Plan by class of employee such as full time, part time, contractor with associated benefit expenses and tax treatment

Description

This requires that the workforce planning model in the CPM tool allow staff to be classified into different employment types. These types then drive the full expense burden differently based on tax laws and other benefits that the person may or may not receive due to their status with the employer.

Example Use Case

Scenario: A large corporation is streamlining its workforce planning process. The corporation has a mix of full-time, part-time, and contract employees, each with different benefit and tax treatments.

Solution: The corporation integrates CPM software that has the functionality of planning by class of employee. The software recognizes and categorizes each employee according to their employment status, applies the correct benefit expenses, and marks the appropriate tax treatment. This paves the way for an efficient and error-free workforce planning process.

Considerations

This can be especially helpful when modeling different scenarios e.g. should the business hire FTEs or simply contract out labor. If the system supports this plus versioning and comparing versions, this can be incredibly useful. For it to work, the employee-type classification must work well and be powered by an underlying set of drivers that build a full burden based on classification.

This also becomes powerful when department managers begin to add TBHs. If the system is has the proper functionality, it can tell them the most cost effective hiring strategy.

Questions to Ask a Vendor

• Workforce Classification: Does the system support different classifications for labor, such as contractor, employee, hourly, and so on?
• Tax Law Compliance: How does the system maintain compliance with current tax laws for labor expenses? Can it account for changes in tax regulations or do we need to maintain that ourselves? How does that work with differing locations like states, provinces, countries, counties, cities?
• Ease of Modification: How easy is it to make amendments, such as changing an employee's status or adjusting benefit expenses? If I move a contractor to full time, can it be done from a specific date forward, thereby preserving historical data?