I. Subscription Services Incorporation
These Subscription Services terms (“Subscription 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 the foregoing services described herein. Capitalized terms that are not defined in this addendum shall have the meaning as set forth in the Terms or applicable Order Form. These services (hereafter referred to as “Subscription Services” in whole, or by their individual offering definition as provided herein) shall only apply insofar as Client has the corresponding SKU on any active Order Form and shall supplement the general Terms between the Parties, where applicable.
II. Benefits Administration
A. Description of Services. Provided that Client has purchased the Benefits Administration services as provided on an active Order Form, is in good standing and has met the obligations of the Terms, Namely shall provide to Client with its Benefits Administration services (hereafter “Benefits Administration Services”), which shall include the following:
1. Store benefit election data in the Platform as submitted by Client employees and approved by the Administrator.
2. Configure Benefits Administration module in accordance with benefit plan decisions and information provided by Client based on benefit plan design and details. Namely does not guarantee the ability to configure every benefit offered by Client, as they can vary significantly by benefit type and benefit vendor.
3. Provide Client with access to a library of standard benefit election reports to assist in ongoing benefits administration.
4. Provide Client with access to ACA Reporting tool to facilitate generation and filing of ACA Reporting Forms 1094-C, 1095-C, 1094-B, where applicable.
5. Subject to Namely’s Carrier Feed Terms (as provided in the Supplemental Services Addendum) Build and test electronic carrier file feeds from Namely to benefit vendors, when permitted by benefits vendor and according to benefit vendor’s specifications, provided that carrier file feed set up is included in Client’s contract.
B. Client Responsibilities
1. Process benefit election and enrollment changes using the Benefits Administration module, and approve submitted employee elections timely according to Client’s benefit vendors’ guidelines, unless otherwise noted in the Managed Benefits or Managed Benefits Pro provisions herein for those Clients who also receive Namely Managed Benefits or Managed Benefits Pro.
2. Maintain ongoing employee benefit eligibility, offers of employee coverage, and qualified life events via Benefits Administration module timely. Maintain employee classes to denote benefits eligibility purposes of ACA reporting. Note: Hours tracked using Namely Time or Timesheets on Namely Platform do not drive offers of benefit coverage through Namely, nor documentation of offers of coverage on ACA Reporting Forms 1094-C, 1095-C, 1094-B, where applicable.
3. Review and reconcile benefit vendor invoices to ensure accurate billing from benefits vendors. Namely does not provide carrier reconciliation services.
4. Timely transmit benefits elections from the Benefits Administration module to insurance carriers, in the event that Client’s benefits vendor does not accept an electronic file feed from Namely or in the event that Client’s electronic file feed is not live, unless Client is a Namely Managed Benefits Client (see Managed Benefits terms below), in which case Namely shall provide these services as part of its Managed Benefits services as described therein.
5. Timely review and respond to all documents and forms presented by Namely to Client for the purpose of building electronic file feeds from Namely to benefits providers.
6. Timely review benefits vendor reports related to data sent on electronic file feeds, unless Client elects Namely Managed Benefits Services or Managed Benefits Pro Services, in which case Namely shall provide this service as described herein.
III. Payroll Services
A. Description of Services. Provided that Client has purchased the Payroll services as provided on an active Order Form, is in good standing and has met the obligations of the Terms, Namely shall provide to Client with its Payroll services (hereafter “Payroll Services”), which shall include the following:
1. Prepare, deposit, and file Client’s U.S. payroll taxes for those federal, state, and local jurisdictions listed by Client upon initial payroll implementation process and any updates provided to Namely by the Client and confirmed by Namely in writing to Client during any active Term period.
2. Prepare a quarterly tax statement for each Federal Employer Identification Number (“FEIN”) or (“EIN”) and, where required, each state or local tax ID provided by Client. This statement shall include a summary of tax liabilities reported throughout the quarter, account reconciliation, and printed returns filed at quarter end.
3. Answer tax agency correspondence for tax deposits and returns filed by Namely on Client’s behalf and in coordination with Client.
4. File amended returns as required for returns processed by Namely. Charges may apply in the event the amended return is a result of incorrect information supplied to Namely by Client or Client representative.
5. Prepare and file W2 agency filings.
6. Funds:
a. The funds held by Namely on Client’s behalf shall be segregated from other funds of Namely, but may be commingled with the funds of other Namely payroll clients. Namely shall be entitled to receive all net investment income generated and interest earned on any funds held and invested pursuant hereto.
b. Independently of the results of any investments of the fund performed by Namely, Namely has the obligation to pay Client’s tax liabilities and wage attachments, provided the Client has previously deposited the corresponding funds with Namely.
c. In the event that Namely is unable to settle funds on behalf of Client, Namely shall return such funds on behalf of Client. Client shall be solely responsible for the escheat of such funds and Namely shall have no responsibility to escheat such funds.
