A look at the world of payroll through the eyes of those who practice it
For years the payroll profession has been doing its best Rodney Dangerfield routine: “Hey. I can’t get no respect.”
Payroll practitioners rightly see themselves as one of the more underappreciated departments and the vast majority of employees don’t understand how much work is involved in getting out paycheques correctly and on schedule.
But in recent years there’s been a slight shift in the way payroll talks about itself. In the face of a somewhat unfriendly business atmosphere for payroll professionals — business process outsourcing is continuing to grow and the payroll department is one of the most popular targets — there’s a new, more confident refrain coming from payroll circles.
The message is simple: Given the chance, payroll can be a valuable strategic business partner.
Canadian HR Reporter chatted with a number of payroll practitioners to get their views on the payroll landscape and the challenges they face in their day-to-day tasks.
Dianne Winsor
Payroll manager
Aliant
St. John’s, Nfld.
Dianne Winsor’s early days in payroll weren’t exactly heady ones. One of her first gigs was in the payroll department at a fish processing plant. As payday approached, she’d wander down to the plant to retrieve the employee timecards that were, more often than not, covered in fish guts.
“They just smelled to high heaven,” she said.
Not a glamorous start to her career. Twenty years ago, payroll was still mostly a manual process. So once she cleaned the extraneous fish guts off the cards it was a pretty simple manual job to get the paycheques ready.
Fast forward a few years. Computers are now on the scene, and payroll is much more automated. It’s time for the annual raises and time for Winsor to make what she calls the biggest mistake of her career. She enters the new wage information, but with one missed keystroke she accidentally gives one worker a $3-million salary.
When preparing to hand out the cheques, she noticed an abnormally large figure on one of them.
“The net pay was like $65,000 or $70,000,” she said. “That was probably my most heart-stopping moment.”
But she was able to get it straightened out immediately and keep her sense of humour. She even took a photocopy of the pay stub down to the employee to show him what he almost had.
Reflecting on her career, Winsor said payroll isn’t just about payroll anymore. There are so many more demands placed on payroll staff. Winsor is now payroll manager for Aliant, the St. John’s, Nfld.-based company that provides local and long distance telephone, wireless and Internet service in the Atlantic provinces.
With a department of 16 people, Winsor oversees the payroll for 8,500 employees and 7,500 retirees. Using PeopleSoft, all of the payroll is processed in-house and for the most part is delivered to employees via direct deposit.
“Our systems are becoming so much more complex,” she said, because they have to deal with new wrinkles all the time like privacy legislation and Sarbanes-Oxley. “That’s becoming a big part of what we do, staying on top of the changes — legislative changes, internal changes and system changes.”
Outside of obvious skills like accounting, there is a range of skills payroll practitioners need. For one, they have to be very patient and understanding.
“Anytime you’re dealing with people and you’re dealing with their money, every situation you have is tricky,” she said. “You have to put your best face forward. The employee is your customer and you have to give them the best service. If they call, chances are something is wrong and they’re not happy.”
As payroll systems become increasingly tied in to other business systems across organizations, payroll practitioners have to develop their business acumen to ensure they have the ability to play the all-important strategic role. That will help payroll get the respect it deserves, she said.
“I don’t think most people understand all that we do that is not associated with a paycheque,” she said.
Things like dealing with the workers’ compensation board, annual reporting, billing for the Canada Revenue Agency, stock purchase plans and stock options are just some of the work that keeps payroll hopping.
“I just got off a call with our legal department on a garnishment that I’ve spent three days on,” said Winsor. “I’ve got court orders on my desk and letters from lawyers and I have to work with the legal department to decipher this and get it all sorted out properly.”
She said if it came down to just processing a worker’s pay, that takes only about 20 per cent of the payroll department’s time.
“The rest is spent dealing with outside entities, dealing with internal customers and all the reporting we provide to other areas,” said Winsor. “I think most people would be surprised to know that we don’t just do cheques and surprised that we just don’t push a button.”
She said payroll is starting to get the respect she thinks it deserves, and senior management at many organizations are starting to understand the expertise required and the ongoing challenges facing payroll departments and how important the function is to the business.
“One of my co-workers always says that everybody that is hired should be forced to spend a week in payroll,” said Winsor. “But I think the attitude towards payroll is changing. It’s slowly changing, but it’s most definitely changing.”
Wendy Doane
HR consultant
Emera Inc.
Halifax
Wendy Doane, an HR consultant with Emera, a Halifax-based energy and services company, said one of the biggest challenges is educating employees and colleagues about how things work in the payroll department.
“As payroll professionals know, the whole process is a well-oiled machine and is built on many layers and steps that have to be done in sequential order,” she said. “Many employers do not have an understanding of why a request may not be able to be processed immediately, why a delay of three to four hours in time submission is a big deal or why there are such strict guidelines around certain processes.”
It’s a fine line between giving employees enough information so that they understand the problem and inundating them with too much information that leaves them confused and frustrated, said Doane.
The payroll department at Emera, consisting of 2.5 full-time equivalents, handles payroll for about 2,100 workers using PeopleSoft. It has five biweekly payrolls, one weekly and a board of directors that gets paid quarterly.
Doane said technology has definitely helped payroll, as it handles the repetitive, well-established processes well.
“By automating many tedious processes, it frees up time for a payroll practitioner to focus on more strategic and value-added initiatives,” she said. “It is when that same technology fails that it throws us for a loop because time is then required not only to fix the issue, but also to manually process what the technology was doing for us in the first place.”
She said there’s not much limit to what technology can do — the limit comes in the form of how much money and resources a company can dedicate to that technology.
“You are only limited by your resources, primarily financial,” said Doane. “Even if you have the funds to implement new hardware or software, you need to ensure funds are available for ongoing maintenance, upgrading and support costs.”
From what she can tell, payroll is becoming a more popular career option for many workers.
“Typically in the past, many payroll professionals were ‘thrown’ into payroll,” she said. “I now see young people choosing to take payroll courses and certification programs at local universities and college. I have employees coming to me seeking development opportunities in our department. To me that signifies that payroll is being viewed as a legitimate career opportunity as opposed to one component of a different career stream.”
Doane said she’s seen a number of mistakes over the years. The worst mistake she’s ever seen is something she calls every payroll professional’s nightmare.
“It was about a year ago when one of the major banks, whom most of our employees happen to deal with, had an issue at their end and none of our deposits were processed,” she said. “Employees tend not to care where the issue occurred, all they know is that today is payday and they have no money.”
The worst mistake she’s made is similar to one Diane Winsor made (see previous page) — overpaying someone significantly.
“Once was a result of incorrectly setting up a new earning code to pay cents per kilometer,” said Doane. “I had it set up to pay at their hourly rate, therefore someone who entered 1,500 kilometres received a cheque for about $45,000 gross. Most people are forgiving and will repay the amount, but every now and then you get a disgruntled employee who just makes it a painful exercise to retrieve the money.”
But one thing Doane has learned is that almost every mistake is fixable.
“You just need to ensure that you approach the mistake front on, with no excuses, and do what needs to be done to rectify the situation,” she said.
She’s received a number of strange inquiries from employees over the years.
“I always get a kick out of people who phone me at tax time and ask me what their social insurance number is,” she said. “I also get a lot of requests from employees to calculate the net pay for their babysitter or their church organist.”
She said few workers truly understand what the payroll department does.
“I believe that people only know 10 per cent of what we do. Processing the pay only takes two or three days out of a biweekly schedule, but it’s the other seven to 10 days they don’t have an appreciation for, primarily because they don’t know what it entails,” she said.
There is an opportunity to gain respect from employees even when something does go wrong with a paycheque, said Doane.
“How we recover from the error is more important than the fact that we fix it,” she said. “Customer service is the key to increasing the respect of the department.”
She said payroll is making inroads to becoming a strategic partner, but professionals need to be more aggressive and get involved early.
“Don’t wait to be asked. We know what we have to offer and often it is just a matter of approaching the right parties and offering our expertise,” said Doane. “Once those players get to know the broad base of knowledge and technical expertise we exhibit, they will be more inclined to approach us when new initiatives are being planned.”
Debbie Smith
Instructor/administrator/
employment specialist
CDI College —
Abbotsford Campus
Abbotsford, B.C.
Debbie Smith has a unique perspective when it comes to watching the world of payroll. As an instructor at CDI College in Abbotsford, B.C., she’s been witness to a very welcome change when it comes to students studying payroll.
Ask any payroll practitioner today how they got into payroll, and the answer will invariably be that they fell into it or just sort of ended up there. But that’s changing.
“It’s a career choice now,” said Smith. “People want to be payroll professionals. It’s one of our most popular programs.”
She said students coming in to the program at CDI are often surprised at how much work actually goes into getting a paycheque out the door.
“The number of government bodies and policies that make up the payroll process (is surprising to most people),” she said. “The students are always amazed at the complexity of payroll.”
Keeping up with Canada Revenue Agency policies and government legislation are the biggest challenges for payroll practitioners, she said.
“The more complex payroll becomes, the more there is to stay updated on,” said Smith.
On the technology front, she said software has helped the profession by reducing processing time, increasing reporting capabilities and eliminating some of the errors.
“(But) it doesn’t eliminate errors totally,” said Smith. “Data input is still subject to human error.”
