HR/Payroll Modernization Update

1. HR/Payroll Modernization Update Payroll Coordinators Spring 2014

2. Agenda • Project Update • Timeline • Full Project • Next Six Months • Key Staffing Updates • Overview of Biweekly Payroll • Questions Payroll Coordinators

3. Vision & Objectives of HR/P Vision HR/Payroll Modernization will deliver a modern system and set of standardized processes to significantly improve support for critical HR and payroll functions across the University. Objectives • Replace UW’s existing payroll system with a modern, integrated HR and payroll system • Implement a technology platform that allows UW to outsource the infrastructure • Implement standardized HR and payroll processes and practices across the entire University • Reduce UW’s risks, realize efficiencies, enable modern practices, and provide better competitive positioning Payroll Coordinators

4. Progress to Date Completed Business Process Redesign work Completed Procurement process Received approval to proceed from Board of Regents and State CIO’s Office Began implementation on March 3 Completed the seven-week planning phase Payroll Coordinators

5. Solution Vendor: Workday • Software-as-a-Service • Core functionality delivered in 22 months (December 2015) • Iterative approach to implementation • Partnering with IBM for implementation • Other higher-ed institutions using Workday include: • Brown • Carnegie Mellon • Cornell • Georgetown • University of Southern California Payroll Coordinators

6. What is a Payroll System? A payroll system involves everything that has to do with the payment of employees. • Calculating Wages • Withholding Taxes and Deductions • Print/Deliver Checks -or- Make Direct Deposits • Pay Employment Taxes At year-end, the payroll system is used to summarize payroll information for tax and reporting purposes. Payroll Coordinators

7. What is an HR System? An HR system is a tool used to store and access HR-related information and perform HR-related functions ranging from recruitment through separation or retirement. • Job announcements • Compensation tasks • Onboarding of new employees • Position management • Time tracking • Leave tracking • Administering benefits Such a system provides management of all employee information, allows reporting and analysis, and integrates with a payroll system. Payroll Coordinators

8. Functional Scope for Phase 1 Time Tracking HR Benefits Administration Time Payroll Compensation Talent Management (for Medical Centers) Absence Management Payroll Coordinators

9. Scope for Phase 2 Beginning approximately January 2017 • Applicant tracking system • Learning management system • Talent management for all UW units Payroll Coordinators

10. Impacts All UW Workforce Members • Staff, faculty, and student employees • Use a new interface to: • Access earning statements, leave balances, and time off requests • View and change direct deposits and W2 withholdings • Change personal information (contact info, benefits selections) • Receive pay on a different schedule • Managers and supervisors • Easily review employee schedules • Approve time-off requests • Approve time sheets for overtime eligible employees • Staff with HR/payroll processing responsibilities • Some work will shift from one office to another • New methods of accomplishing certain actions Payroll Coordinators

11. Timeline & Next Steps

12. HR/P Implementation Timeline Plan Design (Architect) Configure & Prototype Test Deploy Post-Production support Go-Live Data Conversion and Migration Integrations Quality Management Organizational Change Management, Communications, Knowledge Transfer and End-User Training Operational Readiness Payroll Coordinators

13. Snapshot: Next 6 Months Payroll Coordinators

14. Activity During the Next 6 Months • Design workshops (May through September) • System design decisions • HR and payroll processes • Integrations to unit systems • Reports • Assess impacts • Units and roles • University policies • Load additional data into new system Payroll Coordinators

15. HR/P Team Staffing

16. Payroll Coordinators

17. Functional Leads & Teams • Payroll: Ginny Montgomery • Keli Bort, Payroll Functional Analyst • Academic Personnel: Shirley Runkel • Benefits: Erin Roach • Jon Petersen, Benefits Functional Analyst • Compensation: Sherrie Thissell • HR: Alisha LaPlante • Time/Absence: Marisa Graudins • Christa Woodhull, Time/Absence Functional Analyst • Jean Swarm, Time/Absence Functional Analyst Payroll Coordinators

18. Biweekly Payroll

19. Payroll Situation • Problem: Existing semi-monthly pay cycle is required by state statute. • Challenging to calculate overtime and premium pay for overtime eligible employees when a workweek is split between two periods (13x in 2013). • Impacts scheduling and reconciliation of Fair Labor Standards Act (FLSA) workweeks with pay period payments. • Creates confusion for employees, particularly those in healthcare whose schedules are based on work weeks, rather than semi-monthly periods with variable work days. • Is inconsistent with best practices. • Would require UW to customize or configure its new HR/payroll system to adhere to this statute, requiring additional and unnecessary costs. • Solution: When HR/P goes live, we are moving to a biweekly pay cycle. • Legislation signed by Gov. Inslee in March 2014 allows us to move to the biweekly cycle. • Saves approximately $750,000 annually. • Cost avoidance of $1.5 million to $3 million by implementing a biweekly pay cycle with new system. Payroll Coordinators

20. Benefits of Biweekly Payroll Cycle For the University: • Standardizes and establishes a more systematic approach to payroll time reporting. • Standardizes pay practices across all UW locations. • Aligns with business and healthcare best practices. • Provides significant scheduling efficiencies for UW Medicine, which operates 24/7 and whose employees comprise 30% of the UW workforce. • Reflects more efficient and effective time reporting. • Reduces administrative burden to manually prepare, review, and calculate pay. • Reduces payroll adjustments and overpayments, mitigating compliance risk. • Complements other elements of HR/P that will yield additional savings. For employees: • Establishes a consistent pay period that contains the same number of days each time. • Paychecks are received 26 times per year (semi-monthly = 24 time annually). • Overtime pay will be more timely. • Biweekly pay frequency will have a standard 80 hours per pay cycle, resulting in a consistent leave without pay hourly rate. • Alignment of pay cycles in two-week increments against schedule that reflects coverage for the same period helps an employee to understand and verify worked and paid hours. Payroll Coordinators

21. Next Steps • Conduct transition planning • Build a plan for the final payroll runs in HEPPS • Create a new academic year schedule based on bi-weekly payroll and the academic instructional calendar • Assess change impacts to downstream systems • Review options to mitigate impact to UW workforce • Develop a communications and outreach plan Payroll Coordinators

22. Questions? http://f2.washington.edu/teams/hrp