This page provides information on how the University of Washington distributes the costs of implementing and operating Workday, both for Human Resources and Payroll and Finance. Workday is the University of Washington’s enterprise-wide finance, human resources, payroll and benefits system.
Workday implementation costs and ongoing licensing fees are distributed across the UW and UW Medicine using 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.
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.
- Capitalized implementation costs funded through 10-year debt financing, Organizational units pay for annual debt service and interest based on employee FTE and headcount
- Workday HRP cost allocation recharge started in FY18 and goes through FY27.
- Non-capitalized implementation costs, including Workday licensing fees during implementation.
- For Workday HRP, 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.
Workday implementation costs, ongoing licensing fees and the personnel costs associated with Workday sustainment are distributed across the UW and UW Medicine using each organizational unit’s percentage of the University’s total FTE.
Units are responsible for their allocated portion of debt service, in total, and for their allocated portion of operating costs.
- Operating costs from FY23-28 have been approved by the Executive Office and will only vary on a unit-by-unit basis as proportions of FTE over time. Prior to FY29, operating costs will be revisited and future recharges may adjust.
- Debt service amounts will be fixed following the planned issuance of long term debt in FY24. Any unit/campus over or under payments occurring in FY24 will be trued up to reflect the actual debt amortization.
Prior to FY2024, Finance Shared Services (email@example.com) has been responsible for the calculation of Workday fees and costs.
Starting in FY2024, UW Information Technology will be responsible for the calculation and will bill each unit accordingly. This year will be delayed due to UWFT go-live, and units will be billed in October.
Sub-units with questions on why a Workday Finance charge appears on their Workday worktag should consult their Chancellor/Dean/VP Fiscal Administrator.
If your unit/campus desires to prepay, in full, it’s allocated portion of Workday Finance program debt you must reach out directly to Jason Campbell (firstname.lastname@example.org) and Christian Adams (email@example.com) no later than August 25, 2023, affirming your intent to prepay. This is the only opportunity to prepay.
Note that this is different from what was offered for Workday HRP, where units/campuses had the option to partially prepay or “buy down” their debt.
Select the items below to review the Workday HRP and Finance Cost Distribution Detail for FY24 in PDF format.
- FY24 Workday Finance Recharge (PDF)
In this PDF, you’ll find the FY24 payments with and without prepayment, estimated nominal savings of full prepayment versus amortized payments and the basis of the Workday Finance FTE allocation.
See the FAQs below to see historical cost distribution details.
Please reach out to your Chancellor/Dean/VP (level 2 org) Fiscal Administrator. UW Information Technology (firstname.lastname@example.org is available if there are additional questions.
Yes, a list of each organizational unit’s FTE and head counts at the Cost Center Level 5 level is available from UW Information Technology (email@example.com) upon request.
FTE and head counts are taken from Workday and assigned to units based on the employee default budget numbers (FY24 and earlier billing cycles) or FDM worktags (FY25 and later billing cycles). 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.
Workday implementation costs and ongoing licensing fees are distributed across the UW and UW Medicine using unweighted average FTE as the pro-rata allocation basis. FTE counts are taken from Workday and assigned to units/campuses based on the employee default budget numbers (FY24 and earlier billing cycles) or FDM worktags (FY25 and later billing cycles). 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.
Units are responsible for their allocated portion of the debt service, in total, and for their allocated portion of operating costs.
For more information, view the answer to the question: When was the Workday Finance Cost Allocation Plan established and what does it include?
The annual HRP institutional recharge is a fixed amount.
The rate is split by sampling the previous FY FTE count. Decreases/increases in other organizations will impact your slice of the “HRP recharge pie”: an organization with a decreased FTE count may still see a cost increase if other organizations decreased their FTE count at a higher rate.
The annual Workday Finance recharge amount differs each year.
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 and sustainment costs 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 firstname.lastname@example.org .
You can view historical records behind the HR/Payroll Modernization Allocation Plan, which was established in 2017.
During the summer of 2022, a focused effort was undertaken (“Sustainment ”) to refresh and revise the operating and support models, including the 2019 cost model, with the aim of finalizing the infrastructure necessary for central business units (”sustainment units”) to support the transition to the Workday Finance ecosystem and function in a modern ERP. This work concluded in early January 2023. While specific efforts were made to drive both financial and business efficiency, the end result is a material increase in operating cost estimate vs what was preliminarily estimated in 2019.
From FY23-FY28, UWA and UWM, collectively, will be “held harmless” from incremental FT sustainment operating costs over the 2019 estimate.
From FY23-FY28, Central funds, supplemented by any available UWFT program savings, will absorb incremental sustainment operating costs over the 2019 estimate.
Consistent with the 2019 cost allocation methodology, UWA and UWM will be responsible for debt service associated with financed UWFT program expenses.
The operating costs to be allocated in total are final and approved by the President and Provost for the period FY23-FY28. As the underlying allocation driver is FTE, each year there will be shifts in pro-rata share of FTE as units in UWA, and UWM grow and contract, thus shifts in pro-rata cost allocations will occur as well.