Hundreds of employees were getting paid the wrong amount for months: Unions
When the Victorian Order of Nurses (VON) rolled out a new national payroll system in January, “everything that could go wrong went wrong” said Nova Scotia Government and General Employees Union (NSGEU) president Joan Jessome.
About 600 employees represented by the NSGEU weren’t getting the right pay for months.
For some this meant serious complications including trouble paying bills, said Jessome.
“When it started people were shocked… on payday not knowing if they were going to get a pay, period,” she said. “There was a lot of stress all the way around, the home support workers were really, really angry.”
Some people didn’t have enough money to get to and from work after some pay periods, she said.
Other unions report their members were having similar issues. For the VON’s 100 employees represented by the Canadian Union of Public Employees (CUPE), the situation was initially quite dire, said Kim Cail, the union’s national representative.
“Every time they fixed one problem it created another one and it just kind of snowballed for a bit,” she said.
The new finance, HR and payroll system was implemented to meet the demand created by Canada’s aging population, according to a written statement from VON.
“VON is a very complex organization with 5,400 employees and 46 different collective agreements,” the statement said. “An information technology conversion of this size, which involved a huge amount of data transfer, requiring specialized configuration of the computer software and of business process flows, requires constant fine-tuning.”
The rollout of the system is progressing to plan and VON is making resolving any issues a top priority, the statement said.
The software VON used is from SAP. SAP Canada did not want to comment on this story, but also sent a statement.
“We continue to enjoy a strong business relationship with the Victorian Order of Nurses,” the statement said. “SAP, along with the Victorian Order of Nurses’ implementation partner, is committed to the success of this innovative project that will ultimately help provide improved services to the Victorian Order of Nurses’ Employees.”
IBM, VON’s implementation partner for the project, also refused to comment, saying the company didn’t think it was appropriate to speak about a client’s business.
Implementation process, not system itself, likely the problem: Consultant
Without knowing the specifics of the case, it probably wasn’t the system itself that was the problem, but the way the implementation process was handled, said Ian Turnbull, managing partner at Laird and Greer HR Management Consultants in Toronto, a firm specializing in HR, payroll and time system selection and management.
“Systems that handle payroll either work or they don’t,” Turnbull said. “In baseball, if you bat .300 you’re a star. In payroll, if you bat .300 you got fired a long time ago.”
Typically when implementing a new payroll system an organization would do a test for every formula that is inputted into the system, to ensure payments like allowances are set up properly.
They would also a parallel test, where they would run the new payroll using current data and compare the results with the old system, he said.
“You would compare everything right down to the last decimal,” said Turnbull. “You should get the same results, or you should get the results that you expected to get.”
Sometimes one test is sufficient, but most payroll people want to run a couple of tests before a system is used, Turnbull said.
“They could not have tested this properly in advance,” he said.
But VON said the system was tested.
“There were three levels of testing: unit tests, followed by user acceptance tests, followed by parallel tests,” said Janet Macleod, regional manager of public affairs and community engagement at VON’s eastern region in an email.
Issues with payroll system ‘typical’: VON’s chief operating officer
John Gallinger, VON’s chief operating officer, called the issues with the pay system typical and addressed recent media coverage of the situation in a statement.
“VON did have some issues initially that are typical with any system change of this magnitude. It affected our staff and we reacted to correct the situation,” his statement said. “The recent media portrayals were more reflective of the situation two to three months ago and much progress has been made since then. We are now operating at a level of accuracy and service equal to or better than pre-system change.”
Cail said the situation has improved in the past few months, but glitches remain. Most of the pay issues have been worked out, but there are still issues with vacation and sick time banks on paystubs. It makes member weary of taking time off because it isn’t obvious how much they have, she said.
To avoid issues when rolling out a new payroll system Turnbull has some suggestions for organizations.
System implementations should have a project manager and it shouldn’t necessarily be someone from the company’s payroll department, he said.
“Being a project manager and working on a project is different from being a day to day payroll person,” he said.
He emphasized the need for testing and taking time to make sure the system is running properly before it’s rolled out.
“Seventy per cent of major systems implementations don’t result in the ultimate definition of success and the reason is because they rush it,” he said.
Payroll issues cause trust problems between employers, employees
The situation is an example of how pay issues can cause trust problems between employers and employees.
Even now that many of the issues have been ironed out, the ongoing struggles have left a sour taste in the mouths of many of the VON employees the NSGEU represents, said Jessome.
