Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | Apr. 22, 2019 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | TRINET GROUP INC | |
Trading Symbol | TNET | |
Entity Central Index Key | 0000937098 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 69,991,585 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 251 | $ 228 |
Investments | 56 | 54 |
Restricted cash, cash equivalents and investments | 722 | 942 |
Accounts receivable, net | 12 | 11 |
Unbilled revenue, net | 314 | 304 |
Prepaid expenses | 58 | 48 |
Other current assets | 81 | 59 |
Total current assets | 1,494 | 1,646 |
Restricted cash, cash equivalents and investments, noncurrent | 184 | 187 |
Investments, noncurrent | 133 | 135 |
Property and equipment, net | 82 | 79 |
Operating lease right-of-use asset | 59 | 0 |
Goodwill | 289 | 289 |
Other intangible assets, net | 19 | 21 |
Other assets | 85 | 78 |
Total assets | 2,345 | 2,435 |
Current liabilities: | ||
Accounts payable and other current liabilities | 55 | 45 |
Long-term debt | 22 | 22 |
Client deposits | 38 | 56 |
Accrued wages | 369 | 352 |
Accrued health insurance costs, net | 135 | 135 |
Accrued workers' compensation costs, net | 67 | 67 |
Payroll tax liabilities and other payroll withholdings | 550 | 729 |
Operating lease liabilities | 16 | 0 |
Insurance premiums and other payables | 16 | 19 |
Total current liabilities | 1,268 | 1,425 |
Long-term debt, noncurrent | 385 | 391 |
Accrued workers' compensation costs, noncurrent, net | 156 | 158 |
Deferred taxes | 65 | 68 |
Operating lease liabilities, noncurrent | 54 | 0 |
Other non-current liabilities | 11 | 18 |
Total liabilities | 1,939 | 2,060 |
Commitments and contingencies (see Note 6) | ||
Stockholders’ equity: | ||
Preferred stock ($0.000025 par value per share; 20,000,000 shares authorized; no shares issued or outstanding at March 31, 2019 and December 31, 2018) | 0 | 0 |
Common stock and additional paid-in capital (0.000025 par value per share; 750,000,000 shares authorized; 70,079,747 and 70,596,559 shares issued and outstanding at March 31, 2019 and December 31, 2018) | 651 | 641 |
Accumulated deficit | (245) | (266) |
Total stockholders' equity | 406 | 375 |
Total liabilities & stockholders' equity | $ 2,345 | $ 2,435 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2019 | Dec. 31, 2018 |
Preferred stock ($0.000025 par value per share; 20,000,000 shares authorized; no shares issued and outstanding at September 30, 2018 and December 31, 2017) | ||
Preferred stock, par value (in dollars per share) | $ 0.000025 | $ 0.000025 |
Preferred stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock and additional paid-in capital ($0.000025 par value per share; 750,000,000 shares authorized; 70,508,389 and 69,818,392 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively) | ||
Common stock, par value (in dollars per share) | $ 0.000025 | $ 0.000025 |
Common stock, shares authorized (in shares) | 750,000,000 | 750,000,000 |
Common stock, shares issued (in shares) | 70,079,747 | 70,596,559 |
Common stock, shares outstanding (in shares) | 70,079,747 | 70,596,559 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Total revenues | $ 934 | $ 861 |
Costs and operating expenses: | ||
Insurance costs | 683 | 641 |
Cost of providing services | 64 | 57 |
Sales and marketing | 46 | 39 |
General and administrative | 36 | 31 |
Systems development and programming | 12 | 13 |
Depreciation and amortization of intangible assets | 11 | 9 |
Total costs and operating expenses | 852 | 790 |
Operating income | 82 | 71 |
Other income (expense): | ||
Interest expense, bank fees and other | (5) | (6) |
Interest income | 6 | 2 |
Income before provision for income taxes | 83 | 67 |
Income tax expense | 20 | 13 |
Net income | 63 | 54 |
Comprehensive income | $ 63 | $ 54 |
Net income per share: | ||
Basic (in dollars per share) | $ 0.91 | $ 0.77 |
Diluted (in dollars per share) | $ 0.89 | $ 0.75 |
Weighted average shares: | ||
Basic (in shares) | 69,909,984 | 70,047,752 |
Diluted (in shares) | 71,247,427 | 72,274,821 |
Professional service revenues | ||
Total revenues | $ 136 | $ 129 |
Insurance service revenues | ||
Total revenues | $ 798 | $ 732 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Millions | Total | Common Stock and Additional Paid-In Capital ( in shares ) | Common Stock and Additional Paid-In Capital | Accumulated Deficit | AOCI Attributable to Parent [Member] |
Balance (in shares) at Dec. 31, 2017 | 69,818,392 | ||||
Balance at Dec. 31, 2017 | $ 206 | $ 583 | $ (377) | $ 0 | |
Net income | 54 | 54 | |||
Other comprehensive income | (1) | (1) | |||
Issuance of common stock from vested restricted stock units (in shares) | 610,266 | ||||
Issuance of common stock from exercise of stock options (in shares) | 206,430 | ||||
Issuance of common stock from exercise of stock options | 3 | 3 | |||
Stock-based compensation expense | 9 | 9 | |||
Repurchase of common stock (in shares) | (160,033) | ||||
Repurchase of common stock | (8) | (8) | |||
Awards effectively repurchased for required employee withholding taxes (in shares) | (111,804) | ||||
Awards effectively repurchased for required employee withholding taxes | (4) | (4) | |||
Balance (in shares) at Mar. 31, 2018 | 70,363,251 | ||||
Balance at Mar. 31, 2018 | 262 | 595 | (332) | (1) | |
Cumulative effect of accounting change | 3 | 3 | |||
Balance (in shares) at Dec. 31, 2018 | 70,596,559 | ||||
Balance at Dec. 31, 2018 | 375 | $ 641 | (266) | 0 | |
Net income | 63 | 63 | |||
Issuance of common stock from vested restricted stock units (in shares) | 286,719 | ||||
Issuance of common stock from exercise of stock options (in shares) | 81,282 | ||||
Issuance of common stock from exercise of stock options | 1 | $ 1 | |||
Stock-based compensation expense | $ 9 | 9 | |||
Repurchase of common stock (in shares) | (782,909) | (782,909) | |||
Repurchase of common stock | $ (38) | (38) | |||
Awards effectively repurchased for required employee withholding taxes (in shares) | (101,904) | ||||
Awards effectively repurchased for required employee withholding taxes | (4) | (4) | |||
Balance (in shares) at Mar. 31, 2019 | 70,079,747 | ||||
Balance at Mar. 31, 2019 | $ 406 | $ 651 | $ (245) | $ 0 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Operating activities | ||
Net income | $ 63 | $ 54 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 18 | 10 |
Stock-based compensation | 9 | 9 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 1 | 13 |
Unbilled revenue | (9) | 11 |
Prepaid expenses | (12) | (11) |
Other assets | (30) | (24) |
Accounts payable and other current liabilities | 9 | (15) |
Client deposits | (19) | (26) |
Accrued wages | 17 | (15) |
Accrued health insurance costs | 0 | (1) |
Accrued workers' compensation costs | (2) | (3) |
Payroll taxes payable and other payroll withholdings | (180) | (534) |
Operating lease liabilities | (4) | 0 |
Other liabilities | (3) | (4) |
Net cash used in operating activities | (142) | (536) |
Investing activities | ||
Purchases of marketable securities | (30) | 0 |
Proceeds from sale and maturity of marketable securities | 31 | 14 |
Acquisitions of property and equipment | (12) | (12) |
Net cash (used in) provided by investing activities | (11) | 2 |
Financing activities | ||
Repurchase of common stock | (38) | (8) |
Proceeds from issuance of common stock | 1 | 3 |
Awards effectively repurchased for required employee withholding taxes | (4) | (4) |
Repayment of debt | (6) | (10) |
Net cash used in financing activities | (47) | (19) |
Net decrease in unrestricted and restricted cash and cash equivalents | (200) | (553) |
Cash and cash equivalents, unrestricted and restricted: | ||
Beginning of period | 1,349 | 1,738 |
End of period | 1,149 | 1,185 |
Supplemental disclosures of cash flow information | ||
Interest paid | 4 | 4 |
Income taxes paid, net | 1 | 0 |
Supplemental schedule of noncash investing and financing activities | ||
Payable for purchase of property and equipment | $ 5 | $ 2 |
Description of Business and Sig
Description of Business and Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
DESCRIPTION OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES | DESCRIPTION OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES Description of Business TriNet Group, Inc. (TriNet, or the Company, we, our and us), a professional employer organization, provides comprehensive human resources solutions for small to midsize businesses under a co-employment model. These HR solutions include multi-state payroll processing and tax administration, employee benefits programs, including health insurance and retirement plans, workers' compensation insurance and claims management, employment and benefit law compliance, and other HR-related services. Through the co-employment relationship, we are the employer of record for certain employment-related administrative and regulatory purposes for the worksite employees, including: • compensation through wages and salaries, • employer payroll-related tax payments, • employee payroll-related tax withholdings and payments, • employee benefit programs, including health and life insurance, and others, and • workers' compensation coverage. Our clients are responsible for the day-to-day job responsibilities of the WSEs. We operate in one reportable segment. All of our service revenues are generated from external clients. Less than 1% of our revenue is generated outside of the U.S. Basis of Presentation These unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial reporting and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X of the Rules and Regulations of the Securities and Exchange Commission. Certain information and note disclosures included in our annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the condensed consolidated financial statements reflect all adjustments, that are normal and recurring in nature, necessary for fair financial statement presentation. The results of operations for the three months ended March 31, 2019 are not necessarily indicative of the operating results anticipated for the full year. These Financial Statements should be read in conjunction with the audited Consolidated Financial Statements included in Part II, Item 8 Financial Statements and Supplementary Data of our Annual Report on Form 10-K for the year ended December 31, 2018 ( 2018 Form 10-K). Reclassifications Certain prior year amounts have been reclassified to conform to current period presentation. Effects on the cash