3 payroll-related challenges for HR professionals

January 16, 2019

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Employees expect their pay to be correct and processed on time. When something goes wrong, HR professionals are often the first to hear about it. Processing an efficient, effective, and compliant payroll can be complex and challenging. For some HR professionals, administration and management of the payroll function is part of their job responsibilities. Here are three challenges HR professionals face when it comes to payroll:

1. Various provincial/territorial statutes—If a business operates in more than one province or territory, or hires a remote worker, there are numerous pieces of legislation that need to be effectively managed. As employment legislation varies by province and territory (for non-federally regulated employees), administering payroll compliance can be complicated.

For example, employment law is constantly changing. The minimum legal requirements regarding minimum wage, overtime, paid statutory holidays, vacation, termination pay, and the provisions of other legislated leaves vary by province. Staying current, understanding the impact of change, and ensuring payroll compliance can be challenging.

2. Record of employment (ROE)—A ROE needs to be completed for Service Canada and sent to an employee after they stop working for the organization, even if they resigned. Failing to remit an ROE can lead to delays in processing your former employees’ employment insurance (EI) claims, resulting in fines and possibly damages.

Filling out an employee’s ROE can be complicated and mistakes do happen. In fact, Service Canada says the most common ROE mistakes occur with the final pay period ending date (block 12), total insurable earnings (block 15B), pay period details (block 15C), monies paid or payable on separation (block 17), comments (block 18), and overlapping ROEs.

3. Mergers and acquisitions (M&A)—M&A activity is common in the business world. However, a merger or acquisition can mean a lot of internal change, especially when it comes to payroll. These impacts may include year-to-date CPP and/or EI remittances, integrations with benefit plan carriers, and honouring any leaves or vacation accruals.

Getting payroll wrong

Payroll is an important function for both employers and the employee. If workers aren’t paid on time, it can have a devastating impact on the company and its staff. It can negatively affect the brand and employee morale. People expect their pay to show up on time and may default on a payment if they don’t get paid. If there is a problem with payroll, it should be communicated right away. Otherwise, HR will likely be the first point of contact when something goes wrong.

Distribute pay with confidence

We help hundreds of clients and individuals transition their company payrolls. Contact one of our Corporate Payroll Services professionals to help solve your payroll needs.