Employer Misclassification Predictive Analytics (EMPA)
Project Charter
Executive Sponsor – Sue Anne Athens
Business Owner – Roy Padilla
Project Manager – Michael Greene
Date: August 24, 2016
table of contents
table of contents i
1.0 Executive Summary – Project Overview 1
2.0 Justification, Objectives and impacts 2
2.1 Agency Justification 2
2.2 Business Objective 2
2.3 Technical Objectives 3
4.0 Constraints 4
5.0 Dependencies 4
6.0 Significant Risks 5
7.0 PROJECT MANAGEMENT methodology 5
8.0 PROJECT STAKEHOLDERS 6
9.0 Roles and responsibilites 7
10.0 Project Charter Agency Approval Signatures 9
Revision History
Version Number / Date / Author / Comment0 / June 10, 2014 / Eric Aragon / Draft DWS Project Charter Template
1.0 / February 22, 2016 / Michael Greene / Draft of formal deliverable
2.0 / August 3, 2016 / Hunter Wilcox / August PCC Meeting
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Project Charter – Appeals Project 8
1.0 Executive Summary – Project Overview
The following business case document outlines a project initiative that addresses a current business need. This document is designed to provide proposed project initiative information regarding business concerns, benefits, and justification. Additionally, it identifies high level project goals or objectives; proposed timelines, funding, and/or other recognized mandates, in order that it may be successfully reviewed by the New Mexico Department of Workforce Solutions (NMDWS or DWS) executive leadership for consideration and inclusion in the department’s project portfolio, which is aligned with our strategy and mission.
This business case proposes to use internal and external data to develop a statistical solution to identify employers with a higher propensity of misclassifying workers. The Employer Misclassification Predictive Analytics (EMPA) project initiative will use advanced analytical techniques to realize approximately 50% increase in the success rate of audit findings of misclassified workers and a reduction in clean audits, thereby greatly enhancing NMDWS’s ability to pass the US Department of Labor (USDOL) Effective Audit Measures on a consistent basis.
In addition to the predictive analytics, NMDWS will also develop an interface with our Labor and Industrial (L&I) Division to help identify employers that have historically proven to intentionally misclassify employees. NMDWS will seek to gain access to the Governmental Liaison Data Exchange Program (GLDEP) and incorporate the aggregate data into our UI Tax and Claims system to select employers for audits with a high rate of 1099 employees.
Funding for this project initiative has been granted via Supplemental Budget Request (SBR) 2014 under the Employer Misclassification Predictive Analytics application, which was approved for $499,970.00 for completion by September 30, 2016.
2.0 Justification, Objectives and impacts
2.1 Agency Justification
Number / Description /1 / Presently, New Mexico has approximately 45,000 active registered employers and is required to meet a one percent penetration rate. Of these, 450 required audits, NMDWS is required to detect 450 misclassified workers. Approximately 50% of these audits are “clean audits,” meaning there were no wage discrepancies detected 225 of the 450 annual audits. The proposed approach will improve the overall efficiency of NMDWS and will reduce the number of employers misclassifying wages. Historically, there are known employers that misclassify wages and these employers are being overlooked using the current audit selection process.
2 / New Mexico’s current audit program is extremely limited and does not offer a knowledge based capability to target employers most likely to misclassify workers. The current system is limited to a random based selection of employers by zip code in a tax representative’s region. Currently, our targeted or selective audits offer limited criteria: North American Industry Classification System (NAICS) code (Super sector / 3 digit code); zip code; payroll size, and number of employees.
3 / The federal standard requires an average of one misclassified employee finding per employer audit. Audit requirements apply to both the number of audits and the number of misclassified workers. By federal standard, NMDWS must audit at least one percent of our active employers annually.
2.2 Business Objective
A key mission for the New Mexico Department of Workforce Solutions (DWS) is to be a business-driven department, understanding the needs of all employers with a focus on being efficient and responsive to the diverse needs of New Mexico’s employers and workforce. The Workforce Transition Services Division (WTSD) is responsible for providing Unemployment Insurance (UI) benefits to New Mexicans who have lost their jobs through no fault of their own and collection of taxes from liable employers to pay those benefits.
The Employer Misclassification Predictive Analytics (EMPA) initiative will further this strategic goal by improving the overall efficiency of NMDWS and will result in the reduction of the number of employers misclassifying wages, who are being overlooked by the current audit selection process.
Number / Description /Business Objective 1 / To be an integral part of all economic development and education initiatives.
BUSINESS OBJECTIVE 2 / To be efficient and responsive to the diverse needs of New Mexico’s employers and workforce.
BUSINESS OBJECTIVE 3 / Deliver targeted messaging designed to educate, inform, and remind employers of their obligation under Unemployment Insurance (UI) Tax law in an effort to realize significant reductions in the need for targeted audits, saving staff time, and enhancing collections to the UI Trust Fund.
BUSINESS OBJECTIVE 4 / Prioritize employer outreach and audit activities to better identify employers who have historically misclassified employees, further reducing the incidence of misclassification, improving efficiency use of staff time and enhance collections to the UI Trust Fund.
BUSINESS OBJECTIVE 5 / Improve the overall efficiency of NMDWS to reduce the number of employers misclassifying wages by 50%.
BUSINESS OBJECTIVE 6 / Create interface with L&I Division to identify employers making cash payments or under-reporting wages and 1099 reporting.
BUSINESS OBJECTIVE 7 / Gain access to the GLDEP to identify employers with a high rate of 1099 employees.