flow statement due to reclassifications are summarized below: For the Three Months Ended March 31, 2018 (in millions) As previously reported Reclassified amounts As revised Operating activities Changes in operating assets and liabilities: Accounts receivable $ — $ 13 $ 13 Unbilled revenue — 11 11 Prepaid income taxes 13 (13 ) — Prepaid expenses and other current assets (9 ) (2 ) (11 ) Workers' compensation collateral receivable (1 ) 1 — Other assets (2 ) (22 ) (24 ) Accounts payable and other current liabilities (15 ) — (15 ) Client deposits — (26 ) (26 ) Accrued wages — (15 ) (15 ) Accrued corporate wages (9 ) 9 — Accrued health insurance costs — (1 ) (1 ) Accrued workers' compensation costs — (3 ) (3 ) Workers' compensation loss reserves and other non-current liabilities (6 ) 6 — Payroll taxes payable and other payroll withholdings — (534 ) (534 ) Other liabilities — (4 ) (4 ) Worksite employee related assets (14 ) 14 — Worksite employee related liabilities (566 ) 566 — Interest income previously classified in other income (expense), net is now presented in a new line item. Depreciation expense and amortization of intangible assets previously reported separately, are now presented together as depreciation and amortization of intangible assets. Use of Estimates The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect certain reported amounts and related disclosures. Significant estimates include: • liability for unpaid losses and loss adjustment expenses (accrued workers' compensation costs) related to workers' compensation and workers' compensation collateral receivable, • accrued health insurance costs, • liability for insurance premiums payable, • Valuation of the investment portfolio, • impairments of goodwill and other intangible assets, • income tax assets and liabilities, and • liability for legal contingencies. These estimates are based on historical experience and on various other assumptions that we believe to be reasonable from the facts available to us. Some of the assumptions are highly uncertain at the time of estimation. To the extent actual experience differs from the assumptions used, our consolidated financial statements could be materially affected. Accrued Health Insurance Costs We sponsor and administer a number of fully insured, risk-based employee benefit plans, including group health, dental, and vision as an employer plan sponsor under section 3(5) of the ERISA. In Q1 2019, the majority of our group health insurance costs related to risk-based plans. Our remaining group health insurance costs were for guaranteed-cost policies. Accrued health insurance costs are established to provide for the estimated unpaid costs of reimbursing the carriers for paying claims within the deductible layer in accordance with risk-based health insurance policies. These accrued costs include estimates for reported losses, plus estimates for claims incurred but not paid. We assess accrued health insurance costs regularly based upon independent actuarial studies that include other relevant factors such as current and historical claims payment patterns, plan enrollment and medical trend rates. In certain carrier contracts we are required to prepay the expected claims activity for the subsequent period. These prepaid balances by agreement permit net settlement of obligations and offset the accrued health insurance costs or when the prepaid is in excess of our recorded liability the net asset position is included in prepaid expenses. As of March 31, 2019 and December 31, 2018 , prepayments included in accrued health insurance costs were $39 million and $33 million , respectively. Under certain policies, based on plan performance, we may be entitled to receive refunds of premiums which we recognize in accordance with the policy terms. We estimate these refunds based on premium and claims data and record as a reduction in the insurance costs on the consolidated statements of income and comprehensive income and prepaid expenses on the consolidated balance sheets. As of March 31, 2019 and December 31, 2018 , there were no prepaid insurance premiums included in prepaid expenses. Leases We adopted ASU 2016-02 - Leases (ASC 842) effective January 1, 2019 using the optional transition method, under which we recognized the cumulative effects of initially applying the standard as an adjustment to the opening balance of retained earnings on January 1, 2019 with unchanged comparative periods. As part of this adoption, we elected the following practical expedients: • not to reassess 1) whether any contracts that existed prior to adoption have or contain leases, 2) the classification of our existing leases or 3) initial direct costs for existing leases, • to use the practical expedient of using hindsight to determine the lease terms and evaluate any impairments in right-of-use assets upon transition, and • not separately record non-lease and lease components for all leases in which we act as a lessee. We determine if a new contractual arrangement is a lease at contract inception. If a contract contains a lease, we evaluate whether it should be classified as an operating or a finance lease. If applicable as a lease, we record our lease liabilities and ROU assets based on the future minimum lease payments over the lease term and only include options to renew a lease in the minimum lease payments if it is reasonably certain that we will exercise that option. For certain leases with original terms of twelve months or less we recognize the lease expense as incurred and we do not recognize lease liabilities and ROU assets. We measure our lease liabilities based on the future minimum lease payments discounted over the lease term. We determine our discount rate at lease inception using our incremental borrowing rate, which is based on our outstanding term debts that are collateralized by certain corporate assets. As of March 31, 2019 , the weighted-average rate used in discounting the lease liability was 4.6% . We measure our ROU assets based on the associated lease liabilities adjusted for any lease incentives such as tenant improvement allowances and classify operating ROU assets in other assets in our condensed consolidated balance sheet. For operating leases, we recognize expense for lease payments on a straight-line basis over the lease term. Recent Accounting Pronouncements Recently adopted accounting guidance Leases - In February of 2016, the FASB issued ASC 842, which replaced existing lease guidance under GAAP. Under this guidance, we recognize on our condensed balance sheet lease liabilities representing the present value of future lease payments and an associated right-of-use asset representing our right to use or control the use of specified assets for the lease term for any operating lease with a term greater than one year. The impact of our adoption of ASC 842 did not have a material impact on our income statement or cash flow statement. The impact on our condensed balance sheets is as follows: March 31, 2019 (in millions) As reported Balance Using Previous Standard Increase (Decrease) Balance sheet Assets Operating lease right-of-use assets $ 59 $ — $ 59 Liabilities Operating lease liabilities 16 — 16 Operating lease liabilities, noncurrent 54 11 43 Equity Accumulated deficit $ (245 ) $ (245 ) $ — Recently issued accounting pronouncements Credit Losses - In June 2016, the FASB issued ASU 2016-13 - Financial Instruments - Credit Losses (Topic 326), which requires financial assets to be presented at the net amount expected to be collected. We will be required to use forward-looking information when evaluating an allowance for our accounts receivable, unbilled revenue and other financial assets measured at amortized cost. Topic 326 also modifies the impairment guidance for available-for-sale debt securities to require an allowance for credit losses. We will adopt Topic 326 effective January 1, 2020 using a modified retrospective approach through a cumulative-effect adjustment to retained earnings. We are currently evaluating the impact of this standard on our consolidated financial statements, including accounting policies, processes, and systems. |
Cash, Cash Equivalents and Inve
Cash, Cash Equivalents and Investments | 3 Months Ended |
Mar. 31, 2019 | |
Cash and Cash Equivalents [Abstract] | |
CASH, CASH EQUIVALENTS AND INVESTMENTS | CASH, CASH EQUIVALENTS AND INVESTMENTS Under the terms of the agreements with certain of our workers' compensation and health benefit insurance carriers, we are required to maintain collateral in trust accounts for the benefit of specified insurance carriers and to reimburse the carriers’ claim payments within our deductible layer. We invest a portion of the collateral amounts in marketable securities. We report the current and noncurrent portions of these trust accounts as restricted cash, cash equivalents and investments on the consolidated balance sheets. We require our clients to prefund their payroll and related taxes and other withholding liabilities before payroll is processed or due for payment. This prefund is included in restricted cash, cash equivalents and investments as payroll funds collected, which is designated to pay pending payrolls, payroll tax liabilities and other payroll withholdings. We also invest available corporate funds, primarily in fixed income securities which meet the requirements of our corporate investment policy and are classified as available for sale (AFS). Our total cash, cash equivalents and investments are summarized below: March 31, 2019 December 31, 2018 (in millions) Cash and cash equivalents Available-for-sale marketable securities Certificate of deposits Total Cash and cash equivalents Available-for-sale marketable securities Certificate of deposits Total Cash and cash equivalents $ 251 $ — $ — $ 251 $ 228 $ — $ — $ 228 Investments — 56 — 56 — 54 — 54 Restricted cash, cash equivalents and investments Insurance carriers' security deposits 15 — — 15 15 — — 15 Payroll funds collected 564 — — 564 783 — — 783 Collateral for health benefits claims 75 — — 75 75 — — 75 Collateral for workers' compensation claims 65 1 — 66 66 1 — 67 Collateral to secure standby letter of credit — — 2 2 — — 2 2 Total restricted cash, cash equivalents and investments 719 1 2 722 939 1 2 942 Investments, noncurrent — 133 — 133 — 135 — 135 Restricted cash, cash equivalents and investments, noncurrent Collateral for workers' compensation claims 179 5 — 184 182 5 — 187 Total $ 1,149 $ 195 $ 2 $ 1,346 $ 1,349 $ 195 $ 2 $ 1,546 |
