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FY 2024 ADP Annual Services
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DESCRIPTION: Authorization for the renewal agreement for ADP timekeeping and payroll services |
AGENDA NO: Click or tap here to enter text. |
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ACTION REQUEST: ☒ Approval ☐ Review Comment ☐ Information Only ☐ Other |
RECOMMENDATION:
recommendation
Authorize the Chief Executive Officer to renew ADP timekeeping and payroll services. The request is not to exceed the amount of $351,509.56.
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ISSUE/BACKGROUND:
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RTA uses ADP as the primary payroll/timekeeping and benefits system. ADP doesn’t have binding contracts. Instead, ADP has standard price agreements that RTA signed when first onboarding in 2019 and 2020.
In May 2019, RTA entered into an agreement with ADP for executive payroll which entailed 70 personnel in Workforce Now and W2/1099s, 72 in Talent Management, and 2 in Payroll Solutions for a total annual cost of $10,943.80.
After the transfer of Operations and Transportation Departments from TransDev Services to RTA, RTA expanded the ADP services in March 2020 to include all RTA personnel to ADP Workforce Now (800) with 13 InTouch Bar-code Time Clock subscriptions. The agreement was amended to include the remaining operations staff that had transitioned from Transdev to RTA direct employ. This amendment included the incorporation of a Time and Attendance solution for hourly and union staff. The added costs plus implementation brought the new total to $79,080.00.
A review of the 2020 agreement and current annual costs finds an increase in costs for services to ADP. Since its inception, employee counts per service have increased from 800 to 836. Each service provided by ADP is per employee. The increase in employee count plus service costs results in higher annual costs for RTA. Additionally, the Oracle Implementation Project added the integration of ADP with Oracle via the Oracle / ADP Bridge.
A request for a change order to replenish ADP funds was not conducted in 2023 resulting in the 2022 PO for $85,500.00 depleting its funds in December 2023. RTA requisitioned change orders to continue service in Q1-2 2024 until a new, multi-year agreement with ADP could be drafted and brought to the Board for review. Included in the agreement is rate parity, employee count adjustment, and the switch from lease to purchase of timeclocks.
RTA tested three types of time clocks, Barcode, Proximity, and InTouch, and on January 20, 2021, RTA went live with 13 In Touch time clocks at its facilities. RTA leases 13 punch/code entry time clocks from ADP for an annual cost of $22,682.40. The training department requested an additional time clock at or near its location at ENO. RTA is purchasing a 14th time clock for the East New Orleans facility. Should the lease continue at the given rate ($1,744.80 per month), the annual fees would be $24,427.20.
RTA seeks to upgrade to biometric timeclocks and purchase them in lieu of leasing. The total cost of Smart Card Clocks with Quickpunch Plus is $82,160.00. Given the annual fee of leasing the clocks, the purchase will have paid for itself within four years (3.4).
Over the course of the last few months, RTA has worked with ADP to align services into a multi-year agreement with rate parity and a single agreement update plan. The following is a breakdown of the current rates:
RTA - ADP Current Rates
|
Feature Description |
SCN |
MIN |
Base |
Rate |
Units |
Feature Cost |
Annual Billings |
Annual Cost |
|
Essential Plus Payroll |
F0040R |
|
|
$1.40 |
822 |
$1,150.80 |
26 |
$29,920.80 |
|
Enhanced HR |
F0070F |
|
|
$0.95 |
822 |
$780.90 |
26 |
$20,303.40 |
|
Benefits Administration |
F007BA |
|
|
$1.40 |
822 |
$1,150.80 |
26 |
$29,920.80 |
|
Quarterly W2 Delivery |
F00011 |
|
$19.80 |
|
2 |
$19.80 |
4 |
$158.40 |
|
Y/E Info, Tax Reporting, W-2's |
F00053 |
|
|
$4.70 |
987 |
$4,638.90 |
2 |
$9,277.80 |
|
Mass Mutual Custom Pay File |
R00952 |
|
$65.75 |
|
2404 |
$65.75 |
26 |
$1,709.50 |
|
Mass Mutual Master File |
R00952 |
|
$65.75 |
|
1130 |
$65.75 |
26 |
$1,709.50 |
|
ADP Data Bridge |
F00788 |
|
|
$1.50 |
845 |
$1,267.50 |
12 |
$15,210.00 |
|
Employee Hosted Time & Attendance |
F0040D |
$1,192.95 |
|
$4.20 |
378 |
$1,587.60 |
12 |
$19,051.20 |
|
Hosting Fee |
F0040J |
$298.25 |
|
$1.05 |
378 |
$396.90 |
12 |
$4,762.80 |
|
|
|
|
|
|
|
|
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$132,024.20 |
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TOTAL: 132,024.20 |
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Due to the multiple agreements developed over time between RTA and ADP, there are four billing codes associated with the account. The account codes break down as follows:
10-DT0 & SLF - Payroll processing
1W-SLF - Data bridge and third party
3D-SLF - Time and attendance
ADP Annualized Client Current Pricing and the Proposal uses six-month average billing to produce the employee count. Historically, the Annualized Client Current Pricing was used for requisitions. The employee count therein is dramatically lower than the total employee count which resulted in purchase orders depletion before the projected time window end. The above table captures rate per feature as described in the Annualized Pricing and the Proposal and projects to the actual employee count.
