Winning the war for talent through payroll
In today’s competitive labour market, employers can gain an advantage through top-quality payroll practices. violetastoimenova via getty images
In today’s tight labour market, organizations are searching for the most effective strategies for retaining and attracting talent. As employers try to gain an edge in the battle for employee allegiance, they may be overlooking the selling power of a key asset a professional and effective payroll operation.
“When it comes to attracting talent, payroll is often an underappreciated business function,” says Peter Tzanetakis, president and CEO of the National Payroll Institute, the professional association representing payroll practitioners in Canada.
“High-quality payroll delivery enhances employee engagement and productivity, and helps to forge relationships of trust across an organization. In contrast, when payroll is not handled professionally, it can be to the serious detriment of an organization.”
Understanding what drives employees can help employers compete for skilled personnel. Research by the National Payroll Institute underscores that the top driver for employees is confidence they will be paid on time and accurately.
A study of working Canadians1 showed that 94 per cent agree that they would look for a new job if their pay was regularly delayed, and 91 per cent of respondents say they would seek a new job if their pay was regularly inaccurate.
The study also reveals that if consistent and accurate pay for an employee’s work were withdrawn, changed, disrupted or compromised on a regular basis, there would be further consequences for the organization, including the following:
• 64 per cent would trust their employer less.
• 59 per cent would caution others about joining the company.
• 51 per cent would have concerns about how much their employer values them.
Respondents who have experienced payroll mistakes or delays in the past reported feeling the following as a result:
• unease about their ability to manage expenses (38 per cent);
• unappreciated by their employer (38 per cent); strain on workplace relationships (29 per cent); negative mental health impacts (27 per cent); and
• a lack of productivity or disengagement at work (26 per cent).
“These findings highlight that payroll is a central covenant of the employer-employee relationship,” says Mr. Tzanetakis. “No matter what perks and benefits are layered on top, if payroll breaks down, the relationship breaks down.”
An opportunity for employers to differentiate themselves with commitment to payroll excellence
Business leaders and other employers have the opportunity to make a public commitment to payroll excellence and use this commitment as a differentiator that appeals to the needs of current and future employees.
For the first time, the National Payroll Institute has compiled the core principles that are required to conduct payroll professionally: Accuracy, Timeliness, Transparency, Security, Equity, Compliance, Disclosure and Professionalism. Together, these eight principles comprise the Declaration for Payroll, which has been signed by hundreds of Canadian organizations.
The National Payroll Institute’s survey found that more than half of working Canadians (56 per cent) would be more likely to consider working for a company that had made a public declaration to prioritize upholding payroll principles.
“It’s gratifying to see that so many Canadian employers recognize the value of payroll excellence as they continue to compete in a consistently tight and competitive job market,” says Mr. Tzanetakis.
Upgrades to payroll increasing its value to employees and organizations
Employers who recognize the value of a well-functioning payroll operation are investing in new technologies and developing the skills of payroll professionals.
A growing number of payroll practitioners are acquiring professional designations, the standards for which are administered by Payroll Standards Canada, the self-regulating body for payroll that is managed by the National Payroll Institute.
The payroll designations delivered by the National Payroll Institute are the Payroll Compliance Professional (PCP) and the Payroll Leadership Professional (PLP), along with the specialized Professionnel de la paie du Québec (PPQ).
The National Payroll Institute survey found that employees value these professional credentials: 60 per cent of working Canadians say they would feel more comfortable knowing that their organization’s payroll professionals are professionally designated.
Additionally, technology plays a key role in providing employees with access to their payroll information – which was noted as important to most working Canadians.
In the survey, 95 per cent of survey participants noted that it was important that they have access to their pay information (such as pay stubs and tax forms) online or electronically.
“With automation, artificial intelligence and other new technologies on the horizon, team members will have new self-service tools and the ability to provide employees with personalized interactions,” says Mr. Tzanetakis.
1These are the findings of a survey conducted by the National Payroll Institute and hosted on the Angus Reid Forum from February 23 to February 27, 2023.
“High-quality payroll delivery enhances employee engagement and productivity, and helps to forge relationships of trust across an organization. In contrast, when payroll is not handled professionally, it can be to the serious detriment of an organization. ”
To view this report on The Globe's website, visit globeandmail.com
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