best practices for switching payroll providers benefit...

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Your Resource for HR Technology

Benefit Technology Resources LLC

Best Practices For Switching Payroll Providers Benefit Advisors Network May 25, 2016

Benefit Technology Resources LLC Confidential & Proprietary Information – Not for Distribution

2 2 TODAY’S AGENDA

1 Who is BTR

2

3

Timeline recommendations 4

5

6

Challenges Facing HR Today & Trends

Vetting – what you need to do for success Contractual considerations

Testing Testing Testing


3 3 WHO IS BTR?

• Benefit Technology Resources (BTR) is the largest mid-market HR technology consulting firm.

• We are independent – provider agnostic (not tied to any providers).

• We specialize in HR technologies that include:

(ACA) Healthcare Reform Compliance HRIS – Human Resource Information Systems Benefits Administration Payroll Administration Time Keeping Performance Management Recruiting Talent Management And More….


4 4 LEADERSHIP TEAM

JAMIE HAWKINS

President and CEO

Tampa, FL

TERRY HAWKINS

Executive

Vice President

Tampa, FL

KATE TAYLOR

Implementation

Division Manager

Pinehurst, NC

JOSH HOOVER

Consulting Division

Manager

Allen TX


5 5 BTR TEAM MEMBERS

SAMANTHA JEFFERSON

HR Technology

Coordinator

Atlanta, GA

ASHLEY KIRASICH

Senior

HR Technology

Coordinator

Tampa, FL

KELLI LEMIEUX

HR Technology

Consultant

Tampa, FL

JUSTIN HICKMAN

HR Technology

Coordinator

Tampa, FL

DEBBIE PETERS

Senior

HR Technology

Consultant

Boca Raton, FL

BARB GADDO

HR Technology

Consultant

Bloomington, MN


6 6 BTR TEAM MEMBERS

DENISE PYOTT

Implementation

Coordinator

DONNA ARNLUND

Implementation Lead

Coordinator

JAMIE BETTERIDGE

Implementation

Service Coordinator

CONCETTA BURNS-RAMSEY

Implementation

Coordinator

ANNA WEATHERLY

Implementation Lead

Service Coordinator

ADRIENNE CORDES

Implementation Service

Coordinator

ILENE IKUWEME


Coordinator

NIKKI TALLEY

Senior Implementation

Coordinator

KELLIE AISENSTARK

Implementation

Coordinator

JAIME FERGUSON

Senior Service

Coordinator

KRISTI WATTS


Coordinator

KRISTINA GNACINSKI

Implementation Lead

Coordinator

SHANNON TUCCINI

Implementation Lead

Coordinator


7 7 PROVIDERS – THERE ARE OVER 400 IN THE MARKETPLACE


8 8 HR TECHNOLOGY TRENDS IN 2016


9 9

39% would like new benefits enrollment systems 33% seek better benefits administration tools and 31% are planning to spend money on improved employee benefits technology According to a survey of HR Professionals by

Employee Benefit News and Employee Benefit Advisor

HR TECHNOLOGY TRENDS IN 2016

Benefits Administration is booming!

http://ebn.benefitnews.com/news/ebn_co_benefits_strategy/employers-hungry-for-improved-enrollment-communications-tools-2744758-1.html

http://eba.benefitnews.com/news/ebn_co_benefits_strategy/tech-survey-part-2-what-do-benefit-managers-want-2744772-1.html


10 10 CHALLENGES FACING HR TODAY

• ACA Compliance is challenging • Rising costs that impact HR • Data integrity issues with multiple points of entry

• Lack of business intelligence/combined reporting

• Lots of choices. 400+ in the market today


11 11 SYSTEM CHALLENGES FACING HR TODAY

• Compliance -ACA • Payroll administration in the cloud • Online benefit administration • Applicant tracking • Paperless Onboarding • Billing reconciliation • Electronic carrier feeds • HRIS tracking


12 12 KEY COMPLIANCE DATES


13 13 ACA REPORTING OPTIONS

ACA Service Providers: 1. Payroll Provider (ADP, Paychex, Ceridian, Paylocity)

2. Benefits Admin provider (Employee Navigator, PlanSource, Benetrac, bswift)

3. Stand Alone ACA provider (Employee Navigator, Syncstream, Equifax, Tango etc.. )

Fall into 3 major categories


14

Payroll

Performance Management

Time Keeping

HRIS

Recruitment/ Applicant Tracking

Benefits

Admin

HOW DO EMPLOYERS TRACK & REPORT?