7. Wage Attachments. Client is solely responsible for the setup of wage attachments in the Platform in accordance with the Namely online documentation. Namely shall then prepare and deposit Client’s wage attachment liabilities for those U.S. federal, state, and local payment processing units and any individual third party to which an employee of Client owes a debt and has agreed or is compelled by appropriate governmental authority to resolve via attachment of employee’s wages. Namely shall make available a report of wage attachment activity to Client summarizing funds collection and disbursement transactions completed. Namely is not obligated to commence or to provide the Payroll Services until Namely has received all information necessary to disburse wage attachment liabilities.
8. Check Printing. Namely shall provide direct deposit advice slips, and if elected by Client (subject to additional fees), print checks for Client based on the information from each completed payroll as set forth in the Data Remittance section below. Namely shall be responsible for providing such printed checks and direct deposit advice slips to the commercial overnight carrier provided by Client (additional fees may apply as overnight carrier fees shall be borne solely by Client).
9. Reporting for Cash Collections. Upon approval of the payroll by Client, all payroll reports are available immediately. Three (3) business days prior to the applicable check date, Namely shall make available payment service data to Client which is applicable to any given payroll closed within the parameters defined herein, to allow Client to generate reports based on such data at the open of normal business hours.
10. Exclusions. Namely is not responsible for providing additional administrative services, including, but not limited to, agency research, account reconciliation, wage attachment data input and adjustments. Namely is not responsible for any pre-existing errors or similar matters arising prior to commencement of these services by Namely or for any errors that may occur in the event Client fails to provide Namely with all necessary, complete, timely, and accurate information.
11. Errors. To the extent that a payroll or tax filing error is solely caused by Namely, the cost to correct such error, including, but not limited to payment of fines, shall be payable by Namely.
B. Client Responsibilities.
1. Client shall adhere to the National Automated Clearinghouse Association (“NACHA”) rules for the transfer of funds at all times.
2. Client shall provide Namely with its valid Tax ID Number (FEIN/EIN) for each payroll entity.
3. Data Remittance.
a. Direct Deposit Only. Client shall complete its payroll before 3:00 PM EST, no less than two (2) business days prior to the applicable check date(s) for direct deposits completed via reverse wire only.
b. Direct Deposit and Check Printing. Client shall complete its payroll before 3:00 PM EST, no less than three (3) business days prior to the applicable check date(s).
c. Client acknowledges that the data and all information from the completed payroll from the Platform shall be the basis for payroll as provided for herein. Client is responsible for viewing, in the Platform, either the payroll summary report or the cash requirement report prior to approving each payroll. Client acknowledges and agrees that Namely shall conduct an internal electronic audit of Client’s tax database in order to review and export data, on an as needed basis, in order to prepare quarterly or annual tax filings for Client.
4. Funds Collection.
a. For direct deposit only clients as well as for any tax liability within a given pay period requiring a “next day” payment, Namely shall withdraw the total tax liabilities associated with Client’s payroll and wage attachments associated with the given pay period at least one (1) business day prior to the applicable check date from Client’s designated bank account and transfer such amount to a Namely controlled account to effectuate the Client’s payroll run.
b. For direct deposit plus check printing clients and for tax liabilities not requiring a “next day” payment date, Namely shall withdraw the total tax liabilities and wage attachments associated with the given pay period three (3) business days prior to the payroll check dates from Client’s designated bank account and transfer such amount to a Namely controlled account to effectuate the Client’s payroll run.
c. At the times specified above, Namely shall collect funds to cover the total payroll liability of Client. Namely shall direct the transfer of funds from Client’s designated bank account to cover all funding transactions to be made under this Payroll Addendum. In the event Client fails to maintain such good and sufficient funds, Namely may:
(i) terminate the Payroll Subscription only upon notice to Client and charge Client for any applicable fees, penalties and interest; or
(ii) change the method via which Client is required to submit funds in order for Namely to carry out the Subscription Services.
5. Record of Tax Disbursement and Wage Attachments. Namely shall not be liable for any invalidity or inaccuracy caused by Client. Upon Namely making available to Client any and all records of tax disbursements and wage attachments prepared by Namely, Client shall examine all records for validity and accuracy according to Client’s records. Client shall immediately notify Namely of any inaccuracies or inconsistencies.
