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Avon moves to outsource payroll to Paylocity amid staffing shortfall
Summary
Facing difficulty filling a part-time payroll role, the City administration recommended contracting Paylocity for payroll and HR services at an estimated $22,500–$30,000 per year, with per-employee fees and a $2,770 onboarding fee and an exit clause limiting loss to the onboarding fee if testing fails.
Finance Director Steve Presley said the City has struggled to fill the part-time payroll position and evaluated vendors before recommending Paylocity as the best fit. Presley presented an estimated annual cost between $22,500 and $30,000, based on per-employee-per-month fees and a one-time onboarding charge.
Presley detailed the proposed fee structure: $4.73 per employee per month for payroll, $1.88 per employee per month for talent management, $4.10 per employee per month for human resources functionality, plus a $2,770 onboarding fee. The pricing would be guaranteed for two or three years depending on final contract terms. He said the testing phase includes an exit clause limiting the City's loss to the onboarding fee if the system proves incompatible.
Mayor Bryan Jensen and Council members discussed hiring challenges and the comparative costs of outsourcing versus hiring a full-time staff member with benefits. Presley noted a full-time employee would cost nearly $100,000 with benefits, while the Paylocity arrangement provides stability at significantly lower cost.