She said payroll is definitely getting more respect than in the past, but doesn’t doubt that some talented people are still toiling anonymously in the background in the payroll department.
Payroll practitioners rightly see themselves as one of the more underappreciated departments and the vast majority of employees don’t understand how much work is involved in getting out paycheques correctly and on schedule.
But in recent years there’s been a slight shift in the way payroll talks about itself. In the face of a somewhat unfriendly business atmosphere for payroll professionals — business process outsourcing is continuing to grow and the payroll department is one of the most popular targets — there’s a new, more confident refrain coming from payroll circles.
The message is simple: Given the chance, payroll can be a valuable strategic business partner.
Canadian HR Reporter chatted with a number of payroll practitioners to get their views on the payroll landscape and the challenges they face in their day-to-day tasks.
Dianne Winsor
Payroll manager
Aliant
St. John’s, Nfld.
Dianne Winsor’s early days in payroll weren’t exactly heady ones. One of her first gigs was in the payroll department at a fish processing plant. As payday approached, she’d wander down to the plant to retrieve the employee timecards that were, more often than not, covered in fish guts.
“They just smelled to high heaven,” she said.
Not a glamorous start to her career. Twenty years ago, payroll was still mostly a manual process. So once she cleaned the extraneous fish guts off the cards it was a pretty simple manual job to get the paycheques ready.
Fast forward a few years. Computers are now on the scene, and payroll is much more automated. It’s time for the annual raises and time for Winsor to make what she calls the biggest mistake of her career. She enters the new wage information, but with one missed keystroke she accidentally gives one worker a $3-million salary.
When preparing to hand out the cheques, she noticed an abnormally large figure on one of them.
“The net pay was like $65,000 or $70,000,” she said. “That was probably my most heart-stopping moment.”
But she was able to get it straightened out immediately and keep her sense of humour. She even took a photocopy of the pay stub down to the employee to show him what he almost had.
Reflecting on her career, Winsor said payroll isn’t just about payroll anymore. There are so many more demands placed on payroll staff. Winsor is now payroll manager for Aliant, the St. John’s, Nfld.-based company that provides local and long distance telephone, wireless and Internet service in the Atlantic provinces.
With a department of 16 people, Winsor oversees the payroll for 8,500 employees and 7,500 retirees. Using PeopleSoft, all of the payroll is processed in-house and for the most part is delivered to employees via direct deposit.
“Our systems are becoming so much more complex,” she said, because they have to deal with new wrinkles all the time like privacy legislation and Sarbanes-Oxley. “That’s becoming a big part of what we do, staying on top of the changes — legislative changes, internal changes and system changes.”
Outside of obvious skills like accounting, there is a range of skills payroll practitioners need. For one, they have to be very patient and understanding.
“Anytime you’re dealing with people and you’re dealing with their money, every situation you have is tricky,” she said. “You have to put your best face forward. The employee is your customer and you have to give them the best service. If they call, chances are something is wrong and they’re not happy.”
As payroll systems become increasingly tied in to other business systems across organizations, payroll practitioners have to develop their business acumen to ensure they have the ability to play the all-important strategic role. That will help payroll get the respect it deserves, she said.
“I don’t think most people understand all that we do that is not associated with a paycheque,” she said.
Things like dealing with the workers’ compensation board, annual reporting, billing for the Canada Revenue Agency, stock purchase plans and stock options are just some of the work that keeps payroll hopping.
“I just got off a call with our legal department on a garnishment that I’ve spent three days on,” said Winsor. “I’ve got court orders on my desk and letters from lawyers and I have to work with the legal department to decipher this and get it all sorted out properly.”
She said if it came down to just processing a worker’s pay, that takes only about 20 per cent of the payroll department’s time.
“The rest is spent dealing with outside entities, dealing with internal customers and all the reporting we provide to other areas,” said Winsor. “I think most people would be surprised to know that we don’t just do cheques and surprised that we just don’t push a button.”
She said payroll is starting to get the respect she thinks it deserves, and senior management at many organizations are starting to understand the expertise required and the ongoing challenges facing payroll departments and how important the function is to the business.
“One of my co-workers always says that everybody that is hired should be forced to spend a week in payroll,” said Winsor. “But I think the attitude towards payroll is changing. It’s slowly changing, but it’s most definitely changing.”
Wendy Doane
HR consultant
Emera Inc.
Halifax
Wendy Doane, an HR consultant with Emera, a Halifax-based energy and services company, said one of the biggest challenges is educating employees and colleagues about how things work in the payroll department.
“As payroll professionals know, the whole process is a well-oiled machine and is built on many layers and steps that have to be done in sequential order,” she said. “Many employers do not have an understanding of why a request may not be able to be processed immediately, why a delay of three to four hours in time submission is a big deal or why there are such strict guidelines around certain processes.”
