Payroll Outsourcing in Higher Ed - Strategy · PDF fileIn this report, we discuss the costs...

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MARKET EVALUATION SURVEYING DATA ANALYSIS BENCHMARKING INNOVATIVE PRACTICES LITERATURE REVIEW

Payroll Outsourcing in Higher Ed

In this report, we discuss the costs and benefits of payroll outsourcing in higher education. We review three human resource management services, summarize relevant literature on payroll outsourcing, and examine outsourced payroll staffing structures of several higher education institutions.

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ACADEMY ADMINISTRATION PRACTICE

© 2010 Hanover Research – Academy Administration Practice

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Overview

Increasingly, businesses, non-profits, and governmental organizations are turning to external entities to help them manage the back-end financials associated with paying and tracking employees. The field of human resources (HR) outsourcing has grown substantially in the last 10 years and certain indicators suggest that it is “set to explode” in the near future.1 Payroll outsourcing represents just one of many HR functions that can be sourced externally, often at a lower cost than can be achieved through internal staffing. Outsourcing represents a way for organizations to shift weight for a particular job function externally while focusing internal efforts upon more high-value activities. Resources on Entrepreneur.com note the particular appeal of payroll outsourcing:2

For many businesses, payroll services offer an attractive and valuable alternative to in-house processing. Chosen correctly, they provide a less expensive, simpler means of paying your employees, filing your taxes, and performing a host of other duties these companies’ sales reps can’t wait to tell you about.

The appeal of outsourcing is, of course, centered on its potential cost-effectiveness. However, the decision to outsource invariably involves certain trade-offs which must be weighed. In higher education, discussions surrounding payroll outsourcing are newer than in many other industries. While many organizations in the corporate world have outsourced everything from payroll to production for years, higher education leaders have been slower to experiment with this growing trend. As a result, literature on payroll outsourcing in higher education is considerably more limited as compared to what is available in business and management industries. Executive Summary Despite the lack of precedent in payroll outsourcing in higher education, this report seeks to provide a summary of available literature on the topic in addition to a summary of current practices at several higher education institutions. In the pages that follow, we offer a closer look at payroll outsourcing and broader HR outsourcing issues in higher education by profiling three vendors that offer payroll services, examining the available literature on this topic, and presenting 11 case studies from higher education.

1 “HR business process outsourcing.” HR Management, Issue 4, 2010. http://www.hrmreport.com/article/HR-business-process-outsourcing/ 2 Lee, M. “Outsource Your Payroll.” Entrepreneur.com, accessed July 2010. http://www.entrepreneur.com/humanresources/article47340.html

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The first section of this report summarizes the support options made available through three payroll service vendors identified by XYZ College. These vendors are: Kronos, ADP, and Ceridian. The second section provides a quick look at the literature surrounding HR outsourcing. While literature related particularly to higher education is sparse, several resources from business management organizations highlight lessons that are applicable to the higher education landscape. As such, section two includes several observations from the management community in addition to observations from the higher education realm. Findings from this second section are summarized below under the subheading “The Pros and Cons of Human Resources Outsourcing.” The third section of this report presents examples of higher education institutions that have implemented a blend of external products, including Banner, to meet their HR and payroll needs. In all, 11 institutions are profiled, including four Kronos users, four ADP users, and three Ceridian users. The following institutions are profiled in section three:

Abilene Christian University;

Columbus State University;

Curry College;

George Washington University;

Hofstra University;

Kennesaw State University;

Roosevelt University;

Seton Hall University;

Temple University;

University of Detroit at Mercy; and

Xavier University of Louisiana. It is important to note that the profiled institutions vary considerably in size, although where possible Hanover attempted to focus on institutions that more closely resemble XYZ in terms of enrollment and overall size. For each college or university, we list the payroll and/or HR staff presented on various departmental websites in an effort to provide a closer look at the staffing structures of institutions that utilize the three identified vendors. When possible, we also include a description of job responsibilities for each employee within the department. To provide a quick summary of our findings in this section, as well as a deeper look at institutional size, Table 2 below (under the subheading “Summary of Institutional Case Studies”) summarizes student enrollment, total staff count, and the payroll or HR staff present at each institution.

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The Pros and Cons of Human Resource Outsourcing The table below summarizes some of our major findings related to the identified pros and cons of HR outsourcing as discussed in the second section of this report.

Table 1: Human Resources Outsourcing Pros and Cons Pros Cons

Economies of scale Time and effort needed to transition

Shared-cost model Loss of in-house expertise

Potential for rapid cost reduction Dependency

More time for internal staff to focus on “strategic activities”

Potential loss of quality

Removal of “bureaucratic burden” Potential loss of control

Access to new ways of doing things and more extensive best practices

Poor service

-- Resources needed to manage vendor relationship

Summary of Institutional Case Studies The table below summarizes our findings from the 11 institutions profiled in the third section of this report. Notably, the amount of available staff information varied significantly from one institution to the next. As such, generally the lists of payroll and HR staff available online do not allow for fully comprehensive benchmarking. Nonetheless, the information summarized in Table 2 below (which is discussed in greater detail in Section 3) provides a helpful snapshot of the support structures surrounding HR and payroll functions at these institutions.

