Canadian Payroll Reporter

4 Canadian HR Reporter, a Thomson Reuters business 2018 News in Brief A look at news, facts and figures shaping the world of payroll professionals PM #40065782 Phoenix pay problems not software-related: IBM › OTTAWA — Most of the problems that the fed- eral government has had with its Phoenix pay system were not due to the payroll software, but to the government's own internal issues, repre- sentatives of IBM Canada told a Senate commit- tee in late March. The Senate's National Finance standing committee is investigating the reasons why the government has had so many problems with Phoenix. In the months after launching it in 2016, thousands of public-sector workers were overpaid, underpaid, or not paid at all. In addition, the government has had difficulty processing payroll on time. The Phoenix project included replacing the government's 40-year-old payroll system with PeopleSoft software, reducing the number of compensation advisors, and centralizing the department at one location in Miramichi, N.B. IBM representatives told the committee that IBM was only responsible for installing and customizing the payroll software and not with other aspects of the project. "It's important to remember that it's not the software that's the problem. The software works. The challenges associated with the project have been around process and people," said Regan Watts, head of innovation, citizenship, and government affairs at IBM Canada. "We believe that the vast majority of the problems related to the Phoenix transformation project lay primarily with HR business processes and the amount of training received by employees including HR and compensation advisors, data entry — including accuracy and timeliness, and the lack of ongoing root cause analysis." An independent third-party report released last fall described problems that the government experienced when implementing Phoenix. These included underestimating the complexity of changing the pay system, not having proper change management strategies, lack of adequate training, and a culture that discouraged anything but positive feedback. "The Phoenix transformation project made significant changes to how payroll was generated," said Beth Bell, vice-president, partner and Canadian public sector leader at IBM Global Business Services. "You're not just implementing a payroll system. You're changing the way employees work. You're changing the way they generate pay for all of the civil servants across Canada and so when you do something that is a big transformation, you have to really govern it and think about it as a transformation as opposed to just installing a payroll system." Under Phoenix, the government linked its HR and payroll systems for the first time, she said. Instead of having compensation advisors for each department, payroll now depends on departmental managers and HR professionals correctly entering on-time data into the HR system, which feeds directly into the payroll system. Bell said any additional data to be added after system deadlines has to be handled by the compensation advisors in New Brunswick. "Unlike the old system, there is no verification step after data entry," she said. Watts and Bell said IBM raised concerns with government officials months before Phoenix was launched in February and April of 2016. IBM was concerned that it would not have enough time to implement the large number of system changes that the government had requested before going live. They said IBM advised the government to delay the launch, but government officials refused, saying they needed the system operational by April 2016 because they had already handed out termination notices to compensation advisors being let go. Administrative duties shifting to payroll: Survey › TORONTO — Payroll professionals are spending more time doing administrative work, according to a new report. Hays Canada's Payroll Salary Guide 2018 states that the payroll professionals it surveyed reported spending about 40 per cent of their time on administration, up from 37 per cent last year and 35 per cent the year before. Hays surveys members of the Canadian Payroll Association (CPA), as well as its own clients, to create the annual guide which looks at compensation, benefits, recruitment, and retention trends in the profession. "The amount of time that payrollers are spending doing administrative tasks is increasing, which we found very interesting, given the general assumption, which is that (payroll) is a very automatable. It just doesn't seem to be happening," said Antony McElwee, director of sales and client relations at Hays Canada. "With managers, for example, they spend 26 per cent of their time doing administration, which is actually more time than they told us that they spend managing their teams (19 per cent)," he said. The survey results also revealed that payroll managers tend to underestimate their need for temporary workers. Of the 40 per cent of payroll teams that reported using temporary workers, 28 per cent increased their use of temporary help last year, but only 14 per cent had expected the increase. "Only about half of temporary headcount is planned for," said McElwee. "The net result of that is that usually you don't find who you are looking for because you are doing it on a rushed basis and you are doing it typically when you need the person as opposed to four or eight weeks in advance when you've got time to find exactly what you need them to do and what skills you want them to have and can take some time to find the right person," he said. New Brunswick invests in pay equity support › FREDERICTION — New Brunswick's provin- cial government says it will invest $150,000 a year to support the advancement of pay equity among private-sector organizations that do busi- ness with the government and employ at least 50 employees. The province's Pay Equity Bureau will use the funding to help explain the benefits of pay equity to private-sector employees and employers and to provide information on how businesses can apply pay equity within their organization. New Brunswick's pay equity legislation covers only public-sector organizations. Pay equity advocates say the funding is a good first step for eventually expanding pay equity to all employers. "To make this a reality for all New Brunswickers, we have to prepare the ground. We, therefore, applaud these new investments to advance pay equity in the private sector, and we will continue to collaborate with the government until we have legislation for the private sector," said Johanne Perron, executive director of the New Brunswick Pay Equity Coalition. Employers expect rise in medical leaves: Survey › OTTAWA — Due to Canada's aging workforce and greater awareness surrounding mental health, Canadian employers say they are expecting an increase in employee medical leaves, a new study finds. The survey, by the Conference Board of Canada, found that the health conditions employers believe are the most likely to cause increases in medical leaves include a mental health issue or illness (42 per cent), cancer (15 per cent), and a musculoskeletal issue or injury (13 per cent). The survey of 205 employers also found that 63 per cent of them offer formal stay-at-work programs to assist employees dealing with health issues. The programs include flexible work hours or modified duties (95 per cent of employers), offer of a different job (62 per cent), and telework (59 per cent). Average weekly earnings hold steady in January › OTTAWA — Average weekly earnings of non- farm payroll employees were $996 in January, up from $994 in December, Statistics Canada reports. On a year-over-year basis, weekly earnings were up 3.2 per cent from January 2017. Changes in weekly earnings reflect a number of factors, including wage growth, changes in the composition of employment by industry, occupation, and level of job experience, as well as average hours worked per week.

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