Investments
Investments | 3 Months Ended |
Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENTS | INVESTMENTS All of our investment securities that have a contractual maturity date greater than three months are classified as AFS. The amortized cost, gross unrealized gains, gross unrealized losses, and fair values of our investments as of March 31, 2019 and December 31, 2018 are presented below. March 31, 2019 December 31, 2018 (in millions) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Asset-backed securities $ 35 $ — $ — $ 35 $ 33 $ — $ — $ 33 Corporate bonds 100 — — 100 99 — — 99 U.S. government agencies and government- sponsored agencies 6 — — 6 7 — — 7 U.S. treasuries 47 — — 47 46 — — 46 Exchange traded fund 1 — — 1 1 — — 1 Other debt securities 6 — — 6 9 — — 9 Total $ 195 $ — $ — $ 195 $ 195 $ — $ — $ 195 Gross unrealized losses as of March 31, 2019 and December 31, 2018 were not material. Unrealized losses on fixed income securities are principally caused by changes in interest rates and the financial condition of the issuer. In analyzing an issuer's financial condition, we consider whether the securities are issued by the federal government or its agencies, whether downgrades by credit rating agencies have occurred, and industry analysts' reports. As we have the ability to hold these investments until maturity, or for the foreseeable future, no decline was deemed to be other-than-temporary. Actual maturities may differ from contractual maturities because borrowers may have the right to prepay obligations with or without prepayment penalties. The fair value of debt investments by contractual maturity are shown below: (in millions) March 31, 2019 One year or less $ 61 Over one year through five years 117 Over five years through ten years 7 Over ten years 9 Total fair value $ 194 The gross proceeds from sales and maturities of AFS securities for the three months ended March 31, 2019 and March 31, 2018 are presented below. Three Months Ended (in millions) 2019 2018 Gross proceeds from sales $ 14 $ — Gross proceeds from maturities 17 14 Total $ 31 $ 14 |
Leases (Notes)
Leases (Notes) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Leases | LEASES Our leasing activities predominantly consist of leasing office space that we occupy, which we have classified as operating leases. Our leases are comprised of fixed payments with remaining lease terms of 1 year to 9.5 years , some of which include options to extend for up to 15 years . As of March 31, 2019 , we have not included any options to extend or cancel in the calculation of our lease liability or ROU asset. We do not have any significant residual value guarantees or restrictive covenants in our leases. During the three months ended March 31, 2019 , we recognized operating lease expense of $5 million . During the three months ended March 31, 2019 , we paid $5 million to reduce operating lease liabilities and recognized $12 million in new operating lease liabilities in exchange for ROU assets. As of March 31, 2019 , the weighted average remaining lease term on our operating leases was 6.4 years . Future minimum lease payments as of March 31, 2019 and December 31, 2018 were the following: (in millions) March 31, 2019 (2) December 31, 2018 (3) 2019 (1) $ 15 $ 18 2020 17 17 2021 10 11 2022 8 9 2023 8 8 2024 5 5 2025 and thereafter 19 20 Total future minimum lease payments $ 82 $ 88 Less: imputed interest (12 ) N/A (4) Total operating lease liabilities 70 N/A (4) Current portion 16 N/A (4) Non-current portion 54 N/A (4) (1) The remaining payments as of March 31, 2019 exclude those made during the three months ended March 31, 2019. (2) Presented in accordance with ASC 842, which excludes base payments of $3 million for leases that do not yet have a commencement date. (3) Presented in accordance with ASC 840. (4) N/A - Not Applicable under ASC 840. As of March 31, 2019 , we have entered into two leases that have not yet commenced for terms of up to 5 years. Those leases will require minimum lease payments over their terms of $3 million . |
Accrued Workers' Compensation C
Accrued Workers' Compensation Cost | 3 Months Ended |
Mar. 31, 2019 | |
Insurance [Abstract] | |
ACCRUED WORKERS' COMPENSATION COSTS | ACCRUED WORKERS' COMPENSATION COSTS The following table summarizes the accrued workers’ compensation cost activity for the three months ended March 31, 2019 and 2018 : Three Months Ended (in millions) 2019 2018 Total accrued costs, beginning of period $ 238 $ 255 Incurred Current year 19 20 Prior years (5 ) (7 ) Total incurred 14 13 Paid Current year (1 ) — Prior years (15 ) (18 ) Total paid (16 ) (18 ) Total accrued costs, end of period $ 236 $ 250 The following summarizes workers' compensation liabilities on the condensed consolidated balance sheets: (in millions) March 31, 2019 December 31, 2018 Total accrued costs, end of period $ 236 $ 238 Collateral paid to carriers and offset against accrued costs (13 ) (13 ) Total accrued costs, net of carrier collateral offset $ 223 $ 225 Payable in less than 1 year $ 67 $ 67 Payable in more than 1 year 156 158 Total accrued costs, net of carrier collateral offset $ 223 $ 225 Incurred claims related to prior years represent changes in estimates for ultimate losses on workers' compensation claims. For the three months ended March 31, 2019, the change was primarily due to a decrease in estimate of ultimate losses related to older plan years and the recognition of current year development of ultimate losses. As of March 31, 2019 and December 31, 2018 , we had $56 million and $57 million , respectively, of collateral held by insurance carriers of which $ 13 million and $13 million , respectively, was offset against accrued workers' compensation costs as the agreements permit and are net settled against collateral held. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Contingencies In August 2015, Howard Welgus, a purported stockholder, filed a putative securities class action lawsuit, Welgus v. TriNet Group, Inc., et. al., under the Securities Exchange Act of 1934 in the U.S. District Court for the Northern District of California. The complaint was later amended in April 2016 and again in March 2017. On December 18, 2017, the district court granted TriNet’s motion to dismiss the amended complaint in its entirety, without leave to amend. Plaintiff filed a notice of appeal of the district court’s order on January 17, 2018. Plaintiff-Appellant filed his opening appeal brief before the Ninth Circuit Court of Appeals on April 27, 2018. TriNet filed a responsive brief on June 28, 2018. Plaintiff-Appellant filed his reply brief on August 20, 2018. Oral arguments were held before the Ninth Circuit Court of Appeals on March 14, 2019. On March 26, 2019, the Ninth Circuit Court of Appeals affirmed the district court’s dismissal of the amended complaint in its entirety. Plaintiff-Appellant may appeal the decision by the Ninth Circuit Court of Appeals but to date has not done so. We are unable to reasonably estimate the possible loss or expense, or range of losses and expenses, if any, arising from this litigation. We are and, from time to time, have been and may in the future become involved in various litigation matters, legal proceedings, and claims arising in the ordinary course of our business, including disputes with our clients or various class action, collective action, representative action, and other proceedings arising from the nature of our co-employment relationship with our clients and WSEs in which we are named as a defendant. In addition, due to the nature of our co-employment relationship with our clients and WSEs, we could be subject to liability for federal and state law violations, even if we do not participate in such violations. While our agreements with our clients contain indemnification provisions related to the conduct of our clients, we may not be able to avail ourselves of such provisions in every instance. We have accrued our current best estimates of probable losses with respect to these matters, which are individually and in aggregate immaterial to our consolidated financial statements. While the outcome of the matters described above cannot be predicted with certainty, management currently does not believe that any such claims or proceedings or the above-mentioned securities class action will have a materially adverse effect on our consolidated financial position, results of operations, or cash flows. However, the unfavorable resolution of any particular matter or our reassessment of our exposure for any of the above matters based on additional information obtained in the future could have a material impact on our consolidated financial position, results of operations, or cash flows. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | STOCKHOLDERS’ EQUITY Equity-Based Incentive Plans Our 2009 Equity Incentive Plan (the 2009 Plan) provides for the grant of stock awards, including stock options, RSUs, RSAs, and other stock awards. Shares available for grant as of March 31, 2019 were approximately 14 million . Restricted Stock Units (RSUs) and Restricted Stock Awards (RSAs) Time-based RSUs and RSAs generally vest over a four -year term. Performance-based RSUs and RSAs are subject to vesting requirements based on certain financial performance metrics as defined in the grant notice. Actual number of shares earned may range from 0% to 200% of the target award. Awards granted in 2019 and 2018 are based on a single-year performance period subject to subsequent multi-year vesting with 50% of the shares earned vesting in one year after the performance period and the remaining shares in the year after. The following table summarizes RSU and RSA activity under our equity-based plans for the three months ended March 31, 2019 : RSUs RSAs Number of Units Weighted-Average Grant Date Fair Value Number of Units Weighted-Average Grant Date Fair Value Nonvested at December 31, 2018 1,737,554 $ 32.83 346,792 $ 49.13 Granted 669,415 60.43 — — Vested (297,822 ) 28.83 (13,565 ) 50.48 Forfeited (14,908 ) 42.79 (11,103 ) 49.35 Nonvested at March 31, 2019 2,094,239 $ 42.15 322,124 $ 49.20 Equity-Based Compensation Stock-based compensation expense is measured based on the fair value of the stock award on the grant date and recognized over the requisite service period for each separately vesting portion of the stock award. Stock-based compensation expense and other disclosures for stock-based awards made to our employees pursuant to the equity plans was as follows: Three Months Ended March 31, (in millions) 2019 2018 Cost of providing services $ 2 $ 2 Sales and marketing 1 2 General and administrative 5 4 Systems development and programming costs 1 1 Total stock-based compensation expense $ 9 $ 9 Income tax benefit related to stock-based compensation expense $ 3 $ 2 Tax benefit realized from stock options exercise and similar awards $ 2 $ 6 Stock Repurchases In February 2019, our board of directors authorized a $300 million incremental increase to our ongoing stock repurchase program initiated in May 2014. During the three months ended March 31, 2019 , we repurchased 782,909 shares of common stock for approximately $38 million . As of March 31, 2019 , approximately $337 million remained available for further repurchases of our common stock under all authorizations from our board of directors under this program. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Our effective income tax rate was 24% and 20% for the three months ended March 31, 2019 and 2018 , respectively. The increase is primarily due to an increase in nondeductible compensation associated with stock-based compensation and a decrease in excludable income for state tax purposes. During the three months ended March 31, 2019, there was a de minimis change in our unrecognized tax benefits. The total amount of gross interest and penalties accrued was immaterial. It is reasonably possible the amount of the unrecognized benefit could increase or decrease within the next twelve months, which would have an impact on net income. We are subject to tax in U.S. federal and various state and local jurisdictions, as well as Canada. We are not subject to any material income tax examinations in federal or state jurisdictions for tax years prior to January 1, 2012. We previously paid Notices of Proposed Assessments disallowing employment tax credits totaling $11 million, plus interest of $4 million in connection with the IRS examination of Gevity HR, Inc. and its subsidiaries, which was acquired by TriNet in June 2009. TriNet filed suit in June 2016 to recover the disallowed credits, and the issue is being resolved through the litigation process. TriNet and the IRS filed cross motions for summary judgment in this matter in federal district court on February 27, 2018. On September 17, 2018, the district court granted our motion for summary judgment and denied the IRS’ motion. On January 18, 2019, the district court entered judgment in favor of TriNet in the amount of $15 million , plus interest. The IRS filed a notice of appeal of the district court’s decision on March 18, 2019. We will continue to vigorously defend our position through the litigation process. |
Earnings Per Share (EPS)
Earnings Per Share (EPS) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE (EPS) | EARNINGS PER SHAR E (EPS) The following table presents the computation of our basic and diluted EPS attributable to our common stock: Three Months Ended March 31, (in millions, except per share data) 2019 2018 Net income $ 63 $ 54 Weighted average shares of common stock outstanding 70 70 Basic EPS $ 0.91 $ 0.77 Net income $ 63 $ 54 Weighted average shares of common stock 70 70 Dilutive effect of stock options and restricted stock units 1 2 Weighted average shares of common stock outstanding 71 72 Diluted EPS $ 0.89 $ 0.75 Common stock equivalents excluded from income per diluted share because of their anti-dilutive effect 1 1 |
Financial Instruments and Fair
Financial Instruments and Fair Value Measurements | 3 Months Ended |
Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS | FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS Fair Value of Financial Instruments We use an independent pricing source to determine the fair value of our AFS. The independent pricing source utilizes various pricing models for each asset class; including the market approach. The inputs and assumptions for the pricing models are market observable inputs including trades of comparable securities, dealer quotes, credit spreads, yield curves and other market-related data. We have not adjusted the prices obtained from the independent pricing service and we believe the prices received from the independent pricing service are representative of the prices that would be received to sell the assets at the measurement date (exit price). The carrying value of the Company's cash equivalents and restricted cash equivalents approximate their fair values due to their short-term maturities. The Company's restricted investments are valued using quoted market prices and multiple dealer quotes. We did not have any Level 3 financial instruments recognized in our balance sheet as of March 31, 2019 and December 31, 2018 . There were no transfers between levels for the three months ended March 31, 2019 and 2018. Fair Value Measurements on a Recurring Basis The following table summarizes our financial instruments by significant categories and fair value measurement on a recurring basis as of March 31, 2019 and December 31, 2018 . (in millions) Level 1 Level 2 Total March 31, 2019 Cash equivalents: Money market mutual funds $ 74 $ — 74 U.S. treasuries — 3 3 Total cash equivalents 74 3 77 Investments: Asset-backed securities — 35 35 Corporate bonds — 100 100 U.S. government agencies and government-sponsored agencies — 6 6 U.S. treasuries — 42 42 Other debt securities — 6 6 Total investments — 189 189 Restricted cash equivalents: Money market mutual funds 42 — 42 Commercial paper 19 — 19 Total restricted cash equivalents 61 — 61 Restricted investments: U.S. treasuries — 5 5 Exchange traded fund 1 — 1 Certificate of deposit — 2 2 Total restricted investments 1 7 8 Total unrestricted and restricted cash equivalents and investments $ 136 $ 199 $ 335 (in millions) Level 1 Level 2 Total December 31, 2018 Cash equivalents Money market mutual funds $ 4 $ — $ 4 U.S. treasuries — 1 1 Total cash equivalents 4 1 5 Investments Asset-backed securities — 33 33 Corporate bonds — 99 99 U.S. government agencies and government-sponsored agencies — 7 7 U.S. treasuries — 41 41 Other debt securities — 9 9 Total investments — 189 189 Restricted cash equivalents: Money market mutual funds 48 — 48 Commercial paper 20 — 20 Total restricted cash equivalents 68 — 68 Restricted investments: U.S. treasuries — 5 5 Exchange traded fund 1 — 1 Certificate of deposit — 2 2 Total restricted investments 1 7 8 Total unrestricted and restricted cash equivalents and investments $ 73 $ 197 $ 270 Fair Value of Financial Instruments Disclosure Long-Term Debt The carrying value of our long-term debt at March 31, 2019 and December 31, 2018 was $407 million and $414 million , respectively. The estimated fair values of our debt payable at March 31, 2019 and December 31, 2018 were $409 million and $414 million , respectively. The fair value of our debt payable is estimated based on a discounted cash flow, which incorporates credit spreads and market interest rates to estimate the fair value and is considered Level 3 in the hierarchy for fair value measurement. |
Description of Business and S_2
Description of Business and Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Lessee, Leases [Policy Text Block] | Leases We adopted ASU 2016-02 - Leases (ASC 842) effective January 1, 2019 using the optional transition method, under which we recognized the cumulative effects of initially applying the standard as an adjustment to the opening balance of retained earnings on January 1, 2019 with unchanged comparative periods. As part of this adoption, we elected the following practical expedients: • not to reassess 1) whether any contracts that existed prior to adoption have or contain leases, 2) the classification of our existing leases or 3) initial direct costs for existing leases, • to use the practical expedient of using hindsight to determine the lease terms and evaluate any impairments in right-of-use assets upon transition, and • not separately record non-lease and lease components for all leases in which we act as a lessee. We determine if a new contractual arrangement is a lease at contract inception. If a contract contains a lease, we evaluate whether it should be classified as an operating or a finance lease. If applicable as a lease, we record our lease liabilities and ROU assets based on the future minimum lease payments over the lease term and only include options to renew a lease in the minimum lease payments if it is reasonably certain that we will exercise that option. For certain leases with original terms of twelve months or less we recognize the lease expense as incurred and we do not recognize lease liabilities and ROU assets. We measure our lease liabilities based on the future minimum lease payments discounted over the lease term. We determine our discount rate at lease inception using our incremental borrowing rate, which is based on our outstanding term debts that are collateralized by certain corporate assets. As of March 31, 2019 , the weighted-average rate used in discounting the lease liability was 4.6% . We measure our ROU assets based on the associated lease liabilities adjusted for any lease incentives such as tenant improvement allowances and classify operating ROU assets in other assets in our condensed consolidated balance sheet. For operating leases, we recognize expense for lease payments on a straight-line basis over the lease term. |
Segment Information | We operate in one reportable segment. All of our service revenues are generated from external clients. Less than 1% of our revenue is generated outside of the U.S. |
Basis of Presentation | These unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial reporting and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X of the Rules and Regulations of the Securities and Exchange Commission. Certain information and note disclosures included in our annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the condensed consolidated financial statements reflect all adjustments, that are normal and recurring in nature, necessary for fair financial statement presentation. The results of operations for the three months ended March 31, 2019 are not necessarily indicative of the operating results anticipated for the full year. These Financial Statements should be read in conjunction with the audited Consolidated Financial Statements included in Part II, Item 8 Financial Statements and Supplementary Data of our Annual Report on Form 10-K for the year ended December 31, 2018 ( 2018 Form 10-K). |
