Archdiocese to adopt uniform payroll system

BRAINTREE -- In August, all parishes, schools, and cemeteries of the Archdiocese of Boston will begin implementing a standardized payroll system provided by a third-party vendor.

Payroll data-entry will continue to take place at the local entities, but an internet based system will be administered by a company called Interlogic Outsourcing, Inc. (IOI). The payroll service provider has had experience working with 20 other Catholic dioceses and archdioceses in the United States.

"Other dioceses have realized the need to do this type of standardization for platforms like benefits, so we're kind of following in that same venue," said Denise McKinnon-Biernat, director of parish services for the archdiocese.

According to initial surveys by Biernat and her team, switching to IOI will cut the costs of payroll administration for 73 percent of parishes. The standardized system will also pave the way for an archdiocesan-wide 401k-style retirement program to begin in January 2012.

"We needed a platform for the 401K; there's very stringent requirements on reporting and contributions and right now we couldn't support it," said Biernat.

A staggered roll-out will continue through December and training sessions on the new system have already begun. Implementation costs will be paid through the Central Ministries of the archdiocese. Ongoing fees for the payroll service will be continue to be paid on the parish level, as they are with current payroll providers.

The IOI system will allow parishes to process payroll and tax filings for both employees -- who receive an IRS form W-2 -- and non-employee contractors -- who typically receive an IRS form 1099.

The new system will allow payroll to be processed from any secure internet connection, so a parish administrator could file payroll from home or another location. The archdiocese will have a standard template for the entities, but parishes can adapt this template to fit their preferences.

The decision to move to a uniform payroll system was made after input from a 12-parish member focus group that began meeting last October. However, the initial idea came from Susan Healey, the business manager at St. Bonaventure Parish in Plymouth, in a passing conversation with Biernat.

"I really think that we need to leverage our overall size together as a community, to make the most of what we can get to keep costs down in the individual parishes," said Healey.

Healey, other business managers, and pastors of the focus group looked at the overall question of a uniform payroll system for the archdiocese.

One option was to have all processing take place at the Pastoral Center, an idea that was quickly eliminated. Another choice was that the parishes take care of their own processing through the QuickBooks software program. However, the system could be difficult to implement if a parish had multiple entities, such as a school and cemetery, each with their own accounts.

Once deciding on the 3rd party vendor plan, project manager Shannon Swan developed a survey that was sent to the parishes of the archdiocese. It was found that among the 100 parishes that replied to the survey, there were 13 different payroll providers.

"My gut feeling on this was confirmed that we could actually do something to benefit the parishes here," said Healey about the results of the survey. "Because everyone was concerned from the get-go that it's not about the 12 parishes (of the focus group), it's about the needs of all the parishes."

The focus group considered the needs and features they wanted in a payroll vendor -- what Healey called a "wishlist" -- not only for the present day, but for future growth as well.

"And it was a pretty formidable list because we thought we're going to go for more, rather than less," said Healey.

Requests for bids were sent to 11 vendors. Out of their responses, the field was narrowed to four. Of these, IOI was chosen unanimously by the focus group.

The results of the focus group and their action plan were presented to the Archdiocesan Presbyteral Council, which affirmed the plan of the group that implementing the IOI system should be mandatory for all parishes, school, and cemeteries.

In addition to setting a foundation for the new retirement plan, adopting a uniform system is also expected to streamline data-entry between parishes and the archdiocese. Currently, information from employees -- such as Social Security Numbers, date of hire and pay rate -- are recorded at the local level and again at the Pastoral Center.

"Anytime there's double data entry, there's room for error or just lack of receipt of the information," said Carol Gustavson, director of benefit trusts for the archdiocese.

The standardized platform could also be key in setting up voluntary benefits like short-term disability, and flexible-spending accounts, according to Biernat.

Jack Riley, business manager at St. Agatha Parish in Milton, also participated in the focus group.

Riley said he liked the cost savings from the large group approach, and also IOI's capability to streamline information.

"When you're talking about people's retirements and their paycheck, you have to be precise. This will allow us, across the board, do that," said Riley.