6. Client agrees to provide payroll related Client Data in a format reasonably requested by Namely and in a reasonable period of time after such request has been made. Additional fees may apply in the event that Client cannot supply payroll data in the format or time period requested by Namely.
7. Client agrees to timely execute any and all documents and forms presented by Namely in order to effectuate carrying out the Payroll Services, including power of attorney to service taxes. Client agrees that it shall timely respond to any and all requests made by Namely. Namely may, in its discretion, terminate the Payroll Services in the event Client fails to execute such documents or forms when requested by Namely or respond to Namely’s service requests in a timely and complete manner.
8. Namely may unilaterally amend or update the terms of these Payroll Services by providing written notice to Client only:
(a) as reasonably determined by Namely in order to update the Payroll Services provided; or
(b) as mandated by any governmental agency or taxing authority.
9. In the event that change under (a) above adversely impacts 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 the Payroll Services.
10. Client agrees to cooperate and diligently perform its responsibilities as set forth herein and acknowledges that failure to do so may result in additional fees or costs to Client. Namely shall provide Client with ten (10) days advanced written notice of its intent to charge such additional fees and/or costs, and Client shall have the opportunity to perform its obligations resulting in the additional fees or cost attributed for such failure during such ten (10) day period.
11. Tax Information Disclosure. As required by the Internal Revenue Service, the following information must be disclosed to taxpayers utilizing a third party to perform tax filing services on its behalf:
a. Client acknowledges that it is responsible for the timely filing of employment tax returns and the timely payment of employment taxes for its employees, notwithstanding Client’s engagement of Namely to file the returns and make the payments on its behalf.
b. The Internal Revenue Service requires enrollment in the U.S. Treasury Department’s Electronic Federal Tax Payment System (EFTPS) to monitor your account and ensure that timely tax payments are being made. IRS documentation that includes full FEIN and legal business name are required as proof of entity. Enrollment in the EFTPS may be done online at: www.eftps.gov, or by calling (800) 555-4477 for an enrollment form. State tax authorities generally offer similar means to verify tax payment and Clients are advised to contact the appropriate state tax authority directly for details. Namely shall not be liable for any fines, penalties, interest, or other related fees that accrue to Client for its failure to provide proof of entity documentation as required by the IRS. Client acknowledges that no state or federal agency assumes responsibility for the financial solvency of Namely.
12. Tax Authorization. Client agrees Namely shall act as the tax filing agent where required for U.S. federal, state or local deposits, filings and correspondence on Client’s behalf as it relates to payroll tax filings. Namely agrees to hold in confidence all information relating to Client’s assets, liabilities, business or affairs which is received by Namely in the course of rendering service except as provided by law or as provided in the Terms.
13. ACH Access. 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 Client shall, and hereby consents to such investigation(s). Client also acknowledges that Namely or the bank may refuse to process ACH entries at any time, for any reason, or no reason at all.
IV. Enhanced Services
A. Managed Payroll
1. Description of Services. Provided that Client is in good standing and has met the obligations of the Terms, Namely shall provide Client with its Managed Payroll Services, which shall include the following:
a. At Client’s direction, administer payroll runs and related activities in the Client’s instance of the Platform, including the following:
i) Administer payroll calendar and payroll runs;
ii) Administer off-cycle/manual check requests, calculations, and processing;
iii) Administer and process garnishments upon receipt of proper documentation;
iv) Calculate net payment of wages; and
v) Configure general ledger (GL) interface on an ongoing basis.
b. Prepare, deposit and file Client’s payroll taxes for all federal, state, and local jurisdictions which Namely has set up in Platform, including the following:
i) Prepare and file quarterly tax statements for each Federal Employer Identification Number (“FEIN”) and, where required, for each state or local tax identification number provided by Client;
ii) File amended returns as required for returns processed by Namely (additional fees may apply where amendment is required as a result of Client error);
iii) Provide quarterly tax statements, including a downloadable summary of tax liabilities reported throughout the quarter, account reconciliation and printed returns filed at quarter end;
iv) Provide initial tax registration setup in new states/localities if registration by a third party is permitted by the taxing authority;
v) Provide notification of tax changes and assistance in complying with such changes;
vi) Administer quarterly and year-end processing as may be required;
vii) Prepare and file W-2 agency filings;
viii) Prepare and provide electronic copies of employee W-2s and 1099s; and
ix) Respond to agency inquiries on behalf of Client including tax agency correspondence for tax deposits and returns filed by Namely on Client’s behalf.