Table 2: Summary of Institutional Case Studies

Institution Name Estimated enrollment (Fall 2009)

Total employees

(2009)

Vendor Used

Number of Staff listed

Abilene Christian University 4,813 795 Ceridian Human Resources Staff:

6 total

Columbus State University 8,169 1,025 ADP Human Resources Staff

8 total

Curry College 3,095 721 ADP Human Resources Staff

4 total

George Washington University

24,919 6,419 Kronos Payroll Only:

12 total

Hofstra University 12,000 2,588 ADP Human Resources Staff

14 total

Kennesaw State University 22,363 2,516 ADP

Human Resources Staff

21 total Payroll Staff (separate office)

6 total

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Institution Name Estimated enrollment (Fall 2009)

Total employees

(2009)

Vendor Used

Number of Staff listed

Roosevelt University 7,386 1,214 Ceridian Human Resources Staff

15 total

Seton Hall University 9,361 1,782 Kronos


15 total Payroll Staff (within HR)

4 total

Temple University 36,078 7,993 Kronos Payroll Management Staff

18

University of Detroit Mercy 5,585 1,267 Ceridian


8 total Payroll Staff (within HR)

2 total

Xavier University of Louisiana

3,338 774 Kronos Human Resources Staff

7 total Source: Institutional Websites and IPEDS Data Center3

3 IPEDS Data Center. National Center for Education Statistics Website, accessed July 2010. http://nces.ed.gov/ipeds/datacenter

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Section 1: Human Resource Vendor Profiles

In this section, we provide profiles of the three HR solutions identified by XYZ College. It should be noted that findings in this section are drawn directly from information provided by the vendors themselves and therefore may have an unduly positive bent towards a particular service offering. Automatic Data Processing, Inc. (ADP) ADP is a provider of a variety of employer and dealer services. In the area of employer services, ADP offers solutions for HR, taxes and compliance, benefits, retirement services, time and attendance, payroll, and more. Beyond offering systems to help manage these areas, ADP also offers HR business process outsourcing solutions. Of the capabilities noted on ADP’s website, the three that are particularly relevant for this report are their payroll services, HR management solutions (which include business process outsourcing options), and business standalone services. ADP’s payroll services automate payroll transactions and payroll processing. There are multiple options for organizations to choose from when using ADP for payroll management. The four payroll services listed on ADP’s website as potential payroll solutions for organizations with 1,000 or more employees include the following:4

ADP Payforce: This is a “comprehensive, web-based, hosted payroll solution” intended to help large organizations manage their payrolls while taking advantage of best practices and utilizing customized reporting and security options.

ADP HR Anytime: This “software as a service model” enables organizations to manage human resources, benefits, and payroll in a single solution, allowing for “complete employee lifecycle management.” It is a hosted solution, thus “eliminat[ing] the cost of upgrading and supporting hardware.” To facilitate ADP HR Anytime, ADP provides “data center management and complete IT support.”

ADP Enterprise HR: This lower-cost option offers a “robust solution to meet...human resource, benefits and payroll needs” in a single entity. If the hosted model is chosen, then organizations do not have to support and maintain the database in-house.

4 “Payroll Processing for Large Organizations.” ADP Website, accessed July 2010. http://www.adp.com/solutions/employer-services/payroll/large-business.aspx

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ProBusiness Payroll: This service is for payroll processing. It utilizes a “PC-based solution” for controlling payroll in-house with “all the benefits of outsourcing.”

In the area of HR, ADP has a variety of capabilities. At the most basic level, ADP can help organizations track and manage salaries, benefits, and government reporting and compliance. ADP also offers self-service solutions, which give employees the ability to review their own HR, payroll and benefits records; update personal information; and communicate with other employees online. These solutions also help managers to “conduct online performance reviews.” The HR capabilities of ADP can also extend to talent management, providing tools for optimizing and tracking hiring activities. Business process outsourcing (BPO) is another option that can be built into internal HR capabilities. ADP’s BPO services enable organizations to focus HR functions on high-value tasks and contract out the lower-value tasks that are transactional and repetitive in nature.5 Similar to business process outsourcing, standalone services offered by ADP enable organizations to outsource their administrative functions. While the BPO option mentioned previously focuses upon HR, standalone services mentioned on the ADP website encompass a broader range of topics, allowing organizations to pick and choose where to outsource. Standalone services mentioned on ADP’s website include:6

Payroll Tax Services;

Garnishment Services;

Unemployment Compensation Management Services;

Check Printing and Distribution Services;

Year-end Services;

Payment Solutions; and

Professional Consulting Services. Kronos Kronos offers software to enhance organizations’ ability to manage their time and attendance, scheduling, absence management, HR and payroll, hiring, and analytics functions. Unlike some of the other services discussed in this report, Kronos is not primarily an outsourcing service; instead it provides a software tool to help automate

