Complex pay systems slow some E-Payroll migrations

The Federal Aviation Administration and the Veterans Affairs Department are two of the agencies putting the government’s E-Payroll initiative behind schedule. But they have good reasons.

Transportation Department officials had stopped work on the department’s own new human resources system in order to move to a shared-service provider under the E-Payroll umbrella. Most of the department has made the move, but FAA, a part of Transportation, has particularly complicated payroll demands that have slowed its migration. VA has run into similar snags.
DOT and VA are two of only eight agencies that have not fully migrated to one of the four E-Payroll providers. And as the Office of Management and Budget’s 25 e-government projects slowly replace duplicative systems, E-Payroll, managed by the Office of Personnel Management, is making good on e-government’s promise of stopping redundant spending by terminating systems and making government more efficient.

“If you minimize the number of systems you are running, you will cut down costs,” said Tom Park, the Transportation Department’s deputy chief financial officer. “The real credit goes to the Federal Aviation Administration for making sure their migration was under control. They will have to make sure business process changes are processing the human resource transactions.”
FAA will migrate 50,000 employees to Interior’s National Business Center by Oct. 16. The other 10,000 Transportation employees started using NBC’s system in April, Park said.

OPM officials estimate that E-Payroll will save the government more than $1 billion over 10 years by merging 26 separate payroll systems into four. Officials said 80 percent of all agencies—or 1.4 million employees—migrated to the new providers as of April, seven months behind schedule.
“The September 2004 date was a target initially established prior to completion of full requirements definition for each migrating agency,” an OPM spokesperson said. “For some agencies, these requirements were more extensive than originally anticipated and the schedule was adjusted accordingly.”

VA, FAA and the Coast Guard are among those agencies with more extensive requirements.

VA, for instance, pays most of its employees under one section of the U.S. Code, Title 5, but it pays doctors, nurses and other health care workers under Title 38. FAA hires and pays air traffic controllers under Title 49.

‘Stop, drop and roll’

Those circumstances mean the shared-service providers must adjust their systems to meet the requirements for these special pay classes.
“We have unique complexities and it took time to get them documented,” said Angela Curtis, VA’s E-Payroll project manager. “We also had to deal with changes in December from Congress. We had to stop, drop and roll to get our arms around them.”

Curtis added that VA can only make so many changes to its current system at one time. To do what lawmakers mandated, Curtis said VA had to group the changes and add them in stages.

VA, which uses a 30-year-old Cobol system, will migrate to DFAS in 2006, Ed Murray, VA’s deputy assistant secretary for finance, said. “We are optimistic about going to DFAS,” he said. “They are upgrading their software to support us and integrating our time and attendance information.”

FAA, on the other hand, was going to hook into DOT’s new Oracle HR system, but Park said that, after the agency decided to move to the National Business Center, the timetable slipped with the added complexities.

“FAA air traffic controllers are paid different salaries for the different work they do at that moment,” he said. “That is not done anywhere else.”

The Coast Guard will migrate to the Agriculture Department’s National Finance Center Aug. 21, said Rear Adm. Kenneth Venuto, the agency’s assistant commander for human resources.

Migrating to a shared-service provider costs hundreds of thousands, if not millions, of dollars for most agencies. And the price rises for agencies with complex needs.

Murray said he estimates the cost for migration is less than $10 million. Park said he is unsure of the cost of transferring to the new system, but he said DOT will end up paying more per employee at least for the first year.

Park also said he is concerned about creating HR and finance stovepipe systems that don’t talk to each other within the shared-service centers.
OPM officials expect all of the migrations to finish by December 2006.

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