I got my initiation into payroll early in my HR career. It felt like a walk through a firestorm, but it gave me experience in the entire payroll process and each role in it.
Just before the end of the 20th century, I was a new HR Generalist (today’s HRBP) for one location of a multi-site call center company. We were working on an ERP payroll implementation, which interfaced with a top-tier time and attendance platform. It didn’t go well.
Here are some lessons I learned during those hectic times:
I got to know the people at the local office of the Federal Wage and Hour Division very well as we dealt with employee complaints. It didn’t take long to discover that supervisors received little or no training in wage and hour laws or their responsibilities in the payroll process.
I got things started with L&D, but as we waited for them to deliver the curriculum, I invited my new Wage and Hour Division friends to come in and address the knowledge gap. They were very helpful.
Every person at every point in the workflow must know their responsibilities and be held accountable.
Regulators can be an asset if you work with them.
Compliance did not improve a lot until the SVP of Operations stopped by my office and asked me why payroll was so difficult. I explained that there were three handoffs: employee to supervisor, supervisor to payroll coordinator, and payroll coordinator to Central Payroll. He merely said, “Thank you very much,” and said goodbye. Payroll errors became manageable within a few weeks.
When you have the attention and support of top leadership, things get done.
Supervisors complained that it was too hard to monitor time and attendance. Too many people failed to clock in or out, and corrections were challenging to manage in the software. The company invested in automation to give supervisors the tools to make corrections in real time and updated the time and attendance policies.
People need the right tools to get the job done.
About this time, the company pressed all eleven Generalists into service as payroll auditors. Morale in HR plummeted. People don’t get into HR because they want to become accountants. It took only one undergraduate course in accounting to show me I didn’t belong there.
HR should do HR. Payroll should do payroll. Accounting should do accounting. But they all need to work together.
We had problems with time clock fraud, mostly people clocking in and out for their friends. The company replaced time clocks with phone logging software to capture time. That worked well until a few employees, with the collaboration of a supervisor, learned how to remain logged in overnight undetected. The telecom group fixed the vulnerability, but not before we incurred significant losses in overtime payments.
If they can game the system, they eventually will, and it may spread like a virus.
There is no substitute for regular, ongoing audits.
The biggest hassle of all was when the company hired hundreds of employees numbered 10,000 and above. The payroll system handled six-digit numbers, but the time and attendance system had been programmed to manage a maximum of five digits. My first hint that there was a problem was when over a hundred people lined up to ask, “where’s my paycheck?”
All eleven site generalists were pressed into service again, this time as paymasters. One or two left the company.
Overall, employee turnover doubled.
There is no substitute for tight, error-free integration in the payroll ecosystem.
If you can’t get pay right, your people will find an employer who can.
That experience was nearly 20 years ago, but it has colored my perception of payroll technology and how we should manage it ever since.
The State of Payroll Today
Today’s enterprise payroll platforms handle their computational tasks exceedingly well, but getting it right is still a challenge. The primary problem in payroll today, as it was 20 years ago, is the accuracy and timing of payroll inputs.i
Ceridian’s 2019 Pay Experience Report found that 25% of respondents said they had been paid inaccurately at least once in the past 12 months, and 22% had received their pay late at least once during that same time.ii
The Good News
There have been many improvements in payroll management. For example, employee and manager self-service have become industry standard. Employees now expect user-friendly and intuitive self-service with the simplicity they enjoy in their personal online and mobile tasks, and the vendors we work with deliver.
Automated reporting and audits have become a standard requirement in payroll software, saving payroll managers a lot of time in identifying and correcting errors before the payroll commit.
Data integrations have become more standardized and easier to manage. Many vendors now have pre-built connectors for partner systems. Integration platforms as-a-service (iPaaS) provide automated tools that enable systems to connect easier. Getting data from one system to another is no longer so difficult or expensive.
The Bad News
The demands of the payroll cycle overwhelmed many payroll teams. Work can’t begin until the end of the pay period, and there is little time left before the payroll commit. Employees have no visibility into results until after the payroll run. Immediately after commit, the stressful cycle of corrections begins.
Taxation continues to challenge companies as it continues its inexorable march toward incomprehensible complexity.
How Ceridian Is Transforming the Payroll Experience
Ceridian Dayforce is only one of the payroll vendors we work with, but it should be on your shortlist if you are looking for innovative solutions. Besides creating a user-friendly, intuitive experience for each role in the payroll process, Dayforce has changed the payroll model.
Dayforce has combined payroll and time in a single application with continuous calculation of inputs throughout the pay cycle. You can begin immediately to review and process the data. As employee records change in HR, Benefits, or time, records reflect the change in Payroll.
You can preview and adjust records in real time, make quick entries, and run audits to identify potential issues long before the payroll commit.
Compliance experts work with the development team to update regulations and legislative rules, so your taxation rules are up to date.
Dayforce updates all your configured earnings, taxes, and deductions throughout the pay cycle as records change.
Employees can access pay information through both the web and the mobile app. They can access current and historical pay statements and year-end forms. This enables them to be more independent and to provide relevant feedback to Payroll.
The Bottom Line
Dayforce’s better pay experience will soon be accepted in your organization as normal—the way things ought to be. Don’t squander the improvement. Measure and report on your successes and broadcast your accomplishments.
We are proud to partner with Ceridian, a company that focuses on your employee experience.
You can read more in Ceridian’s report in “A better pay experience: How Dayforce can help.”
Pixentia is a full-service technology company dedicated to helping clients solve business problems, improve the capability of their people, and achieve better results.