I’m just back from the 36th Annual American Payroll Association (APA) Congress and Expo, at the Gaylord Resort and Convention Center in National Harbor, Maryland. It was another successful event – lots of engaging keynotes and thought-provoking training sessions. The weather was also very interesting – the severe storms in DC delaying flights and causing travel chaos for many. Despite the daily deluge of rain, spirits remained high, and neither the enthusiasm nor the energy of the attendees dampened.
A little background to the APA Congress
Just in case anyone is unfamiliar with the APA Congress, here’s a brief overview. With over 1,800 attendees, 180+ educational sessions and 100+ exhibitors, it is the largest conference and expo focused on payroll and associated disciplines in the world. It is the event for payroll professionals, and while the focus of the event is on the US, there was a significant presence from many international payroll associations and professionals including representations from Canada, the United Kingdom, Mexico and Australia.
This diversity of experience and knowledge makes the Congress essential for anyone working in payroll/HCM. Not only do you leave with a ton of new information and insight, but you also come away with a greater sense of what your peers are doing and thinking.
This year I came away a very real sense that payroll as a profession is moving to more of a strategic function. To highlight this, here are 5 key trends and topics that payroll professionals face:
#1 – Fair Labor Standard Act (FLSA) violations are still occurring and are costly
We are still seeing many incidents of FLSA violations by employers. While the number of cases is slightly down, the dollar amounts awarded to employees is increasing. A large portion of these violations are the result of inaccuracies regarding payments for time worked especially concerning overtime, meal breaks, on-call and other time-related areas. In the past four years, the Department of Labor recovered over $1B in back wages for employees as a result of violations.
#2 – The “Gig Economy” is driving changes to the frequency of payroll
To encourage retention organizations are looking at different and creative types of benefits and structures. For many this means implementing more frequent payroll cycles; payments are now weekly and even daily for some organizations. One presenter spoke of a company that provides such an offer and although there was a slight premium, over 80% chose the daily payment option. This had the knock-on effect of forcing their competitors to provide a similar remuneration scheme.
The downside to such a system though is that daily payroll adds significant complexities and challenges to your processing, so consider all factors before deciding to offer this.
#3 – Talent Is the top CEO concern
Josh Bersin from Bersin by Deloitte gave one of the keynote presentations and talked about how CEOs see the recruitment and retention of talent as a major problem. Granted, at first this seems unrelated to payroll, but the current approach to driving employee engagement is by consolidating payroll, time & attendance with Talent and Learning solutions, the consequence of which means payroll is moving from a peripheral role to a more central one.
#4 – As the world turns, do does changes to tax and legislation
Another year and another round of changes to tax and legislative changes for payroll departments to manage. Signed on December 22, 2017, the Tax Cuts and Jobs Act is having a major impact on payroll departments, as it impacts a wide range of changes for standard deductions, elimination of the personal exemption, child tax credits, employer-provided assistance and benefits, W-4’s and much more. And that’s just at the federal level! Depending on your state and municipal area, there may be even more changes. Processing payroll accurately is getting more and more complicated!
#5 – Artificial intelligence, machine learning and personal assistants are coming!
Everyone at the Congress was talking about artificial intelligence (AI), machine learning and personal assistants and what these technologies will mean for payroll, HR departments, supervisors, and employers. At the minute the consensus is that all this new technology will not only help make better and more informed decisions, it will also enable us to handle routine tasks better. Many also believe these technologies can remove, or even eliminate, unconscious bias from the workplace. How? Primarily by taking the human out of some of the decision-making process and using machine learning, an objective entity, to predict for example which employees will violate attendance policies and recommend corrective action.
It is an exciting time for payroll and I look forward to seeing how as a profession we embrace the changes that are ahead. The APA continues to play an essential part in this journey, and if you are not already a member, I recommend joining.
Next year, the Congress is in Long Beach, California. Let’s hope the golden state lives up to its name.
I look forward to seeing you there.