10.A.
City Council Meeting - FINAL
- Meeting Date:
- 10/18/2016
- Co-Submitter:
- Damian Gallegos
- From:
- Brandi Suda, Finance Director
Information
TITLE:
Consideration and Approval of Cooperative Agreement: Payroll Time Entry Software and Implementation Services with Kronos Incorporated.
RECOMMENDED ACTION:
Approve a Cooperative Agreement with Kronos Incorporated (Kronos) and the City of Flagstaff as procured through a cooperative contract agreement with Harford County Public Schools for payroll time entry software and implementation for an amount not to exceed $206,116.19.
Executive Summary:
The City currently administers payroll services for over 1,000 full-time and part-time employees. Automating the time entry associated with payroll administration simplifies labor-intensive timesheet tracking, data entry and approval processes. An automated time entry system also aids labor law compliance.
The proposed cooperative agreement with Kronos will provide the City with payroll time entry software and implementation services. A payroll time entry software and system provides the City the following benefits:
1. Provide employees the ability to enter their daily time worked electronically (and includes supervisor approval),
2. Tracks accruals of paid time off leave,
3. Ensures time entry compliance with federal and state laws as well as City policy,
4. Assist supervisors schedule staff and managing time off requests,
5. Provides Affordable Care Act reporting for part-time employees.
The proposed cooperative agreement with Kronos will provide the City with payroll time entry software and implementation services. A payroll time entry software and system provides the City the following benefits:
1. Provide employees the ability to enter their daily time worked electronically (and includes supervisor approval),
2. Tracks accruals of paid time off leave,
3. Ensures time entry compliance with federal and state laws as well as City policy,
4. Assist supervisors schedule staff and managing time off requests,
5. Provides Affordable Care Act reporting for part-time employees.
Financial Impact:
The budget of $50,000 for this project has been carried forward in the budget since FY2008. The FY2017 budget for time entry software is the originally recommended $50,000. The cost to provide this streamlined service to the City has increased significantly since originally proposed in the budget 9 years ago. In additional to the current budget of $50,000, the Budget Team approved allocating the additional $156,000 from projected budget savings in Finance personnel costs due to vacancies aad contractual savings in non-departmental.
Connection to Council Goal and/or Regional Plan:
COUNCIL GOALS:
1) Invest in our employees and implement retention and attraction strategies
3) Provide sustainable and equitable public facilities, services, and infrastructure systems in an efficient and effective manner to serve all population areas and demographics
1) Invest in our employees and implement retention and attraction strategies
3) Provide sustainable and equitable public facilities, services, and infrastructure systems in an efficient and effective manner to serve all population areas and demographics
Has There Been Previous Council Decision on This:
Yes, Council previously budgeted $50,000 for this service in FY 2008. The budgeted amount has been carried forward into future budgets for purposes of contracting this service in the future.
Options and Alternatives:
1) The City Council may approve this cooperative agreement for time entry software and implementation
2) The City Council may decline to enter into this cooperative agreement and direct staff to conduct a formal competitive solicitation.
3) The City Council may decline to enter into this cooperative agreement and continue with the city's current process.
2) The City Council may decline to enter into this cooperative agreement and direct staff to conduct a formal competitive solicitation.
3) The City Council may decline to enter into this cooperative agreement and continue with the city's current process.
Background/History:
The City of Flagstaff has a workforce of approximately 1,000 employees. One of the key requirements in managing the workforce is to accurately account for employees' time on and off of the job. This information is used for several purposes:
1. Payroll – to ensure each employee is paid a fair and accurate wage.
4. Compliance – the City has to adhere to City policy and federal and state laws.
5. Cost accounting– labor costs have to be accurately distributed to the appropriate accounting units.
6. Grant accounting – labor costs related to grants have to be accurately recorded and reported.
The City of Flagstaff currently relies on a very manual and paper intensive process for time reporting. While some departments use Excel spreadsheets, many still record their time on paper timesheets with supporting over-time and leave approval forms. In response to the current inability to close the time-reporting process quickly enough to meet payroll deadlines, some departments are estimating time worked by employees and any estimates have to be reconciled the following pay period creating a duplication of effort. These paper forms are then passed to administrative staff for entry into the City's Naviline system for payroll processing. If forms are incomplete or appear inaccurate the appropriate supervisor is contacted to resolve the issue. Administrative staff then prints the payroll reports which are given to section heads and/or division directors for review and approval. Finally the payroll reports are given to the payroll staff for final review of adherence to City policy.
A major benefit of an automation of time entry is that the added efficiencies will allow staff to be more productive in their other duties. An automated system also make the process consistent and limits the possibility of error that a manual system has.