5 “ADP Human Resource Solutions Overview.” ADP Website, accessed July 2010. http://www.adp.com/solutions/employer-services/human-resources.aspx 6 “ADP Large Business Standalone Services.” ADP Website, accessed July 2010. http://www.adp.com/solutions/employer-services/standalone-services/large-business.aspx

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in-house workforce management.7 Kronos cites four major benefits to using their software in higher education:8

The ability to “control labor costs” by streamlining data and “optimizing…operational efficienc[y]”

The provision of a “centralized system that eliminates discretionary policy interpretation and facilitates accurate and consistent enforcement of complex compliance requirements” while also “minimiz[ing] the risk” of legal action

Automating administrative tasks to “improve workforce productivity”

A management systems solution that is both “integrate[d]” and “automat[ed]”

Kronos has software solutions for both HR and payroll, amongst other solutions. The Workforce HR software helps organizations “streamline human resources tasks such as benefits administration, compensation and performance management, training, [and] tracking.”9 Beyond the software itself, support service is available via phone or web. Additionally, institutions can call upon Kronos for staff augmentation, optimization services, product extensibility, or consulting expertise for an additional charge.10 The Workforce Payroll software provides a way to manage payroll in-house through an automated system. Some of the features of this program, as listed in Kronos’ Payroll Solutions Guide, include the following:11

Benefits Management: Calculate rates and let employees enroll

Compensation Management: Keep employees motivated

Performance Management: Help ensure timely performance reviews

Applicant Tracking: Track and process applicant information

Training Tracking: Keep skills, licenses, and certifications up to date

Compliance: Enforce and meet policies, rules, and regulations

Reporting: Use standard, custom, and ad hoc reports and views

Self-Service: Empower employees with automation

Payroll: Control your own payroll processes and data

7 Kronos Website, accessed July 2010. http://www.Kronos.com/ 8 “Higher Education Solution Guide.” Kronos Website, accessed July 2010. http://www.Kronos.com/workarea/DownloadAsset.aspx?id=2906&rr=0&LangType=1033&fn=Higher-ed-solution-guide.pdf 9 “Workforce HR.” Kronos Website, accessed July 2010. http://www.Kronos.com/HR/HR-Software/Workforce-HR-Support.aspx 10 Ibid. 11 “Payroll Solutions Guide.” Kronos Website, accessed July 2010. http://www.Kronos.com/thankyou.aspx?id=1394&rr=0&LangType=1033&fn=PayrollSolutionsGuide.pdf

http://www.kronos.com/workarea/DownloadAsset.aspx?id=2906&rr=0&LangType=1033&fn=Higher-ed-solution-guide.pdf

http://www.kronos.com/workarea/DownloadAsset.aspx?id=2906&rr=0&LangType=1033&fn=Higher-ed-solution-guide.pdf

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Kronos suggests pairing the Workforce HR and Workforce Payroll programs to provide a “total solution” to HR, benefits, and payroll administration.12 Integration with Banner Although our research suggests that some institutions use Banner in tandem with the Kronos software, the way in which these two software tools are integrated is not entirely clear from the Kronos website or institutional resources. Limited information was available from SunGard, Banner’s producer, pertaining to integration with Kronos. A 2007 SunGard presentation outlines the benefits of integrating Banner and Kronos; for instance, it is noted that the two-way integration of Banner and Kronos allows for streamlined data updating, reduction in overall file transfer size, and batch processing of timecard inputs. SunGard goes on to suggest that Banner-Kronos integration allows users to maximize their investment and use of both products.13 Ceridian Ceridian is a leading provider of payroll and tax services that has the ability to fully integrate with the Banner software. Ceridian offers a few different options for using and managing its services. Organizations can elect to use Ceridian for payroll processing only; to “integrat[e] payroll processing, HR management, and benefits administration services”; or “seamlessly integrate” time and attendance resources with payroll processing and HR administration.14 Payroll information can be submitted to Ceridian through one of three methods:15

Online

Via payroll software installed internally; or

Through the phone Although Ceridian has its own ERP solution (ERP Easy), the tool can pull data through Banner into its own database, offering a “backward and forward solution” for institutions looking to outsource their payroll or HR functions without doing a software overhaul. Per a conversation with a representative from Ceridian, pricing is determined on a per-employee-per-month basis and use of the software typically necessitates an internal team (usually two to three representatives from accounts payable) to oversee operations on the front end.16

12 “The Integrated Human Resources and Payroll Solution.” Kronos Website, accessed July 2010. http://www.Kronos.com/thankyou.aspx?id=6488&rr=0&LangType=1033&fn=91707-WF-HR-PayrollDS.pdf 13 “Integration – Banner and Kronos.” SunGard Higher Education. March 22, 1007 (presentation). http://webs.edinboro.edu/edocs/SUNGARDHESummit2007/color/BHumres/1225/1225.pdf 14 “Payroll Services: Payroll Processing & Time Tracking.” Ceridian Website, accessed July 2010. http://www.ceridian.com/payroll_services_nav/1,6267,15575,00.html?v=150&cam=branded&k=ceridian&gclid=CMDEkZ2_16ICFciA5QodOlL9xg 15 Ibid. 16 Per telephone conversation with Terence Hung, Ceridian Account Representative. 8 July 2010. 973-515-6380

