Case Study:
Non-Profit
KnowledgeWell
How a food bank saved over 45% in payroll administration costs and 25% on employee benefits.
The non-profit industry has been hit hard by declining donations which puts a lot of strain on operating budgets and makes it difficult for organizations to provide front-line services to their community. Smaller non-profit organizations have been hit particularly hard as they have fewer employees to split between administrative and front-line tasks and have a difficult time retaining employees.
The typical non-profit spends approximately 80% of total operating costs on administration and staff. Smaller non-profits cannot afford the same compensation and benefit packages that larger agencies and companies can provide to their staff. With declining funds, the need for small non-profits to save on administration costs and find affordable benefits is critical.
Overview:
A local food bank in a mid-size suburban community was facing increased demand for their services and lower revenues, as donations had been steadily declining. Balancing the budget was proving difficult and they needed to lower administrative costs to continue providing their services to people in their community that needed help. The food bank manager was questioning the software they were using to administer payroll as it seemed to require a lot of time and more manual data collection and entry than she’d anticipated. The premium for the benefits program had just increased and this put further strain on the budget, but she knew providing benefits was critical to attract and retain employees.
The team was also handling a CRA payroll audit which required a lot of additional time to locate records and answer questions as the information was spread over several files and software programs.
A Board member suggested contacting PeopleWell as he’d heard good things about their solution for payroll and benefits, particularly how easy it was to produce reports needed to manage the organization and present to the Board of Directors.
Years in Business:
15 years
Number of Employees:
8
PeopleWell Products:
MediDirect benefits,
Payroll, Time Management & KnowledgeWell
Problem:
The food bank was facing several challenges: increased demand from the community, declining donations, rising costs, and attracting/retaining staff.
Adding to the challenges was a recent CRA payroll audit that resulted in penalties due to non-compliance of some of their rules. The audit had taken a
lot of management time to answer questions and find documentation requested by the auditors. The information was in several files and spread across different software systems, some of the information could not be found at all! As a result, CRA re-assessed employees with penalties and interest due to
the food bank’s non-compliance. The reassessments hurt their employees financially and was bad for morale.
During a review of administration processes looking for efficiency and cost savings, the manager discovered software costs were rising and they were adding more software solutions to evaluate operations. She also found people were spending a lot of time preparing information for payroll and management reporting. Overall, the systems were inefficient and rising in cost.
The manager received notice of another group benefit premium increase for the third year in a row. She had tried negotiating a better premium but lowering premiums only reduced the benefits provided. Providing good benefits was key to employee retention, which reduced the need to find and train new employees.
Solution:
At a board member’s suggestion, the manager of the food bank met with PeopleWell and decided to use their single solution for benefits and payroll.
With the new solution in place the food bank saved 45% in costs by removing the multiple software solutions previously used and cutting the time spent on preparing information for payroll significantly.
With CRA and labour standard rules built right into the system the manager was relieved to know the system ensured compliance. Employee files and documentation were all in one place, so it was quick and easy to locate information when it was needed. The manager and employees can all access information, paystubs, and tax documents through secure logins.
PeopleWell’s benefit plan reduced the overall costs of providing benefits by 25% which stabilized the budget.
With PeopleWell’s Knowledge Library and system documentation, the food bank implemented a compensation pay model allowing employees choice on how they are paid and the benefits that fit their lifestyle. By offering choice to their employees, turnover declined, reducing the cost of recruitment and training.
Conclusion:
The food bank saved over 45% in payroll administration costs and 25% on the cost of providing benefits, with the added perk of staff being able to choose the compensation and benefits that best suit their individual needs. Employee retention rate and morale improved dramatically, and everyone is confident the organization is compliant with CRA and labour standard rules.
The manager easily pulls reports on a regular basis to aid in running the food bank and keeping the board of directors informed.
The total net cost savings were reallocated to support the front-line services provided to their community.
Contact Us
Reach out to discuss how we can help.