Integrated Service Center

Workday HR/P Cost Distribution for Organizational Units

Last updated Friday, August 7, 2020

This page provides information on how the University of Washington distributes the costs of implementing Workday, the University’s human resources, payroll and benefits system.

Workday Cost Components

  • Capitalized implementation costs funded through 10-year debt financing
    • Organizational units pay for annual debt service and interest based on employee FTE and headcount
  • Non-capitalized implementation costs, including Workday licensing fees during implementation
    • Organizational units pay 50 percent over 10 years based on employee FTE and headcount – the Provost paid the remaining 50 percent of these costs
  • Post-implementation Workday licensing fees
    • Organizational units will pay annual Workday licensing fees on a 10-year average, based on employee FTE and headcount

Many organizational units made pre-payments and these payments have been applied against each organizational unit’s total cost.

Cost distribution detail (in PDF format):

Please note: Although the capitalized and non-capitalized implementation costs are fixed, the Workday licensing fees are variable. As a result, the total cost of Workday will be reviewed and adjusted as necessary every two fiscal years.

Basis of Annual Workday Costs

Workday implementation costs and ongoing licensing fees are distributed across campus based on each organizational unit’s percentage of the University’s total FTE and headcount. Each organizational unit’s FTE and headcount are calculated by averaging the home department’s FTE over the past four quarters of the prior fiscal year.

For example: The cost of each unit’s FY 2021 total annual Workday expense was determined by averaging the unit’s FTE as of the second pay period of August 2019, November 2019, February 2020 and April 2020.

Each organizational unit’s FTE percentage of Workday expenses will be recalculated each year based on information taken from Workday.

Billing

Finance Shared Services (finssfin@uw.edu) is responsible for the calculation of Workday fees and costs. They work directly with Dean/VP (level 2 org) Fiscal Administrators in the collection of funds for the entire Dean/VP organization. Sub-units with questions on why an HRP charge appears on their budget should consult their Dean/VP Fiscal Administrator.

Frequently Asked Questions

Please reach out to your Dean/VP (level 2 org) Fiscal Administrator. Finance Shared Services (finssfin@uw.edu) is available if there are additional questions.

If no change was made to the unit’s three-digit org code, then no action is required. If the reorganization resulted in FTE moving to a new three digit org code, department administrators of the units involved in the reorganization should note any reorganization exceptions as part of the annual billing process and obtain confirmation from the other department(s) for any adjustments made to their share of the costs.

Yes, a list of each organizational unit’s FTE and head counts at the 10-digit organization code level is available from Finance Shared Services upon request.

FTE and head counts are taken from Workday and assigned to units based on the employee default budget number. They are calculated by using a four quarter average taking the second pay period of August, November, February and April from the prior fiscal year.

The majority of the HR/P cost allocation (90.7%) is allocated based on FTE, with the remainder based on the headcount of non-exempt staff. The non-exempt portion of the allocation accounts for the additional cost of the timekeeping module in Workday.

Unlike the Technology Recharge Fee, the distributed cost of Workday represents an annual debt payment and an annual license payment, expenses already incurred by the UW. This means that the collection of the annual pay-down amounts need to be applied as soon as possible each fiscal year, and monthly payments are therefore not available.

Once all the initial implementation costs are paid, only the cost of the annual Workday licensing fees will continue to be distributed to organizational units.

The Workday shared costs and fees cannot be charged directly to federal (or federal flow-through) grants or contracts, but it can be charged to non-federal grants or contracts if the sponsor does not specifically disapprove the cost either in the award or in any other notice given to the University.

Yes, though the costs must be allocated in accordance with Management Accounting & Analysis (MAA) Recharge Center Policies.

For any other questions about the distribution of Workday implementation costs and licensing fees across organizational units, please contact Finance Shared Services.

HRPM Allocation Plan Archive

All documents are in PDF format: