[00:00:00] Speaker A: Welcome back to on the Fringe. I'm your host, Ann Larson, and today I'm joined by Larry Horner, who leads the contractor division at Zuma Payroll.
Larry has one of those rare perspectives in our world. Someone who didn't come from union payroll, but learned it the hard way from the ground up.
In this episode, we talk about how he found his way into the industry, what makes union payroll so uniquely complex, and how our partnership came to be after a chance conversation.
If you've ever been stuck dealing with messy manual reporting, trying to explain your world to someone who just doesn't get union work, or wondering why it's so hard to find a payroll partner who truly understands contractors, this episode is for you. Let's get into it.
So you want to introduce yourself?
[00:00:46] Speaker B: Sure. Larry Horner. I work with a company called Zuma Payroll.
I am the head of the sales for Zuma's contractor division.
[00:00:57] Speaker A: And before you started the contractor division, who were you selling to?
[00:01:03] Speaker B: A variety of businesses. So anything from a dentist office to a pizzeria to a plumber, white collar, gray collar, blue collar, really anything and everything.
So.
[00:01:20] Speaker A: Let'S talk about why you got into payroll.
[00:01:23] Speaker B: Oh, my. This is like 20 years ago. Oh, my God.
Why did I get in the payroll?
Well, I grew up in Jersey. I was working for a company called Ecolab, which was a great company. And I worked in midtown Manhattan and I loved the job. I had a book of business of restaurants, all in the city. Then I met my wife and I wanted to move to Long Island. And then I applied for a job with adp and they trained me. They said, oh, this is a great company. They have a great training program.
And then I stuck with ADP for eight years. A friend of mine started Zuma Payroll in Melville and I left them. I was the third employee and now there's like 50 some odd employees.
So that was fun. But I guess I would say the reason I stayed with it was because I do like the contractor aspect. It's so different, so unique. And you're helping people really solve a problem, which is get rid of all this manual stuff. And it's not just about gross to net payroll and direct deposit. It's like anybody can do that. I think that would have bored me and I would have left, but the excitement of being part of a small company and them trusting and allowing me to say, hey, we gotta partner with Ann and we gotta do these union benefits, she's gonna help. I credit Chris and Scott, you know, the owners who just have trusted me and allowed Me to do things that are different and maybe even take a risk. You know, I'm lucky that that's why I stay in it. I don't know if that's why I.
[00:02:58] Speaker A: Joined it, but most people go into a job or stay in a job not because of the job itself, but because of the people they're around. It could be the client's peers in the company, could be a great mentor, boss. It could be like, there's. There's that. It's the culture of the company or whatever. Like, that's the stuff people stay for, not the job. Although there are some jobs that are really horrible, like doing manual payroll processes for three or four days out of your week that might make anybody leave.
[00:03:32] Speaker B: Yeah.
Yeah.
[00:03:33] Speaker A: But overall, the things that we love are typically not like you. You didn't grow up saying, I want to work in payroll.
[00:03:41] Speaker B: No, I didn't. But, yeah, it is the people that you work for, you know, and even people within my organization that do payroll, and they're really talented payroll people and know payroll up and down and the time and HR products and applicant tracking and benefit enrollments and integrate with the 401k and integration with workers comp. All things that we do payroll. Outside of this expertise of. Of working with you and doing the unions, they say, how did you learn this stuff? It was like learning a different language, like learning Spanish. I literally had to put effort into it. And that's another great thing about these contractors and solving their fringe benefit problems. You want the learning curve to be high.
You don't want people to fake it, that they can do it, because the repercussions of them saying, hey, I can do it, and then doing it wrong.
And everybody's been burnt by that. Say once, you know, if you could just. Then everybody would probably fake it. And they get audited by the union. It's a good thing that the learning curve's high for me. I like it. It keeps the competition out because they're like, you know, don't want to learn it.
But it's also, I think, good for the contractor, because I don't think they can fake it.
[00:05:02] Speaker A: Do you want to tell the story of how we started working together?
