Talent2 Statement re Novopay Announcement
Talent2 and the Ministry of Education have agreed that the management and operation of the Novopay payroll service will
transition from Talent2 to a new Government owned company on 17 October 2014. The decision has been reached by mutual
agreement in support of a new service delivery model and settles a flawed contractual arrangement between the parties,
which was found in the June 2013 Ministerial Inquiry as not fit for purpose.
Media Statement
Wednesday July 30, 2014
NOVOPAY ANNOUNCEMENT
Talent2 and the Ministry of Education have agreed that the management and operation of the Novopay payroll service will
transition from Talent2 to a new Government owned company on 17 October 2014.
The decision has been reached by mutual agreement in support of a new service delivery model and settles a flawed
contractual arrangement between the parties, which was found in the June 2013 Ministerial Inquiry as not fit for
purpose.
Talent2’s Alesco software will continue to be used by the Government owned company to process the Ministry’s payroll
under a six-year license arrangement.
A total settlement package of NZ$18-22M has been negotiated with the Ministry. The negotiated package includes a cash
payment by Talent2 of NZ$7M, a transfer of assets including Novopay customisations and other IP previously funded
through the existing contract and a discounted software license.
The Ministry has agreed a support and maintenance contract with Talent2 for the Alesco Software under which the Ministry
is expected to pay Talent2 fees totaling NZ$9.6M over a six-year period. Talent2 also has a contract that covers
transition and the completion of certain objectives prior to the transfer.
This change allows Talent2 to better focus resources and investment on its core payroll business and broader New Zealand
client base.
Under the new arrangement the Government will assume full responsibility for the provision of the education payroll
service. Integral to the agreement, the Ministry intends to retain the valued skills and expertise of Talent2’s Novopay
employees in the new Government owned company.
Today’s announcement marks the beginning of a transition period which will see the orderly transfer of payroll
operations from Talent2 to the new entity by 17 October 2014. Through this period Talent2 will retain operational
responsibility for the Novopay payroll service. Talent2 is committed to ensuring that current service levels are
maintained and that the transition is a smooth process for its staff, the sector and the Ministry.
Talent2 will be working closely with the Ministry over this period. Talent2 acknowledges the hard work and commitment of
the Novopay team.
-Ends-
About Talent2
Talent2 is the leading Human Resources Business Process Outsourcing (BPO) organization in the Asia Pacific region,
working with clients across diverse business types and industries to deliver end-to-end talent management solutions that
put people first. These include HR Advisory, Payroll, Recruitment and Learning solutions to enable organisations to
improve the power and productivity of their people.
Notes to Media
Talent2 will not be making any further comment to media regarding today’s announcement. All media enquiry will be
referred to this statement.