The City of Flagstaff began initiated the process of procuring a contact for payroll time entry system services on May 4, 2016 and received an initial quote in the amount of $227,499.00. On 09/16/16, City staff made a second contact with Kronos and received a quote in the amount of $222,552.81. Further negotiations with Kronos, resulted in a final quote in the amount of $206,116.19 resulting in cost savings from the original quote of $21,382.81 and a cost saving of $16,436.62 from the 09/16/16 quote. The discounts were given as part of the cooperative agreement between Kronos and Harford County Public Schools. The agreement with Harford County Public Schools is effective until March 17, 2017. Kronos will offer software support at no cost in year 1, and the subsequent annual cost is approximately $21,000 per year.
1. Payroll – to ensure each employee is paid a fair and accurate wage.
2. Time management – supervisors have to make sure staffing levels are consistent with job requirements and ensure over-time hours are kept to a minimum.
3. Leave time management – employee leave time used must be accurately deducted.4. Compliance – the City has to adhere to City policy and federal and state laws.
5. Cost accounting– labor costs have to be accurately distributed to the appropriate accounting units.
6. Grant accounting – labor costs related to grants have to be accurately recorded and reported.
The City of Flagstaff currently relies on a very manual and paper intensive process for time reporting. While some departments use Excel spreadsheets, many still record their time on paper timesheets with supporting over-time and leave approval forms. In response to the current inability to close the time-reporting process quickly enough to meet payroll deadlines, some departments are estimating time worked by employees and any estimates have to be reconciled the following pay period creating a duplication of effort. These paper forms are then passed to administrative staff for entry into the City's Naviline system for payroll processing. If forms are incomplete or appear inaccurate the appropriate supervisor is contacted to resolve the issue. Administrative staff then prints the payroll reports which are given to section heads and/or division directors for review and approval. Finally the payroll reports are given to the payroll staff for final review of adherence to City policy.
A major benefit of an automation of time entry is that the added efficiencies will allow staff to be more productive in their other duties. An automated system also make the process consistent and limits the possibility of error that a manual system has.
The City of Flagstaff began initiated the process of procuring a contact for payroll time entry system services on May 4, 2016 and received an initial quote in the amount of $227,499.00. On 09/16/16, City staff made a second contact with Kronos and received a quote in the amount of $222,552.81. Further negotiations with Kronos, resulted in a final quote in the amount of $206,116.19 resulting in cost savings from the original quote of $21,382.81 and a cost saving of $16,436.62 from the 09/16/16 quote. The discounts were given as part of the cooperative agreement between Kronos and Harford County Public Schools. The agreement with Harford County Public Schools is effective until March 17, 2017. Kronos will offer software support at no cost in year 1, and the subsequent annual cost is approximately $21,000 per year.
Key Considerations:
This proposed contract includes Kronos providing implementation services to design and configure the system to match City policy and federal and state regulations. Kronos estimates that the implementation of the payroll time entry software will take 18 weeks to complete.
With this proposed payroll time entry software, employee will report hours electronically via a computer or other electronic devices. Supervisors will then also review and approve hours electronically and the employee hours data will interface into the City's HR/Payroll system. In addition, employee vacation, sick, floating holiday, personal time, and paid time off accruals will be managed within the system and interface with City's HR/Payroll system.
Kronos is compatible with existing City systems. The City's Fire Department currently utilizes TeleStaff. As part of this implementation, Kronos will configure an integration between time entry software and TeleStaff. It will also share accrual balances from time entry software into TeleStaff.
In addition, by implementing the time entry software in coordination with the implementation of the new Innoprise payroll system, it will create several efficiencies as City staff will not need to be trained on two new systems. The City will integrate the implementation of both systems to reduce duplication of effort. We anticipate the Innoprise payroll system to go live in FY2017.
With this proposed payroll time entry software, employee will report hours electronically via a computer or other electronic devices. Supervisors will then also review and approve hours electronically and the employee hours data will interface into the City's HR/Payroll system. In addition, employee vacation, sick, floating holiday, personal time, and paid time off accruals will be managed within the system and interface with City's HR/Payroll system.
Kronos is compatible with existing City systems. The City's Fire Department currently utilizes TeleStaff. As part of this implementation, Kronos will configure an integration between time entry software and TeleStaff. It will also share accrual balances from time entry software into TeleStaff.
In addition, by implementing the time entry software in coordination with the implementation of the new Innoprise payroll system, it will create several efficiencies as City staff will not need to be trained on two new systems. The City will integrate the implementation of both systems to reduce duplication of effort. We anticipate the Innoprise payroll system to go live in FY2017.
Expanded Financial Considerations:
None
Community Benefits and Considerations:
The community benefits include the reduction f the risk of payroll related liabilities and errors which can have penalties or other consequence. Additionally, Affordable Care Act reporting will be enhanced to ensure timely compliance with regulations.
Community Involvement:
Inform
Expanded Options and Alternatives:
None.