Effective: April 1, 2020 (Managed Payroll)
Effective: March 1, 2020 (Managed Benefits)
Effective: April 10, 2020 (Managed Benefits Pro)
These Enhanced Services terms (“Enhanced Services Terms”), together with the Namely Terms and Conditions (“Terms”) and Order Form (collectively, the “Agreement”), set forth the terms and conditions under which Namely and its affiliates agree to provide Client certain Namely-administered services described herein at an elevated service-level to those found in the Benefits Administration, Employee Benefits, and Payroll Addenda, which services and terms are separate from, and shall have no effect over these Enhanced Services Terms. Capitalized terms that are not defined in this addendum shall have the meaning as set forth in the Terms or applicable Order Form.
Provided that Client is in good standing and has met the obligations of these Managed Services Terms, Namely shall provide Client with its Managed Payroll Services, which shall include the following:
Client has certain obligations under these Managed Payroll Terms to ensure that Namely has accurate data and authority to process payroll, and engage in tax-related services on behalf of Client. In order to provide such services, Namely relies on the information and instructions provided by Client. Specifically, Client’s obligations to ensure accurate information and instructions to Namely include but are not limited to:
In performing the Managed Payroll Services, Namely will rely solely on the information provided by Client and as reviewed and approved by Client Administrator. Namely is not responsible for any errors resulting from such reliance except as detailed in the Managed Payroll Service Level Agreement contained herein, which shall be the sole and exclusive remedy for errors resulting from Namely’s processing of Client payroll. In the event Client fails to carry out its obligations in whole or in part in a manner that materially interferes with Namely’s ability to carry out its obligations, Namely reserves the right to terminate the Managed Payroll Services in its sole discretion. Prior to Client’s initial payroll processing date, Client must provide and approve the completed and executed documents Namely requires for providing the Managed Payroll Services, including all implementation documents and properly formatted payroll data. Namely will provide the Managed Payroll Services in reliance on the accuracy of the information provided by Client. Failure to provide complete or accurate information may adversely impact Namely’s ability to carry out the Managed Payroll Services. Namely reserves the right to charge additional reasonable fees in the event that Client fails to provide timely, and properly formatted data as reasonably requested by Namely and as detailed herein to carry out the Managed Payroll Services.
Namely shall notify Client via electronic communication when all information necessary to begin the Managed Payroll Services has been received and when the implementation process has been completed. Subsequently, Client shall, prior to submitting its first payroll run, review and approve the payroll information for completeness and accuracy. Upon approval of the payroll information, Client consents to the transfer of funds from Client’s designated bank account to Namely’s designated payroll account by electronic funds transfer. Prior to the submission of Client’s initial and each subsequent payroll run, Namely must receive from Client the payroll funds necessary to cover the total payroll and tax liability of such payroll run. Namely, in its capacity as payroll processor, shall direct the transfer of funds from Client’s designated bank account in accordance with Client’s designated payroll fund recipients including employees, independent contractors and other payroll designees, as well the appropriate taxing authorities as provided by Client. Namely’s standard processing time for payroll is three (3) business days. In the event that Client is a direct deposit only Client, Namely’s standard processing time is one (1) business day. Client acknowledges that it has been advised of these standard processing times and agrees that Namely has no obligation to process payroll in a shorter amount of time and that failure to adhere to payroll processing timeliness for data submission, payroll approval, or employee status updates may result in pay cycle exclusion from the Managed Payroll Service Level Agreement and may result in additional processing fees. If Namely agrees to process Client’s payroll through an expedited action outside of these normal processing times, Namely reserves the right to charge an expedited processing fee in its sole discretion.
Client will maintain a bank account in which it shall deposit payroll funds in accordance with these Managed Payroll Terms. Client shall maintain good and sufficient funds in Client’s designated payroll bank account (“Client Payroll Account”) to cover all funding transactions and liabilities to be made pursuant to the payroll function. Client shall adhere to the National Automated Clearinghouse Association (“NACHA”) guidelines. Client acknowledges that, in the event that Client fails to maintain such good and sufficient collected funds, Namely may be unable to carry out the Managed Payroll Services and that Client will immediately become solely responsible for funding transactions to be made pursuant to this Addendum. In the event Client fails to maintain such good and sufficient collected funds, Namely may terminate the Agreement upon notice to Client and charge Client for any applicable fees, penalties, and interest, or change the method via which Client submits payroll funds. Client agrees to pay any fees, fines, or funds paid by or accrued to Namely as a result of Client’s failure to maintain sufficient funds. Namely may take any legal action it deems necessary to collect such fees, fines, or funds paid by Namely as a result of insufficient funds. Payroll funds held by Namely on Client’s behalf will be segregated from other funds of Namely, but may be commingled with funds of other Namely payroll clients. Namely shall be entitled to receive all net investment income generated and interest earned through any funds held and/or invested by Namely from its payroll fund account(s). Independent of the result of any investment of funds performed by Namely, Namely shall pay Client’s tax liabilities and wage attachments in accordance with Client’s proscribed payroll schedule, provided Client has complied with its obligations as detailed herein, including but not limited to the prior deposit of such funds in accordance with the above schedule.
