Payroll Contractor Audit for Automotive Client

Upon setting up a payroll provider for our automotive client’s managed services (MSP) program, it was discovered that contractors listed as “payrolls” were also involved in a discount tenure project. As a result of this, bill rates for contractors were decreasing by one percent yearly (capped at three years). Given the low margins for payrolls, contractors’ involvement in the tenure policy discount created numerous invoicing issues, including correcting headcount type, readjusting bill rates, and reprocessing time sheets.

As such, Allegis Global Solutions (AGS) ran an audit to uncover why some of our client’s contractors were being grouped into the tenure discount. After conducting the audit, it was determined that misclassification occurred when contractors were not being coded as payrolls under the headcount type. From there, AGS used the report generated from the original audit to provide visibility into all of the payroll provider’s contractors, as well as the headcount type they are coded as.

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