Reclassifications | Certain prior year amounts have been reclassified to conform to current period presentation. Effects on the cash flow statement due to reclassifications are summarized below: For the Three Months Ended March 31, 2018 (in millions) As previously reported Reclassified amounts As revised Operating activities Changes in operating assets and liabilities: Accounts receivable $ — $ 13 $ 13 Unbilled revenue — 11 11 Prepaid income taxes 13 (13 ) — Prepaid expenses and other current assets (9 ) (2 ) (11 ) Workers' compensation collateral receivable (1 ) 1 — Other assets (2 ) (22 ) (24 ) Accounts payable and other current liabilities (15 ) — (15 ) Client deposits — (26 ) (26 ) Accrued wages — (15 ) (15 ) Accrued corporate wages (9 ) 9 — Accrued health insurance costs — (1 ) (1 ) Accrued workers' compensation costs — (3 ) (3 ) Workers' compensation loss reserves and other non-current liabilities (6 ) 6 — Payroll taxes payable and other payroll withholdings — (534 ) (534 ) Other liabilities — (4 ) (4 ) Worksite employee related assets (14 ) 14 — Worksite employee related liabilities (566 ) 566 — Interest income previously classified in other income (expense), net is now presented in a new line item. Depreciation expense and amortization of intangible assets previously reported separately, are now presented together as depreciation and amortization of intangible assets. |
Use of Estimates | The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect certain reported amounts and related disclosures. Significant estimates include: • liability for unpaid losses and loss adjustment expenses (accrued workers' compensation costs) related to workers' compensation and workers' compensation collateral receivable, • accrued health insurance costs, • liability for insurance premiums payable, • Valuation of the investment portfolio, • impairments of goodwill and other intangible assets, • income tax assets and liabilities, and • liability for legal contingencies. These estimates are based on historical experience and on various other assumptions that we believe to be reasonable from the facts available to us. Some of the assumptions are highly uncertain at the time of estimation. To the extent actual experience differs from the assumptions used, our consolidated financial statements could be materially affected. Accrued Health Insurance Costs We sponsor and administer a number of fully insured, risk-based employee benefit plans, including group health, dental, and vision as an employer plan sponsor under section 3(5) of the ERISA. In Q1 2019, the majority of our group health insurance costs related to risk-based plans. Our remaining group health insurance costs were for guaranteed-cost policies. Accrued health insurance costs are established to provide for the estimated unpaid costs of reimbursing the carriers for paying claims within the deductible layer in accordance with risk-based health insurance policies. These accrued costs include estimates for reported losses, plus estimates for claims incurred but not paid. We assess accrued health insurance costs regularly based upon independent actuarial studies that include other relevant factors such as current and historical claims payment patterns, plan enrollment and medical trend rates. In certain carrier contracts we are required to prepay the expected claims activity for the subsequent period. These prepaid balances by agreement permit net settlement of obligations and offset the accrued health insurance costs or when the prepaid is in excess of our recorded liability the net asset position is included in prepaid expenses. As of March 31, 2019 and December 31, 2018 , prepayments included in accrued health insurance costs were $39 million and $33 million , respectively. Under certain policies, based on plan performance, we may be entitled to receive refunds of premiums which we recognize in accordance with the policy terms. We estimate these refunds based on premium and claims data and record as a reduction in the insurance costs on the consolidated statements of income and comprehensive income and prepaid expenses on the consolidated balance sheets. As of March 31, 2019 and December 31, 2018 , there were no prepaid insurance premiums included in prepaid expenses. |
Recent Accounting Pronouncements | Recently adopted accounting guidance Leases - In February of 2016, the FASB issued ASC 842, which replaced existing lease guidance under GAAP. Under this guidance, we recognize on our condensed balance sheet lease liabilities representing the present value of future lease payments and an associated right-of-use asset representing our right to use or control the use of specified assets for the lease term for any operating lease with a term greater than one year. The impact of our adoption of ASC 842 did not have a material impact on our income statement or cash flow statement. The impact on our condensed balance sheets is as follows: March 31, 2019 (in millions) As reported Balance Using Previous Standard Increase (Decrease) Balance sheet Assets Operating lease right-of-use assets $ 59 $ — $ 59 Liabilities Operating lease liabilities 16 — 16 Operating lease liabilities, noncurrent 54 11 43 Equity Accumulated deficit $ (245 ) $ (245 ) $ — Recently issued accounting pronouncements Credit Losses - In June 2016, the FASB issued ASU 2016-13 - Financial Instruments - Credit Losses (Topic 326), which requires financial assets to be presented at the net amount expected to be collected. We will be required to use forward-looking information when evaluating an allowance for our accounts receivable, unbilled revenue and other financial assets measured at amortized cost. Topic 326 also modifies the impairment guidance for available-for-sale debt securities to require an allowance for credit losses. We will adopt Topic 326 effective January 1, 2020 using a modified retrospective approach through a cumulative-effect adjustment to retained earnings. We are currently evaluating the impact of this standard on our consolidated financial statements, including accounting policies, processes, and systems. |
Fair Value Measurement | Fair Value of Financial Instruments We use an independent pricing source to determine the fair value of our AFS. The independent pricing source utilizes various pricing models for each asset class; including the market approach. The inputs and assumptions for the pricing models are market observable inputs including trades of comparable securities, dealer quotes, credit spreads, yield curves and other market-related data. We have not adjusted the prices obtained from the independent pricing service and we believe the prices received from the independent pricing service are representative of the prices that would be received to sell the assets at the measurement date (exit price). |
Description of Business and S_3
Description of Business and Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Effects on cash flow due to new accounting pronouncements | Effects on the cash flow statement due to reclassifications are summarized below: For the Three Months Ended March 31, 2018 (in millions) As previously reported Reclassified amounts As revised Operating activities Changes in operating assets and liabilities: Accounts receivable $ — $ 13 $ 13 Unbilled revenue — 11 11 Prepaid income taxes 13 (13 ) — Prepaid expenses and other current assets (9 ) (2 ) (11 ) Workers' compensation collateral receivable (1 ) 1 — Other assets (2 ) (22 ) (24 ) Accounts payable and other current liabilities (15 ) — (15 ) Client deposits — (26 ) (26 ) Accrued wages — (15 ) (15 ) Accrued corporate wages (9 ) 9 — Accrued health insurance costs — (1 ) (1 ) Accrued workers' compensation costs — (3 ) (3 ) Workers' compensation loss reserves and other non-current liabilities (6 ) 6 — Payroll taxes payable and other payroll withholdings — (534 ) (534 ) Other liabilities — (4 ) (4 ) Worksite employee related assets (14 ) 14 — Worksite employee related liabilities (566 ) 566 — |
Effect of Adoption of ASU 2016-02 | March 31, 2019 (in millions) As reported Balance Using Previous Standard Increase (Decrease) Balance sheet Assets Operating lease right-of-use assets $ 59 $ — $ 59 Liabilities Operating lease liabilities 16 — 16 Operating lease liabilities, noncurrent 54 11 43 Equity Accumulated deficit $ (245 ) $ (245 ) $ — |
Cash, Cash Equivalents and In_2
Cash, Cash Equivalents and Investments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Cash and Cash Equivalents [Abstract] | |
Summary of Cash, Cash Equivalents and Investments | Our total cash, cash equivalents and investments are summarized below: March 31, 2019 December 31, 2018 (in millions) Cash and cash equivalents Available-for-sale marketable securities Certificate of deposits Total Cash and cash equivalents Available-for-sale marketable securities Certificate of deposits Total Cash and cash equivalents $ 251 $ — $ — $ 251 $ 228 $ — $ — $ 228 Investments — 56 — 56 — 54 — 54 Restricted cash, cash equivalents and investments Insurance carriers' security deposits 15 — — 15 15 — — 15 Payroll funds collected 564 — — 564 783 — — 783 Collateral for health benefits claims 75 — — 75 75 — — 75 Collateral for workers' compensation claims 65 1 — 66 66 1 — 67 Collateral to secure standby letter of credit — — 2 2 — — 2 2 Total restricted cash, cash equivalents and investments 719 1 2 722 939 1 2 942 Investments, noncurrent — 133 — 133 — 135 — 135 Restricted cash, cash equivalents and investments, noncurrent Collateral for workers' compensation claims 179 5 — 184 182 5 — 187 Total $ 1,149 $ 195 $ 2 $ 1,346 $ 1,349 $ 195 $ 2 $ 1,546 |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Amortized Cost, Gross Unrealized Gains and Losses, Fair Values of Investments | The amortized cost, gross unrealized gains, gross unrealized losses, and fair values of our investments as of March 31, 2019 and December 31, 2018 are presented below. March 31, 2019 December 31, 2018 (in millions) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Asset-backed securities $ 35 $ — $ — $ 35 $ 33 $ — $ — $ 33 Corporate bonds 100 — — 100 99 — — 99 U.S. government agencies and government- sponsored agencies 6 — — 6 7 — — 7 U.S. treasuries 47 — — 47 46 — — 46 Exchange traded fund 1 — — 1 1 — — 1 Other debt securities 6 — — 6 9 — — 9 Total $ 195 $ — $ — $ 195 $ 195 $ — $ — $ 195 |