Client authorizes Namely to act as an agent on its behalf with the IRS as well as applicable state and local tax authorities including the submission of tax-related information and Client Data, the payment of tax liabilities, and correspondence with appropriate taxing authorities. Client acknowledges that Namely is not acting in a fiduciary capacity on its behalf and that although Namely is authorized as a third-party to act on its behalf with certain tax authorities to file payroll tax returns and to make payroll tax payments, Client is ultimately responsible to the relevant taxing authority for the timely filing of employment tax returns and the timely payment of employment taxes on behalf of Client’s employees. Namely and the IRS recommend Client enroll in the U.S. Treasury Department’s Electronic Federal Tax Payment System (EFTPS) to monitor Client’s IRS account and to ensure that timely tax payments are being made on Client’s behalf. You may enroll in the EFTPS system online at www.eftps.gov or via phone at 800-555-4477 for an enrollment form. State tax authorities generally offer similar means to verify tax payments and Clients are advised to contact the appropriate state tax authority directly for details.
Client represents and warrants that an account Administrator shall review and approve the submission of all payroll information to Namely, thereby authorizing Namely to create and input entries and to submit payroll runs as required to process payroll runs and payroll related tax transactions. By approving a payroll for processing by Namely, Client acknowledges and agrees that: (i) all payroll information and tax-related information are accurate and may be submitted by Namely without further review or approval by Client; (ii) any instructions provided to Namely by Client (including but not limited to payroll information and client data required for payroll run and or tax transaction) are deemed to authorize Namely to execute such payroll run or tax transaction in accordance with such instructions and that Namely in its sole discretion reserves the right to refuse to act upon such instructions. After a payroll has been approved by Client Administrator and received by Namely for the purposes of submitting Client’s payroll, Client may not be able to cancel or amend such amount and Client understands that by approving a payroll for processing, that while Namely will use reasonable efforts to act on any cancellation or amendment request, Namely shall have no liability to Client for: (i) the rejection of any payroll for processing as well as any resulting penalties, interest, or any claims arising directly or indirectly therefrom; and (ii) any under or overpayments to Client employees as a result of Namely having processed the approved payroll action.
Client acknowledges and understands that if Client terminates Managed Payroll Services pursuant to Section 9 of the principal Agreement or via the non-renewal of Managed Services on any active Order Form, then such termination may not be reversible. In the event that Client or Namely terminates Client’s Managed Payroll Services, then as of the time such termination becomes effective, Namely shall have no obligation to make further payroll or tax filings or actions on Client’s behalf and reserves the right to apply additional fees for any of the Managed Payroll Services detailed herein for the provision of such services.
Namely is not a co-employer or joint employer of Client employees. Namely is not a professional employer organization and the Managed Payroll Services do not constitute professional employer organization services. In the event that Client makes any assignment for the benefit of creditors, or a receiver, trustee in bankruptcy or similar officer is appointed to take charge of any or all of Client’s property or Client seeks protection under any bankruptcy, receivership, trust deed, creditor’s arrangement, composition or comparable proceeding or such proceeding is instituted against Client, Namely may terminate the Agreement upon prior notice to Client or change the method via which Client remits outstanding or future payments to Namely. In the event that Namely is unable to settle funds on behalf of Client for reasons of bankruptcy or otherwise, Namely shall return such funds on behalf of Client. Client shall be solely responsible for the escheat of such funds and Namely accepts no escheat responsibility. Client acknowledges that Namely or the bank that processes Client’s payroll transactions may need to investigate ACH entries transmitted by Client to the bank and consents to such investigation. Client also acknowledges that Namely or the bank may refuse to process ACH entries at any time in their sole discretion, respectively. Client is solely responsible for recruiting, hiring, classifying, disciplining, and terminating Client employees and for determining their wages, benefits, duties, responsibilities and work schedules. Namely is not the employer of record of Client employees and all payroll and tax filings for Client shall be performed using Client’s employer identification number (“EIN”).
