Special Notice / Hearing: None__
Vote Required: Majority
To: Honorable Board of Supervisors
From: Rocio Kiryczun, Human Resources Director
Juan Raigoza, Controller
Subject: Order Form Agreement with Workday, Inc. for Human Resources, Payroll, and Learning Management Services
RECOMMENDATION:
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Adopt a resolution:
A) Approving a new Order Form Agreement pursuant to the Master Subscription agreement with Workday, Inc. to provide expanded HR/payroll and learning management services, for the term of September 26, 2025 to September 25, 2035, in an amount not to exceed $21,189,733; and
B) Waiving the Request for Proposals process.
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BACKGROUND:
In September 2013, a new HR/payroll system vendor, Workday, was retained to provide the County’s Human Resources Payroll system. This selection followed a comprehensive RFP process and was part of a multi-faced and inter-departmental strategic procurement initiative involving Human Resources, the Controller’s Office, the Information Services Department, and the County Executive’s Office.
On September 10, 2013, the Board approved Resolution No. 072741 and the County entered into an agreement establishing a Master Subscription Agreement (MSA) with Workday and ordering Human Capital Management and Payroll service subscriptions pursuant to specified order forms specifying such services and associated payment and other terms and conditions. The MSA includes terms required by the County relating to anti-discrimination, employee benefits, and compliance with the County’s jury service ordinance. A comprehensive technical implementation process took approximately two years to make the Workday system operational and cost approximately $6.7 million in contracted services. Workday was implemented at the County as of March 2015.
The MSA has remained in place while the services were amended five times through new order forms with Board approval to extend the term and incorporate an expanded array of service subscriptions, including expense tracking, staff analytic tools, and Workday success plans. The Board approved the most recent amendments on October 17, 2023 (Resolution No. 80002). The current Workday order form runs through September 9, 2026, with a total not-to-exceed amount since 2013 of $13,117,539. The existing order form also allows for an additional three-year option to extend the term, at a 3% + Consumer Price Index increase for applicable rates each year.
Workday has been a successful, secure and reliable HR/payroll system for the County. Over the last ten years since Workday was implemented, Workday has increased employee self-service, streamlined manager approvals, created transparent processes, improved data analytics, and automated manual procedures. Workday has proven to be a flexible and adaptable HR/Payroll system, which allows the County to address rapid changing workforce challenges and focus on continuous innovation.
Workday has provided two major updates per year, including feature enhancements, federal legislative changes, and technical fixes. This ensures the County stays current with the latest Human Resources technologies.
DISCUSSION:
In January 2025, the Human Resources Department issued a Request for Proposals for a Learning Management System to assist employees with developing and maintaining new skill sets. The County received twelve vendor responses and interviewed three potential systems providers. After the interview process and system demonstrations, the selection committee determined that Workday Learning would best enhance employees’ career development journeys, allow transparent skills-based development, and suggest potential job opportunities for employees to consider based on their skills and open positions. These features in Workday will also allow for better succession planning for many County Departments. Workday Learning was a cost-efficient solution for enhanced services.
Workday Learning is not available as a stand-alone module without also subscribing to the core Human Capital Management subscription services discussed above, which the County already uses and for which the order form in effect under the MSA is set to expire in September 2026.
The Human Resources Department and the Controller’s Office subsequently began negotiations with Workday to ensure the County continues to receive competitive value for all Workday subscription services, along with the new Workday Learning service. As part of these negotiations, Workday offered the County a 3.7% discount on the current HR and payroll offerings in exchange for bundling the new Learning Management Services module as part of a new, ten-year extension. Workday also offered to begin two additional subscription services in addition to Workday Learning.
First, Workday offers Peakon, an employee sentiment and engagement tool with an Employee Voice platform to gather employee feedback, generate actionable insights, provide interactive reporting, and facilitate confidential dialogue between staff and leadership. In addition, it offers managers and supervisors access to suggested mini-learning modules designed to enhance their management skills. The Human Resources Department conducted a pilot of Peakon and recommends replacing the County’s current survey provider, GP Strategies, and the performance and development platform Tiny Pulse, with this integrated module. Workday Peakon is less expensive than the combination of GP Strategies and Tiny Pulse, generating cost savings as well as efficiencies by combining through a single access platform.
Second, Workday is offering a Help module that offers enhanced employee experiences by improving self-service, engagement and improve customer services with step-by-step guides, frequently asked questions, policies and reference information, and linked training, videos and resources that appears when employees use Workday. This includes suggestions that will appear during key employee lifecycles such as onboarding, benefits, and career development.
The Human Resources Department and the Controller’s Office believe it is in the best interest of the County to waive the Request for Proposals (RFP) process for HR/payroll services and approve a new Order Form to extend the term of all current Workday services for another ten years, incorporating the new learning management, employee engagement, and help services as part of these services. This will allow the County to obtain the best value for learning management services (following the RFP) and to lock in benefits from having a stable payroll and personnel service platform.
Workday is a complex integrated system that processes a large amount of sensitive personnel information. The technical implementation of Workday into County systems in 2013 took approximately two years and required substantial technical support, change management services, and employee training that cost approximately $6.7 million as well as 10 County staff dedicated solely to the implementation. If the County were to change HR/Payroll systems, those costs would recur. The proposed ten-year extension in the term also allows the County to receive discounts on the comprehensive Workday subscription services we are currently using.
As part of Human Resources recruitment and retention strategies, Workday stands out as a crucial service because it provides a comprehensive HR system that will efficiently support County employees and Departments across the HR, payroll, learning, and employee voice management systems. Workday’s biggest advantage is that it offers a unified platform for an employee’s career life cycle with one data source, one security system, and one employee experience. This integrated system facilitates greater employee adoption and powerful targeting for human resources services.
The Human Resources Department and the Controller’s Office recommend extending the current MSA with Workday for a ten-year agreement term and amending the subscriptions ordered under the MSA to continue current HR, Payroll, Expenses, and other tools and add new subscriptions for Workday Learning, Peakon (employee engagement), and Help. This would be accomplished through approval of a new Order Form under the MSA, that will supersede the current order form and confirm a new order for the ten-year subscription services for HR, payroll, learning management, and other services discussed herein. As noted, this new Order end existing subscription orders early and replace them with a revised subscription term for the expanded services from September 26, 2025 to September 25, 2035.
The County’s Information Services Department has confirmed that Workday is within the County’s IT standards.
The Procurement Director has recommended a waiver of the competitive solicitation process is in the best interests of the County to secure the expanded software services and obtain the best value for learning management services (which were selected following an RFP) and to retain long-term benefits from having a stable payroll and personnel service platform, maintain discounted pricing, avoid substantial implementation costs, and continue to benefit from the expanded scope of Workday services. The Procurement Director has also approved the extended term of the contract beyond the County’s standard 5-year term.
The County Attorney has reviewed and approved the Resolution and Order Form Agreement as to form.
PERFORMANCE MEASURE:
|
|
FY 2024-25 Actuals |
FY2025-26 |
FY2026-27 |
|
Service Availability (per month) |
99.9% |
99.5% |
99.5% |
|
Disaster Recover Time |
3 hours and 45 minutes |
With 12 hours |
With 12 hours |
FISCAL IMPACT:
Funding for the new Order Form Agreement is in the Controller’s Office Payroll Commons Budget and Human Resources Budget for an annual amount $1,636,830 in FY 2025-26, an annual amount of $2,007,594 in FY 2026-27, and a subsequent 2% increase over the next 8 years for a total of $21,189,733.