c. Import approved payroll data in the Client’s instance of the Platform in accordance with Client’s instructions, including the following:
i) Import and/or enter payroll data and any necessary overrides, including but not limited to wages and deductions;
ii) Enter employer-level payroll data, including but not limited to SUI tax rates and custom pay codes;
iii) Calculate and enter salary proration, gross-up earnings, retro pay, and Group Term Life (GTL) imputed;
iv) Prepare and provide payroll data to Client for review and final approval;
v) Import time and time-off data into platform; and
vi) Balance time data imports against client provided controls.
d. Perform routine payroll-related audits (note: when Client makes a change that has a significant effect on Client’s payroll, including but not limited to mergers and acquisitions, office location changes, or spin-offs, additional fees may apply);
e. Prepare and deposit Client’s wage attachments for any third party to which Client’s employee owes a debt and has agreed or is compelled by a lawful authority to resolve via attachment of employees wages;
f. Perform banking and other related money movements, including the following:
i) Process direct deposit reversals (direct deposit requests must be received within thirty (30) days of initial direct deposit transfer. Additional service fees and limitations may apply);
ii) Conduct check and payroll reconciliation;
iii) Distribute payroll through checks, direct deposit and/or paycards.
2. Client Obligations. 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:
a. Designating an account Administrator to review and approve the submission of all payroll information to Namely;
b. Providing accurate, timely, and complete information required by Namely herein to perform the Managed Payroll Services, which shall require Client to, as applicable:
i) Collect time sheet/time card data from employees;
ii) Collect time off requests and data from employees;
iii) Download time data files from time-keeping system (if not using Namely Time);
iv) Review time data for adherence to proper data format;
v) Reformat time data files (if not currently using Namely Time) to appropriate time data input file (note: Namely Time may be subject to additional terms and conditions available at: https://www.namely.com/third-party/);
vi) Add new hire/terminated employees in Namely platform;
vii) Input general ledger (“GL”) file into Client’s financial system of choice;
viii) Inform Namely of any changes to payroll calendar or holiday schedules;
ix) Provide Namely with all valid federal, state and/or local Tax ID numbers in the format required by the corresponding agency (unless Namely has completed the registration process in those federal, state and/or local tax jurisdictions on Client’s behalf); and
x) Execute forms and documents necessary to designate Namely to act on Client’s behalf in tax and payroll related services, including but not limited to a power of attorney to execute tax disbursements.
c. Promptly notify Namely of third-party notices on behalf of Client and Client employees, such as Internal Revenue Service (“IRS”) penalty notices or garnishment notices, which could affect Namely’s ability to effectively administer the Managed Payroll Services.
d. In performing the Managed Payroll Services, Namely shall 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 SLA 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 shall 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.
3. Payroll Funds Collection and Timing. 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 as the appropriate taxing authorities as provided by Client. Namely’s standard processing time for payroll is three (3) business days (excluding US federal and banking holidays). In the event that Client is a direct deposit only Client, Namely’s standard processing time is one (1) business day (excluding US federal and banking holidays). 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.
4. Payroll Funds Processing. Client shall 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 shall 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 shall 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.
5. Client Tax Information Acknowledgement. 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 recommends 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.
6. Client Representations. 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, while Namely shall 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.
7. Effect of Termination of Managed Payroll Services. Client acknowledges and understands that if Client terminates Managed Payroll Services pursuant to Section 9 of the principal Terms 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.
8. Managed Payroll Services General Provisions. 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”).
B. Managed Benefits
1. Managed Benefits – Description of Services. Provided that Client is in good standing and has met the obligations of the Terms, Namely shall provide Client with its Managed Benefits Services, which shall include the following:
a. Benefits administration configuration upon implementation and benefits election, including the following:
i) Configuration of Client’s instance of the Namely Platform;
ii) Processing of Namely-supported benefits changes in the Client’s instance of the Platform;
iii) Open enrollment planning, support and configuration;
iv) Unlimited carrier feed setup upon implementation (for insurance lines in which Namely is Broker of Record); and
v) Where carrier feeds are unavailable, managing Client eligibility with insurance carriers by distributing enrollment and life event change information to insurance carriers as may be required (for insurance lines in which Namely is Broker of Record).