This Service Level Agreement (“SLA”) sets forth the performance levels (each, a “Service Level”) Namely must meet for its Managed Payroll Services. If Namely does not meet a Service Level, and if Client meets its obligations under this SLA, Client will be eligible to receive the Service Credit defined below. This SLA sets forth Client's sole and exclusive remedy for any failure by Namely to meet a Service Level.
“Service Credit Measurement Period” means, for the Initial Term, the period beginning ninety (90) days after the Payroll module Go Live Date and ending at the end of the Initial Term, and for any subsequent Renewal Term, the full Renewal Term. “Erroneous Net Payment” means a payment of wages or salary to an employee or contractor of Client that was not for the correct net amount or was not paid on the correct day and that Namely determines in good faith was solely the result of Namely’s error. “Net Pay Accuracy Level” means the quotient calculated by dividing (a) the difference of Total Net Payment less Erroneous Net Payments during the applicable period by (b) Total Net Payments. “Service Credit” means the following for any full Service Credit Measurement Period:
|Net Pay Accuracy Level||Service Credit|
|99% or higher||None|
|95% to 98.99%||5% of Fees for Managed Payroll for the applicable Service Credit Measurement Period|
|90% to 94.99%||10% of Fees for Managed Payroll for the applicable Service Credit Measurement Period|
|Under 90%||15% of Fees for Managed Payroll for the applicable Service Credit Measurement Period|
“Total Net Payments” means the total number of payments processed by Namely during the applicable period.
The calculation of Net Pay Accuracy Level shall not include Erroneous Net Payments due, in part or in whole, to any of the following: (i) Force majeure events that fall outside of Namely’s control; (ii) Provision by Client of inaccurate employee, wage, tax, benefits, or other related data necessary for accurate processing of payroll; (iii) Client’s failure to timely submit payroll data, approve a payroll run, or update employee status; (iv) Client’s failure to meet its responsibilities, including but not limited to any deadlines, set forth in the relevant Order Form and/or the Terms; or (v) Failure by Client to review and approve employee and payroll year-to-date data loaded either during the implementation phase or configuration of: (a) the Client’s Namely site; or (b) any new EIN(s) or product module(s).
In order to be eligible to receive the applicable Service Credit described above or exercise the termination right described below, Client must notify Namely of its failure to meet the applicable Net Pay Accuracy Level within thirty (30) days from the end of the applicable measurement period.
In the event that Namely does not meet a Net Pay Accuracy Level of 90% or higher in any two (2) consecutive months, Client may terminate the Managed Payroll module upon fifteen (15) days’ prior written notice to Namely and will receive a pro rata refund of Fees.
Provided that Client is in good standing and has met the obligations of these Enhanced Services Terms, Namely shall provide Client with its Managed Benefits Services, which shall include the following:
Provided that Client is in good standing and has met the obligations of these Enhanced Services Terms, and has elected the elevated service offering of Managed Benefits Pro and such election is active in Client’s current product subscription plan, Namely shall provide Client with its Managed Benefits Pro Services, which shall include the following:
Client has certain obligations under these Managed Benefit Terms to ensure that Namely has accurate data and authority to act as Broker of Record on behalf of Client and to administer the services detailed in the foregoing section. These Client obligations include, but are not limited to the following:
Client acknowledges that: (i) the solicitation and sale by Namely related to the Platform (where applicable) were separate and independent from the solicitation and sale related to the Managed Benefits Services or Managed Benefits Pro Services as set forth in this Addendum which was performed by a different Namely sales team with the appropriate licenses as insurance producers, brokers and/or agents; and (ii) Client has been, and hereby is informed that it: (a) may obtain the Subscription to the People Operations Platform, Payroll and Benefits Administration modules without signing on for the Managed Benefits Services or Managed Benefits Pro Services; and (b) it is under no obligation to purchase any insurance product from Namely or any of its affiliates.
Namely may waive the fees associated with the Benefits Administration module, Expert Advisors, Carrier Feeds, Benchmarking, Custom Benefits Guide, and any other features or services which may be sold separately, if the Client receives the Managed Benefits Services or Managed Benefits Pro Services described in this Addendum and by designating Namely or a Namely affiliate as Broker of Record as these Namely product and service offerings are directly related to the sale or servicing of the insurance products placed by Namely or its affiliates. No other fees shall be waived. In the event the Client notifies Namely of its decision to rescind the status of Namely or of any of its affiliates as Broker of Record, Namely will be entitled to charge Client for the products or offerings described in this Part 3, Section IV at their current and prevailing rates.