[00:05:07] Speaker B: I do. I remember. Okay, so I remember this. Local 25 IBEW, International Brotherhood of Electrical Workers. There was a woman in that office in Long island that one of our payroll clients.
She was actually helping the contractor report the benefits. She was really going out of her way to do something she probably shouldn't even have been doing.
This was the Contractor's responsibility to report or remit to Local 25, his union, or, you know, every week, maybe every month. Can't remember because they sometimes vary unions. Right. It could be weekly, could be monthly. One of the reps in my office said, you know, this woman wants to talk to you. She thinks she has an opportunity maybe for Zuma. I go to the office and she says, you really should talk to these people at Carillion and Larson. You guys need to figure out a way to work with each other, because then I wouldn't have to do this for this contractor. Not even employee owner, Business owner. So, yeah, I spoke to Ann, and we at least had an introduction to each other. We understand a little bit about what each other did.
So when Covid hit, what happened was there was a regional payroll provider called DSI, and DSI got absorbed by another company in 2019. Another company absorbed those clients or bought the book of business. And so that company that did union benefits and payroll and understood it really well didn't exist anymore.
All of a sudden, there was a gap in the market, like, very local, regional to ibew, International Brotherhood of Electrical Workers.
Specifically, a huge need in Local 3 in the city where a lot of these contractors were using this one vendor.
The vendor got taken over by the biggest payroll company in the country. They said, we don't need your people and your experience.
You're fired. They threw the software in the garbage, and they said, we can do. We're the best payroll company in the world. We can do payroll for anybody. And they screwed it up.
And there was still a need to have that done.
So I said, hey, this would be great if we could do this. And we tried our best to do it through the payroll software.
But what we realized is that software does have limitations when it comes to fringe benefit calculations. You might not find it out quickly, but if you do enough unions, you eventually will find that the payroll software can't handle the fringe benefit calculations accurately.
You're eventually going to hit a wall and go, oops, it doesn't do this. And we did. And I said, let me call.
And I remember that conversation we had.
And that's where. Where that started.
[00:08:06] Speaker A: I think I heard you or somebody at Zuma talking about how there was an area that was still using coupons, and I'd never heard of that.
[00:08:13] Speaker B: Stamps. Yeah, they call them stamps. You actually had to purchase stamps as the employer to pay the fringe benefits on behalf of your employees.
You had to buy these. I mean, so it's very archaic and old.
They really don't care how long it takes the contractor to do it. That's why I see people doing all these manual things. And I think they're doing the best that they can. And I've been in these scenarios and they say, larry, I can't believe that you really are able to cut all this time and manual process out. I was not really even counting on that.
This person has been with me for 35 years. She's retiring in, like two years.
She can't do anything else because it took her four days a week to do all this. Can you call me when she retires? So that happens once in a while, but most of the time that's the exception, not the rule.
[00:09:07] Speaker A: I would say the stories that we have heard is overwhelmingly that it's not a job anybody wants to do.
[00:09:17] Speaker B: No.
[00:09:18] Speaker A: So, yeah, there are just more fun, better things to do. You could even go down to four days a week. That would be better.
And having them do these manual processes that are rife with errors and yes, other issues.
[00:09:32] Speaker B: Stressful, too. I mean, you know how many times that, like, somebody will find us online?
And I always say, like, well, how did you find us? What did you search in there? Oh, union, payroll, company, something.
And I'd say overwhelmingly, it's a lot smaller of an organization. You think? Yeah, we do large organizations with hundreds of employees. But I would say the ones that's really fulfilling to me is like, it's usually the guy that was a union worker, started his own, he's on his own, he still wants to use the union labor.
He does not. He from the beginning knows, I don't even have the time to do this. I don't have the people to put on this manual task.
He's searching for a solution.
Often it's like him, a partner and his wife are the first three employees.
And they are just so happy that they don't even have to learn and build manual processes. I love that too, because they're just so like, oh, my God, thank God I found you. And then I've had it. Where sometimes they got started, they have five employees.
And the wife goes, you don't understand.