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Section 2: Literature Review

In this section, Hanover provides a review of literature surrounding the topic of payroll outsourcing. We draw upon findings from both the management and higher education fields. In general, our research identified a blend of pros and cons surrounding payroll outsourcing. At least theoretically, most sources suggest that payroll outsourcing makes sense, given that it can help ease the burden on internal resources by taking advantage of economies of scale. While from a purely financial standpoint outsourcing is generally a sound decision, there may be negative repercussions that accompany the decision to outsource. Payroll Outsourcing in the Management Literature In business management literature, the process of outsourcing business services such as payroll and HR is commonly associated with the idea of “corporate function unbundling” and “business process outsourcing.” From a purely economic standpoint, many management sources suggest that outsourcing makes sense. However, these sources also suggest that outsourcing decisions involve a variety of both financial and non-financial short and long-term costs. These costs should be weighed carefully in the process of making outsourcing decisions. We provide a sampling of the management literature available on this topic below. Economies of Scale A 1999 article from the Harvard Business Review aptly notes that most companies have “three kinds of businesses-a customer relationship business, a production innovation business, and an infrastructure business.” The third of these components (the “infrastructure business”) has high fixed costs, so it runs best when large volumes are being processed, thus achieving low unit costs. It is also cost-focused, working best when processes are standardized, predictable, and efficient. The primary means through which organizations gain a competitive advantage in this arena is through economies of scale. For this reason many organizations outsource the infrastructure component of a business. Unless an organization is very large and handling large amounts of infrastructure-related tasks, it may be logical to outsource certain functions to take advantage of the economies of scale possible through the shared-cost model of large service providers.17 Unbundling Services Authors H. Gospel and M. Sako suggest that the process of corporate function unbundling is complicated and that there are varying paths towards outsourced

17 Hagel, J. III, and M. Singer. “Unbundling the Corporation.” Harvard Business Review, March-April 1999. http://hbr.org/1999/03/unbundling-the-corporation/ar/1

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services, each with varying implications. In some cases, an organization may first work to create internal process improvements through the development of an “internal SS (Shared Services) center.” From here, an organization may choose to “outsource the ownership and management of such a center to a supplier or multiple suppliers…[and] retain in-house know-how of service provision and process improvements.” The downfall of this approach is that the “company has to commit initially to a large investment in standardization and centralization.” In other cases, the company may choose to “outsource the existing processes, typically to multiple suppliers.” Here, suppliers manage the “technological infrastructure” as well as the “know-how to transform specific processes.” The disadvantage here is that the client loses significant ability to provide “input into redesigning processes.”18 The final path discussed by Gospel and Sako involves a quick transition to external services, aiming for “rapid cost reductions to exploit scale economies, labor arbitrage, and increasing return on assets.” The main benefit with this path is that the company does not shoulder the cost of developing an SSC (shared service center); however, in exchange they lack the “know-how” for “transforming processes in-house” and can become “heavily dependent” upon a supplier or group of suppliers.19 Pros and Cons of Outsourcing While at the outset, outsourcing may appear to be a viable option, it does not come without complexities. A 2003 piece on HR outsourcing published in MIT’s Sloan Management Review notes that: “Companies [that outsource] can find themselves overly dependent on suppliers, and they can lose strength in strategically core competencies.”20 Drawing upon a variety of literature on the topic of HR outsourcing, the author of this piece delicately weighs the pros and cons of outsourcing decisions. The pros of outsourcing noted in this article include the following:21

Frees internal staff to “focus on strategic activities that add more value”

“Enables decentralized structures that support higher rates of innovation and flexibility”

Removes the “bureaucratic burden” of a “centralized HR administration”

Allows HR to take part in corporate downsizing

Provides “access to new ideas and approaches outside the organization”

18 Gospel, H and M. Sako. “The unbundling of corporate functions: the evolution of shared services and outsourcing in human resource management.” Industrial and Corporate Change, 1 March 2010, pp. 20-21. http://www.sbs.ox.ac.uk/research/people/Documents/Mari%20Sako/Gospel%20and%20Sako%20ICC%20March2010.pdf 19 Ibid. 20 Adler, P. “Making the HR Outsourcing Decision.” MIT Sloan Management Review, 15 Oct. 2003. http://sloanreview.mit.edu/the-magazine/articles/2003/fall/45112/making-the-hr-outsourcing-decision/ 21 Ibid.

