What to Do if Your Payroll Solution is Sunsetting

When your vendor moves away from its payroll module it can be stressful, leaving you with several questions. The most obvious being, “Now what?”

Rest assured, there are many alternatives out there that can meet your needs and there are steps you can take now to better control your company’s experience going forward.

Let’s focus on what actions are available to you to minimize disruptions and avoid payroll concerns during this transition period.

Key Takeaways

• Identifying your payroll requirements upfront helps you research, evaluate and select the best payroll solution for your operations.
• Asking vendors about their data migration and implementation process can ensure a smooth transition, limiting payroll disruptions.
• Communicate early and often with your team about potential payroll changes and include administrative staff who handle payroll in any meetings with the new vendor.

The Steps You Can Take to Minimize Payroll Disruptions

When a payroll module is sunsetting, the best way to avoid disruptions is to follow a clear, organized plan that keeps your payroll data, timelines and teams aligned. Some points to consider include:

• Talking to your current provider about the upcoming changes
• Identifying your payroll requirements
• Selecting the best fit, whether that’s another payroll software/module or service
• Exploring generic payroll solutions vs. construction-specific and understanding which is the best fit for your company
• Asking your current vendor about migration support
• Communicating with your team to avoid confusion
• Talking to potential new vendors about their implementation process
• Selecting your new provider and begin implementation

Let’s take a closer look at each step so you’re more comfortable with the process and are ultimately able to invest in the best fit for your operations.

Step One: Talk to Current Provider to Understand What’s Happening

The first step in navigating a payroll sunset is to understand exactly what your current provider is changing and how these changes affect your day-to-day processes.

More specifically, ask which functionalities are being removed: is it the entire module itself or just certain deployments (i.e. on-premises vs. hosted).

Additionally, ask your current vendor about the shutdown timeline. That way you have a clear understanding of when your current payroll functionalities end so you can research new options and implement a new solution before that deadline.

Step Two: Ask Current Vendor About Migration Support

Once you know what’s being shut down and when, the next step is determining what migration support your current vendor provides so you can prepare for a smooth transition.  

A few key questions you should ask include:

• What payroll data can be exported?
• Am I limited to a certain timeframe, or is all of my historical data able to be exported?
• What does the migration process look like?
• Does your team offer hands-on support during the migration process?
• If yes, for how long?
• What will taxes and W-2s look like if the migration process starts in the middle of the fiscal year?
• When is the end date for payroll processing with this current system?
• What is the cutoff date for retrieving my data?

Once you have a clear understanding of how your current module will be offloaded, you can look at alternative options to invest in and onboard.

Step Three: Identify Your Payroll Requirements

Before choosing a replacement, take a moment to reassess what your payroll process truly needs today, since your needs may have changed during your tenure with your current provider.

Consider recent growth, intent to grow, increased workload or headcount, the addition of multi-state projects, government contracts and any interest in union workers.

If you have changed or expanded your company’s goals and scope, consider if you now need:

• Certified payroll
• Union reporting
• Multi-state processing
• Prevailing wage tracking to remain compliant with the Davis-Bacon Act
• Integration capabilities with existing construction systems like time tracking apps and accounting software

Once you’ve identified your needs, you can begin exploring your options.

Payroll Software/Module vs. Payroll Services

When considering how you want your payroll process to be handled, the two most common options are payroll software/modules and payroll services.

What’s the difference?

Payroll software provides you with the tools you need to automatically calculate payroll. You enter your crew’s information, and the system does the calculations for you, saving you time and reducing the chance of errors.

Whereas payroll services handle payroll processing for you. Typically, with these services, you submit your timecards, and their team handles the payroll calculations, and in many cases, W-2s and direct deposit/check mailing.

As you consider the amount of time your admin has to focus on payroll ­— for example, a payroll service cuts down on processing time dramatically while your crew still processes payroll on their own with software — there is one more thing to consider — what’s a better fit for your operations: a generic payroll solution or a construction-specific one?

Generic vs. Construction-Specific Payroll Solutions

Another choice you’ll face is whether to use a generic payroll system or one built specifically for construction, and that decision often comes down to your reporting needs.

Generic payroll solutions are just that, generic. They’re built to process payroll, but they don’t offer the reporting contractors often need to manage compliance with the Department of Labor’s laws and regulations, including certified payroll and union.

But with construction-specific payroll solutions, you get built-in features that can easily calculate payroll, automatically compile reports during each pay period and ensure your workers are paid accurately while maintaining compliance with labor laws.

If you regularly take on government projects or manage union workers, a construction payroll provider offers the certified payroll, union reporting and fringe benefit support you need.

However, if your crews are smaller and work mostly local, smaller-scale jobs, a generic payroll solution might meet your needs just fine.

Step Four: Communicate With Your Team

According to Hubstaff, almost half of employees will leave their job after two payroll issues so communication during this transition period is key.

Keep employees informed about potential payroll processing changes and reassure them that disruptions will be minimal.

It’s also important to make sure the administrative staff who may handle payroll understand the upcoming changes and give them room to provide feedback.

Their buy-in goes a long way in ensuring a smooth transition.

Step Five: Select Your New Provider and Begin Implementation

While there are many providers to choose from you can start trimming your list by using:

• Word of mouth recommendations
• Review sites and user ratings
• Case studies
• Demonstrations

Once you’ve determined the best fit for your operations, it’s time to make the switch.

Lean on your new provider’s support to help with implementation and get your team up to speed on the payroll module or payroll service you’ve chosen.

Reclarify key points with their implementation team like:

• Will your team offer me hands-on guidance through the implementation process?
• What training or onboarding materials do you offer to me and my team?
• How long is the implementation process?
• What payroll data can be imported, and does it have to be entered manually?
• Do you provide payroll support during my first payroll runs?
• How long does this support last?
• How does your software/module or service integrate with my accounting system?
• What will taxes and W-2s look like if implementation occurs in the middle of the fiscal year?

As implementation begins, take notes and ask questions. Ask for reference materials — like walkthrough guides or screen recordings — as your team learns the software or service over the coming weeks and months.

Bottom Line: Alternative Payroll Providers Can Meet Your Needs

Even if your current payroll module is shutting down, there are trusted providers that can fully support your payroll needs.

For example, Payroll4Construction is a leading construction payroll service that employs an in-house team of construction payroll experts that handle:

• Prevailing wage
• Certified payroll reporting
• Union reporting and tracking
• Multi-state, trade and union payroll on a single timecard
• Fringe calculations

Interested in talking through your payroll needs? Chat with a payroll expert from Payroll4Construction.