You suspect that you may have a problem with the way your employees have been paid. Maybe you have selected the incorrect rate or inappropriately applied higher duties allowances. It happens, even to the biggest employers in Australia. You’re determined to do the right thing by your employees and your stakeholders. You decide to undertake a wage review to verify the historical payments made to employees and make good on any amounts owed to your workforce. You engage with your stakeholders and legal advisors, and engage a provider to quantify the extent of any potential underpayment. The project is planned, instructions are provided, and deadlines are set. Everything is on track.
You receive the data requirements and send them off to your payroll and operations team to extract.
Then you get the call.
Usually a variation of “we don’t have any roster data”, “we don’t have any time and attendance data for those employees” or the dreaded “we have the data but that’s kept onsite in the desk drawers of the site managers… yeah probably thousands of sheets flying around….who knows how long they keep them”.
No one looks forward to ‘the call’. The call means: changes to tight deadlines, more work for an already strained team, and the uncertainty of how to move forward.
How do you navigate gaps in data during wage reviews?
When our clients come to us - slightly stressed - informing us of data issues, our first two words are always the same: “No worries”. We’ve seen this before many times, and we’ve got a solution.
Data issues are inevitable in any wage or payroll review. Industrial instruments are complex and frequently changing so it is difficult to ensure there is a system in place to ensure every necessary data point is captured for all awards or agreements covering your workforce. At Yellow Canary, our mission is to make payroll compliance easy, and we take the same approach to finding a solution for your data issues.
We’ve seen every possible permutation of gaps in data and have developed a robust methodology to solve the array of issues we see each day.
Common roster and timesheet data issues
We are going to focus on the most common data issues you will be faced by: roster data and timesheet data. It’s important to note the distinction between rosters and timesheets. Rosters are a record of the hours your employee was scheduled to work, whereas timesheets are a record of the actual hours they worked. In an ideal world, you should have a record of both rosters and timesheets. However, in our experience this is often not the case.
We have outlined the common scenarios and their relative complexity as they relate to roster data and timesheet data below:
Here, we’ll focus on the big four issues and provide examples of how we can solve them. We have to note that the methodology that you end up applying should be chosen in consultation with your legal advisors.
Problem 1: “Our rosters are maintained in thousands of Excel spreadsheets prepared by supervisors/managers”
The solution: data enrichment.
Rosters are typically used as a workforce planning tool by business units to ensure you have the right people on site at the right time, rather than a data input for the calculation of wages. This can take the form of rosters prepared in Excel where colours represent a shift type, or the employee name used in the spreadsheet is the first name only, or the format differs slightly as one department prefers another format. The unintended consequence of this is that the rosters are prepared by humans for humans, not for computers.
Unstructured data is complex to solve and due to its nature, there may still be data gaps. Manual transcription of these rosters may be achievable if you have 20 employees but is not scalable for a cohort of 100 or more employees.
In this case, we undertake a process called data enrichment where we take the internal data and transform the data into a format that can be programmatically consumed by our platform and used for the review. This process typically takes weeks, not the years that manual transcription would take.
Problem 2: “We don’t keep any rosters or timesheets”
The solution: templates.
This is common in workforces that work regular hours or shifts like banking, insurance, and professional services. In these situations, cohorts of employees will typically work the same pattern of hours depending on their role, employment type or store. For example, bank tellers at a regional branch may work Monday to Friday from 8:30am to 4:30pm and their counterparts at a metro branch may work 9:00am to 5:00pm. Historically, you may not have kept a copy of the roster or been required to complete timesheets as you were paid a salary.
In this situation, we will work with workforce planning teams to develop a series of roster templates as a proxy roster or timesheet data set. These templates are then ingested into our platform and applied to each of the employees within your relevant cohorts.
It is important to note that the template approach can only be used in specific use cases as templates are applied to cohorts of employees, and individual variation would be harder to treat. Accordingly, we work closely with your legal advisors to ensure this approach can be adopted.
Problem 3: “We have some timesheets, but we don’t have them for the whole period”
The answer: extrapolation.
A wage review often covers a six-year period and business practices and systems can change over that period of time. In many cases, timesheets may have only been introduced part way through the period, or lost for certain pay periods, or not kept consistently for cohorts of employees for the whole period. This means we do not have full visibility over an employee’s pattern of work and hours leading to gaps.
When we apply the extrapolation method, we work with you to identify historic patterns of employment for each employee and apply those patterns to the periods where there are gaps. This process is more complicated than using templates, because it takes into account individual circumstances, and therefore requires scrutiny at an individual level by your labour and HR teams. For this reason, it may not be practical for larger employee cohorts.
Problem 4: “We have some rosters and some timesheets, but it’s a hot mess”
The answer: blending.
It’s common for organisations to have a combination of some rosters and some timesheets available throughout the review period. For example, timesheets were only introduced part way through the review period and rosters were kept for the whole period, but rosters only reflect the hours an employee was scheduled to work, not the hours actually worked. This gives rise to a situation where we only have the actual hours worked for a portion of the review period and the hours employees were scheduled to work for the remaining portion.
The Fair Work Act and associated regulations require records to be used where they are available. That is, you cannot be selective about the records you choose to use.
In these circumstances we undertake the process of blending. This is the process of homogenising multiple approaches to optimise accuracy given available data, and can be extremely complicated. The complexity lies in the intersecting points between data sources, as the data sources typically do not neatly cut-over. Practically, this involves adopting one data source (e.g. timesheets) for a portion of the period and using another data source (e.g. rosters) for a different portion. This process can become complex, and we have developed a framework to protect the integrity of the method.
Helping you make a complex problem easy to solve
No one sets out on a wage review hoping to encounter data issues. We’ve made it our job to make solving data issues easy through our Yellow Canary Data Gaps Methodology. As with every aspect of a Yellow Canary project, we work closely with your legal advisors, payroll and operations teams to ensure we are applying the right methodology to your data problems. If you want to speak to us about the data gaps in your wage review, contact us here and we’ll give you a call.
* Yellow Canary content on this website is intended solely for the purpose of offering commentary and general knowledge. The content is not intended to constitute legal advice. You should seek legal or other professional advice before acting or relying on any of the content.