This consumes all of my day. I still get it wrong. It is stressful. And my husband and his partner don't even. I can't even verbalize to them why it's so complicated.
It's such a relief when they can give that very important.
Because they said, it's really important to do this accurately. These employees, this is their benefits. My husband was an employee and still is. And I take that really seriously. And I'm getting it wrong and it's making me feel horrible and the employees are upset and I just don't know why it takes so long to do it even wrong.
[00:11:24] Speaker A: The decision makers going into changing software and changing the processes, they often talk about not wanting to bother other people. And I always sort of wonder, maybe they want to be bothered.
I think that they generally would like the change.
And we find if they do move forward, they do like the change, but they're afraid. They're afraid that people aren't going to like it in those circumstances. It sounds like generally you back off, but are there instances where you've gone forward and it's worked out really well?
[00:11:59] Speaker B: Yeah, I'm in the process of one that I. So this was a.
I think I started the process with them, say October 2022.
They had hired a consultant, a general contractor. They had like. I mean, they didn't use all these different unions all the time, but they needed to store all these agreements to make sure that when they use this union labor, they had 40 different.
40, like nine different locals. So there's a lot of data to keep accurate with all these agreements that change every year and to use them. So they had a payroll department of four people.
Now the owner came to me, she said, I know this is inefficient. It takes way too many time, way too many people.
I hired a consultant. He confirmed this is true. I'm not crazy. There is a better way to do this. We want to hear about your solution.
She said, but all the people that do it want to be part of the conversation.
And it was like sabotage. I never experienced anything like it in my life.
I almost envisioned before the meetings that they all got together and said, don't say anything to him. Don't give him any information, make him look stupid or say something. And they just fought me every inch. I mean, anytime I had a question, it was just.
And they were like, why change this? Why do we need to do this? This works. It did work, right? So often, but it took four people, four days. I remember they would even say they did it by floor. They had a four floor building they owned and they would say, first floor does this and second floor does this. I recently went back into their office and I got into the elevator and had flashbacks because I saw the floors. I go, oh my God. And now what happens is.
So, yeah, I even said to them, October 2022, and now they're ready to move forward. They said, we had to. Sometimes there needs to be. They said, hey, we had to either replace some people or tell them this change is for the better. And it's not. It's going to be different, but we need to do it for the organization.
[00:14:11] Speaker A: Where do you think that fear came from for the staff? Was it fear for their jobs?
[00:14:17] Speaker B: I would say fear for their job.
What often happens is without that consultant.
[00:14:25] Speaker A: To.
[00:14:27] Speaker B: Work with the staff, you could have somebody doing manual processes. And when you ask the boss who's out there running jobs, selling jobs, you know, he's doing so many other aspects of the business, he goes, I don't even know what she does. It's about really.
In the end, it's.
I don't think they have anything to fear because nothing's automated in that world. There's so many different steps. You're just automating the things that can go wrong, which is a lot of the calculations. So why manually do that part of it? There's so many other things that go wrong anyway, and they often go, all right, this is good. You know, this is really automating this. You still need a person behind it. It's why we need a service team to answer questions. We couldn't take our payroll staff that manages restaurants or financial advisors or other types of business. They could never service our union contractors, not in a million years. It doesn't make one better or smarter than the other. It just means that this does require a specific support staff, software and expertise.
It's not easy to just replace it with anything.
[00:15:39] Speaker A: Well, I'm curious. With the software stuff, you know, we see AI used more and more in our work, but I'm curious if you've seen AI do some cool things in payroll software or the payroll world or just like the contractors in general.
[00:15:58] Speaker B: So I've seen it. Some of our contractors. So besides doing, you know, you know, we still do. We still have, I'd say, all of the bells and whistles of any other payroll company, and some of the contractors are starting to use them. I'll give you an example of one product that I'm seeing more is like onboarding. So, like onboarding employees electronically electronic i9s and W4s and collecting OSHA cards and getting expiration dates and having the employee onboard themselves. Some union contractors are using that technology.
