Stay in the Loop When Changing Pay Cycles

Employers should communicate clearly and often to their employees when they decide to undertake a change in their payroll cycles, said Lisa Poole, a vice president and business systems analyst with Sun Trust Bank.

Most employers change their pay cycles for efficiency, Poole said May 17 at the annual American Payroll Association Congress in Orlando, Fla.

In communicating the plan, employers should use make use of the five Ws: who, what, when, where and why, Poole said. Employers should relieve their employees’ fears and show that the plan is important to them and the company, she said.

Employers should provide information about the proposed change on websites and other locations, Poole said.

Changes in paycheck delivery dates and times and the number of days in the pay period may result after a new pay cycle is implemented, Poole said. Employers should be aware of the calculations that may result when moving to a new pay cycle, she said.

The team formed in planning and implementing a new pay cycle should include staff from the payroll, human resources, finance and information technology departments, Poole said. There should be an ombudsman on the team who is not part of the change process and would challenge everything, she said.

The team should create a calendar showing pay dates, processing cutoff dates and direct-deposit dates, Poole said. The team should agree on check points and milestone dates, she said.

Details is important, Poole said. The team should study the effect of moving the pay date forward or back, review every earning code and deduction and communicate early and often, she said.

Employers should share their experience with other employers  to gain insight, Poole said.

Take a free trial of Bloomberg BNA’s Payroll Decision Support Network, your one-stop resource for reliable, up-to-date guidance and analysis in every area of payroll administration and compliance.

Follow Bloomberg BNA on Twitter @BloombergBNA and join the Bloomberg BNA U.S. and Global Payroll group on LinkedIn.