Employee Data, Affordability Safe Harbor

ALE Determination, Hours worked, Full Time Equivalent Status

Eligibility, Benefit Status, Dependent Information, Waive Reasons, Coverage Begin dates, end dates


15 15

Lots of New Technology in the market

• Activity is at an all time high

• New Providers in the HR Technology Space

• Algorithms to make big data useful (think personal Facebooks updates lending to recruiting efforts)

• Employee Engagement software

• Performance Management

• New User Interface rollouts

• Mobile capabilities

• Replacing on premise with SaaS

TECHNOLOGY IN TODAY’S MARKET


16 16

• High Activity Levels- employers are moving to more robust technology • HR Technology is finally impacting the bottom line

• ACA compliance has been painful and can be costly

• Based on studies and research Employers want:

Bottom Line = Employers Want MORE Automation!

TECHNOLOGY IN TODAY’S MARKET

• Paperless Onboarding • Online Benefits Administration • HRIS Compliance and Tracking • Mobile Capabilities


17 17 THE PROCESS

Discovery/ Needs Assessment

Prepare your Request for Proposal

(RFP) to begin the provider review

process

Ongoing

technology

support

We conduct a detailed discovery of

your business needs

BTR Analyzes and Reviews proposals

received by the providers and builds analysis

Schedule

demos

Review

agreements

Provide support during

implementation

Post Im

plem

entatio

n

Ph

ase

Search Phase

Mutual Non-Disclosure Agreement BTR will access our proprietary database to

find the providers that match your

requirements

Client makes decision on finalist

BTR recommends onsite meetings with finalists


18 18 STEP 1 - VETTING

• Do your own discovery before jumping into a project • What does your organization need/want • What is “in scope” what is optional

• Consult with Strategic Partners for assistance – this is a big expenditure

• Document your processes and requirements

• A system must address an organization's objectives, culture and industry – Define Success

• Integrating data with other systems will be the key to success

• Understand integration needs on the front end, don’t wait to bring IT in

• Technology solutions support workflow by laying out tasks that need to be done in a certain order, which trigger other tasks for different members of the HR & payroll team.

• Leading solutions also provide dashboards that ensure complete and transparent visibility into the process.



• Areas to focus on – providers – what size market do they cover. • Small – under 250 employees • Mid – under 1000 employees • Large – over 1000 employees • Look at multiple providers – times have changed • Reporting

• Standard and Ad hoc – varies greatly • Dashboards

• Service and support

• What is your expectation vs. what the provider provides • Ask to speak to your potential service team and understand structure

• THERE IS NO PERFECT SOLUTION



• Other software required (Silverlight) How will IT feel about this?

• Mobile what exactly do you need?

• User Interface – how important is it?

• Budget – be realistic

• Think about what you need today but also 5 and 10 years from now.

• Think strategically not just tactically


21 21 HR TECHNOLOGY AUDIT CASE STUDY #1

Client • 150 employees in Florida

• Not ACA compliant.

• Struggling with current payroll provider.

• Disparate systems

• No HRIS system.

• No Benefits Administration system.

• Manual processes.

.

Details • The client asked us to go through an HR

Technology Audit.

• Please refer to next few slides.


22 22

Payroll system

Time

Keeping

Medical Carrier

EE Training and

Licenses

LTD / STD Carrier

FSA Carrier

FMLA Spreadsheets

Internal Company Portal

COBRA Carrier

Background checking

software

Recruitment

Spreadsheet

Applicant Tracking

Spreadsheet

E-Learning Software

Performance Management

Spreadsheet

BTR identified 16 different touch points for each new hire, status

change, and termination.

Time Keeping

Spreadsheet

OSHA Incidents

WHAT IS BEING DONE MANUALLY?


23 23 WE ALSO REVIEWED THEIR BENEFIT PROCESS

Manual process, employee

completes forms

HR tracks employees’

waiting period

HR follows up with employee to

see who has completed the

forms.

HR receives form, and then

completes a benefit deduction form and faxes it

to the Payroll provider

HR routes deduction form to the payroll administrator

HR manually keys in add/term/

changes into each carrier

website:

Medical, Dental, Vision, Ancillary,

etc.

HR sends confirmation to Broker that the

employee is enrolled

Monthly carrier bills are manually

reconciled by HR. Approx. 3

hours per month

Payroll administrator manually keys

deductions into payroll

RED IS MANUAL

BLUE IS AUTOMATED


24 24 BENEFIT PROCESS WITH BENEFIT ADM IN SYSTEM

Employee logs in to enroll

online

Eligibility is managed in the

system

Payroll deduction file

is sent electronically

to payroll provider

Eligibility files are

electronically submitted to

carriers

Monthly carrier bills are

reconciled through the

system


25 25 STEP 2 - TIMELINE

• Core typically is implemented 1st ******** • Payroll/ HRIS/ Sometimes Time Keeping (allow for 60-90 days)

