ITEM 4.1 Modifying payroll software0
ots11.1 o
MINNESOTA V
DEPARTMENT INFORMATION
Request for
City Council Action
ORIGINATING DEPARTMENT:
REQUESTOR:
MEETING DATE:
Administration
Dan Jordet, ASD
10 November 2014
PRESENTER(s):
REVIEWED BY:
ITEM #:
Dan Jordet, ASD
Lori Johnson, CA
4.1
AGENDA ITEM DETAILS
RECOMMENDATION:
It is recommended that the City adopt a motion modifying the City's service agreement for payroll
software with ADP to acauire access to ADP Resource.
ARE YOU SEEKING APPROVAL OF A CONTRACT?
No
IS A PUBLIC HEARING REQUIRED?
No
BACKGROUND/1 USTI FICATION:
The City's payroll processing is outsourced to Automated Data Processing (ADP). Timesheets are
completed via computer interface using the ADP EZ Labor Manager program. Until July of 2014, this
program interfaced with another ADP program to produce payroll checks, track earnings and produce
W-2 reporting documents at year end. In July, 2014 ADP stopped supporting that program and switched
the City of Otsego to a different payroll processing program called ADP Run to produce payroll checks.
There were two immediate problems with this change. First, the City was not adequately notified of the
change by ADP. It was simply implemented without City choice, input or proper training. Second, the
ADP Run program did not interface properly with the ADP EZ Labor Manager program. Checks produced
by the ADP Run system did not show pertinent information about employee accruals on the paystub.
There were questions about how the ADP Run system would produce accurate W-2 documents at year
end. The ADP Run system that was implemented by ADP simply did not work with the ADP EZ Labor
Manager software that ADP had sold the City.
Over the span of two or three meetings with ADP Representatives between September and October, a
conclusion was reached that the City of Otsego would have to switch to a different payroll processing
program with ADP to obtain the proper interface with ADP EZ Labor Manager and produce checks and
year end payroll records that were reliable and accurate. Two payroll processing programs were
proposed by ADP.
One, called ADP WorkForce, would interface correctly with ADP EZ Labor Manager and produce the
correct information on pay stubs as well as reliable W-2 information at the end of the year. The
marginal monthly increase in cost for ADP WorkForce was quoted as $ 773.02 per month. When added
to the City's current ADP monthly cost of $ 520.15 per month that would produce a total monthly bill of
$ 1,293.17 per month or $ 15,518.04 per year for ADP payroll processing services.
The other, called ADP Resource, also provides the proper interface with ADP EZ Labor Manager and
correct payroll information. In addition, ADP Resource provides the City additional human resources
support in the areas of federal and state regulatory compliance, COBRA administration and relations,
assistance with employee policy and handbook development and review, and various other HR
functions. The marginal cost increase for ADP Resource is $ 701.53 per month. Total monthly cost
would rise to $ 1,221.68 per month or $ $ 14,660.16 per year.
While each of these options increases the City's payroll function costs, it continues to be a better cost
solution than having a staff payroll specialist and in-house software for payroll processing. ADP
Resource appears to provide more service for less money under the two scenarios presented for solving
our current payroll processing problem. Staff recommends that ADP Resource services be acquired in
combination with the ADP EZ Labor Manager software immediately and continue on a month to month
basis for the foreseeable future.
At this time, no other payroll processing options or companies have been explored. It may be prudent
to examine other options in the future, up to and including an RFP for payroll services. Because the ADP
agreement is a month to month agreement, such service could be changed in short order at a later date
following careful research and consideration of other alternatives..
SUPPORTING DOCUMENTS: X ATTACHED ❑ NONE
POSSIBLE MOTION
Please word motion as you would like it to appear in the minutes.
Moved that staff is authorized to implement ADP Resource software for City of Otsego payroll
processing immediately.
BUDGET INFORMATION
FUNDING:
General Fund and Utility Funds currently paying
for payroll services would absorb any increased
cost.
ACTION TAKEN
BUDGETED: ❑ YES
X NO
❑ APPROVED AS REQUESTED ❑ DENIED ❑ TABLED ❑ OTHER (List changes)
COMMENTS:
Presented To:
Prepared By:
Barton Perry
District Manager
612-723-3861
barton.perry@adp.com
ADP Resource
8100 Old Cedar Ave S
Bloomington, MN 55425
This proposal contains information that is proprietary to Automatic Data Processing. It remains the property of ADP and
is to be kept in confidence. It should not be divulged to persons other than those authorized by their duties to receive
such information. No part of this proposal may be reproduced without the prior written consent of Automatic Data
Processing.
lop
Resou rce-
HR solutions that fit.:.
