Where should you begin? First, you need a well-thought-out plan. You also need enough time to properly handle the key steps. For smaller organizations, 90 days is usually the minimum lead time while the process may take 6 months or more in large organizations. Implementation often takes longer than anticipated and there may be delays due to unforeseen issues, such as those in the legal or regulatory arena. While it’s important to take action quickly, be sure to build in sufficient time for due diligence and coordinating your well-thought-out plan of action with the larger organizational-change roadmap.
Here are a few of the many payroll-related questions for your team to consider during the planning process:
Compensation
- Do the compensation plans of the two organizations align?
- Will you use one of the existing salary scales or create a new one?
- How will you address gaps in pay ranges between the two organizations?
- Will you review the salary scales for equity and market competitiveness issues?
- Are there pay policy changes identified that haven’t yet been implemented? Should modifications be made for the new organization?
- Do employees have incentive plans that need to be paid or rolled forward?
- Are there stock option or restricted stock plans to be accommodated?
- Will one of the existing payroll and human resources systems be used or will a new one be selected?
- If using an existing system, does it have the full range of features and services needed to serve a larger organization? Or would another platform be better suited for the future growth of the company?
- Are you happy with the services and responsiveness provided by the current technology partner? Or could another provider better serve the range of needs of the joined organization?
- How will you handle year-to-date tax and wages migration? Will you do it inhouse or will you ask your payroll company to do it?
- How will you process W2s/W-2c’s creation and distribution?
- What steps are needed to avoid risk of SUTA dumping and FUTA issues?
- Will Paid Time Off (PTO) balances be carried forward?
- How will sick time off balances be handled for specific jurisdictions that require reporting?
- What about FLSA or ACA audits and inquiries for the prior organizations?
More flexibility can also be added, such as offering employee self-serve and mobile functionality, timekeeping or pay cards. Choosing these or some of many other options will save valuable hours and expense in managing payroll while also increasing employee happiness. Integrating payroll with a full Human Resources Management System can also be considered. Your team will have the ability to manage employee processes through an intuitive system that combines all staff functions and data in a single platform.
During a time of organizational change, choose your payroll and human resources technology and partner wisely to meet the needs of the organization at the time of implementation and for its future growth. The transition process and support provided to your team is also a crucial factor.
Combining organizations and merging payroll systems have many more intricacies --- and ramifications --- than what most organizations expect. A consolidation or merger is the time to do it right.
New pay transparency regulations have exploded during the past year. Provisions are now in effect in states stretching from New York and Rhode Island, to Washington, Colorado and California with proposals being drafted in many more. Experts expect the growth of salary transparency legislation to continue in the foreseeable future.
Even in locales with laws already in effect; however, not all organizations have taken action. A compliance researcher in the technology sector, as reported by Forbes, discovered that only about 39% of the companies in California have implemented the regulations; the total is higher at about 48% in Washington and 63% in New York City. On the other hand, the survey also found that 17% of companies are already disclosing pay range information even in locations not required and another 62% have a plan to publish this information independent of regulation.
No matter the status in your state, all employers need to be aware of this regulatory trend and begin to prepare. For those doing business where laws are already in effect, now is the time to review and modify policies and internal procedures for compliance. Multi-state companies may see a more significant impact as laws can vary between each location. In those organizations, human resources managers should pay especially close attention to job postings at each site to ensure the postings, even those made on their behalf by third parties, comply with relevant transparency regulations.
The end of the calendar year is an important time to schedule and complete the payroll tasks needed for accurate tax reporting -- both for your organization and your employees. The schedule for these steps stretches from 4th quarter of one calendar year into the 1st quarter of the next. 
Accurate and timely year-end processing ensures compliance with governmental regulations and reduces headaches and the risk of penalties for your organization. In addition to wrapping up payroll matters for 2022, completing the work at this time of year also helps in determining compensation and benefits levels for 2023 and supporting other areas of business financial planning.
Although most changes that affect payroll go into effect in January, others take place on July 1 with the start of a new fiscal year for many state and local governments. This year is no exception with July 1 bringing new wage-and-hour-related provisions to some states and municipalities. Based on the location of your organization and structure of your workforce, you may be required to comply.
Most of the July changes impact minimum wage levels, for example, the state-wide increases in Nevada, Oregon, Connecticut and Washington DC. In other states, local minimum wage requirements also apply, such as in Nevada where the minimum wage may differ if the employee is offered health insurance. In addition, several communities in California, Illinois, Oregon, Maryland and Minnesota also made city and county-level changes.
Some provisions also affect calculation of wages for workers who receive tips and for certain types of exempt staff. Looking at those changes, the minimum wage requirements in some states now apply to workers who are exempt from overtime regulations, such as those who hold professional, administrative, executive or outside sales positions. A few mandate that these staff must earn the applicable minimum wage or more for each workweek hour. If the employee works on a commission basis, the overtime exemption in Nevada, Oregon or Washington must be a at least 1.5 times the newly-increased minimum wage while in Connecticut, it must be double. A post by Epstein Becker Green, published in the National Law Review, summarizes minimum wage changes nationwide and the organizations to which they apply.
There may be additional new regulations in your jurisdiction which affect your employees. A detailed list of other 2022 wage-and-hour-related changes, including those which went into effect earlier in the year and those projected between now and January 1, 2023, are described in this Littler Mendelson article.
If you have minimum wage, exempt or tip-compensated employees, get in touch with your compensation specialist or employment legal counsel to ensure your compensation structure is compliant in the locations where you do business.
QTS delivers customized payroll and human resources solutions for organizations across the nation, ranging in size from 2 to more than 1000 employees. Advanced technology combined with exceptional service differentiates QTS from other payroll companies which has made QTS the vendor of choice in provider-to-provider comparisons. QTS also provides HR outsourcing and consulting on wage-and-hour and related compensation and payroll issues to support in-house organizational teams