b. Annual benefits renewal and evaluation of elections for optimization, including the following:
i) Assistance with the review and renewal of benefit plan designs, benefit levels, insurance premiums, program communications and quality of current employee health and welfare insurance policies for which Client has elected Namely as Broker of Record;
ii) Preliminary estimates of anticipated renewal rates, when possible, to assist Client in preparation of annual benefits budget;
iii) Market research analysis for the purpose of making recommendations on benefit vendor selection and services;
iv) Assistance with development of Client’s employee health and wellness programs as needed;
v) Representation of Client in negotiations with benefit providers where Namely has authority to do so as Broker of Record and subject to certain limitations;
vi) Review of prospective rate proposals to ensure underlying assumptions are appropriate and accurate, and are consistent with requested assumptions (note: rate proposals are provided by third-party insurance underwriters and Namely assumes no responsibility over price offering accuracy or reliability); and
vii) Materials detailing Client’s health benefit plans including open enrollment, new benefits offerings, and/or changes to existing benefits offerings.
c. Benefits analysis and reporting of Client’s benefits offerings, including the following:
i) Review of Client’s utilization, experience trends, changing patterns, and plan-specific data for the purpose of guiding benefit plan strategy;
ii) Financial modeling and experience reporting as needed when available;
iii) Summaries of vendor proposals obtained on Client’s behalf, detailing proposal differences, assumptions and cost calculations (note: rate proposals are provided by third-party insurance carriers and Namely assumes no responsibility over price offering accuracy or reliability);
iv) Benchmarking analysis of health and welfare plan offerings and costs to determine prospective plan competitiveness.
d. Client assistance focusing on benefits optimization, including the following:
i) Liaising between Client and health and welfare plan providers and providing assistance on Client’s behalf in any conversations with health and welfare plan providers;
ii) Providing timely customer service and assistance to Client with issues involving but not limited to: provider billing issues, claims issues, interpretation of contract language, and general troubleshooting and account problem resolution relating to benefit program operations; and
iii) Attendance of meetings with Client as requested and assist in the management and administration of Client’s employee health and welfare plans (meeting attendance shall include remote attendance, additional fees may apply where in-person attendance requested, which Namely may provide in its sole discretion).
e. Compliance guidance, assistance and reporting including the following:
i) Assistance with the evaluation of Client programs regarding state and federal laws, rules and regulations, including ERISA, HIPAA, and ACA, and provide information about applicable new or proposed laws, rules and regulations (for insurance lines in which Namely is Broker of Record);
ii) Select regulatory updates and/or best practices for the effective administration of health plans;
iii) Preparation of signature-ready Form 5500s and associated schedules, where applicable, and assist with compliance and all mandated reporting and posting/notice requirements for health and welfare plans; and
iv) ACA reporting and filing guidance (including Form 1094 and Form 1095 on Client’s behalf, where permitted by applicable law. Note: Client is solely responsible for submitting ACA reports).
f. Additional Plan Administration Features, including the following:
i) Carrier feed setup and management as necessary and as available (subject to the Carrier Feed Terms) including electronic data interchanges (“EDI”) availability;
ii) Employee communication recommendations relating to available health benefit plans; and
iii) Broker-sponsored seminars, benefits-related events, and educational forums and roundtables, as available.
2. Client Obligations. 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:
a. Designate Namely or its affiliates as Client’s Broker of Record;
b. Designate an account Administrator to review and approve actions taken on Client’s behalf including benefits elections and enrollment/unenrollment;
c. Provide accurate, timely, and complete information required by Namely to perform the Managed Benefits Services;
d. Provide timely notice to Namely of any and all notices and advisories sent to Client from benefits carriers and providers concerning Client’s eligibility, enrollment, or payments for applicable plans, or any and all additional notices that could reasonably be interpreted to affect Client’s coverage or related to the services described by Namely herein including any and all notices regarding a claim or potential claim against Client or Namely in connection with the Managed Benefits Services;
e. Provide timely notice of any and all qualifying events that may impact Client’s or covered employees’ health insurance eligibility;
f. Making all payments to carriers and benefits providers directly for amounts invoiced by carriers and benefits providers in the manner and timeframe as described on the applicable invoice.
3. Acknowledgement of Benefits Sale. Client acknowledges that:
a. 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 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
b. Client has been, and hereby is informed that it:
i) may obtain the Subscription to the Namely HR and Talent Platform, Payroll and Benefits Administration modules without signing on for the Managed Benefits Services; and
ii) it is under no obligation to purchase any insurance product from Namely or any of its affiliates.
4. Fees for the Managed Benefits Services. Namely may, in its sole discretion, waive the fees associated with the Benefits Administration module, Expert Advisors, Carrier Feeds, Benchmarking, Custom Benefits Guide, and Carrier Feed Reconciliation, and any other features or services which may be sold separately, if the Client receives the Managed Benefits 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 shall be entitled to charge Client for the products or offerings described in the first sentence of this paragraph at their current and prevailing rates.