RTA seeks to enter into the two-year agreement with ADP with a 1% increase in services equivalent to $1320.24 at the onset of the agreement. See the following table for year one (1) expected costs:
RTA - ADP Year 1 with 1% Increase Rates
|
Feature Description |
SCN |
MIN |
Base |
Rate |
Units |
Feature Cost |
Annual Billings |
Annual Cost |
|
Essential Plus Payroll |
F0040R |
|
|
$1.414 |
822 |
$1,162.31 |
26 |
$30,220.01 |
|
Enhanced HR |
F0070F |
|
|
$0.9595 |
822 |
$788.71 |
26 |
$20,506.43 |
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Benefits Administration |
F007BA |
|
|
$1.414 |
822 |
$1, 162.31 |
26 |
$30,220.01 |
|
Quarterly W2 Delivery |
F00011 |
|
$19.998 |
|
2 |
$19.998 |
4 |
$159.99 |
|
Y/E Info, Tax Reporting, W-2's |
F00053 |
|
|
$4.747 |
987 |
$4,685.289 |
2 |
$9,370.58 |
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Mass Mutual Custom Pay File |
R00952 |
|
$66.4075 |
|
2404 |
$66.4075 |
26 |
$1,726.60 |
|
Mass Mutual Master File |
R00952 |
|
$66.4075 |
|
1130 |
$66.4075 |
26 |
$1,726.60 |
|
ADP Data Bridge |
F00788 |
|
|
$1.515 |
845 |
$1,280.175 |
12 |
$15,362.10 |
|
Employee Hosted Time & Attendance |
F0040D |
$1,192.95 |
|
$4.242 |
378 |
$1,603.476 |
12 |
$19241.71 |
|
Hosting Fee |
F0040J |
$298.25 |
|
$1.061 |
378 |
$400.869 |
12 |
$4,810.43 |
|
|
|
|
|
|
|
|
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$133,344.46 |
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TOTAL: 133,344.46 |
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ADP identified a 2% increase in services for the second year of the agreement equivalent to $2,666.89. See the following table for year two (2) expected costs:
RTA - ADP Year 2 with 2% Increase Rates
|
Feature Description |
SCN |
MIN |
Base |
Rate |
Units |
Feature Cost |
Annual Billings |
Annual Cost |
|
Essential Plus Payroll |
F0040R |
|
|
$1.442 |
822 |
$1,185.32 |
26 |
$30,818.42 |
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Enhanced HR |
F0070F |
|
|
$0.979 |
822 |
$804.74 |
26 |
$20,923.19 |
|
Benefits Administration |
F007BA |
|
|
$1.442 |
822 |
$1, 185.32 |
26 |
$30,818.42 |
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Quarterly W2 Delivery |
F00011 |
|
$20.398 |
|
2 |
$40.796 |
4 |
$163.18 |
|
Y/E Info, Tax Reporting, W-2's |
F00053 |
|
|
$4.842 |
987 |
$4,779.054 |
2 |
$9,558.11 |
|
Mass Mutual Custom Pay File |
R00952 |
|
$67.7357 |
|
2404 |
$67.7357 |
26 |
$1,761.13 |
|
Mass Mutual Master File |
R00952 |
|
$67.7357 |
|
1130 |
$67.7357 |
26 |
$1,761.13 |
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ADP Data Bridge |
F00788 |
|
|
$1.545 |
845 |
$1,305.525 |
12 |
$15,666.30 |
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Employee Hosted Time & Attendance |
F0040D |
$1,192.95 |
|
$4.327 |
378 |
$1,635.606 |
12 |
$19,627.27 |
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Hosting Fee |
F0040J |
$298.25 |
|
$1.082 |
378 |
$408.996 |
12 |
$4,907.95 |
|
|
|
|
|
|
|
|
|
$136,005.10 |
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TOTAL: 136,005.10 |
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The ADP Annualized Current Pricing used for quotes only accounts for a six-month average billing. Actual employee counts are not provided. Due to the disparity between 6-month average and actual employee count, purchase requisitions may be far lower than projected amounts thereby leading to depleted POs and change order requests.
