth applying.

Let me know your interest.  We did a zoom call two years ago on this topic and some of you engaged. Slides can be found HERE. Now everyone needs to consider it.

Let me connect you as Tim is no longer with HireTECH and you will get charged 25 or 30% fee.

SHARE THIS ACCORDINGLY with other employers-in any state.

PS   Some states have state or local credits for new hires that HireTECH will also file for.  New York does and I am trying to get a list of the other states that have additional credits.

Our friend, Steve Gergar, asked if I would share this request.    I can think of no better “give” right now.   Please consider if you or one of your organizations can assist Miller Blood Bank.

Please do what you can to assist this sincere request.  Feel free to share this request.

Thank you from me and Steve.

You may have seen our Miller-Keystone Blood Center appeals lately for blood donations throughout the Lehigh Valley.  The effect of the Coronavirus combined with our hospitals reopening to do elective surgeries has caused our blood supply to drop to dangerously low levels at Miller-Keystone, as well as across the country.

I attached a couple of recent press releases above and a short YouTube video below that describes the current environment and issues we are facing. We have 4 local Donor Centers located in Bethlehem, Allentown, Easton, and Reading.

I was wondering if I (or you) could forward this email to our CFO Forum members to help reach potential blood donors at this critical time.

Thanks

Stephen A. Gergar
Vice President, Finance and CFO
Hospital Central Services, Inc./Miller-Keystone Blood Center
2171 28th Street S.W.
Allentown, PA 18103
Office (Direct):     610-295-1637
Fax:                       610-791-2919
Cell:                       484-357-0460

We are all getting back to work and dealing with reduced demand, delayed or cancelled projects and supply chain issues in the event your demand has remained strong.

As one of our elected officials once said “Never waste a crisis” and now could be the time to analyze every dime of spending and make some changes that typically you would not have made.

It is not unrealistic to change some travel policies, benefit policies, demand price reductions from suppliers and change work rules(whether unionized or not) or anything else you have been dying to change!  Change can be good IF you are managing it and the CFO should be the Chief Change Officer!

It is now crucial to save every dime and dollar and, as usual, anyone you ask in Procurement is going to tell you that we are getting the best prices and terms from our suppliers and there is nothing more that they can do.

Realistically-how would they know if they are getting the best price and terms on everything that they buy ?

Procurement usually spends 95% of their time on the key and strategic materials, components and services and the rest of the spend, typically 35 to 40% of the spend, is subject to subtle price increases, shorter terms, evergreen and automatic renewals-with an increase, insertion of adders for delivery, packaging or special orders.

We have several best practices to offer AND they can make the CFO and Procurement heroes in the battle to save money.

We have partners who can provide focused review of “almost any line item or purchase” and they provide their assessment on a performance based cost sharing model.

The “worst” case is that our experts can find zero savings.   IF that was ever determined, Procurement would be one less thing that the CFO has to worry about.

The best case, and what we normally find, is that Procurement does a great job on the key purchases and we find savings of 15 to 20% on a lot of the other purchases.   That is found money and although CFOs hate to write the check (out of the savings) to the contingency experts, smart CFOs realize they just found savings that will continue AND probably learned a bit about spending analysis, cost stacks and opportunities for savings.

We are glad to chat with you to determine if you want specialists or a sourcing expert to do a strategic sourcing analysis.    You determine the scope and they report back to you.

Many of the expense reduction franchise guy are sharks and to a degree unethical (as most of us know).

We have vetted our partners and they realize they work for the CFO and have to provide real savings AND that the decisions remain with the client.   No phantom or “could have saved more” savings calculations and invoices!

Couple of points for you to consider:

• Does procurement know that certain costs are semi regulated AND that price increases over a baseline could result in 36 months of savings?  Telecom, certain utilities, trash hauling, haz mat disposal are semi regulated and I suspect that Procurement does not know that and does not track increases versus the baseline.
• Do you have a comprehensive spend analysis and a process to review increases, vendor performance (quality, on time delivery, product development, pricing, shipping terms, payment terms) that you can review?  I suspect Procurement and Finance are focused on watching a few key items and that the others don’t get much attention (or you don’t have a lot of knowledge on pricing in those items and services).   We are glad to offer a strategic assessment.
• An example-we all have software annual or multi year agreements and we are conditioned to 4 or 5% increases per year, perhaps more.  IF IT needs it, they will approve the renewal and not challenge the increase or negotiate.  It is not their responsibility and Procurement rarely understands software and service agreement pricing.  Our experience has shown that you can negotiate decreases on these IT spends.   Same applies to hardware purchases.   One of our experts focuses on this and his savings will startle you.  His expertise has saved our engineering firm significantly in the last two years since he opened my eyes!
• Let us know how we can help you reduce your expenses.  We can help on:
  • Benefit costs—25% savings have been realized.
  • Hiring costs-10 to 20% savings have been realized
  • Operating costs-material, components, shipping, services, utilities (cost and efficiency best practices), property taxes (in some cases) as well as insurances, legal fees, bank fees, etc.
  • IT spend-software, service agreements, hardware, line costs (and capacity design/ utilization reviews), etc.
• Cap ex-equipment, installation, and related costs are purchases that Procurement rarely makes and the savings can be really significant also.

Give me a call and we can discuss your concerns and outline a plan.   Then I will handle the introductions.  You have nothing to lose!

As we all yearn to get back to work, many practical questions that we never had to think about now have to be dealt with.

Thanks to Scott Palochik of ESPI for sharing these blueprint to get back to work.   IT is worth reviewing.

Find the PDF HERE.

Some other back to work, PPP, business insurance savings and unemployment info will be shared in the next day or two.

Remember our May face to face sessions are cancelled.  R&D tax credit session via ZOOM next Friday.   June sessions to be determined.