In the past, companies prefer that payroll computations be done in-house because they do not want to share employee information with a third party. However, companies eventually realized that payroll processing takes a lot of time. Ever changing tax regulations often result into errors that affect the bottom line. The solution for most companies is payroll outsourcing service that is a better alternative to in-house payroll processing.
The Senate wants to give up the Phoenix payroll system being used by the government. It wants a better system that will ensure employees are paid properly. There is a search for a service provider that will assume the responsibility of payroll processing including the pension benefits of the employees of Canada’s Senate.
The Phoenix payroll system started to be used by government departments and agencies last April 2016 and since then thousands of public employees have been improperly paid. The Senate plan for a new payroll solution is their response to the complaints made by public servants. The Senate is seriously considering the compensation of its workforce because the problems generated by the Phoenix payroll system for the last 2 years have negatively affected equality and standards of service that the Senate has set for its employees.
According to report that was commissioned by the Federal government it was revealed that the Phoenix payroll system lacked proper definition, accountability and foresight. This is a situation that the Prime Minister and several other ministers called unacceptable but when the system will be fixed remains unclear.
Over the past year and a half, the government estimates that the final cost of the Phoenix system that is not functioning properly is inching towards $750 million. The government thought that new technology and centralized system will allow them to lay off thousands of compensation advisers and save about $700 million across the country.
The use of payroll outsourcing service makes sense because it is more efficient and cost effective but is important to choose the service provider wisely. The payroll service must have a high level of customer support who will respond promptly whenever there are questions regarding the payroll data.