What a payroll mess!

Sometimes you walk into a mess and other times you have a mess thrust upon you. Those were the salient experiences of Jodi Parsons, CPP, Director, Payroll, for the 2015 World Series winners, the Kansas City Royals Baseball Club; and Billy Meyerkorth, CPP, Manager, Human Resources Operations, Cetera Financial Group. Parsons and Meyerkorth lead attendees at the American Payroll Association’s Annual Congress through a workshop on how to fix payroll messes.

Clean up on aisle one. Parsons’ mess consisted of walking into a new job, in December, and having to deal with the day-to-day payroll operations, as well as year-end, and a pay frequency conversion to biweekly, from semimonthly. That’s a lot on a new employee’s plate.

According to Meyerkorth, employees in his organization weren’t being paid properly, their benefits weren’t accruing correctly, and, while trying to straighten all of that out, the parent company bought 12 more companies, which meant converting five vendors’ payroll systems into an entirely new system. Like Parsons, he also had to change employees’ pay frequencies.

Audience members cited two more horror stories—one company didn’t deposit payroll taxes or file returns for 12 years; another just classified everyone as exempt, because it didn’t want to pay overtime.

Advice for the forlorn. Messes are construction projects, Parsons said. When you look at a challenge, you should see an opportunity to have an impact on your organization, she added. Meyerkorth noted that it’s important to be sensitive and form partnerships with the people who are already there. Both gave these pearls of wisdom:

  • Maintain composure. If you’re not calm, your staff and, worse, the general employee population, will start panicking
  • Identify your crisis team. Who’s in charge of resolving the crisis? And block out time during the week to resolve the crisis. Further, Parsons said, ignore what’s causing the problem; pay employees first and then go back and analyze
  • Overcommunicate with employees. That way, employees will know that the issue is being resolved. Idea: Meyerkorth suggested smile-and-dial—calling every employee in the company and telling them to contact you if they have pay problems
  • Know your choices. Don’t be so quick to take the second best choice. Sometimes, according to Parsons, it’s better to stick with what you know, all the problems, and workarounds, included
  • Appreciate your team. Thank your team once the problem is resolved. And go further, Parsons said, by also thanking those who worked on the day-to-day payroll tasks while you were in crisis mode.

LIVE UP TO YOUR JOB ETHICS: Sometimes you just can’t fix it and you have to decide whether to put your name on a bad product. After trying to square things up with the IRS, the attendee whose company was 12 years in default resigned, because the IRS was kind enough to tell her that her company was throwing her under a bus. Ditto for the attendee whose company just classified everyone as exempt. It’s ultimately up to you—you have to decide what’s best for the company or you.


A step-by-step payroll compliance guide to each pay period, month and calendar quarter of the year is now available. Download it free here.