5. Coverage Quotes and Fees. Namely and its affiliates as part of the Managed Benefits 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:
a. are created in reliance on the representations made by Client during the implementation (underwriting) process;
b. may not be the lowest-cost options for Client; and
c. 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.
6. Broker Limitations. In providing the Managed Benefits 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. 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.
7. Subcontractors. The Managed Benefits 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 as well as on subcontractors to perform certain services as detailed herein. Namely shall 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 API or EDI performance from causes beyond Namely’s reasonable control including Client, third-party internet providers, and acts of third parties on which the API or EDI performance relies.
8. Effect of Termination of Managed Benefits. 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 shall 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.
V. Namely Time Clock
A. Description of Services. Provided that Client is in good standing and has met the obligations of these Time Clock Services, Namely shall, subject to availability, provide Client with the quantity and clocks as provided on the applicable Order Form as well as the following services (hereafter Time Clock Services”):
B. Shipment. Namely shall ensure shipment of the Namely Time Clocks within five (5) business days of Client’s written delivery request to Namely, including the following information: number and type(s) of clocks per location, delivery address(es), contact name, contact phone number and contact email address. Namely shall charge a shipping and handling fee for ground shipping within the forty-eight contiguous states. Additional fees may apply for any other requested shopping options or shipment to Hawaii or Alaska.
C. Maintenance Fee. Upon renewal of Client’s Namely Time Clock Subscription, an annual, recurring maintenance fee shall be charged to Client for each Namely Time Clock as listed in the Order Form.
D. Maintenance Service Plan.
1. Coverage:
(a) During the first twelve (12) months after Client’s purchase of the Namely Time Clock, a repaired or replacement Namely Time Clock shall be shipped to Client within thirty (30) days or less of receipt of the Namely Time Clock containing the defect if the troubleshooting described below is not successful. Namely shall provide comprehensive instructions on how to return the Namely Time Clock. Prepaid labels shall be provided to the Client upon request. For locations outside of the forty-eight contiguous states only, and Client shall reimburse Namely for the cost of the pre-paid labels. Time Clocks damaged by Client or damaged in shipment to Namely shall be charged to Client.
(b) Beginning on the first anniversary of Client’s purchase of the Namely Time Clock, and for the remainder of any active Term period, a replacement Namely Time Clock shall be shipped within two (2) business days (unless the shipping address is outside of the 48 contiguous US) if Namely, in its sole discretion, determines that the troubleshooting described below was not able to resolve the issue. If the location is not in one of the forty-eight contiguous states, Namely shall communicate shipping options with Client, including timelines and any additional fees that apply and shall ship the replacement Namely Time Clock in accordance with the shipping option chosen by Client.
(c) After being replaced, the return of the original Namely Time Clock shall be the sole responsibility of Client. Comprehensive instructions and prepaid labels for the return of the original Namely Time Clock shall be included in the packaging and replacement of the Namely Time Clock and can also be provided upon request. The original Namely Time Clock must be returned within 14 days of receiving the Namely Time Clock. Client agrees to pay Namely the Manufacturer’s Suggested Retail Price (“MSRP”) of the original Namely Time Clock if not returned to the address included by Namely within fourteen (14) days of Client receiving the replacement Namely Time Clock.
(d) Service requests made after 2pm EST may be processed on the following business day. Replacement Namely Time Clock may not be identical, but it shall be a comparable device of like kind with equivalent functionality. If not identical, the shipment shall include appropriate documentation and instructions so the Client can use the replacement Namely Time Clock. If Namely replaces Namely Time Clock, the replacement Namely Time Clock becomes the property of Client.
2. Exclusions. Namely is not responsible for any cost incurred by Client related to travel, communications, and telephone company charges with regard to the repair, maintenance, or replacement of any Namely Time Clock. The Namely Time Clock provisions further do not apply to:
(a) Damage caused by accident, abuse, misuse, liquid contact, fire, earthquake, or operating Namely Time Clock outside its intended or permitted use;
(b) Namely Time Clock with a serial number that has been defaced, altered, removed, or modified without written permission from Namely;
(c) Namely Time Clock that has been lost or stolen;
(d) Cosmetic damage including but not limited to scratches, dents, and broken plastics or ports;
(e) Consumable parts such as batteries;
(f) Preventative maintenance; and
(g) Defects caused by normal wear and tear or otherwise normal aging of the product.