• Don’t try implement benefits admin at Open Enrollment

• Allow for an additional 90 days for the implementation of other modules

• Building in plenty of testing time across multiple stakeholders

• Allow time for 2 successful parallel payrolls

• You determine the timeline – not the provider

• Be willing to tweak things along the way and update your timeline as needed • The worst thing you can do is rush this


26 26 TESTING

• Don’t rush – be sure you give yourself a reasonable timeline and allow for testing and more testing

• Perform Rigorous Balances and Audits • Ask the provider for testing documentation

• Think about worst case scenarios and test for them • Is the CEO’s pay correct • Are dependents listed correctly

TEST TEST TEST


27 27 DEPLOYING MODULES

• Understand your population to know when and how to get the best user adoption

• Where will you get the “quick wins”

• Where will you have immediate ROI • Long term ROI

• Which modules you do need to spend more time planning (performance management)

• Remember you must focus on “Change Management” as well • It takes 6 months to learn the system

• Just because you did it that way in the past doesn’t mean you will going forward


28 28 KEY STAKEHOLDERS

• Determine what success looks like at the end – Set Proper Expectations!

• Include all stakeholders in key discussions from the very beginning

• Enforce accountability (Internal & External)

• The Hackett Group, best practice companies in the Fortune 1000 spend

$85 per employee per year on payroll; others shell out as much as $715.


29 29 STEPS TO MAKING A FINAL DECISION

• Reference checking

• From provider and SHRM, Colleagues etc.

• Get online and Google reviews

• If you can’t get references that should be a “sign”


30 30 CONTRACTUAL CONSIDERATIONS

• Pricing - negotiate the best you can (you have to play hard-ball)

• Be willing to walk away

• Does the contract contain a “100% network availability” guarantee?

• How does the contract define “user.” Is each employee a user?

• Be sure your contract states if there is an additional fee for QA/test database/sandbox.

• Is the contract precise on pricing, volume and units and when or how they’re counted? If you

know you’re going to be growing or shrinking, minimum employee count?

• When does the contract start? When you sign it or after the software is in use? When do

monthly fees start? Monthly fees usually start when the system goes “live”.



• Is the contract clear on “fiduciary” and under what circumstances? • What expertise do they have– in federal payroll regulations?

• Does the contract contain clauses for disaster recovery, data security and privacy, and your protection if data is miss-handled by the provider?

• What about the contract renewal? Is there language that limits how much the provider can increase the subscription fee at renewal?

• What about termination of the contract? • Your data back - recruitment application, data such as resumes, cover letters and • You need to specify what data you want back, how you will get it and the time frame

within which you will get it, and what charges would be incurred if any.


32 32

• What about purging your data, when and how it will be destroyed? • DATA SECURITY: SSAE-16 Industry standard

• What legal responsibility does the vendor have in the event of a security breach? What about liability arising out of violations of state employment laws or data privacy restrictions?

• DATA PRIVACY: If you operate across international borders does the vendor segregate or tag

employee data from different countries in order to be in compliance with the privacy restrictions which differ from the United States? Do job candidates have an option of deleting data from the system or requesting that data be deleted? In some countries they have a right to do this.

• If your new SAAS solution is shifting employee support from your internal IT personnel to the external vendor, be sure you work out service support responsibilities and standards up front.

CONTRACTUAL CONSIDERATIONS



• Be sure a “change in control” clause is built in.

• If you pay for more modules than you end up using, can you lower your cost?

• Does the contract contain precise statements about the features and work covered? Even if you’ve thoroughly tested and demoed you still should have guarantees in case the product doesn’t do what the provider claims it will do.

• Service Level Agreements (SLA)- Is the maintenance clause specific about problems covered,

hours and days available (such as nights and weekends), response times, the protocol for escalating issues to higher managers and any upgrades?

• Never agree to a contract that references a URL. Be sure you print all marketing materials and

references to the contract.


34 34 POST MORDEM

• Measure results to determine if it was a successful implementation.

• There will be bumps – plan on them

• What would you have done differently?

• Have a strong communication campaign to educate managers and employees – this often is forgotten


35 35 BENEFITS OF LEVERAGING TECHNOLOGY

Healthcare Reform Compliance – reduce the risk of potential fines, automate the paper burden.

Total savings of $19.07 PEPM can be realized through the accuracy and efficiency of complete automation (bswift benchmark study surrounding billing)

Reduce errors and omissions – 88% of spreadsheet documents contain errors. (University of Hawaii analysis)

Reduce multiple points of entry (payroll, HR, timekeeping and carrier websites).

Reduce paper with Employee and Manager self-service (i.e. onboarding and workflows).

Streamline and centralize communication campaigns.


36 36

Thank You!

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