A new centralized payroll system is in the works for the Diocese of Honolulu. By August, the diocesan human resources office will be processing paychecks for more than 1,000 church employees in parishes, schools and offices across the state.
The human resources department currently handles payroll for only about 250 people. This includes paychecks and benefits administration for diocesan staff (in offices like the diocese’s financial department, Office for Social Ministry and the Hawaii Catholic Herald) and employees of 37 parishes, said HR director Dara Perreira.
The Islands’ 29 other parishes and its 30-plus parish schools are in the process of moving their payroll responsibilities over to the diocesan human resources team.
“Payroll is a necessary process of any employer,” Perreira said. “Our business managers and the staff at our locations (parishes and schools) often find they have a lot of things to do. This is a way to remove something from their plate so that they can work on things that matter most.”
Better support for employees
The diocese has long considered centralizing its payroll processing, Perreira noted. There are myriad calculations, as well as ever-changing federal and state laws, to monitor when handling employee paychecks. The human resources office can now provide their expertise in these areas to assist parishes and schools.
Under the centralized payroll system, pastors and principals will still be able to set pay scales, holidays, vacation guidelines and operating rules for their employees. Parishes and schools will also continue to be responsible for ensuring that their employees’ salaries are financed by their institution’s budget.
The diocesan HR office will now simply be the hub through which all timesheets are submitted, paychecks distributed, employee data updated and inquiries about benefits answered.
“We want to support our employees,” Perreira said. “The employees make the ministries, they are the ones that are in there day in and day out. We want to support them as best as we can with the best services, the best human resources department that we can offer them.”
The human resources office will be migrating payroll data from parishes and schools in several phases. From May through August, a handful of locations will transition into the diocese’s payroll system at the start of each month. Perreira emailed a timeline to school and parish employees March 31 listing when each institution will make the change.
Perreira and human resources generalist Lisa Sakuma have been working with staff at Ceridian, the diocese’s payroll processing company, on the centralization project. The jump from the diocese’s current payroll load of 250 employees to more than 1,000 will mark an increase of at least 75 percent.
The human resources department is looking to hire a payroll/benefits coordinator to help with its expanded needs. Perreira said that will be the only full-time position added to the diocesan HR office as a result of the initiative thus far.
Payday every two weeks
One of the biggest challenges with centralizing payroll will be adjusting all employees to the diocese’s bi-weekly pay schedule with a “pay lag” — the allowance of a few days between the pay period and paycheck.
Parishes and schools not already under the diocesan payroll system have been managing pay frequencies at their own discretion. This inconsistency has not been a problem, Perreira said, but the bi-weekly pay schedule used by the diocese (rather than monthly or twice a month) is widely considered to be a “best practice.”
The bi-weekly system with a pay lag ensures that all hours worked are accurately accounted for. Without a pay lag, payroll managers have to forecast the hours an employee will work between the day paychecks are calculated and the day they are disbursed.
This can sometimes leave an employer continually adjusting paychecks hours that did not meet their forecasts. It can become an efficiency issue down the line, Perreira said. Implementing a pay lag, she explained, “captures all the hours that are worked, and then you pay it one time.”
“It’s not easy,” Perreira said of standardizing the payroll frequency. “The most difficult part of this is you have all of these different groups doing different things at different times.”
“To standardize that is challenging because in most corporations that Ceridian has worked with, they don’t have all those differences,” she added.
Switching everyone to a bi-weekly pay schedule will not alter anyone’s overall pay, but “if you’re moving from 24 pay periods to 26” a year, Perreira said, “paychecks look a little different.”
She advises parish and school employees to plan ahead for their finances, particularly during the month their respective locations will be transitioned into the diocesan payroll.
“There is a little bit of pain in the beginning because of change, but once you get into the swing of things, there are some very positives about having” a bi-weekly system, Perreira said.
Employees will still have the option for direct deposit of their paychecks.
The diocesan human resources department can be reached at 585-3337 to answer any questions employees have about their paychecks during the payroll transition.
Advantages of centralization
Perreira said centralizing payroll paves the way for other services the HR office can provide in the future.
Having data on wages, medical and retirement plans, and other employee information under one umbrella allows the human resources department to procure quick and accurate censuses. This is important in meeting state employment reporting requirements, and in adding new benefit plans for staff.
The HR department can also use the data to provide advice on proper pay scales, job descriptions and other inquiries. Perreira said many pastors and principals have sought the office’s help on such matters. Understanding comparable salaries and staff positions has so far been difficult without an overall scope of employment in the diocese.
A centralized payroll system will coincide as well with the launch of a new online hiring initiative. According to Perreira, the diocesan website (www.catholichawaii.org) on July 1 aims to include a special module listing all the jobs available in local parishes, schools and diocesan departments.
This will provide a hub allowing Hawaii’s Catholic institutions “to share in applicants” for various positions.
In 2015, the HR office will begin handling administration of all employee benefits. With that, enrolling in and updating benefit plans will be much more efficient and timely.
Perreira said the process of implementing these changes has been daunting, but it has been pivotal in establishing a good connection between the diocese’s human resources department and local church staff.
She noted that the support of parish and school leaders, particularly those who shared advice in a payroll/benefits steering committee, has been key in allowing the diocese to move forward in best employment practices.
“It’s been a very good partnership,” Perreira said. “Because of those positive partnerships, we’re able to do something like this now.”