BUSINESS OBJECTIVE 8 / Identify employers with two or more blocked claim audits in order to utilize wage claim data to identify misclassification.
BUSINESS OBJECTIVE 9 / Ensure a fair and competitive playing field for all employers.
BUSINESS OBJECTIVE 10 / Work with Maryland and Utah, state leaders in field audits, to adopt best practices.
2.3 Technical Objectives
Number / Description /Technical Objective 1 / Ensure reuse of existing architecture, specifically the uDetect engine with integration into the UIA
Technical Objective 2 / SECURE ADDITIONAL DATA SOURCES THAT CAN BE SECURELY STORED AND REUSED FOR A RANGE OF PURPOSES
3.0 Assumptions
Number / Description /1 / The EMPA engine will be integrated with UIA
2 / DWS will provide the technical infrastructure hardware and software - application server, database, reporting tools, and remote connectivity required to build and test the technical deployment artifacts as part of this project
3 / DWS will obtain access to any external data that may be required to complete the Services under this Scope of Work.
4 / Business Personnel will actively participate in all business requirements workshops
5 / Business Personnel will be available for follow up meetings regarding the different tasks and deliverables related to Business Implementation
6 / Business personnel will assist in the development and approval of monitoring reports and implementation of Randomized Control Trials (RCTs).
7 / Data security requirements will not restrict use and storage approach
4.0 Constraints
Number / Description /1 / None at this time
5.0 Dependencies
· Mandatory dependencies are dependencies that are inherent to the work being done.
· D- Discretionary dependencies are dependencies defined by the project management team. This may also encompass particular approaches because a specific sequence of activities is preferred, but not mandatory in the project life cycle.
· E-External dependencies are dependencies that involve a relationship between project activities and non-project activities such as purchasing/procurement
Number / Description / Type M,D,E /1 / Funding is available / M
2 / Contract Amendment is approved / E
3 / Necessary infrastructure updates or modification will be scheduled in conjunction with project timelines. / D
6.0 Significant Risks
· H- High as defined by the project management team may have significant impact if approved to start.
· M- Medium impact
· L- Low impact
Risk 1
Description – Resource Availability / Probability: Medium / Impact : MediumMitigation Strategy: Project will be assigned a high priority by DWS and appropriate resources will be made available to perform the work per the approved work plan.
Contingency Plan: Additional contract resources will be deployed to the project.
Risk 2
Description – Impact on Tax Rate Reform Redux project / Probability: Low / Impact: LowMitigation Strategy: All proposed changes will be thoroughly reviewed before development to ensure that everything complies with concurrent projects
Contingency Plan Not applicable
7.0 PROJECT MANAGEMENT methodology
DWS projects are managed through a series of phases and/or gates: Initiation, Planning, Execution, and Closeout. Each of these phases/gates has a set of expected documents associated with it.
This project will be organized into multiple stand-alone releases focusing on addressing the needs of key business areas within the Appeals Tribunal one at a time. These releases will follow hybrid SDLC practices, which will involve early and frequent demonstrations of new functionality to customers, with the goal of mitigating unforeseen business issues before deployment. This gives the customer an opportunity to identify and correct any flaws in the detailed design early on.
8.0 PROJECT STAKEHOLDERS
Stakeholders should be a mix of agency management and end users who are impacted positively or negatively by the project.
name / Stake in Project / Organization / Title /Celina bussy / Executive sponsor / DWS / secretary
sue anne Athens / executive Sponsor / DWS / cio
JASON DEAN / EXECUTIVE SPONSOR / DWS / DIVISION DIRECTOR
Roy Padilla / Business Owner / DWS / Deputy Director UI
UI business Staff / System User / DWS
9.0 Roles and responsibilites
Role / responsibilities /Executive Sponsor / 1. Provide guidance to team on how project fits within overall agency vision and goals.
Project Sponsors / 1. Define overall project goals and objectives.
2. Provide guidance and directions to the project team over the course of the project.
3. Provide conflict resolution.
Business Owner / 1. Provide insights to business procedures.
2. Develop, document, and distribute Standard Operating Procedures (SOP).
3. Ensure availability of the subject matter expertise needed over the course of the project.
Solution Owner / 1. Ensure availability of the technical infrastructure and technical expertise needed for developing the solution.
2. Ensure availability of human resources in following areas:
2.1 Project management
2.2 Business analysis
2.3 Application development
2.4 Training
customer / 1. Provide subject matter expertise over the course of the project.
2. Participate in business solutions design discussions; when developed, test the solutions to ensure that they meet the business requirements.
3. Train the Appeals Tribunal staff for the business procedures and system features.
4. Participate in development of SOP.
5. Participate in test scenario definition and test script development.
Business Analysts / 1. Elicit and document business requirements and system specifications.
2. Design and test business solutions.
3. Train the customer and business partners for system features.
4. Facilitate customer and business partner communications.
5. Facilitate test scenario development and test script development.
business Partners / 1. Provide subject matter expertise over the course of the project.
2. Participate in business solutions design discussions; when developed, test the solutions to ensure that they meet the business requirements.
3. Participate in test scenario definition and test script development.
Trainer / 1. Develop a comprehensive training plan for the Appeals business processes and system features.
2. Develop training materials.
3. Facilitate training
PMO / 1. Monitoring and governance – routine review of project status, issues, and risks
Project Manager / 1. Manage project schedule and scope
2. Balance project constraints
3. Manage stakeholder communications
10.0 Project Charter Agency Approval Signatures
signature / dateProject Sponsor
project Sponsor
Business Owner
Solution Owner
Project director (PMO)
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