Original agreements were locked in place for an initial time period only and are subject to rate increases annually at the going market rate. Agreeing to a multi-year agreement locks in the rate increase and lowers the risk of exorbitant rate hikes. For example, in the 4/28/2023 Invoice 632216081, 0036-10-DT0 rate increase 3.88% from $3.61 to $3.75 in 1/26/2024 Invoice 652955194. The same code only increases by the contracted 1% and 2% for the coming two years.
RTA seeks funding for continued, annual ADP services. The first year of services would be no more than $133,344.46 plus the cost of the purchase of the new time clocks Smart Card Clocks with Quickpunch Plus, $82,160.00, results in a total year one (1) request of $215,504.46. RTA seeks to request the total funds for the two-year agreement. Year one $215,504.46 plus year two $136,005.10 results in the total request for continued ADP subscription of $351,509.56.
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DISCUSSION:
A request for a change order to replenish ADP funds was not conducted in 2023. The current PO dating from 2022 was for $85,500.00 depleted its funds in December 2023. RTA seeks to update the service agreement and continue services with ADP in 2024.
ADP is a specialized software used by RTA Human Capital Management, Timekeeping and Dispatch, and Benefits. Timeclocks purchased from ADP are proprietary and only work with ADP software. Due to the prior agreements in place, Sole Source requisition will be used to purchase the time clocks and procure the annual funding.
Original agreements were locked in place for an initial time period only, and are subject to rate increases annually at the going market rate. Agreeing to a multi-year agreement locks in the rate increase and lowers the risk of exorbitant rate hikes. The same code only increases by the contracted 1% and 2% for the coming two years.
RTA requests the funding for two years of ADP services at $269,349.56 and the purchase of Smart Card Clocks with Quickpunch Plus timeclocks to replace the monthly lease fees for a total of $82,160.00 bringing the projected total request to $351,509.56.
FINANCIAL IMPACT:
The ADP subscription agreement will be locally funded from account 01-2900-02-7140-171-00-00-00000-00000 and is not to exceed $351,509.56.
NEXT STEPS:
With Board approval, staff will assign a purchase order to extend the annual agreement with ADP.
ATTACHMENTS:
1. Resolution ADP 2024
2. Cost breakdown
3. RTA - 13 DX Timeclock Purchase Sales Agreement
4. Regional Transit Authority Current Detailed Pricing Report
5. Regional Transit Authority MAS Pr Agr 2024 May 20 Draft
6. Original Signed Enterprise eTime Order and Addendum
7. RTA - WFN Original Order and MA Agreement
8. ADP APR Routing Form 5.2024
9. 1827816 0036 10SLF Proposal 05-14-2024
10. ADP LLC - PO RTAP_00292
11. ADP Inv Rate hike examples 2024
Prepared By: Doris O’Sullivan
Title: Project Manager of Information Technology III
Prepared By: Sterlin Stevens
Title: Director of Information Technology
Reviewed By: Dwight Norton
Title: Chief Planning & Capital Projects Officer
Reviewed By: Gizelle Johnson-Banks
Title: Chief Financial Officer
6/10/2024
Lona Hankins Date
Chief Executive Officer