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Products February 7, 2002
IBM Latest To Outsource HR, Taps Fidelity
July 2, 2002 (PLANSPONSOR.com) - In the latest
example of an emerging trend, IBM has decided to outsource
the administration of its pension and health and welfare
plans, along with a broad range of HR services to Fidelity
Employer Services Company (FESCo).
Reported by Nevin E. Adams
In a related announcement, IBM Global Services and Fidelity have formed a relationship to market HR payroll and benefits outsourcing services, according to the companies.
The two firms will provide clients with consulting
services involving the evaluation and implementation of HR
and benefits outsourcing alternatives.
Outsourcing Trends
The announcement follows several other large employer
decisions, including American Express, which tapped Mellon
HR Solutions (see
American Express Picks
Mellon as HR “Source”
) and AT&T’s selection of Aon Consulting for a similar
range of services (see
AT&T Outsources HR
to Aon
). Late last year Xerox opted to outsource the asset
management function of its program to GMAM (see
Anatomy of an
Outsourcing Deal
).
Human resources is the second most outsourced area at companies included in a recent Hewitt Associates survey, with defined benefit and defined contribution plans the HR area most frequently given to an outside vendor (see Retirement Plans Top Outsourcing List ).
Blue Notes
According to Fidelity, the transition is scheduled to begin August 1, 2002, when approximately 450 employees working in the IBM Employee Service Center, who provide HR transaction and administrative support to IBM U.S. employees and retirees, will transfer to Fidelity Employer Services Company.
There they will continue to provide HR transaction and administrative support to IBM employees and retirees in the US.
Fidelity said that it plans to expand the Raleigh, North Carolina service center to accommodate growth in its HR payroll and benefits outsourcing business.