Case Study: Financial Services Firm

By creating a more efficient engagement channel for its professional contractors, MBO Partners helped this financial giant save over $10 million.

Client Situation

With nearly $35 billion in revenue and over 50,000 employees, this New York-based powerhouse is one of the world's foremost financial services firms. As part of its ongoing commitment to providing the best possible services to its clients, this client employs an accomplished technology services team to build and maintain its critical systems infrastructure.

To stay flexible and responsive, the client commonly supplements this team with exceptionally talented professionals it engages on a contract basis. Rather than use staffing companies to find these contractors, it realized early on that it could cut costs by recruiting them on its own. But in doing so, it found itself struggling with IRS "1099" risks and time-consuming administrative burdens.

Why MBO Partners?

The client began using MBO Partners, then MyBizOffice, in 1996 because it offered the most efficient means of administering internally recruited contractors. Its primary goal was to reduce costs by implementing a convenient way to employ, pay, and process contractors without channeling them through an expensive staffing intermediary.

The client also realized that, unlike many staffing vendors, MBO also gave it the ability to provide top-quality employment services to a wide variety of contractors and could support individuals whether they wished to work as a W-2 employee or as a qualified corporation.

The MBO Partners Solution

Upon finding contractors to work its assignments, the client simply directs them to call MBO. Because MBO Partners and the client have entered into a Master Services Agreement, contractors can become engaged with minimal paperwork or contractual administration.

When new contractors are ready to come on board, MBO Partners helps them choose the most appropriate service option depending on their rate, expectations, and personal preferences. For those choosing to become MBO's W-2 employees, the firm offers access to a comprehensive benefits program, client billing and collections, a pre-tax expense reimbursement program, online account access, and much more.

The Results

Over twelve years later, the client is still sending its contractors to MBO Partners. The client has channeled over 250 contractors to MBO, which has reduced its contractor-related costs by 25%, or nearly $2 million per year. All this with no degradation of talent, minimal administration, and no risk of IRS reclassification.