We also have applicant tracking. So if you wanted to post jobs, the employee can respond to the job and then you can track, coordinate interviews and do all that. And I've seen AI be really good at building and writing the Job description, because it just says fill in these blank name of job, how much per hour per year, industry type.
And they put in data points. Now the description that might have taken an HR person to write the job description is done through AI. That's where I've seen it used in my world.
[00:17:14] Speaker A: Do you see it anywhere else in payroll?
[00:17:17] Speaker B: No. I think AI is only as good as the data that's out there on the Internet. Right. I think that people that claim they're experts in this, their website maybe has a picture of somebody in a hard hat and it's nothing beyond that. There is no real actual data that AI can draw from. You know, AI's got to have the data out there, you know.
[00:17:40] Speaker A: Well, you know, I have a huge pet peeve with anything in our industry and our website as well. There are no, there should never be a picture of somebody in a hard hat holding a laptop. I just, I cannot stand it.
Everybody who wants to build our website always wants somebody out on the field in a hard hat with a laptop. Yeah, like sitting there typing.
[00:18:04] Speaker B: It's actually interesting you say that. Yeah, because time and attendance, anybody.
So what happens is if it's a contractor, it's usually the CFO or the accountant that has no day to day experience of what goes on. And he says, why are these guys tracking this stuff so manual? They just are. There was a great statistic that I took a, I was at a CPA firm, did an annual. They got all this data about contractors and every year they did this whole talk and they had guest speakers. In regard to technology, they say contractors on average are 15 years behind in technology.
They care about accuracy, they need accuracy. They don't need, you know, snazzy portals. They want accuracy. When it comes to time and attendance, the rest of the world now is starting to have employees log in on their phone and there's, you know, they're out there in the field with a laptop.
And I would say 95% of contractors, their employees are not collecting time in the field. And the people that don't experience, that aren't in this industry full time don't understand why.
And I think the answer is there's so many other manual tasks that need to get changed and automated before that happens.
That'll come eventually, I think.
[00:19:24] Speaker A: Do you think it's cultural in any way?
[00:19:28] Speaker B: I think eventually as the younger generation gets in there and they're okay with it. I think a lot of it is the actual union protecting the employee. You know, the union employee that is older and doesn't want to use his phone or does not want to use technology.
They say if you're using local 1, 2, 3. Our agreement says that employees cannot use their own phone to log in time unless you pay them. You want to pay them $2.50 per week per person to use their phone or give them their own phone. And then you have to provide an alternative for the guys that don't have a phone. Sometimes the union agreements themselves will protect the employees from using the technology. That would make everybody's life easier.
[00:20:19] Speaker A: I wonder why.
You think it's protecting the job of the foreman or something? Or protecting.
Or do they just not trust it? Do they not trust technology? They think it's gonna get hacked or somebody can do something?
[00:20:36] Speaker B: Sure. A little bit of all that. I don't know the answer to that. I just know that sometimes the excuse is like, hey, I'd love to, but my union won't allow me.
The person in the office responsible for collecting all these paper time sheets from the foreman, they would say, we might consider that, but we would never let the employees record their own time. We'd let the foreman record on behalf of the employees. So I think you'll see that first.
That will be the first transition allowing the foreman to record the software built for this time. Collection doesn't consider union contractors needs. So there's. Sometimes there's a gap and they have to use the tablet plus the paper also.
So, yeah, I think there's a lot of reasons.
[00:21:28] Speaker A: Do you remember we had a meeting with the jib at local 3 one time? There's two pieces of it that I think speak to what you're talking about. One was that in EPR Live, we call everything an agreement. And the JIB kept talking about contracts. And it's like we could not. Yeah, they could not understand that contract meant agreement. We didn't know what they were talking about when they were talking about contracts. It was just this funny mismatch. And I mean, the words are very similar. They really mean the same thing. But we got our wires completely crossed on that one. I also remember being on a call with them where we were talking about this file, which was a complicated file, and I said, we can do it.
They said, everybody says that. Everybody says it's easy. And I said, it's not easy. It's just. I know we can do it because we've done it before.
