Agencies must pick new payroll shops soon

OPM's Janet Dubbert says a new standardization plan will ease the migration of more than 22 federal payroll systems to no more than four.

Henrik G. DeGyor

By month's end, the government will settle on the two to four payroll systems that agencies will have to migrate to by September 2004.

Once the Office of Personnel Management announces the systems, agencies will have until Nov. 30 to select the one they will use, said Janet Dubbert, OPM's director of the Office of Payroll, Policy and Systems Integration, and project leader for E-Payroll.

Meanwhile, OPM says that agencies can standardize many payroll functions. When OPM began work on the E-Payroll initiative, it identified 87 functions where agencies could standardize payroll processing. Of these, agencies can work on 50 without awaiting legal changes, Dubbert said.

The E-Payroll project team has begun work on the 50 areas and will assign specific program offices to review payroll policies and procedures for them, she said.

Dubbert recently led a discussion of the progress of the E-Payroll initiative, one of the 24 Quicksilver e-government projects, at the Office of Management and Budget's Strategic Compensation Conference in Alexandria, Va.

'We analyzed the improvement opportunities that the Joint Financial Management Improvement Program found in their interagency study,' Dubbert said. 'We identified additional opportunities by speaking with agency payroll operational and systems specialists.'

Some of the 87 areas included differences in agencies' pay cycles, rules for rounding off salary figures and rules for accruing leave.

OPM has established a Standardization Action Team, with officials from the Agriculture, Health and Human Services, Interior, State, Transportation and Veterans Affairs departments and the Defense Finance and Accounting Service and Environmental Protection Agency.

The team developed a modernization plan using agency and industry best practices to identify data fields needed for payroll processing. The group also is identifying the methods for making changes, whether legislatively or through the regulatory process, Dubbert said.

Fewer systems

OPM director Kay Coles James last month approved the standardization plan.

Dubbert said the plan will ease the migration from more than 22 federal payroll systems to no more than four. OPM is reviewing proposals for becoming one of the common payroll systems from USDA, DFAS, EPA, the General Services Administration, HHS, Interior, State and Veterans Affairs.

A panel of officials from the National Science Foundation, OMB, OPM, the Social Security Administration and the Treasury Department is reviewing the payroll systems proposals. Dubbert said the agencies selected will enter a memorandum of agreement with OPM and identify the services they will provide agency customers.

'The baseline services will be for a standard rate, and anything beyond those services, the agency customer and provider will negotiate the costs,' Dubbert said. 'Each provider and OPM also will have to establish metrics to measure their performance.'

The agencies selected also will have to make sure their systems are compatible with one another.

'We will bring in the providers for two weeks in October and discuss the need to acquire assistance from vendor integrators to help with the conversion and migration processes,' she said. 'Almost all of the systems were built by the government, and all are different types of systems.'

Once OPM chooses the systems, it will hold a vendor fair in November for agencies that need to change payroll systems. OPM will manage the migrations, which will continue through September 2004.

'We will meet with the agencies and develop a timeline to migrate their data into the selected provider systems,' Dubbert said. 'Once we standardize among these two, three or four systems, we will take a look at what is available in the private sector. That is down the road and part of the end-state version.'

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