The ADP Resource Solution
Based on what I have learned about your organization, the ADP Resource solution will provide you the following and
much more:
HR Business Partner
■ No one on staff has core HR expertise and this is a concern. This is a key reason why so many business turn to
ADP for expertise and support.
■ ADP Resource becomes a valuable extension to Executives and Managers providing them the HR expertise
needed to effectively do their job.
Owner/President
............................:.................. ........
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4.9
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Finance and Services and Sales and Human
Accounting Operations Marketing Resources
ResourceADP ..................
You'll be assigned a designated single point contact that will provide telephone and onsite support to your
organization. They will leverage their strong HR background as your business partner
Beginning with your first meeting, your HRBP will conduct comprehensive strategic needs assessment
designed to pinpoint key company objectives. With this knowledge, they will develop an HR project plan
that is designed to support your goals.
❖ $60-80K to hire Internal HR with the same qualifications
Technology
■ There is a clear correlation between using performance management programs and improved business and
organizational results.
❖ ADP Resource includes a Web -based Payroll & Human Resources Management Technology that integrates
HR administration, payroll, reporting, employee discounts and more into one seamless solution that's both
sophisticated and simple to use.
❖ Multiple levels of access can be set up ensuring quality, control and confidentiality.
❖ Employees can be granted access to their information electronically or by phone. This helps to reduce
mundane payroll and HR related questions allowing more time for your core role with less distractions.
❖ $10-15K to build
Employee Documentation Collection & Compliance
■ Our initial conversation uncovered numerous potential gaps here. This is common in small organizations as
they don't have the necessary HR expertise to get the job done right.
❖ It is our goal to avoid compliance violations assessed by the DOL, DHS, USCIS, and ICE.
❖ Your HRBP will review your current employee documentation processes and outline ways to implement
more effective strategies.
❖ Your HRBP will conduct a review of employment files but more importantly train your staff so that you
know it's being done correctly.
The Strategic Integration of HR, Payroll, Compliance & Abididstratim Services for Sinall Business!
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Resource..
HR solutions that fit. -
Employee Relations
■ Your HR Business Partner can assist with a wide variety of matters pertaining to effectively managing and
developing your employees.
v Performance Appraisals - Provide you with HR best practice guidance on conducting performance
appraisals and support on delivering performance feedback effectively.
❖ HR Forms - Supply templates for useful HR Forms such as Performance Appraisal Forms, Leave Request
Forms, Disciplinary Documents, etc.
❖ Policy Development - Provide recommendations regarding HR best practices for policy development and
communication strategies.
❖ Conflict Resolution - Provide HR best practice support and guidance on how to address workplace
employee conflicts and resolve differences in a constructive manor.
Employee Handbook
■ As we discussed, the burden of proof has shifted to the Employer and an up to date and compliant handbook
is key to properly protecting the organization.
❖ Your HR Business Partner will help customize your employee handbook that will be reviewed by ADP's
Legal Team.
❖ Hard copy hand books can be printed and distributed to employees.
❖ Employees can also be provided access to their handbook online at My ADP Resource.com
1. Polices can be updated and acknowledged electronically by current and new employees
through our technology
d• ADP Resource will help to ensure you keep up with all Fed., State, & local laws that apply to the number of
employees you will have and all applicable states.
❖ $4-6K to have reviewed and updated by a qualified attorney
• Employee Training
■ We touched on this briefly and I bring it up because almost every organization I work with takes advantage of
our HRBP led trainings.
❖ Train your staff so you can be more hands off, while still confident the jobs are being done effectively &
efficiently.
❖ Training topics include leadership, coaching, mentoring, customer service, human resources, employment
law, time management, stress management, team building, diversity, etc.
Risk Management & Safety
■ OSHA auditing is on the rise and being compliant affects your Worker's Comp and liability.
❖ Loss Control Hotline: Educate you on the Loss Control Hotline services offered (i.e. OSHA standards and
record keeping, safety hazards, programs and training to name a few) and provide you with the Loss
Control Hotline contact information.
❖ Safety Training Needs Assessment: Proactive steps to help you assess training needs.
•8 Pure Safety Training: Give you access and provide guidance on enrolling employees in Risk and Safety
training. (optional a la carte)
❖ Workers' Compensation Claim Reporting: Provide guidance on handling reported work-related illness or
injury.
❖ $3,000 + on open market
The Strategic Integration of HR, Payroll, Compliance & Administrative Services for Snnall Business!
