The Client

Xcel Energy is a leading provider of electricity and natural gas, offering a comprehensive portfolio of energy-related products and services to 3.3 million electricity customers and 1.8 million natural gas customers in eight western and midwestern states. With annual revenues of more than $9 billion and nearly 11,000 employees, Xcel Energy has provided energy-related products and services to customers for more than 130 years.

The Challenge

As many utilities companies do, Xcel Energy has a high degree of usage for independent contractors, seasonal temps, retirees, third-party contractors and payrollees. Xcel Energy needed a payrolling provider to mitigate risk, to manage their contingent workforce, reduce costs and ensure a smooth and seamless operation of the program while taking advantage of diversity spend credits.

The key challenges in implementing a payrolling program for Xcel Energy, included:

• Transition smoothly to HireGenics payrolling services
• Standardize payrolling vendor with Xcel Energy
• Synchronize payrolling implementation with the VMS rollout by department
• Meet a three-month implementation deadline
• Introduce efficient processes for payrollee onboarding
• Standardize processes and procedures for independent contractors and payrollee
• Reduce or eliminate direct independent contractors at Xcel Energy

Additional requirements included:

• Control costs and leverage spending
• Achieve volume discounts
• Standardize pay cycles for independent contractors
• Centralize time reporting processes
• Simplify/streamline invoicing
• Standardize benefits for independent contractors
• Mitigate co-employment risks
• Streamline processes to standardize business practices
• Find the right talent for internal projects

The Solution

HireGenics implemented a payrolling solution at Xcel Energy with tremendous success. Utility companies have a common problem with the deployment of contingent labor, but the HireGenics solution not only addressed these problems but also delivered significant cost savings.

HireGenics performed an independent contractor analysis to identify1099 contractors. All contractors were converted to HireGenics payrollees.

Analysis also revealed that payrolling services were decentralized among multiple vendors. Multiple staffing companies were providing payrolling services; all offering various benefit packages and different markups, including recruitment staffing markups instead of payrolling markups. HireGenics centralized the program, benefit package and markups by conducting the following activities:

• Conducted a sweep for other payrollees and independent contractors
• Centralized payrolling activities at Xcel within the HireGenics environment.
• Ensured all new payrollees at Xcel Energy were channeled through the HireGenics payrolling solution
• Performed common law employee determinations on Xcel independent contractors and promoted the conversion of such contractors to HireGenics payrollees
• Encouraged payrolling versus independent contractor utilization at Xcel Energy
• Additionally, communication issues were identified around the internal client, vendors and payrollees. HireGenics developed and instituted a communication strategy involving all stakeholders, addressing the program communication issues.

Impact to Client: Cost Reduction

The implementation of the HireGenics payrolling solution resulted in a reduction in Xcel Energy’s contingent workforce costs.