VI. Service Level Agreements
A. Platform Service Level Agreement
1. During any active Term period, the Platform shall be operational and available to Client at least 99.5% of the time in any calendar month (the “Platform SLA”). If Namely does not meet the Platform SLA, and if Client meets its obligations under this SLA and the Agreement between the Parties, Client shall be eligible to receive the Platform Service Credit defined below. This Platform SLA sets forth Client’s sole and exclusive remedy for any failure to meet the Platform SLA.
a. Definitions. The following definitions shall apply to the Platform SLA. Capitalized terms not defined herein shall have the meaning set forth in the Agreement between the Parties. “Downtime” shall mean the period during which the Platform is unavailable to Client in accordance with this Platform SLA.
“Monthly Uptime Percentage” shall mean the total number of minutes in a calendar month minus the number of minutes of Downtime in a calendar month, divided by the total number of minutes in a calendar month.
“Platform Service Credit” shall mean the following:
Monthly Uptime Percentage credit of the monthly pro rata share of the Subscription Fees
| 99.5% or higher | none |
| 98.0% to 99.49% | 10% |
| 95.0% to 97.99% | 20% |
| Under 95.0% | 30% |
b. Client Obligations. In order to receive the applicable Service Credit described above, Client must notify Namely within ten (10) days from the time Client becomes eligible to receive such Platform Service Credit.
c. Maximum Service Credit. The aggregate maximum number of Platform Service Credits to be issued by Namely to Client for any and all Downtime that occurs in a single calendar month shall not exceed thirty percent (30%) of the monthly pro rata share of the quarterly Subscription Fees.
2. Exclusions. The Platform SLA does not apply to:
a. Downtime related to scheduled maintenance;
b. Downtime related to any matter constituting force majeure;
c. Downtime resulting from acts by Client other than in accordance with the Terms, including but not limited to any negligence, willful misconduct, fraud or use of the Platform in breach of the Terms; and
d. Downtime resulting from data or transmission quality issues outside of Namely’s reasonable control. Namely, in its sole discretion, may plan scheduled maintenance which shall be communicated by email or via the Platform to Client at least twenty-four (24) hours in advance with notice of how many hours of Downtime is expected. The time and day of the scheduled maintenance may be changed at the sole discretion of Namely subject to the minimum notice period specified herein.
3. Termination. In the event that Namely materially breaches this Platform SLA by not meeting the Performance Commitment in any three (3) months in a twelve (12) month period, Client may terminate these Terms and any related Order Form upon fifteen (15) days’ prior written notice to Namely and shall receive a pro rata refund of any prepaid Subscription Fees during the corresponding period as well as for any Subscription Services not yet rendered.
4. Severity Levels, Response Times and Service Hours. Client must subscribe to updates at status.namely.com to receive notifications and status updates regarding Platform and module performance issues. Once Client subscribes, Namely shall notify and update Client through status.namely.com pursuant to the following terms:
| Severity Level | Definition | Initial Notification via status.namely.com | Update Interval |
| Severity Level 1 | Total outage of the Platform, defined as complete unavailability of the Platform | One (1) hour from Namely discovery of issue | Updates provided via status.namely.com every hour until the issue is resolved |
| Severity Level 2 | (i) Module outage, defined as complete unavailability of the HR, Payroll, Benefits or Time Module(s); or (ii) Substantial degradation of Platform performance | Two (2) hours from Namely discovery of issue | Updates provided via status.namely.com every two (2) hours until the issue is resolved |
| Severity Level 3 | Sub-module outage, defined as the complete unavailability of a Sub-Module (e.g., notifications of performance reviews) | Four (4) hours from Namely discovery of issue | Updates provided via status.namely.com every four (4) hours until the issue is resolved |
5. Service Hours. Client’s support team shall be available by phone or email, Monday to Friday from 9:00 am to 9:00 pm Eastern Time (excluding Namely observed holidays). At all other times (including weekends and US holidays), Client may contact Namely by submitting a case to their pod contact. Subject to Client’s approval, Client agrees that Namely shall have the right to charge for any support service resulting from problems, errors or inquiries not related to the Subscription or Platform.
B. Managed Payroll Service Level Agreement
1. This Service Level Agreement (“Managed Payroll SLA”) sets forth the performance levels (each, a “Service Level”) Namely must meet for its Managed Payroll Services during any active Managed Payroll Services Term period. If Namely does not meet a Service Level, and if Client meets its Managed Payroll Services obligations (as set forth above), pursuant to the principal Terms, and under this Managed Payroll SLA, Client shall be eligible to receive the Service Credit (defined below). This Managed Payroll SLA sets forth Client’s sole and exclusive remedy for any failure by Namely to meet a Service Level.
a. Definitions.