It’s a fine line between giving employees enough information so that they understand the problem and inundating them with too much information that leaves them confused and frustrated, said Doane.
The payroll department at Emera, consisting of 2.5 full-time equivalents, handles payroll for about 2,100 workers using PeopleSoft. It has five biweekly payrolls, one weekly and a board of directors that gets paid quarterly.
Doane said technology has definitely helped payroll, as it handles the repetitive, well-established processes well.
“By automating many tedious processes, it frees up time for a payroll practitioner to focus on more strategic and value-added initiatives,” she said. “It is when that same technology fails that it throws us for a loop because time is then required not only to fix the issue, but also to manually process what the technology was doing for us in the first place.”
She said there’s not much limit to what technology can do — the limit comes in the form of how much money and resources a company can dedicate to that technology.
“You are only limited by your resources, primarily financial,” said Doane. “Even if you have the funds to implement new hardware or software, you need to ensure funds are available for ongoing maintenance, upgrading and support costs.”
From what she can tell, payroll is becoming a more popular career option for many workers.
“Typically in the past, many payroll professionals were ‘thrown’ into payroll,” she said. “I now see young people choosing to take payroll courses and certification programs at local universities and college. I have employees coming to me seeking development opportunities in our department. To me that signifies that payroll is being viewed as a legitimate career opportunity as opposed to one component of a different career stream.”
Doane said she’s seen a number of mistakes over the years. The worst mistake she’s ever seen is something she calls every payroll professional’s nightmare.
“It was about a year ago when one of the major banks, whom most of our employees happen to deal with, had an issue at their end and none of our deposits were processed,” she said. “Employees tend not to care where the issue occurred, all they know is that today is payday and they have no money.”
The worst mistake she’s made is similar to one Diane Winsor made (see previous page) — overpaying someone significantly.
“Once was a result of incorrectly setting up a new earning code to pay cents per kilometer,” said Doane. “I had it set up to pay at their hourly rate, therefore someone who entered 1,500 kilometres received a cheque for about $45,000 gross. Most people are forgiving and will repay the amount, but every now and then you get a disgruntled employee who just makes it a painful exercise to retrieve the money.”
But one thing Doane has learned is that almost every mistake is fixable.
“You just need to ensure that you approach the mistake front on, with no excuses, and do what needs to be done to rectify the situation,” she said.
She’s received a number of strange inquiries from employees over the years.
“I always get a kick out of people who phone me at tax time and ask me what their social insurance number is,” she said. “I also get a lot of requests from employees to calculate the net pay for their babysitter or their church organist.”
She said few workers truly understand what the payroll department does.
“I believe that people only know 10 per cent of what we do. Processing the pay only takes two or three days out of a biweekly schedule, but it’s the other seven to 10 days they don’t have an appreciation for, primarily because they don’t know what it entails,” she said.
There is an opportunity to gain respect from employees even when something does go wrong with a paycheque, said Doane.
“How we recover from the error is more important than the fact that we fix it,” she said. “Customer service is the key to increasing the respect of the department.”
She said payroll is making inroads to becoming a strategic partner, but professionals need to be more aggressive and get involved early.
“Don’t wait to be asked. We know what we have to offer and often it is just a matter of approaching the right parties and offering our expertise,” said Doane. “Once those players get to know the broad base of knowledge and technical expertise we exhibit, they will be more inclined to approach us when new initiatives are being planned.”
Debbie Smith
Instructor/administrator/
employment specialist
CDI College —
Abbotsford Campus
Abbotsford, B.C.
Debbie Smith has a unique perspective when it comes to watching the world of payroll. As an instructor at CDI College in Abbotsford, B.C., she’s been witness to a very welcome change when it comes to students studying payroll.
Ask any payroll practitioner today how they got into payroll, and the answer will invariably be that they fell into it or just sort of ended up there. But that’s changing.
“It’s a career choice now,” said Smith. “People want to be payroll professionals. It’s one of our most popular programs.”
She said students coming in to the program at CDI are often surprised at how much work actually goes into getting a paycheque out the door.
“The number of government bodies and policies that make up the payroll process (is surprising to most people),” she said. “The students are always amazed at the complexity of payroll.”
Keeping up with Canada Revenue Agency policies and government legislation are the biggest challenges for payroll practitioners, she said.
“The more complex payroll becomes, the more there is to stay updated on,” said Smith.
On the technology front, she said software has helped the profession by reducing processing time, increasing reporting capabilities and eliminating some of the errors.
“(But) it doesn’t eliminate errors totally,” said Smith. “Data input is still subject to human error.”
She said payroll is definitely getting more respect than in the past, but doesn’t doubt that some talented people are still toiling anonymously in the background in the payroll department.