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Meanwhile, the article also notes several cons related to outsourcing. Citing a study of large companies that have taken outsourcing measures, the article states that some of the more frequent complaints about outsourcing include “perceived higher cost and lower quality and fear of losing control.”22 Another survey cited in this article had similar findings, suggesting that outsourcing may result in “poor service, costs higher than promised, contractors with insufficient knowledge about the client, and unanticipated resources required to manage the relationship.”23 All in all, the author concludes that the blend between pros and cons can weigh out differently depending on the unique challenges facing a particular organization. Ultimately, it is recommended that organizations consider the following six factors when making outsourcing decisions:24

Dependency risks: By working with an outside vendor, an organization may become dependent upon that vendor. Certain activities within an organization may also be dependent upon the successful completion of the task being outsourced.

Spillover risks: When information is outsourced, there is the possibility that it may be leaked, possibly “even to competitors.”

Trust: A strong relationship between vendor and client that is built upon trust can avoid some of the risks often associated with outsourcing. Here, it may be useful to compare the level of trustworthiness of potential vendors to that of “internal suppliers.”

Relative proficiency: Organizations should consider how proficient a particular entity is at doing a certain task, comparing internal capacity to the expanded capacity made possible through external resources. If outsourcing is pursued, an organization should likewise consider its own ability to manage suppliers.

Strategic capabilities: If an organization thinks it can gain a competitive advantage in a particular area, it should avoid outsourcing, even if “its current relative proficiency is modest and other factors make outsourcing attractive.” Meanwhile, if a company does not think it can gain such an advantage, outsourcing might be a good idea.

Commitment versus flexibility: Both commitment in a particular direction and strategic flexibility have advantages; organizations should weigh the benefits of both factors in making outsourcing decisions.

22 Ibid. 23 Adler, P. Op. cit. 24 Ibid.

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Outsourcing in Higher Education

In the realm of higher education, Hanover found limited resources regarding the topic of payroll and HR outsourcing. Much of the literature on this topic, which is indeed sparse, is exploratory rather than definitive in nature. One resource of particular note, however, is a piece published by the Institute of Higher Education Policy entitled “Is Outsourcing Part of the Solution to the Higher Education Cost Dilemma?” In this report, authors Merisotis and Phipps contend that “a major barrier to outsourcing in higher education is the very essence of the organization.”25 By definition, institutes of higher education exist to educate, not to make money; this reality makes the prospect of outsourcing particularly challenging. After reviewing and summarizing a variety of literature on the subject of higher education outsourcing, Merisotis and Phipps propose a loose list of “the components of a threshold conducive to outsourcing.” They put forth the following stipulations:26

Outsourcing must result in a benefit to “virtually all of the constituencies of the institution.” In particular, there must be no harm to the personnel who are impacted by outsourcing.

The quality of the service must be equal to and cheaper than, or otherwise superior to, that previously offered.

Organizations hoping to outsource should participate in a formal RFP process.

Building upon these stipulations and the existing literature on the topic, Merisotis and Phipps conclude that “not nearly enough” is known about the topic of outsourcing as it relates to higher education in order to make a “reasonable judgment” about an opportunity to outsource.27

Outsourcing Apprehension

A 2004 survey of higher education institutions with at least 15,000 students revealed that many show increased apprehension in outsourcing HR, financial, and accounting functions as compared to other functions, like information technology. Several noted that leaders are unwilling or unable to introduce a third party vendor into the employer-employee relationship. The sensitive, and often proprietary, nature of HR information has inhibited HR outsourcing in the past. In contrast, colleges and universities are generally more open and willing to outsource other services, like bookstore management, dining operations, and janitorial service.28

25 Merisotis, J. and R. Phipps. “Is outsourcing part of the solution to the higher education cost dilemma?” Institute for Higher Education Policy, Sept. 2005, 19. http://www.ihep.org/assets/files/publications/m-r/Outsourcing.pdf 26 Merisotis, J. and R. Phipps. Op. cit. 19-20. 27 Ibid. 20. 28 Williams June, A. “Colleges Avoid Some Outsourcing.” The Chronicle of Higher Education. September 30, 2005, accessed online July, 2010. http://chronicle.com/article/Colleges-Avoid-Some-Outsour/4428/

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Section 3: Institutional Profiles

The section below offers profiles from 11 institutions that either currently use or have recently used Kronos, ADP or Ceridian. All of these institutions are either current or former Banner users, as well. Kronos Users Xavier University of Louisiana Xavier University of Louisiana utilizes both the Kronos service and the Banner software to help manage its HR functions. In tandem with Kronos’ time and attendance system, employees enter their hours using the telephone or through their supervisor. The system tracks both hourly and salaried employees, although only hourly employees’ compensation is determined using the system. For salaried employees the system tracks vacation time, sick leave, jury duty, etc. Internally, Xavier designates certain employees as timekeepers, who are responsible for reviewing leave, absences, and missing punches each day.29 Staff listed within Xavier’s Human Resource Division includes the following:30

Compensation Analyst (2)

Director of Human Resources

Employment Specialist

Administrative Assistant

Associate Director of Human Resources

Human Resources Technician

Temple University Temple University uses a combination of Banner and Kronos, according to a 2009 update on the university’s website.31 Notably, Temple’s staff is much larger than that of XYZ College overall. Corresponding to their large staff size, Temple has a substantial HR division, with six subdivisions.32 One of the subdivisions of Temple’s Human Resource Department is its Payroll and Information Management