The union supports VON because they are non-for-profit health care agency and an incredible organization, but it will take time for members to trust the employer again, she said.
“A lot of rebuilding will have to happen after this.”
About 600 employees represented by the NSGEU weren’t getting the right pay for months.
For some this meant serious complications including trouble paying bills, said Jessome.
“When it started people were shocked… on payday not knowing if they were going to get a pay, period,” she said. “There was a lot of stress all the way around, the home support workers were really, really angry.”
Some people didn’t have enough money to get to and from work after some pay periods, she said.
Other unions report their members were having similar issues. For the VON’s 100 employees represented by the Canadian Union of Public Employees (CUPE), the situation was initially quite dire, said Kim Cail, the union’s national representative.
“Every time they fixed one problem it created another one and it just kind of snowballed for a bit,” she said.
The new finance, HR and payroll system was implemented to meet the demand created by Canada’s aging population, according to a written statement from VON.
“VON is a very complex organization with 5,400 employees and 46 different collective agreements,” the statement said. “An information technology conversion of this size, which involved a huge amount of data transfer, requiring specialized configuration of the computer software and of business process flows, requires constant fine-tuning.”
The rollout of the system is progressing to plan and VON is making resolving any issues a top priority, the statement said.
The software VON used is from SAP. SAP Canada did not want to comment on this story, but also sent a statement.
“We continue to enjoy a strong business relationship with the Victorian Order of Nurses,” the statement said. “SAP, along with the Victorian Order of Nurses’ implementation partner, is committed to the success of this innovative project that will ultimately help provide improved services to the Victorian Order of Nurses’ Employees.”
IBM, VON’s implementation partner for the project, also refused to comment, saying the company didn’t think it was appropriate to speak about a client’s business.
Implementation process, not system itself, likely the problem: Consultant
Without knowing the specifics of the case, it probably wasn’t the system itself that was the problem, but the way the implementation process was handled, said Ian Turnbull, managing partner at Laird and Greer HR Management Consultants in Toronto, a firm specializing in HR, payroll and time system selection and management.
“Systems that handle payroll either work or they don’t,” Turnbull said. “In baseball, if you bat .300 you’re a star. In payroll, if you bat .300 you got fired a long time ago.”
Typically when implementing a new payroll system an organization would do a test for every formula that is inputted into the system, to ensure payments like allowances are set up properly.
They would also a parallel test, where they would run the new payroll using current data and compare the results with the old system, he said.
“You would compare everything right down to the last decimal,” said Turnbull. “You should get the same results, or you should get the results that you expected to get.”
Sometimes one test is sufficient, but most payroll people want to run a couple of tests before a system is used, Turnbull said.
“They could not have tested this properly in advance,” he said.
But VON said the system was tested.
“There were three levels of testing: unit tests, followed by user acceptance tests, followed by parallel tests,” said Janet Macleod, regional manager of public affairs and community engagement at VON’s eastern region in an email.
Issues with payroll system ‘typical’: VON’s chief operating officer
John Gallinger, VON’s chief operating officer, called the issues with the pay system typical and addressed recent media coverage of the situation in a statement.
“VON did have some issues initially that are typical with any system change of this magnitude. It affected our staff and we reacted to correct the situation,” his statement said. “The recent media portrayals were more reflective of the situation two to three months ago and much progress has been made since then. We are now operating at a level of accuracy and service equal to or better than pre-system change.”
Cail said the situation has improved in the past few months, but glitches remain. Most of the pay issues have been worked out, but there are still issues with vacation and sick time banks on paystubs. It makes member weary of taking time off because it isn’t obvious how much they have, she said.
To avoid issues when rolling out a new payroll system Turnbull has some suggestions for organizations.
System implementations should have a project manager and it shouldn’t necessarily be someone from the company’s payroll department, he said.
“Being a project manager and working on a project is different from being a day to day payroll person,” he said.
He emphasized the need for testing and taking time to make sure the system is running properly before it’s rolled out.
“Seventy per cent of major systems implementations don’t result in the ultimate definition of success and the reason is because they rush it,” he said.
Payroll issues cause trust problems between employers, employees
The situation is an example of how pay issues can cause trust problems between employers and employees.
Even now that many of the issues have been ironed out, the ongoing struggles have left a sour taste in the mouths of many of the VON employees the NSGEU represents, said Jessome.
The union supports VON because they are non-for-profit health care agency and an incredible organization, but it will take time for members to trust the employer again, she said.
“A lot of rebuilding will have to happen after this.”