“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 Management Period. |
“Total Net Payments” means the total number of payments processed by Namely during the applicable period.
b. Namely Performance Commitment Exclusions. 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; and
v) Failure by Client to review and approve employee and payroll year-to-date data loaded either during the implementation phase or configuration of: (i) the Client’s Namely site; or (ii) any new EIN(s) or product module(s).
c. Client’s Obligation to Notify. 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.
d. Termination Right. 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 Services upon fifteen (15) days’ prior written notice to Namely and shall receive a pro rata refund of any prepaid Managed Payroll Subscription Fees during the corresponding period as well as for any Managed Payroll Services not yet rendered.
VIII. General Provisions – Subscription Services Addendum.
Client acknowledges and understands that if Client terminates any Subscription Service in accordance with the Terms, then such termination may not be reversible. In the event that Client or Namely terminates any or all Subscription Services, then as of the time such termination becomes effective, except as otherwise provided in the Terms, Namely shall have no obligation to make further Subscription Services activities on Client’s behalf or to take compliance-related actions and reserves the right to apply additional fees for any of the Carrier Feed Services detailed herein for the provision of such terminated service. If Client substitutes Namely as Broker of Record with another Broker of Record then Namely shall be unable to carry out many of the services described herein on Client’s behalf including communication with the respective underwriter on Client’s behalf and in carrying out brokerage related activities on Client’s behalf and Client assumes all brokerage related actions and activities upon the submission of a substitute Broker of Record letter to the corresponding benefits Provider whether or not Client provides notice to Namely of a substitute Broker of Record letter. Client acknowledges that irrespective of Namely’s obligations to carry out the Subscription Services as provided herein, Namely does not assume fiduciary responsibilities on behalf of Client and Client remains the sole fiduciary of any and all Subscription Services rendered hereunder. Client shall be responsible for reviewing for accuracy all communications, notices, and invoices Client receives directly from Namely or benefits providers. Client shall be solely responsible for any fees it incurs as a result of its failure to review such communications, notices, and invoices and to timely report any inaccuracies to Namely. Client further acknowledges that failure to timely notify Namely of outstanding balances, fees, or related account issues may result in the termination of, inability to obtain, and/or penalties and taxes assessed to, Client’s benefits plans. Client shall at all times 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 adverse 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 the Subscription Services. Client retains all employment risks and liabilities regarding Client employees. Namely does not provide legal or tax advice to Client or Client’s employees as part of the Managed Payroll Services and Client acknowledges that for all legal and tax related advice, Client should always consult with its own legal or tax advisors.
Managed Benefits Pro Legacy Subscribers
In addition to the General Provisions described in Section VII above, the following terms apply to Clients who have an active Order that includes a subscription to Managed Benefits Pro:
1. Managed Benefits Pro – Description of Services. Provided that Client is in good standing and has met the obligations of the Terms, and has elected the elevated service offering of Managed Benefits Pro, Namely shall provide Client with its Managed Benefits Pro services (hereafter “Managed Benefits Pro Services), which shall include the following:
a. Carrier Reconciliation, including quarterly reconciliation reports of Client’s applicable medical, dental, and vision insurance carrier invoices detailing identified billing errors and overages, suggested corrective action and additional account related actions (“Carrier Reconciliation”). For the avoidance of doubt, quarterly reports shall be the sole deliverable of this Carrier Reconciliation service and Client shall assume responsibility for direct communications with insurance carriers and for electing to carry out suggested recommendations;
b. ACA Consulting, which shall include the following services and limitations:
i) Consultation with a Namely ACA consultant for up to six (6) hours annually to review ACA elections and administration with Client’s payroll and benefits teams to identify common errors and efficiencies;
ii) identify solutions to these errors and inefficiencies; and
iii) direct Client’s internal payroll and benefits teams to implement these solutions and create ACA election best practices.
c. Healthcare Concierge Services powered by Touchcare, which shall include the following services and limitations (subject to Touchcare’s terms of service and to the provisions of Namely’s Third Party Terms):
i) Healthcare concierge services which shall include but not be limited to billing resolution;
ii) prescription drug management;
iii) and the identification and election of healthcare coverages for employees.
2. Client Responsibilities. Client agrees to provide accurate, timely and complete information required by Namely to provide the Managed Benefits Pro Services.
