Paperless Pay Discussion

withPatrick Koroly, ADP

Agenda

Why companies are moving to Electronic Wage Payments

How to Integrate into your Organization

Choosing a Vendor

About ADPs Aline Pay Card

Fun?? Facts

$36 - $43

55% +

94%

Paperless Savings Per Employee/Yr.Sources: The Hackett Group, Payroll Performance Study, 2009.American Payroll Assoc. Workforce Management and Payroll Performance Studies, 2010.

% Americans using a Smart Phone

Percent of Dog owners who say their

dog makes them smile at least once per day#

Benefits of Electronic Payment

Solutions

Four Universal Objectives

HR & Payroll departments are focused on:• Increasing operational

efficiency

• Minimizing financial and compliance risk

• Attracting and attaining quality employees

• Reducing environmental impact

Best in Class Companies Use Electronic Pay to Cut CostsAn APA published

study revealed:• Top performers attain

90% electronic pay distribution that costs $41 per employee

Versus 76% by peer group that costs $84 per employee!

• Top Performers save over 50% in payroll processing costs

Top Performer

s

Peer Group

90%

$41

$84

76%

0

100%

$100

%

ele

ctr

on

ic

pay

$ c

ost

per

em

plo

yee

Sources: The Hackett Group, Payroll Performance Study, 2009. American Payroll Assoc. Workforce Management and Payroll Performance Studies, 2010.

Cost of Printing/Distribution

$33 Billion – the amount spent on printing checks each year

Cost of Postage continues to increase

Fed Ex/UPS Charges

Multi-locations = multiple Bank relationships

Misc: check stock, toner, etc…

Payroll Dept’s time to process

Why Move to Electronic Pay?

The Electronic Payment Landscape Is Slowly Taking Shape…

Events

Wage Payments in the U.S. today…

the United States… 72% of Americans

receive pay via Direct Deposit

Pay Card is a solution for the Unbanked• 7.7% of American

households are unbanked

• 17.9% are underbanked – still use check-cashing services

So Why Aren’t More Companies at 90% Electronic?

Many companies hit a ceiling when going electronic

A segment of employees don’t have traditional banking relationships

No means to do direct deposit

Some simply prefer physical check payment

Expanding to this group is perceived as a daunting task

Many cautious about process interruptions and complications

Hesitation with presenting new solutions to Unions

How to Integrate Pay Cards into your

Organization

Secure Executive Support at the Initiation of the Program..

Allows the company to realize the full benefit:

Distribution Costs

Delivery Guarantee

Disaster Recovery/Business Continuity

89% of participants in our 2010 Global Payroll Performance Study indicate a high/medium level of executive support but they haven’t been able to leverage it to increase organizational influence…

Position as Employee Benefit

Pay Cards need to be positioned as benefit to employees

●Reduces fraud

●Allows them to take advantage of other conveniences like online bill payment

Every attempt should be made to eliminate and/or alleviate changes to/from paycards to paper payments…

Position as Employee Benefit…not only for Unbanked

Pay Cards for the Banked are on the rise – they use for:

●Children in College

●Christmas Club

●Vacation

●Fun money

Every attempt should be made to eliminate and/or alleviate changes to/from paycards to paper payments…

Include it as a part of the Onboarding process

Include it as part of annual benefits open enrollment/and other benefits employees can opt into at certain times during the year

Make Electronic Payments a Characteristic of Your Corporate DNA…

Choosing a Pay Card Vendor

Choosing a Pay Card Solution

Key Components: Branded

Compliant:

Direct Deposit

Pay Card

Self-Issued Checks that can be activated without activating the Card

Convenience/Accessibility to Funds:

Choosing a Pay Card Solution

Cardholder Convenience/Accessibility to Funds:

Large ATM Network Footprint

Access Funds “Pay to the Penny”

Low Cardholder Fees:

Free Withdrawals at ATM per pay period

Free Cash Back (Supermarkets, Convenience Stores…)

Free POS and Signature Based Transactions

Free Cashing of Convenience Checks

Ability to Load Funds onto the Card (Green Dot MoneyPak)

Choosing a Pay Card Solution

Electronic Banking for Cardholder:

Check Balance

Bill Pay

Ability to Transfer Funds

Order Checks, Additional Cards, Report Lost/Stolen Cards

Mobile App Technology

Check Balances and Transaction History

Find nearby ATM Locations ATM Locator

Text and Email Alerts

Mobile App Technology

Choosing a Pay Card Solution

Implementation

Experience and Resources

Solutions Architect

Customized Rollout Plan

Customized Communications: brochures, letters, emails, posters

Multi-Lingual support

Multi Location/Tabling Services to go on site to talk to employees

Dashboards to measure success

Cardholder Average Usage Used?

ATM Networks: Primary method used by cardholders to access cash

ATM Usage: The average cardholder uses the ATM 2.6 times per month.

POS Transactions: The average cardholder conducts 6 debit and 8 signature based transactions per month.

Convenience Checks: Less than 1% of transactions are convenience checks.

Best Practices

Mandate where allowable Direct Deposit, Pay Card, Self-Issued

Check

Incorporate into Overall Culture Use Cards for New Hires, Bonuses and

Termination pay

Executive Support

Effective Communication

Combine with On-Line Pay Statement to reduce costs, offer more convenience

© API Fund for Payroll Education, Inc.

Thank you!!