The Arc of Baltimore Uses Kronos to Control Labor Costs and Serve Clients More Effectively
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The Arc of Baltimore is one of the nation's largest agencies addressing the needs of people with developmental disabilities. The Arc provides an array of community-based support services to approximately 3,000 men, women, and children in Baltimore City and Baltimore County at nine major facilities and 160 residential sites. The Arc's programs and services include vocational training, medical day care, landscape and janitorial employment services, other supported employment, residential care, individual and family support, treatment foster care, respite assistance, and recreation, camping, and leisure activities.
With its use of paper timesheets and manual data entry, the Arc had a difficult time ensuring that its payroll was accurate. And with a workforce of 750 full- and part-time employees working at more than 160 locations, verifying actual time worked was nearly impossible. But then the Arc implemented the Kronos® Workforce Central® suite — and the organization achieved some major accomplishments: It improved staffing, scheduling, time and attendance, and payroll processes. Saved $900,000 in labor costs. Reduced payroll cycle time by 75 percent. And it’s now sure that the right staff is in place where and when they are needed.
Mission: replace a cumbersome, manual process
Prior to the implementation of its Kronos solution, the Arc's employees entered their time on paper timesheets. The timesheets were then transported to the Arc's main office. And then the hours were manually tabulated and keyed into the payroll system. Inevitably, math errors occurred and were then transmitted to payroll. To make things worse, there was no reliable way to verify that employees actually worked the hours reported on their timesheets.
Problems also occurred with salaried employees, when managers failed to notify the payroll department of terminations. Since there was no way to check timesheets against the payroll, some terminated employees continued to receive paychecks after they had left the organization. And these overpayments added up.
The Arc receives a cost-effective, smooth implementation
The Arc began investigating workforce management solutions and narrowed its choices down to Kronos and MITC. After visiting Kronos customers to see Workforce Central in action, the Arc was convinced. "The Kronos product was spectacular," says IT Manager Christian Ehrhardt. "It worked very well, and all the customers we spoke to were very happy."
The Arc selected the Kronos remote implementation method in order to save money. "As a nonprofit, it's very important for us to keep projects affordable," says Ehrhardt. Initially somewhat skeptical of remote implementation, Ehrhardt was quickly won over by the experience. "Our implementation was on schedule from beginning to end. The Kronos team has remote implementation down to a science, and they're very thorough, organized, and professional. Everything ran smoothly, and I was very comfortable with the process."
Complete automation means real visibility and control
The biggest challenge for the Arc was getting employees accustomed to punching in and out. "Coming from a paper environment, our people were not used to accounting for their time in the exact detail that Kronos offers," says Ehrhardt. "With our old system we were taking people at their word that they were on the job, but now we have concrete proof. With Kronos we have an accurate picture of our labor force."
Now that it has high-quality time and attendance information, the Arc can easily verify time worked at all of its facilities. Employees at the Arc's residential houses use Workforce TeleTime to clock in and out. This helps managers to confirm that employees are at their scheduled locations on time and to pay them properly. And by using Caller ID, the Arc can verify that employees are clocking in from the houses they are assigned to.
Another major benefit: The Caller ID feature of Workforce TeleTime helped the Arc identify and eliminate employee fraud. "Through Workforce TeleTime we discovered that some employees were not where they were supposed to be," says Ehrhardt. "Those employees were disciplined or terminated for company fraud." For the Arc's clients, the consequences can be severe when staff fail to report as scheduled. "If the people we serve are left without the support they require, injury or death could result," says Ehrhardt.
The Arc uses Workforce Connect to import employee time and attendance data into its payroll system, which helps the organization manage multiple pay rates more effectively. "We use a blended rate calculation to pay people who work two different positions a weighted average of the different pay rates, including overtime," says Ehrhardt. "Workforce Connect is able to perform this complicated calculation with no problem."
Labor costs drastically reduced
Since implementing its Kronos solution, the Arc has realized several significant benefits, including reduced payroll costs and improved workforce productivity. Implementing a completely automated timekeeping system reduced payroll processing time by 75 percent, from 24 hours to six, while accuracy improved 100 percent. With more time freed up, the payroll department can now assist the accounting and HR departments, thus eliminating two open positions.
The Arc also lowered labor costs, reducing total pay hours by 100,000 in the first year. At an average pay rate of $9 per hour, this represents a $900,000 savings. Overtime hours were reduced by 30 percent, far surpassing the goal of a $100,000 reduction.
Next up: advanced scheduling
The Arc is now turning its attention to implementing advanced scheduling that will allow managers to get a more detailed look at where and how their budget dollars are being spent. Another project currently under way: implementing time tracking for Arc clients who participate in supported employment programs. Many of these programs involve state and federal contracts. So, with better employee time tracking, the Arc will be able to develop more cost-effective bids for projects — and ensure that these employment programs are operating in the black.
"The ability to manage our entire organization's staffing, scheduling, payroll, and time and attendance with one fully integrated solution has allowed us to run a more efficient operation," says Ehrhardt. "Once we implemented Kronos we saw the immense possibilities of how it could help us in our mission. Our business is caring for individuals who are vulnerable. And having the correct staff in the right place at the right time can literally be a matter of life and death."
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