Fair Value of Debt Investments by Contractual Maturity | The fair value of debt investments by contractual maturity are shown below: (in millions) March 31, 2019 One year or less $ 61 Over one year through five years 117 Over five years through ten years 7 Over ten years 9 Total fair value $ 194 |
Proceeds from available-for-sale securities | The gross proceeds from sales and maturities of AFS securities for the three months ended March 31, 2019 and March 31, 2018 are presented below. Three Months Ended (in millions) 2019 2018 Gross proceeds from sales $ 14 $ — Gross proceeds from maturities 17 14 Total $ 31 $ 14 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Operating lease payments | Future minimum lease payments as of March 31, 2019 and December 31, 2018 were the following: (in millions) March 31, 2019 (2) December 31, 2018 (3) 2019 (1) $ 15 $ 18 2020 17 17 2021 10 11 2022 8 9 2023 8 8 2024 5 5 2025 and thereafter 19 20 Total future minimum lease payments $ 82 $ 88 Less: imputed interest (12 ) N/A (4) Total operating lease liabilities 70 N/A (4) Current portion 16 N/A (4) Non-current portion 54 N/A (4) (1) The remaining payments as of March 31, 2019 exclude those made during the three months ended March 31, 2019. (2) Presented in accordance with ASC 842, which excludes base payments of $3 million for leases that do not yet have a commencement date. (3) Presented in accordance with ASC 840. (4) N/A - Not Applicable under ASC 840. |
Accrued Workers' Compensation_2
Accrued Workers' Compensation Cost (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Insurance [Abstract] | |
Summary of Activities in Liability for Unpaid Claims and Claims Adjustment Expenses | The following table summarizes the accrued workers’ compensation cost activity for the three months ended March 31, 2019 and 2018 : Three Months Ended (in millions) 2019 2018 Total accrued costs, beginning of period $ 238 $ 255 Incurred Current year 19 20 Prior years (5 ) (7 ) Total incurred 14 13 Paid Current year (1 ) — Prior years (15 ) (18 ) Total paid (16 ) (18 ) Total accrued costs, end of period $ 236 $ 250 The following summarizes workers' compensation liabilities on the condensed consolidated balance sheets: (in millions) March 31, 2019 December 31, 2018 Total accrued costs, end of period $ 236 $ 238 Collateral paid to carriers and offset against accrued costs (13 ) (13 ) Total accrued costs, net of carrier collateral offset $ 223 $ 225 Payable in less than 1 year $ 67 $ 67 Payable in more than 1 year 156 158 Total accrued costs, net of carrier collateral offset $ 223 $ 225 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Restricted Stock Unit and Restricted Stock Award Activity Under Equity-Based Plans | The following table summarizes RSU and RSA activity under our equity-based plans for the three months ended March 31, 2019 : RSUs RSAs Number of Units Weighted-Average Grant Date Fair Value Number of Units Weighted-Average Grant Date Fair Value Nonvested at December 31, 2018 1,737,554 $ 32.83 346,792 $ 49.13 Granted 669,415 60.43 — — Vested (297,822 ) 28.83 (13,565 ) 50.48 Forfeited (14,908 ) 42.79 (11,103 ) 49.35 Nonvested at March 31, 2019 2,094,239 $ 42.15 322,124 $ 49.20 |
Performance Stock Unit and Performance Stock Award Activity Under Equity-Based Plans | The following table summarizes RSU and RSA activity under our equity-based plans for the three months ended March 31, 2019 : RSUs RSAs Number of Units Weighted-Average Grant Date Fair Value Number of Units Weighted-Average Grant Date Fair Value Nonvested at December 31, 2018 1,737,554 $ 32.83 346,792 $ 49.13 Granted 669,415 60.43 — — Vested (297,822 ) 28.83 (13,565 ) 50.48 Forfeited (14,908 ) 42.79 (11,103 ) 49.35 Nonvested at March 31, 2019 2,094,239 $ 42.15 322,124 $ 49.20 |
Stock-based Compensation Expense | Stock-based compensation expense and other disclosures for stock-based awards made to our employees pursuant to the equity plans was as follows: Three Months Ended March 31, (in millions) 2019 2018 Cost of providing services $ 2 $ 2 Sales and marketing 1 2 General and administrative 5 4 Systems development and programming costs 1 1 Total stock-based compensation expense $ 9 $ 9 Income tax benefit related to stock-based compensation expense $ 3 $ 2 Tax benefit realized from stock options exercise and similar awards $ 2 $ 6 |
Earnings Per Share (EPS) (Table
Earnings Per Share (EPS) (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted EPS | The following table presents the computation of our basic and diluted EPS attributable to our common stock: Three Months Ended March 31, (in millions, except per share data) 2019 2018 Net income $ 63 $ 54 Weighted average shares of common stock outstanding 70 70 Basic EPS $ 0.91 $ 0.77 Net income $ 63 $ 54 Weighted average shares of common stock 70 70 Dilutive effect of stock options and restricted stock units 1 2 Weighted average shares of common stock outstanding 71 72 Diluted EPS $ 0.89 $ 0.75 Common stock equivalents excluded from income per diluted share because of their anti-dilutive effect 1 1 |
Financial Instruments and Fai_2
Financial Instruments and Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of Financial Instruments by Significant Categories and Fair Value Measurement on a Recurring Basis | The following table summarizes our financial instruments by significant categories and fair value measurement on a recurring basis as of March 31, 2019 and December 31, 2018 . (in millions) Level 1 Level 2 Total March 31, 2019 Cash equivalents: Money market mutual funds $ 74 $ — 74 U.S. treasuries — 3 3 Total cash equivalents 74 3 77 Investments: Asset-backed securities — 35 35 Corporate bonds — 100 100 U.S. government agencies and government-sponsored agencies — 6 6 U.S. treasuries — 42 42 Other debt securities — 6 6 Total investments — 189 189 Restricted cash equivalents: Money market mutual funds 42 — 42 Commercial paper 19 — 19 Total restricted cash equivalents 61 — 61 Restricted investments: U.S. treasuries — 5 5 Exchange traded fund 1 — 1 Certificate of deposit — 2 2 Total restricted investments 1 7 8 Total unrestricted and restricted cash equivalents and investments $ 136 $ 199 $ 335 (in millions) Level 1 Level 2 Total December 31, 2018 Cash equivalents Money market mutual funds $ 4 $ — $ 4 U.S. treasuries — 1 1 Total cash equivalents 4 1 5 Investments Asset-backed securities — 33 33 Corporate bonds — 99 99 U.S. government agencies and government-sponsored agencies — 7 7 U.S. treasuries — 41 41 Other debt securities — 9 9 Total investments — 189 189 Restricted cash equivalents: Money market mutual funds 48 — 48 Commercial paper 20 — 20 Total restricted cash equivalents 68 — 68 Restricted investments: U.S. treasuries — 5 5 Exchange traded fund 1 — 1 Certificate of deposit — 2 2 Total restricted investments 1 7 8 Total unrestricted and restricted cash equivalents and investments $ 73 $ 197 $ 270 |
Description of Business and S_4
Description of Business and Significant Accounting Policies - Effects on cash flow due to new accounting pronouncements (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Accounts receivable | $ 1 | $ 13 |
Unbilled revenue | (9) | 11 |
Prepaid income taxes | 0 | |
Prepaid expenses and other current assets | (12) | (11) |
Workers' compensation collateral receivable | 0 | |
Other assets | (30) | (24) |
Accounts payable and other current liabilities | 9 | (15) |
Client deposits | (19) | (26) |
Accrued wages | 17 | (15) |
Accrued corporate wages | 0 | |
Accrued health insurance costs | 0 | (1) |
Accrued workers' compensation costs | (2) | (3) |
Workers' compensation loss reserves and other non-current liabilities | 0 | |
Payroll taxes payable and other payroll withholdings | (534) | |
Other liabilities | $ (3) | (4) |
Worksite employee related assets | 0 | |
Worksite employee related liabilities | 0 | |
As previously reported | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Accounts receivable | 0 | |
Unbilled revenue | 0 | |
Prepaid income taxes | 13 | |
Prepaid expenses and other current assets | (9) | |
Workers' compensation collateral receivable | (1) | |
Other assets | (2) | |
Accounts payable and other current liabilities | (15) | |
Client deposits | 0 | |
Accrued wages | 0 | |
Accrued corporate wages | (9) | |
Accrued health insurance costs | 0 | |
Accrued workers' compensation costs | 0 | |
Workers' compensation loss reserves and other non-current liabilities | (6) | |
Payroll taxes payable and other payroll withholdings | 0 | |
Other liabilities | 0 | |
Worksite employee related assets | 14 | |
Worksite employee related liabilities | (566) | |
Reclassified amounts | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Accounts receivable | 13 | |
Unbilled revenue | 11 | |
Prepaid income taxes | (13) | |
Prepaid expenses and other current assets | (2) | |
Workers' compensation collateral receivable | 1 | |
Other assets | (22) | |
Accounts payable and other current liabilities | 0 | |
Client deposits | (26) | |
Accrued wages | (15) | |
Accrued corporate wages | 9 | |
Accrued health insurance costs | (1) | |
Accrued workers' compensation costs | (3) | |
Workers' compensation loss reserves and other non-current liabilities | 6 | |
Payroll taxes payable and other payroll withholdings | (534) | |
Other liabilities | (4) | |
Worksite employee related assets | 14 | |
Worksite employee related liabilities | $ 566 |
Description of Business and S_5
Description of Business and Significant Accounting Policies - Additional Information (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2019USD ($)segment | Dec. 31, 2018USD ($) | |
Product Information [Line Items] | ||
Operating Lease, Weighted Average Discount Rate, Percent | 4.60% | |
Number of reportable segments | segment | 1 | |
Prepaid Insurance | $ | $ 39 | $ 33 |
Non-US | Revenue | Foreign Sales | ||
Product Information [Line Items] | ||
Percent of concentration risk | 1.00% |
Description of Business and S_6
Description of Business and Significant Accounting Policies - Effect of Adoption of ASU 2016-02 As Reported (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
New Accounting Pronouncement, Early Adoption [Line Items] | ||
Operating lease right-of-use asset | $ 59,000,000 | $ 0 |
Operating lease liabilities | 16,000,000 | 0 |
Operating lease liabilities, noncurrent | 54,000,000 | 0 |
Accumulated deficit | (245,000,000) | $ (266,000,000) |
Balance Using Previous Standard | ||
New Accounting Pronouncement, Early Adoption [Line Items] | ||
Operating lease right-of-use asset | 0 | |
Operating lease liabilities | 0 | |