29 “KRONOS Workforce Central Timekeeping System Policy Manual.” Xavier University of Louisiana Website, accessed July 2010, 5-6. http://www.xula.edu/human-resources/documents/KRONOS%20Policy%20Manual.pdf 30 “Campus Directory Search.” Xavier University of Louisiana Website, accessed July 2010. http://www.xula.edu/other/phonebook.php 31 “KRONOS Time and Attendance Application.” Temple University Website, accessed July 2010. http://www.temple.edu/hr/departments/payroll/Kronostimeattendance.htm 32 Temple University Department of Human Resources Website, accessed July 2010. http://www.temple.edu/hr/index.html

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department. Temple currently employs 18 payroll management staff. Positions within the payroll sub-department include the following:33

Assistant Vice President

Director

Assistant Director (3)

Technical Systems Manager (2)

Administrative Coordinator

Administrative Specialist (7)

Senior Administrative Specialist (3)

Temple has published a few pieces of information related to the switch to Kronos on its website. One piece of information that may be particularly useful is the university’s project development timeline for implementation of the Kronos software. The implementation was completed in January of 2010. Here, the University provides a month by month list of the tasks completed to integrate Banner and Kronos capabilities. Below, we provide a quick summary of these tasks as detailed in an abbreviated version of the timeline provided by Temple:34

Figure 1: Kronos Project Development/Timeline from Temple University

Source: Temple University Website

The transition to Kronos was completed in conjunction with a university-wide Banner implantation. Temple University utilizes Kronos to automate attendance, time, and leave recording. All hourly employees record hours worked and leave time using Kronos. Salaried employees use Kronos for leave time only. Adjunct faculty and graduate students do not record time using Kronos.35

33 “Staff: Payroll Management.” Temple University Directory, Temple University Website, accessed July 2010. http://www.temple.edu/hr/departments/payroll/staff.htm 34 “Kronos Time and Attendance Application: Project Development/Timeline.” Temple University Website, accessed July 2010. http://www.temple.edu/hr/departments/payroll/ProjectDevelopment.htm 35 “Kronos Time and Attendance Application FAQ.” Temple University Website. accessed July, 2010. http://www.temple.edu/hr/departments/payroll/FAQs.htm

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Seton Hall University

Seton Hall University’s Department of Human Resources utilizes Kronos for time, attendance and leave management in tandem with its ERP/Banner solution. The university uses Kronos to “streamline mission critical HR, payroll, and time and leave processes.”36 According to a January 2008 press release from Seton Hall, the university added the Banner software to its existing capabilities fairly recently and was still in the process of implementing new Banner systems on campus in 2008.37

In an effort to summarize the way that HR and payroll functions are staffed internally at Seton Hall, some information about the Department of Human Resources is provided below. The Department of Human Resources at Seton Hall has seven divisions. In total, there are 15 staff members in the Human Resources department, four of which work in payroll administration. Employees in all of the divisions within the Department of Human Resources are listed below:

Benefits (2 employees)38 o Benefits Manager o Benefits Specialist

Compensation (2 employees)39 o Recruitment and Compensation Manager o Compensation Analyst

Employee and Labor Relations (1 employee)40 o Manager, Labor and Employee Relations

HR Information Systems (3 employees)41 o HRIS and Payroll Operations o HRIS Data Manager o HRIS Specialist

Payroll (4 employees)42 o Payroll Manager

36 “Time and Attendance System (Kronos).” Seton Hall University Website, accessed July 2010. http://www.auth.shu.edu/offices/human-resources/time-attendance-system.cfm 37 “HR/Payroll Module Banner Update.” Seton Hall University Website, 28 Jan. 2008. http://www.shu.edu/news/article/64695 38 “Department of Human Resources: Benefits.” Seton Hall University Website, accessed July 2010. http://www.shu.edu/offices/human-resources/benefits.cfm 39 “Department of Human Resources: Compensation.” Seton Hall University Website, accessed July 2010. http://www.shu.edu/offices/human-resources/compensation.cfm 40 “Department of Human Resources: Employee and Labor Relations.” Seton Hall University Website, accessed July 2010. http://www.shu.edu/offices/human-resources/employee-labor-relations.cfm 41 “Department of Human Resources: HR Information Systems.” Seton Hall University Website, accessed July 2010. http://www.shu.edu/offices/human-resources/hr-technology.cfm 42 “Department of Human Resources: Payroll Administration.” Seton Hall University Website, accessed July 2010. http://www.shu.edu/offices/human-resources/payroll.cfm

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o Senior Payroll Administrator o Supervisor/Data Processing o Personnel Tech/Data Entry

Recruitment and Employment (2 employees)43 o Recruitment and Compensation Manager o Employment Specialist

Training and Organizational Development (1 employee)44 o Manager, Training and Organizational Development

George Washington University

George Washington University also uses both Banner and Kronos services, amongst others.45 Banner functions as GW’s enterprise system whereas Kronos fulfills the university’s time-keeping functions. To manage the use of its Banner enterprise system, GWU has a Banner Advisory Committee, comprised of staff from a variety of university divisions.46 Meanwhile, Kronos serves as a software package built into the university’s IT capabilities, allowing for streamlined clock-in/clock-out functions and payroll reporting.47

To provide a more comprehensive picture of the way that the use of Kronos has impacted GWU’s payroll staffing, we list the payroll staff currently listed on the university’s finance office website in the table below. Where available, we also list corresponding job responsibilities.