Namely and its affiliates as part of the Managed Benefits Services and Managed Benefits Pro Services shall make recommendations and coverage price estimates in reliance on Client’s location, group size, and unique circumstances and composition. Client hereby acknowledges that plan recommendations and pricing: (i) are created in reliance on the representations made by Client during the implementation (underwriting) process; (ii) may not be the lowest-cost options for Client; and (iii) may not fulfill User’s employees obligations pursuant to the Affordable Care Act or applicable state or local laws in all cases. Client acknowledges that Namely plan recommendations may be rejected in Client’s sole discretion. Client further acknowledges that all pricing quotes are estimates provided by third-party underwriters and may be changed by the underwriter without prior notice to Namely, and that Namely shall not be liable for any pricing change as a result of the acts of third parties.
In providing the Managed Benefits Services and Managed Benefits Pro Services, Namely may provide Client with written or oral materials describing, summarizing, consolidating, and otherwise presenting benefit plans. Client acknowledges that Namely is not a benefits provider or underwriter and as such, these materials are intended to facilitate Client understanding of the benefit plan’s offerings, limitations, and exclusions, among other details, and that any information contained in the materials prepared by Namely may not contain complete plan details and/or inaccuracies and that materials provided by the service provider directly shall form the complete and controlling source of plan details including coverages, limitations, and exclusions. Client further acknowledges that as broker, Namely may not design, underwrite, amend, modify, or terminate any insurance plan presented to or elected by Client or as recommended to Client as part of the Managed Benefits Services or Managed Benefits Pro Services. Additionally, Namely may not process claims, make decisions, or determine eligibility on behalf of Client, the decision to accept any insurance plan offering or to terminate any insurance plan offering is within the sole discretion and direction of Client.
The Managed Benefits Services and Managed Benefits Pro Services described herein may rely on third-party technology and services, such as application programming interfaces (APIs), electronic data interchanges (EDIs) and web-hosting services. Namely will attempt to provide Client with prior written notice of any known downgrades or changes in third-party provided services. Notwithstanding the foregoing, Client acknowledges that Namely shall not be liable for any delays or failures in performance from causes beyond Namely’s reasonable control including third-party technology providers and acts of third parties.
Client acknowledges and understands that if Client terminates Managed Benefits Services pursuant to Section 9 of the principal Terms or via the non-renewal of such services on any active Order Form, then such termination may not be reversible. In the event that Client or Namely terminates Client’s Managed Benefits Services, then as of the time such termination becomes effective, Namely shall have no obligation to make further benefits-related activities or to take compliance-related actions on Client’s behalf and reserves the right to apply additional fees for any of the Managed Benefits Services detailed herein for the provision of such services. If Client substitutes Namely as Broker of Record with another Broker of Record then Namely will be unable to carry out many of the services described herein on Client’s behalf including communication with the respective underwriter on behalf of Client and carrying out brokerage related activities on behalf of Client. Client assumes all brokerage related actions and activities upon the submission of a substitute Broker of Record letter.
Client shall comply with all applicable anti-money laundering (“AML”) as well as Office of Foreign Assets Control (“OFAC”), laws and regulations with regard to the funds and individuals involved in this Addendum. In the event (i) Client does not comply with such laws or regulations, or (ii) either Client or one of its employees is included in the Specially Designated Nationals (“SDN”) list published by OFAC, Namely may immediately terminate the Agreement, take any required legal steps and make all necessary filings and disclosures with the appropriate governmental authorities. Client agrees that Namely may unilaterally amend or update these Managed Services Terms by providing written notice to Client only as reasonably determined by Namely in order to update the services provided or as mandated by any governmental agency or taxing authority. In the event that changes have a materially adversely impact on Client’s normal business operations, Client shall have the option to reject such changes, in good faith within thirty (30) days of receipt of notice of such change from Namely by providing written notice to Namely. Upon such rejection, Namely shall have the option to not make said change or terminate these Managed Services Terms. Client retains all employment risks and liabilities regarding Client employees. Namely will not provide legal or tax advice to Client or Client’s employees as part of the Managed Payroll Services. Client should always consult with its own legal or tax advisors for legal or tax questions.