'You end up doing better because you know your company is taking care of you the way they're supposed to'
Payroll compliance is far more than a back-office function — it is a direct contributor to trust, productivity, and employee wellbeing in Canadian workplaces, according to one expert.
At the heart of payroll compliance is providing workers with the correct pay, says Chris Kiklas, vice-president of product management at UKG, in an interview with Human Resources Director Canada.
“To me, the most important piece has to do with the employee,” he says.
“I think about when I was in my first job, and if my paycheques were off — even by a few dollars — it threw my entire life into disarray.”
Overall, employers owed workers in Ontario a total of $60 million in unpaid wages between the 2017-18 fiscal year to July 2024, according to a previous report from CBC.
In 2024, some workers reported errors in the Saskatchewan Health Authority (SHA)’s payroll system.
Failing to ensure accurate pay for workers through the payroll system can also harm productivity, says Kiklas.
“There's always an interesting phenomenon that if you're worried about something, it takes a piece of your mental ability away.”
He says this happens because a part of workers’ brains is constantly worrying about whether they will be paid correctly, or whether the salary increase they’re entitled to will be reflected in their paycheque.
“The more of that that gets put on your mind, the less you're focused on the other things in life or in work,” says Kiklas.
Also, a faulty payroll system may expose companies to the risk of lawsuits.
In 2024, after nearly a decade of legal wrangling, the federal government reached an out-of-court settlement to compensate non-unionized and casual federal employees affected by the long-standing issues of the Phoenix pay system.
The federal government has been focusing on improving the payroll system. In 2024, Ottawa achieved a government-wide average biweekly payroll accuracy of 98.1%, according to the government.
“The more we can establish that trust between the employee and the employer, the less space that takes up in their mind,” says Kiklas.
If the system works, you, as a worker, you “feel more confident, you're happier and you're more productive. You end up doing better because you know your company is taking care of you the way they're supposed to.”
“Payroll is essential to the long-term health of every business, the financial wellness of workers and the strength of our economy,” says Rebecca Logan, marketing communications specialist, National Payroll Institute.
Recently, UKG launched its UKG Ready suite in Canada — a solution that includes HR, payroll, talent, time, scheduling, and a native payroll platform designed for small and mid-sized Canadian businesses.
“Growing businesses face unique challenges including recruiting and retention. They often must do more with less,” says Lisa Highfield, principal director, research and advisory services at McLean & Company, a global HR research and advisory firm. “The UKG Ready suite offers intuitive features such as charts and dashboards, that allow for quick visualizations and personalization, which can increase efficiency and improve decision making.”
