The Idaho Department of Labor awarded about 15 percent of its Workforce Development Training Fund to Paylocity for the training of about 500 new employees.
The department will reimburse Paylocity training costs for the next two years up to a total of $1.2 million while the Illinois-based company tries to build its workforce from about 50 employees to more than 500.
Paylocity opened a Boise office in 2015 after receiving a tax reimbursement incentive from the Idaho Department of Commerce. A TRI is a tax credit from the Idaho Department of Commerce available to moving or expanding businesses that can be worth up to 30 percent of a company’s income, payroll and sales taxes for as long as 15 years.
The Department of Commerce gave Paylocity a TRI rate of 28 percent for 15 years – worth an estimated $6.5 million. To get a TRI, companies must create of a certain number of jobs with average pay above the county’s average salary. Many small businesses have complained that they are unfairly disadvantaged because small expansion projects don’t create enough jobs to be considered for the tax credit.
The owner of a Boise human resource company, Employers Resource Management Company, has sued the Idaho Department of Commerce, stating the Paylocity TRI gives an unfair advantage to a competitor. A hearing to discuss dismissing the case is scheduled for July 20.
Workforce Development Training Fund money is easier to receive. A business can apply for a grant from the fund to assist with training costs if the positions build skills necessary to create an economic opportunity or address a workforce need identified by the local community.
“Economic developers approached us in spring of last year and identified this company (Paylocity) that wanted to come to Idaho,” said Carmela Ramirez, Department of Labor spokeswoman. “They were a cloud-based payroll computing service and at that very moment we had Boise State University, University of Idaho and nearby colleges that identified that industry as being in high demand and having high pay.”
The Legislature placed about $7.7 million into the Workforce Development Training Fund this year.
The average salary for Paylocity’s positions is expected to be about $21 an hour and the positions will come with employer-assisted medical benefit, according to the Department of Labor.
Paylocity did not immediately return calls or respond to questions about the grant or tax credit.