Operating lease liabilities, noncurrent | 11,000,000 | |
Accumulated deficit | (245,000,000) | |
Accounting Standards Update 2016-02 | Increase (Decrease) | ||
New Accounting Pronouncement, Early Adoption [Line Items] | ||
Operating lease right-of-use asset | 59,000,000 | |
Operating lease liabilities | 16,000,000 | |
Operating lease liabilities, noncurrent | 43,000,000 | |
Accumulated deficit | $ 0 |
Cash, Cash Equivalents and In_3
Cash, Cash Equivalents and Investments (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Cash and cash equivalents | $ 251 | $ 228 |
Investments | 56 | 54 |
Restricted cash, cash equivalents and investments | 722 | 942 |
Investments, noncurrent | 133 | 135 |
Restricted cash, cash equivalents and investments, noncurrent | 184 | 187 |
Total unrestricted and restricted cash equivalents and investments | 1,346 | 1,546 |
Cash and cash equivalents | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Cash and cash equivalents | 251 | 228 |
Investments | 0 | 0 |
Restricted cash, cash equivalents and investments | 719 | 939 |
Investments, noncurrent | 0 | 0 |
Total unrestricted and restricted cash equivalents and investments | 1,149 | 1,349 |
Available-for-sale marketable securities | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Cash and cash equivalents | 0 | 0 |
Investments | 56 | 54 |
Restricted cash, cash equivalents and investments | 1 | 1 |
Investments, noncurrent | 133 | 135 |
Total unrestricted and restricted cash equivalents and investments | 195 | 195 |
Certificate of deposits | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Cash and cash equivalents | 0 | 0 |
Investments | 0 | 0 |
Restricted cash, cash equivalents and investments | 2 | 2 |
Investments, noncurrent | 0 | 0 |
Total unrestricted and restricted cash equivalents and investments | 2 | 2 |
Insurance carriers' security deposits | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 15 | 15 |
Insurance carriers' security deposits | Cash and cash equivalents | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 15 | 15 |
Insurance carriers' security deposits | Available-for-sale marketable securities | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 0 | 0 |
Insurance carriers' security deposits | Certificate of deposits | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 0 | 0 |
Payroll funds collected | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 564 | 783 |
Payroll funds collected | Cash and cash equivalents | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 564 | 783 |
Payroll funds collected | Available-for-sale marketable securities | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 0 | 0 |
Payroll funds collected | Certificate of deposits | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 0 | 0 |
Collateral for health benefits claims | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 75 | 75 |
Collateral for health benefits claims | Cash and cash equivalents | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 75 | 75 |
Collateral for health benefits claims | Available-for-sale marketable securities | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 0 | 0 |
Collateral for health benefits claims | Certificate of deposits | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 0 | 0 |
Collateral for workers' compensation claims | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 66 | 67 |
Restricted cash, cash equivalents and investments, noncurrent | 184 | 187 |
Collateral for workers' compensation claims | Cash and cash equivalents | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 65 | 66 |
Restricted cash, cash equivalents and investments, noncurrent | 179 | 182 |
Collateral for workers' compensation claims | Available-for-sale marketable securities | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 1 | 1 |
Restricted cash, cash equivalents and investments, noncurrent | 5 | 5 |
Collateral for workers' compensation claims | Certificate of deposits | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 0 | 0 |
Restricted cash, cash equivalents and investments, noncurrent | 0 | 0 |
Collateral to secure standby letter of credit | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 2 | 2 |
Collateral to secure standby letter of credit | Cash and cash equivalents | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 0 | 0 |
Collateral to secure standby letter of credit | Available-for-sale marketable securities | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | 0 | 0 |
Collateral to secure standby letter of credit | Certificate of deposits | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash, cash equivalents and investments | $ 2 | $ 2 |
Investments - Amortized Cost, G
Investments - Amortized Cost, Gross Unrealized Gains and Losses, Fair Values of Investments (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Debt and Equity Securities | ||
Amortized Cost | $ 195 | $ 195 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 195 | 195 |
Asset-backed securities | ||
Debt Securities | ||
Amortized Cost | 35 | 33 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 35 | 33 |
Corporate bonds | ||
Debt Securities | ||
Amortized Cost | 100 | 99 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 100 | 99 |
U.S. government agencies and government- sponsored agencies | ||
Debt Securities | ||
Amortized Cost | 6 | 7 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 6 | 7 |
U.S. treasuries | ||
Debt Securities | ||
Amortized Cost | 47 | 46 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 47 | 46 |
Exchange traded fund | ||
Equity Securities | ||
Amortized Cost | 1 | 1 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | 1 | 1 |
Other debt securities | ||
Debt Securities | ||
Amortized Cost | 6 | 9 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Fair Value | $ 6 | $ 9 |
Investments - Fair Value of Deb
Investments - Fair Value of Debt Investments by Contractual Maturity (Details) $ in Millions | Mar. 31, 2019USD ($) |
Investments, Debt and Equity Securities [Abstract] | |
One year or less | $ 61 |
Over one year through five years | 117 |
Over five years through ten years | 7 |
Over ten years | 9 |
Total fair value | $ 194 |
Investments Proceeds from avail
Investments Proceeds from available-for-sale securities (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | ||
Gross proceeds from sales | $ 14 | $ 0 |
Gross proceeds from maturities | 17 | 14 |
Total | $ 31 | $ 14 |
Leases (Details)
Leases (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2019USD ($)Lease | Dec. 31, 2018USD ($) | |
Operating Leased Assets [Line Items] | ||
Operating Lease Cost | $ 5 | |
Operating Lease, Payments | 5 | |
Operating lease right-of-use asset | 12 | |
Future Minimum Payments Due | $ 3 | |
Lease Term ( in years ) | 6 years 4 months 17 days | |
Term of Contract ( in years ) | 5 years | |
Renewal Term ( in years ) | 15 years | |
Less: imputed interest | $ 12 | $ 0 |
Operating lease liabilities | 16 | 0 |
Operating lease liabilities, noncurrent | $ 54 | $ 0 |
Number of Operating Lease ( in leases ) | Lease | 2 | |
Minimum | ||
Operating Leased Assets [Line Items] | ||
Term of Contract ( in years ) | 1 year | |
Maximum | ||
Operating Leased Assets [Line Items] | ||
Term of Contract ( in years ) | 9 years 6 months |
Leases - Operating lease paymen
Leases - Operating lease payments (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Leases [Abstract] | ||
2019 | $ 15 | $ 18 |
2020 | 17 | 17 |
2021 | 10 | 11 |
2022 | 8 | 9 |
2023 | 8 | 8 |
2024 | 5 | 5 |
2025 and thereafter | 19 | 20 |
Total future minimum lease payments | 82 | 88 |
Less: imputed interest | (12) | 0 |
Total operating lease liabilities | 70 | 0 |
Operating lease liabilities | 16 | 0 |
Operating lease liabilities, noncurrent | $ 54 | $ 0 |
Accrued Workers' Compensation_3
Accrued Workers' Compensation Cost - Summary of Workers' Compensation Loss Reserve Activity (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ||
Total accrued costs, beginning of period | $ 238 | $ 255 |
Incurred | ||
Current year | 19 | 20 |
Prior years | (5) | (7) |
Total incurred | 14 | 13 |
Paid | ||
Current year | (1) | 0 |
Prior years | (15) | (18) |
Total paid | (16) | (18) |
Total accrued costs, end of period | $ (236) | $ 250 |
Accrued Workers' Compensation_4
Accrued Workers' Compensation Cost - Summary of Workers' Compensation Liabilities (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Total accrued costs, end of period | $ 236 | $ 238 | $ (250) | $ 255 |
Collateral paid to carriers and offset against accrued costs | (13) | (13) | ||
Total accrued costs, net of carrier collateral offset | 223 | 225 | ||
Payable in less than 1 year (net of collateral paid to carriers of $4 and $3 at March 31, 2019 and December 31, 2018, respectively) | 67 | 67 | ||
Payable in more than 1 year (net of collateral paid to carriers of $9 and $10 at March 31, 2019 and December 31, 2018, respectively) | 156 | 158 | ||
Worksite Employee [Member] | ||||
Condensed Balance Sheet Statements, Captions [Line Items] | ||||
Payable in less than 1 year (net of collateral paid to carriers of $4 and $3 at March 31, 2019 and December 31, 2018, respectively) | 67 | 67 | ||
Payable in more than 1 year (net of collateral paid to carriers of $9 and $10 at March 31, 2019 and December 31, 2018, respectively) | $ 156 | $ 158 |
Accrued Workers' Compensation_5
Accrued Workers' Compensation Cost - Additional Information (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Financial Guarantee Insurance Contracts, Claim Liability [Line Items] | ||
Collateral held by insurance carriers | $ 56 | $ 57 |
Liability For Unpaid Claims And Claims Adjustment Expense, Collateral | $ 13 | 13 |
Collateral for workers' compensation claims | ||
Financial Guarantee Insurance Contracts, Claim Liability [Line Items] | ||
Liability For Unpaid Claims And Claims Adjustment Expense, Collateral | $ 13 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Feb. 06, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock Repurchase Program, Authorized Amount | $ 300 | ||
Number of shares available for grant (in shares) | 14,000,000 | ||
Repurchase of common stock (in shares) | 782,909 | ||
Stock repurchased during period | $ 38 | $ 8 | |
Amount available for further repurchases under stock repurchase program | $ 337 | ||
Time-Based Restricted Stock Units and Restricted Stock Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 4 years | ||