Table 3: Payroll Staff at George Washington University

Staff Division Title Responsibilities

Chief Administrative Staff Director Not available

Assistant Manager Not available

Administration

Technical Support Specialist

Banner Support

Payroll Analyst SmarTrip/SmartBenefit Vouchers; Non-

GW Parking Escheatment

43 “Department of Human Resources: Recruitment and Employment.” Seton Hall University Website, accessed July 2010. http://www.shu.edu/offices/human-resources/recruitment-employment.cfm 44 “Department of Human Resources: Training and Organizational Development.” Seton Hall University Website, accessed July 2010. http://www.shu.edu/offices/human-resources/training.cfm 45 “Division of IT Supporter Software.” George Washington University Helpdesk Website, 3 June 2010. 46 “Banner Advisory Committee.” George Washington University Website, accessed July 2010. http://www.gwu.edu/~banner/bac/index.html 47 “Time Reporting System (Kronos).” George Washington University Helpdesk Website, 1 June 2010. http://helpdesk.gwu.edu/Kronos/index.html

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Staff Division Title Responsibilities

Payroll Operations

Supervisor, Payroll Operations

Monthly/Biweekly Processing; Supplemental Payroll Processing; Non-

Resident Tax

Senior Payroll Specialist Retirement Pay Remittance; Garnishments,

Levies, Liens; Child Support Payments; Savings Bond Remittance

Payroll Specialist Telephone Inquiries; Payroll Distribution; W4; State Tax Processing; Employment

Verifications

Operations Specialist Direct Deposits; Overpayments;

Terminations

Payroll Specialist Timesheets; Pay Adjustment Processing;

Parking

Time Reporting System System Administrator Training; User Administration; Approvals

Payroll Accounting Accountant Payroll/Benefit Accounts; Reconciliation

Payroll Accountant Labor Adjustments; Labor Redistributions;

Labor Reporting; Tax Payments Source: George Washington University Finance Office Website48

ADP Users Columbus State University The HR division at Georgia’s Columbus State University uses a combination of ADP and Banner services. There are eight staff positions listed on Columbus State University’s HR Website, including:49

Human Resources Director

Data Manager

Human Resources Administration/Benefits Manager

Employment Manager

Payroll Associate (2)

Senior Benefits Assistant

Administrative Assistant Specific functions of the Human Resources’ Payroll Office at Columbus State University are also listed on the HR website and consist of the following:50

48 “Payroll Staff.” George Washington University Finance Office Website, accessed July 2010. http://financeoffice.gwu.edu/taxpayrollbenefits/payroll/payroll_staff.html 49 “Contact Info.” Columbus State University Human Resources Website, accessed July 2010. http://helpdesk.gwu.edu/software/supported.htmlhttp://hr.colstate.edu/contact.asp 50 “Payroll.” Columbus State University Human Resources Website, accessed July 2010. http://hr.colstate.edu/payroll.asp

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Input data into the Human Resources Management System (HRMS).

Salary payments to employees for work performed for the university.

Time, attendance and accrued leave records.

Preparation and distribution of federal W-2’s and other tax information.

Court-ordered withholdings such as garnishments, bankruptcies and tax levies.

Payroll accounting activities such as budget account reconciliation. Additionally, the payroll staff offer “consultation to managers and users on payroll processes and procedures” and answer questions related to pay and deductions.51 HR services at Columbus State University are overseen by the Vice President for Business and Finance, who also oversees the university’s Business Services, Financial Services, and Plant Operations. Hofstra University A recent job posting from Hofstra University suggests that the institution uses a mix of ADP and Banner services.52 Hofstra has over 2,000 employees and manages the payroll for these employees through electronic software. It is not clear which staff members at Hofstra manage payroll services; however, it is apparent that they are contained within the university’s HR division. The HR office at Hofstra has 14 listed staff, which are labeled using generic position descriptions. Listed HR positions include:53

Director, Human Resources

Associate Director, HR/Compensation

Associate Director, Human Resources

Senior Associate Director, Human Resources

Senior Human Resources Administrator (2)

Human Resources Administrator (4)

Human Resources Coordinator, HRIS

Human Resources Coordinator (2)

Human Resources Assistant Curry College Curry College, a liberal arts institution in Massachusetts, uses both Banner and ADP. Information available on Curry’s website suggests that ADP’s services are used not

