For Third-Party Administrators (TPAs), compliance is one of the most critical—and often most challenging—parts of managing retirement plans. From ensuring that payroll data is accurate to preparing census reports for non-discrimination testing, TPAs must adhere to stringent regulatory requirements, and any errors can lead to costly fines or penalties.

However, manual processes can be time-consuming and error-prone. That's where automation comes in. By automating payroll and census data scrubbing, TPAs can not only streamline their workflows but also ensure compliance with greater accuracy and efficiency.

In this blog post, we’ll explore how automating payroll and census data scrubbing can simplify compliance for TPAs and why it’s a must-have for modern retirement plan administration.

The Challenge of Manual Data Scrubbing

Traditionally, TPAs have relied on manual processes to gather, validate, and clean payroll and census data for compliance purposes. This often involves:

• Collecting census data or payroll reports from plan sponsors in various formats (e.g., Excel, CSV).

• Validating the data to ensure that all information is accurate and complete.

• Scrubbing the census data to identify and correct errors before submitting it for compliance testing, such as non-discrimination tests (NDT).

Unfortunately, manual data entry and scrubbing are prone to errors. Even a small mistake—such as an incorrect employee compensation figure or a missing Social Security Number—can lead to inaccurate census data and potentially costly compliance issues.

On top of that, the manual process is time-consuming. For many TPAs, hours or even days are spent cleaning up payroll and census data for a single client, leaving less time to focus on higher-value tasks like client servicing and business growth.

How Automation Transforms Compliance

Automation offers a solution to these challenges. By automating payroll data collection, validation, and census scrubbing, TPAs can drastically reduce the time spent on these tasks and improve the accuracy of their compliance processes.

1. Automated Payroll Report Uploads and API Integration

One of the first areas where automation makes a big impact is in the collection of payroll data. TPAs often receive payroll reports in various formats from clients, which can be tedious to upload and process manually.

With platforms like Stax.ai CX, TPAs have two options to streamline this process:

• Manual report uploads: Plan sponsors can securely upload payroll reports through the client portal, and the system automatically parses and processes the data.

• API integration: Stax.ai CX integrates with over 200 payroll providers to automatically pull payroll data via their APIs. This eliminates the need for manual uploads, allowing for real-time data retrieval and ensuring that payroll data is always accurate and up-to-date.

2. Automated Data Validation

Once payroll data is uploaded or pulled via API, it needs to be validated to ensure accuracy and completeness. Manual validation can be a tedious process, requiring TPAs to manually check for missing or incorrect data fields. Automation eliminates this hassle by automatically identifying data inconsistencies or missing fields.

For example, if a Social Security Number is missing or an employee’s compensation is outside of expected parameters, the system will flag these issues for review. Automated validation ensures that data is accurate and clean before it moves to the next step of the compliance process.

3. Census Data Scrubbing

Perhaps the most important and complex part of the compliance process is census data scrubbing. This involves reviewing the entire employee census for a retirement plan to ensure that it meets the standards required for non-discrimination testing (NDT) and other compliance reports.

Manually scrubbing census data is not only time-consuming but also highly prone to errors. By automating this process, TPAs can save significant time while ensuring that census data is accurate and compliant.

Stax.ai CX automatically scrubs payroll and census data for errors, such as duplicate entries or incorrect compensation figures. It flags discrepancies and allows the TPA to review and correct them before submitting the data for compliance testing. This automation significantly reduces the risk of non-compliance while also speeding up the entire process.

Why Automated Compliance is Critical for TPAs

Automating payroll and census data scrubbing isn’t just about saving time—it’s about ensuring compliance and protecting your business from the risks of errors or omissions. Here’s why automated compliance is critical for TPAs:

1. Increased Accuracy

Automation reduces the likelihood of human error, ensuring that payroll and census data is accurate, complete, and ready for compliance testing. With automated validation and scrubbing, TPAs can trust that their data is clean, reducing the risk of costly compliance mistakes.

2. Time Savings

By automating data scrubbing, TPAs can drastically reduce the time spent on compliance tasks. Instead of spending hours or days manually reviewing data, automation allows TPAs to complete the process in minutes. This frees up time for TPAs to focus on other essential tasks, such as client management or business development.

3. Regulatory Compliance

With increasing regulatory scrutiny, TPAs need to ensure they are fully compliant with industry regulations. Automation helps ensure that all necessary data is validated and scrubbed according to regulatory standards, minimizing the risk of non-compliance penalties.

4. Scalability

As your TPA business grows, the volume of data you need to process increases. Manually scrubbing payroll and census data for multiple clients becomes unsustainable at scale. Automated compliance processes allow your business to grow without increasing manual workloads, enabling you to serve more clients efficiently.

How Stax.ai CX Automates Compliance for TPAs

Stax.ai CX is designed to help TPAs automate key compliance processes, including payroll data uploads, API integrations, validation, and census data scrubbing. By integrating with 200+ payroll providers, Stax.ai CX ensures that payroll data flows seamlessly into your system, while automatic data validation and scrubbing reduce the risk of errors and non-compliance.

Additionally, Stax.ai CX provides a white-labeled client portal, allowing plan sponsors to securely upload payroll reports and census data, streamlining the entire compliance workflow.

With Stax.ai CX, TPAs can:

• Automate the collection and scrubbing of payroll and census data.

• Reduce manual data entry and validation efforts.

• Improve the accuracy of compliance reports.

• Save hours of work and focus on delivering more value to clients.

Automating Compliance is the Future for TPAs

For TPAs, compliance will always be a critical part of retirement plan administration. However, manual processes are no longer sufficient to meet the demands of modern plan administration. By automating payroll and census data scrubbing, TPAs can ensure accuracy, reduce time spent on repetitive tasks, and focus on providing a better client experience.

With Stax.ai CX, you can transform your compliance processes, automate time-consuming tasks, and ensure your firm is always ahead of regulatory requirements. Ready to streamline your compliance workflow?