And we did. We did it for them. And I think they were very surprised.
[00:22:24] Speaker B: I agree with that. I remember that moment. I wish I really had that on recording, maybe I do have it recorded. They got deleted, I bet you. But, yes, I do remember that it was Kevin Duffy from the Joint industry board at Local 3 IBEW. And I think he's retired since then. And he was a great guy and knew his stuff inside and out. He was a very smart man, and he might even work for them as a consultant. I think he retired and he's traveling hopefully somewhere nice now on a beach, and maybe he's doing some consulting. But I remember he was trying to find a solution. To his credit, he was trying to screen people that just said, yeah, because everybody said, hey, I need people to fill a void. And he had questions for them. Even after bringing you aboard to help us win, you said, yes, we could do it. And he said, even the biggest payroll company, the biggest, raddest payroll company, said, they can do it and they can't do it. So what makes you think you can do it? And now I would say out of any payroll company in the entire country, we do more local 3ibew contractors than any other payroll company, definitely, hands down. And they. We've earned their respect of Kevin Duffy and the Joint Industry Board. They don't like to get in the habit of referring people because they want to remain neutral, but they will tell you if you ask them, and they'll say, these guys, Zuma, do it accurately.
[00:23:50] Speaker A: They do not like to endorse anybody, which is. It's okay if there were equal alternatives.
[00:23:57] Speaker B: Yeah.
[00:23:58] Speaker A: But you guys do it the best. You know, you do it the best.
[00:24:00] Speaker B: Yeah, yeah.
[00:24:03] Speaker A: I'm just curious. Do you have a. A payroll horror story you want to share?
Or alternatively, you could go the other direction and be like, no, this is the best.
[00:24:13] Speaker B: Yeah.
[00:24:14] Speaker A: All right.
[00:24:14] Speaker B: I'll tell you a horror story recently, and it's not really a horror story, but nobody likes to lose. I don't.
And. And I learned from this. I had a contractor, union contractor that was coming in from in house, didn't even outsource their payroll. They did it through Sage.
So they had all these manual processes on top of, you know, they did even their payroll and their taxes manual. So they had a lot of people and they were making a change from.
They wanted to outsource their payroll and outsource the union, but they were also changing their accounting software and thought it would be a good idea to change them at once.
[00:25:00] Speaker A: That doesn't sound like a good idea.
[00:25:02] Speaker B: I would never allow. I would never take that on ever again.
[00:25:07] Speaker A: What's your ideal customer profile?
[00:25:09] Speaker B: Do you have one yeah, no, I do. I would say the ideal customer profile is doing the union calculations or reporting or remittance. They're manually combining payroll data to get that information. They're doing the certified payrolls, and they do a lot of those. There's awareness that there is a lot of manual effort and a desire to reduce the amount of time they're spending.
[00:25:36] Speaker A: Is there ever, like, an event that triggers it? Like they suddenly get more work or they get more work in a different area or something like that that triggers the change? Or is it just like an accumulation of just like, ugh, this is really.
[00:25:49] Speaker B: I think sometimes, yeah, there could be an event. So, like, recently I got introduced to somebody. Their payroll person was leaving, and, you know, so somebody was leaving. So somebody that had all that knowledge for those manual is leaving. So they said, hey, this is a good time to change. If we're going to train somebody on new processes, it might as well be a new person. So that's always often nice. Somebody's close to retirement. You know, they. They're like, hey, they're expanding into different unions. It was doable when they had one local, but now they want to start working in cities that require additional locals to take on.
So, yeah, that. That'll so change. Right? More unions, more certified payroll reports. The need to now want to job cost, and we've never done it. We've always kind of estimated our labor costs, and now we want a company that can accommodate giving us the data for real labor costing.
[00:26:52] Speaker A: What advice would you offer somebody coming into your field now, or what is advice that you wish you'd had when you were younger that somebody else had given to you?