51 Ibid. 52 “Payroll Office.” Hofstra University Website, accessed July 2010. http://www.hofstra.edu/pdf/jobs_PayrollAsstDirector.pdf 53 “Staff Directory: Human Resources.” Hofstra University Website, accessed July 2010. http://www.hofstra.edu/About/HR/hr_staff.html

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only for payroll, but also for other HR functions.54 It does not appear that Curry lists all HR staff online, particularly since the payroll and purchasing and accounts payable divisions do not have websites. However, the following positions are listed on Curry College’s HR webpage:55

Director

Benefits and Compensation Administrator

Recruitment and Employee Relations Administrator

Administrative Assistant and HR Representative Kennesaw State University Kennesaw State University uses both Banner and ADP services. The degree to which either service is integrated into the campus’ HR and/or payroll functions is unclear; however, both services are listed on the university’s homepage.56 A search of the university’s directory revealed that they have both a HR department and a payroll department. A number of staff members are listed under the HR department, including:57

HR Specialist III

HR Specialist II (3)

Assistant Vice President, Human Resources

Senior Human Resources Partner

Director I

Manager/Supervisor VII

Administrative Assistant III

Administrative Assistant IV

Administrative Specialist II

Administrative Specialist III

Manager of Human Resources

Director, Human Resources Operations

Senior Human Resources Partner

Employment Specialist II

Accounting Professional IV

Director, Human Resources Services

Human Resources Specialist II

54 “Curry College’s Red Flag Identity Theft Prevention Program.” Curry College Website, accessed July 2010. http://www.curry.edu/NR/rdonlyres/56BF481C-615E-44B3-AED6-243D12FD6EC1/0/RedFlagPolicy.pdf 55 “Human Resources.” Curry College Website, accessed July 2010. http://www.curry.edu/About+Us/Human+Resources/ 56 Kennesaw State University Website, accessed July 2010. http://www.kennesaw.edu/ 57 Kennesaw State University Phone Directory search for “human resources.” Kennesaw State University internal Website, accessed July 2010. http://ksuweb.kennesaw.edu

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Meanwhile, the payroll division lists six staff members, including the following:58

Office/Clerical Lead I

IT Application Support Professional V (2)

Payroll

IT Application Support Professional I-Payroll Supervisor

Manager III Ceridian Users Roosevelt University Chicago-based Roosevelt University uses a blend of services from a variety of platforms, including Banner, BSR Advance, and Ceridian.59 The HR division at Roosevelt University currently lists 15 staff members. Positions falling under this office include:60

Administrative Clerk

Assistant Vice President

Assistant Vice President of Human Resources

Assistant to the Vice President of Human Resources

Chief Clerk (2)

Director of Employment

Director of Human Resources

HR Recruiter

HRIS Specialist

Human Resource Generalist (2)

Recruiting Assistant

Student Placement Specialist

Vice President Abilene Christian University Abilene Christian University uses both Banner and Ceridian to help with its HR functions. The university lists six staff under its HR office:61

58 Kennesaw State University Phone Directory search for “payroll.” Kennesaw State University internal Website, accessed July 2010. http://ksuweb.kennesaw.edu 59 “Roosevelt University Employee/Contractor Confidentiality Agreement and FERPA Policy Statement.” Roosevelt University Legacy Website, accessed July 2010. http://legacy.roosevelt.edu/ 60 “Human Resources: Faculty/Staff Directory.” Roosevelt University Website, accessed July 2010. http://www2.roosevelt.edu/dir/results-offices.asp 61 “Contact Us.” Abilene Christian University Human Resources Website, accessed July 2010. http://www.acu.edu/campusoffices/hr/welcome/our_staff.html

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Associate Vice President

Director

Employee Services Coordinator (2)

Internal Communications Coordinator

Project Specialist Employees of Abilene Christian University keep track of their time using the Banner Web service, which is then approved by their supervisor.62 The specific ways in which Ceridian’s services are integrated with the Banner software are not clear from Abilene Christian University’s website. University of Detroit at Mercy The University of Detroit at Mercy (UDM), a former Ceridian Source 500 user, recently switched all of its systems over to the Banner service.63 Information regarding the university’s decision to discontinue the use of Ceridian and other Enterprise Resource Planning services is not available. Per review of the institution’s website, UDM currently lists eight staff members in its Human Resources Division (categorized by functional area):64

Human Resources and Payroll: o Associate Vice President o Associate Director o Assistant Director o Human Resources Generalist

Compensation and Benefits: o Benefits Generalist

Employment Services: o Administrative Assistant

Payroll: o Payroll Supervisor o Payroll Associate

62 “Entering Time on Banner Web.” Abilene Christian University Website, accessed July 2010. http://www.acu.edu/campusoffices/hr/documents/payroll/Entering_Web_Time-20.pdf 63 “ITS Departmental Accomplishments.” 64 “Human Resources.” University of Detroit at Mercy Website, accessed July 2010. http://www.udmercy.edu/hr/index_print.htm

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Payroll Outsourcing in Higher Ed - Strategy · PDF fileIn this report, we discuss the costs...

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