Performance-Based Restricted Stock Units and Restricted Stock Awards [Member] | Tranche 1 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 1 year | ||
Vesting percentage | 50.00% | ||
Minimum | Time-Based Restricted Stock Units and Restricted Stock Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Purchase Price of Common Stock, Percent | 0.00% | ||
Maximum | Time-Based Restricted Stock Units and Restricted Stock Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Purchase Price of Common Stock, Percent | 200.00% |
Stockholders' Equity - RSU, RSA
Stockholders' Equity - RSU, RSA Activity Under Equity-Based Plans (Details) | 3 Months Ended |
Mar. 31, 2019$ / sharesshares | |
RSUs | |
Number of Units | |
Nonvested At Dec 31, 2018 (in shares) | shares | 1,737,554 |
Granted (in shares) | shares | 669,415 |
Vested (in shares) | shares | (297,822) |
Forfeited (in shares) | shares | (14,908) |
Nonvested At Mar 31, 2019 (in shares) | shares | 2,094,239 |
Weighted-Average Grant Date Fair Value | |
Nonvested At Dec 31, 2018 (in dollars per share) | $ / shares | $ 32.83 |
Granted (in dollars per share) | $ / shares | 60.43 |
Vested (in dollars per share) | $ / shares | 28.83 |
Forfeited (in dollars per share) | $ / shares | 42.79 |
Nonvested At Mar 31, 2019 (in dollars per share) | $ / shares | $ 42.15 |
RSAs | |
Number of Units | |
Nonvested At Dec 31, 2018 (in shares) | shares | 346,792 |
Granted (in shares) | shares | 0 |
Vested (in shares) | shares | (13,565) |
Forfeited (in shares) | shares | (11,103) |
Nonvested At Mar 31, 2019 (in shares) | shares | 322,124 |
Weighted-Average Grant Date Fair Value | |
Nonvested At Dec 31, 2018 (in dollars per share) | $ / shares | $ 49.13 |
Granted (in dollars per share) | $ / shares | 0 |
Vested (in dollars per share) | $ / shares | 50.48 |
Forfeited (in dollars per share) | $ / shares | 49.35 |
Nonvested At Mar 31, 2019 (in dollars per share) | $ / shares | $ 49.20 |
Stockholders' Equity - Stock-Ba
Stockholders' Equity - Stock-Based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 9 | $ 9 |
Income tax benefit related to stock-based compensation expense | 3 | 2 |
Tax benefit realized from stock options exercise and similar awards | 2 | 6 |
Cost of providing services | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | 2 | 2 |
Sales and marketing | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | 1 | 2 |
General and administrative | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | 5 | 4 |
Systems development and programming costs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 1 | $ 1 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | Jan. 18, 2019 | Mar. 31, 2019 | Mar. 31, 2018 |
Income Tax Contingency [Line Items] | |||
Effective income tax rate | 24.00% | 20.00% | |
Income Tax Credits and Adjustments | $ 15 | ||
Internal Revenue Service | |||
Income Tax Contingency [Line Items] | |||
Disallowed employment tax credits | $ 11 | ||
Interest on disallowed employment tax credits | $ 4 |
Earnings Per Share (EPS) - Comp
Earnings Per Share (EPS) - Computation of Basic and Diluted EPS Attributable to Common Stock (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Basic EPS | ||
Net income | $ 63 | $ 54 |
Weighted average shares of common stock outstanding (in shares) | 69,909,984 | 70,047,752 |
Basic earnings per share (in dollars per share) | $ 0.91 | $ 0.77 |
Diluted EPS | ||
Net income | $ 63 | $ 54 |
Weighted average shares of common stock outstanding (in shares) | 69,909,984 | 70,047,752 |
Dilutive effect of stock options and restricted stock units (in shares) | 1,000,000 | 2,000,000 |
Weighted average shares of common stock outstanding (in shares) | 71,247,427 | 72,274,821 |
Diluted earnings per share (in dollars per share) | $ 0.89 | $ 0.75 |
Common stock equivalents excluded from income per diluted share because of their anti-dilutive effect ( in shares ) | 1,000,000 | 1,000,000 |
Financial Instruments and Fai_3
Financial Instruments and Fair Value Measurements - Summary of Financial Instruments by Significant Categories and Fair Value Measurement on a Recurring Basis (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Fair Value, Financial Instruments [Line Items] | ||
Total unrestricted and restricted cash equivalents and investments | $ 1,346 | $ 1,546 |
Fair Value Measurement on a Recurring Basis | ||
Fair Value, Financial Instruments [Line Items] | ||
Cash equivalents | 77 | 5 |
Investments | 189 | 189 |
Restricted cash equivalents | 61 | 68 |
Restricted investments | 8 | 8 |
Total unrestricted and restricted cash equivalents and investments | 335 | 270 |
Fair Value Measurement on a Recurring Basis | Level 1 | ||
Fair Value, Financial Instruments [Line Items] | ||
Cash equivalents | 74 | 4 |
Investments | 0 | 0 |
Restricted cash equivalents | 61 | 68 |
Restricted investments | 1 | 1 |
Total unrestricted and restricted cash equivalents and investments | 136 | 73 |
Fair Value Measurement on a Recurring Basis | Level 2 | ||
Fair Value, Financial Instruments [Line Items] | ||
Cash equivalents | 3 | 1 |
Investments | 189 | 189 |
Restricted cash equivalents | 0 | 0 |
Restricted investments | 7 | 7 |
Total unrestricted and restricted cash equivalents and investments | 199 | 197 |
Asset-backed securities | Fair Value Measurement on a Recurring Basis | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 35 | 33 |
Asset-backed securities | Fair Value Measurement on a Recurring Basis | Level 1 | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 0 | 0 |
Asset-backed securities | Fair Value Measurement on a Recurring Basis | Level 2 | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 35 | 33 |
Corporate bonds | Fair Value Measurement on a Recurring Basis | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 100 | 99 |
Corporate bonds | Fair Value Measurement on a Recurring Basis | Level 1 | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 0 | 0 |
Corporate bonds | Fair Value Measurement on a Recurring Basis | Level 2 | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 100 | 99 |
U.S. government agencies and government- sponsored agencies | Fair Value Measurement on a Recurring Basis | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 6 | 7 |
U.S. government agencies and government- sponsored agencies | Fair Value Measurement on a Recurring Basis | Level 1 | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 0 | 0 |
U.S. government agencies and government- sponsored agencies | Fair Value Measurement on a Recurring Basis | Level 2 | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 6 | 7 |
U.S. treasuries | Fair Value Measurement on a Recurring Basis | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 42 | 41 |
Restricted investments | 5 | 5 |
U.S. treasuries | Fair Value Measurement on a Recurring Basis | Level 1 | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 0 | 0 |
Restricted investments | 0 | 0 |
U.S. treasuries | Fair Value Measurement on a Recurring Basis | Level 2 | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 42 | 41 |
Restricted investments | 5 | 5 |
Other debt securities | Fair Value Measurement on a Recurring Basis | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 6 | 9 |
Other debt securities | Fair Value Measurement on a Recurring Basis | Level 1 | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 0 | 0 |
Other debt securities | Fair Value Measurement on a Recurring Basis | Level 2 | ||
Fair Value, Financial Instruments [Line Items] | ||
Investments | 6 | 9 |
Exchange traded fund | Fair Value Measurement on a Recurring Basis | ||
Fair Value, Financial Instruments [Line Items] | ||
Restricted investments | 1 | 1 |
Exchange traded fund | Fair Value Measurement on a Recurring Basis | Level 1 | ||
Fair Value, Financial Instruments [Line Items] | ||
Restricted investments | 1 | 1 |
Exchange traded fund | Fair Value Measurement on a Recurring Basis | Level 2 | ||
Fair Value, Financial Instruments [Line Items] | ||
Restricted investments | 0 | 0 |
Certificate of deposit | ||
Fair Value, Financial Instruments [Line Items] | ||
Total unrestricted and restricted cash equivalents and investments | 2 | 2 |
Certificate of deposit | Fair Value Measurement on a Recurring Basis | ||
Fair Value, Financial Instruments [Line Items] | ||
Restricted investments | 2 | 2 |
Certificate of deposit | Fair Value Measurement on a Recurring Basis | Level 1 | ||
Fair Value, Financial Instruments [Line Items] | ||
Restricted investments | 0 | 0 |
Certificate of deposit | Fair Value Measurement on a Recurring Basis | Level 2 | ||
Fair Value, Financial Instruments [Line Items] | ||
Restricted investments | 2 | 2 |
Money market mutual funds | Fair Value Measurement on a Recurring Basis | ||
Fair Value, Financial Instruments [Line Items] | ||
Cash equivalents | 74 | 4 |
Restricted cash equivalents | 42 | 48 |
Money market mutual funds | Fair Value Measurement on a Recurring Basis | Level 1 | ||
Fair Value, Financial Instruments [Line Items] | ||
Cash equivalents | 74 | 4 |
Restricted cash equivalents | 42 | 48 |
Money market mutual funds | Fair Value Measurement on a Recurring Basis | Level 2 | ||
Fair Value, Financial Instruments [Line Items] | ||
Cash equivalents | 0 | 0 |
Restricted cash equivalents | 0 | 0 |
U.S. treasuries | Fair Value Measurement on a Recurring Basis | ||
Fair Value, Financial Instruments [Line Items] | ||
Cash equivalents | 3 | 1 |
U.S. treasuries | Fair Value Measurement on a Recurring Basis | Level 1 | ||
Fair Value, Financial Instruments [Line Items] | ||
Cash equivalents | 0 | 0 |
U.S. treasuries | Fair Value Measurement on a Recurring Basis | Level 2 | ||
Fair Value, Financial Instruments [Line Items] | ||
Cash equivalents | 3 | 1 |
Commercial paper | Fair Value Measurement on a Recurring Basis | ||
Fair Value, Financial Instruments [Line Items] | ||
Restricted cash equivalents | 19 | 20 |
Commercial paper | Fair Value Measurement on a Recurring Basis | Level 1 | ||
Fair Value, Financial Instruments [Line Items] | ||
Restricted cash equivalents | 19 | 20 |
Commercial paper | Fair Value Measurement on a Recurring Basis | Level 2 | ||
Fair Value, Financial Instruments [Line Items] | ||
Restricted cash equivalents | $ 0 | $ 0 |
Financial Instruments and Fai_4
Financial Instruments and Fair Value Measurements - Additional Information (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Carrying value of notes payable | $ 407 | $ 414 |
Estimated Fair Values | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Estimated fair value of notes payable | $ 409 | $ 414 |