[00:27:06] Speaker B: Okay, I guess I'll say I'm very lucky. We brought on employees that worked for a payroll company that was doing what we do now, and that was eliminated. We got to take knowledge from people that did it and say, all right, this is how you did it. All right. You know, they say, hey, all these years you worked for them, what did you think you could be the. Could be better? And we had that perspective, which is amazing. Then we partnered with you and got to see how you did things, and we had years of your perspective.
So I would say, I guess to that point, if you can partner with somebody to get into this space and gain from years of, you know, it's kind of like, what do they say reading a biography? It's like you get to learn about somebody's life from reading their book, telling their story without having to do it.
So if you can gain Any knowledge from people and perspective and learn from their mistakes. That's great. If you can do that in any way, shape or form. And then I guess with the unions put in the effort to learn the language, it's literally like you would learn any other language. You're like, what does that word mean? Ask questions. And if you're not okay with asking questions, it might be hard for you to learn because you're going to have to ask people, what do you mean when you say agreement and I say contract?
What's the difference between the two? Right. And even I find that even with. There's not even a universal language from one contractor, a trade to the other. You can kind of assume, but you still have to ask questions.
So I would say ask a lot of questions, take a lot of nodes.
You are literally learning a different way of speaking.
And if you're not ready for that, then don't even bother.
And you can't fake it. It's just not possible. They see right past it and so don't try.
And then I would say don't get caught up. Say the pay period ends on Sunday.
Maybe they, they input the payroll on, say, Wednesday and then Monday, Tuesday, they at least have some time to gather the hours from the field, process payroll and move money.
And Steam Fitters is very specific. And they're like, yeah, pay period ends on Wednesday and they need to be paid by Thursday morning, 10:30 or something like that. And you're like, what is that even possible?
Do they even considering you know what it's like to move money. It's not like everybody's getting cash in an envelope like they used to. So. But their agreements are very, sometimes even not acknowledging, like banking, like money movement.
I mean, they're literally asking, you have to lend money. It is very crazy.
[00:30:01] Speaker A: It does sound like that is language from a cash, you know, or like you could print a check.
[00:30:07] Speaker B: Correct.
[00:30:08] Speaker A: How do you handle it?
[00:30:10] Speaker B: We do.
So we don't do ach, so a lot of payroll companies will. They'll pull ach, and that could take three days to find out and fund. I want to make sure the money is there before I direct deposit all your employees. So we use reverse wire.
So wire's made it.
It's made it faster.
A lot of payroll companies don't use it. They use ach, but that's more convenient. It's forever reverse wire, kind of similar to ach, where the wire process will allow the money to move quicker.
[00:30:47] Speaker A: Is that more expensive?
[00:30:49] Speaker B: There might be a small fee at the bank that I've never heard anybody complain about. They're just happy that they can accommodate the need.
[00:31:00] Speaker A: Yeah. That's surprising.
[00:31:02] Speaker B: Yeah.
Yeah.
[00:31:04] Speaker A: So is there anything that you wish I'd asked?
[00:31:10] Speaker B: I would say how to find Zuma. If you're out there and you need help or you're looking to just have a conversation and learn more, how do you get to us? If you're a contractor, you can go on our website, fill out a form, put in some basic information, and we'll reach out to you.
So Z.
Uma Zuma. Not Zumba. Like the Zumba. Everybody always says like. Oh, the Zumba. The exercise. No, no. B. So Zumba without the B. So zumbapayroll.com and there is a. You can fill out a form to schedule a call with a contractor payroll expert. That expert will be me. And I'll schedule a time or there's a think fill out form to get a quote. And I will be the one that reaches out to schedule some time and learn about your scenario to see if we might be a good fit or not. And if we're not, we always say that's okay.
[00:32:03] Speaker A: Yeah, absolutely. Well, I think that's the perfect note to end on. I really appreciate you taking the time to share your story and your insight, Larry. It's been such a great conversation. Thanks for being here and to everyone listening, thank you so much for joining us. If you liked this episode, be sure to subscribe. Share it with someone who might find it helpful. And as always, you can reach us at on the Fringe
[email protected] with your thoughts or guests suggestions.
We'll see you next time on on the Fringe.