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Resou rce..
HR solutions that fit. -
ADP Resource Core Services
HR Functions/Administration
HR Audit & Assessment (1-9's, Files, etc)
Certified HR Business Partner Assigned to your account
Dedicated Payroll Specialist to assist with processing (Commissions, etc)
Assigned Account Management Team (Recruiting, OSHA, etc)
Formal, ADA Compliant Custom Job Descriptions
Employee Handbooks and Manuals (Professional/Legally Reviewed)
Guidance with all FLSA, FMLA, EEOC, Title VII, etc
State and Federal Compliance Support
Online Human Resource Management System Integrated with Payroll
Employee Risk Management
Wage Garnishment Support & Processing
Properly Classifying Employees
Employee Self Service Center/Intranet
New - Hire/termination reporting
SUI Administration
Full COBRA Administration & Carrier Relations
Training & Development
ADP Resource University
Professional Development Seminars (Employment Law, etc)
Customized Training for EEO policy/procedure
On - site training HRBP lead
Risk Management & Safety
OSHA Standards and compliance
Online Safety Training
Loss Control Hotline (22 yr. OSHA Investigation Experience)
Estimated Monthly Investment in ADP Resource: 25 Employees
ADP Resource HR & Compliance Solution & Payroll
Current Payroll Fees Monthly
Included
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$1221.68 19% Discount
$ 520.15
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Total Fees for Resource Monthly $ 701.53
ONE TIME SET-UP FEES
Price Includes:
WorkForceNow
$1950.00 Waived
$ 773.02
Set - up pricing includes full implementation of core services, conversion of payroll data, and HRBP implementation meeting,
and training of all systems.
4 Includes Payroll, Technology & Dedicated HR Business Partner, Risk & Safety Specialist & Payroll Specialist.
4Set-up includes full implementation of core services, conversion of payroll data, HR engagement, training, etc.
The Strategic Integration of HR, Payroll, Compliance & AClndnnistrative Services for Small Business!
Resou ree..
HR solutions that fit. -
ADP RESOURCE OPERATES ON A MONTH-TO-MONTH AGREEMENT
Payroll Conversion Expectations
Administrative
Service Set -Up & Set-Up/Data Verification First Transition
Agreement Analysis Conversion & Training Payroll To Service
Signed Meeting
STEPS TO GETTING STARTED
Step 1- Administrative Service Agreement Signed (10/29/14)
Review the ADP Resource agreements and set expectations for timeframes and implementation.
Step 2 - Set -Up & Analysis Meeting (2-5 days after signing)
In the week after signing the service agreement, you will receive a welcome call and email from your
ADP Resource Project Manager to review your elections and you will be assigned your service teams.
Step 3 - Set-Up/Data Conversion (Implementation)
Your hands-on service team will consist of a Project Manager and a team of Implementation Specialists
that will handle your set up and data conversion along with the implementation of all your elections.
They will get you registered for training and closely guide you through the transition. The introduction
of your dedicated Human Resources Business Partner will also occur at this time.
Step 4 - Verification & Training (Week prior to first payroll run)
ADP Resource will verify that your payroll is accurate and that you are trained on the system. Should
any additional training be needed, we will provide support at this time.
Step 5 - First Payroll (Target 15f check in November)
You are now ready to input your first payroll with ADP Resource. This will be done in conjunction
with your Implementation Specialist. This person will be available to walk you through the payroll
and address any questions, concerns or corrections that you may have during the input process.
Step 6 - Transition to HR Service (After first payroll has been run)
Once you have completed your first successful payroll, you will be transitioned to your service team.
This is primarily your HR Business Partner and their team.
The Strategic Integration of HR, Payroll, Compliance & Administrative Services for Small Business! 4
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Resource,.
HR solutions that fit.,.
ADP Resource Optional Services
401(k) Administration (complete)
$120/month'
Commuter Benefit/PreTax Transit Administration (complete)
$110/mo*
Time & Labor Manager (web - based/job costing/labor distribution)
$60*
Employee Background Checks
$9/screen*
Employee Drug Testing
$28/test*
1099 Processing and Administration
$20/mo*
Workers Comp Pay - By - Pay Administration (based upon underwriting)
$13/month
Job Posting
$225/job*
Resume Search Support (complete)
$625/job*
Recruiting Services (full service with professional recruiter)
$3,500/job
*All optional service pricing vailes depending on the number of employees and may also include a minimal set up fee.
The Strategic Integration of HR, Payroll, Compliance & Administrative Services for Small Besinness! 5