Proactive Payroll Management: A Lesson from Te Whatu Ora's Mistake
The recent news about Te Whatu Ora having to pay out almost a quarter billion dollars for holiday pay mistakes is yet another wake-up call for all employers. And there is still more to come, with arrears across the country expected to top $2bn for Te Whatu Ora.
Here are three key takeaways:
Responsibility Over Reliance: Employers must remember that payroll systems are tools, not solutions. It's crucial to actively manage and understand these systems to ensure compliance with employment laws.
The High Cost of Errors: Te Whatu Ora's case illustrates the severe financial implications of payroll mistakes. Not only is there a financial burden, but also a moral obligation to treat staff fairly. Overlooking these aspects can lead to substantial penalties and loss of trust. The errors that have been paid so far equate to approximately $7,250 per employee ($246.5m across 34,000 employees).
Being Proactive Pays Off: Addressing payroll system issues early and being on the front foot can simplify processes and mitigate risks. Proactive measures are always better than reactive ones, especially in complex areas like payroll management.
Employers, take note. It's not just about having a system in place but actively ensuring its accuracy and compliance. Start 2024 with action.
Reference article: Te Whatu Ora Pays Out Quarter Billion in Holiday Pay Errors
