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Workday Payroll and HR Software Review


Workday’s Payroll and HCM Software Review

Workday’s Payroll and HCM solution provides an intuitive and appealing core system-of-record for managing the full onboard-to-retire process for both employees and contingent workers in an increasingly global environment. Consisting of a number of different potential configurations, the company’s product line is roughly divided into 5 primary product modules (with Payroll being a wholly separate solution). These modules are: Workforce Lifecycle Management, Organization Management, Compensation Management, Absence Management, and Employee Benefits


Workday’s Payroll solutions come in one of three distinctly different packages:

  • Workday Payroll
    Addressing the full range of what most companies within the United States or Canada will need for payroll functionality, Workday Payroll provides functionality to define earnings and deductions using compensation elements and benefit plan costs captured by Workday HCM; create identifying eligibility criteria and scheduling logic; configure accumulations, balance periods, and balances according to current calculations and reporting needs; quickly modify the list of accumulations, balance periods, or balances at any time; and group workers into logical pay groups according to organizational needs (with no restrictions related to the Employer ID or type of worker).

    As is the case for most of the other similarly-situated enterprise-level Payroll/HR software solutions on the market, Workday Payroll is built as part of the greater Workday Human Capital Management (HCM) offering—a fact that does allow for some built-in efficiency leverage; including utilization of the same business process framework (and core worker data) for both applications as well as a unified self-service solution for employees (i.e. time off requests, online pay slip checking, payment elections, etc. can all be made from the same system). Further, using a dynamic combo of load balancing (in-memory across multiple servers), and a tabular data store, Workday significantly decreases the amount of time necessary to handle the heavy processing needed for payroll.

    Additionally, as it is with all of Workday’s applications, built-in analytics for payroll are available—providing the ability to run reports and audits on payroll-related data. Workday Payroll also includes the ability to use pre-defined reports for common and critical information; run audits (at the summary, pay group, or worker level); take action real-time on a pay-calculation result for a worker (via a one-click actionable report); compare payroll results across periods; control how gross-to-net is calculated for different types of payroll runs; define criteria for specific earnings and deductions (including gross-up calculations and garnishments); run multiple pay groups together; assign one or more cost centers to workers (and define how earnings will be distributed); and calculate and/or report on any earning, deduction, or accumulation for any period of time.

  • Payroll Co-Sourcing Services
    Provided through BPO vendor OneSource Virtual HR (Dedicated payroll and tax specialists), Workday’s Payroll Co-sourcing Services provide capabilities for payroll settlement services (i.e. direct deposit processing; check printing/distribution; payroll settlement/funding; W-2 printing/distribution, etc.); tax administration (i.e. Federal, State, and Local payroll tax prep/filing/deposits; daily, quarterly, and annual tax obligations processing; filing of annual W-2; monthly and quarterly tax reconciliation, response to agency inquiries, etc.); garnishments administration (i.e. order receiving from client; garnishment processing orders; authority notifications, etc.). These capabilities allow customers to retain control and visibility of payroll data (because payroll is always processed within a client’s own tenant); take advantage of the always-on audit control of Workday; provide self-service access for employees to access their payslips through Workday HCM; and reduce the overall manual effort it takes to process payroll, taxes, and garnishments.

  • Cloud Connect for 3rd-Party Payroll
    In regards to analysis, this module serves as the reporting feature for drilling into global positions, headcount, turnover, demographics, employee/position history, and compliance. The higher level functions that Workday's Talent Management offering provides appear to all originate from this module.
    The Workday Payroll Connector provides a way for customers to integrate bi-directionally to multiple 3rd-party payroll systems. This element includes Workday Human Capital Management (HCM) features that support data models required by external payroll systems; and also offers web services that identify and transfer only the Workday HCM events that affect payroll. With these configuration capabilities, Workday can capture applicable personal and job/position data within Workday HCM; assign employees to their appropriate pay groups directly; and define earnings/deductions (including benefit plan deductions, pay periods, and benefits/allowances) to match required structures. Further, the Workday Payroll Connector provides the capabilities to structure pay groups to match the payroll solution’s requirements; configure and populate custom payroll fields that are required by the payroll solution; define transactions as one-time (or one-off) payroll events; format and validate that data conforms to the payroll system requirements; and run payroll data audits to see exactly what data was captured, selected, and sent to payroll.
  • Employee Benefits

    Workday’s Payroll solutions come in one of three distinctly different packages:

    Enabling HR managers to design and implement a number of benefit plans (and control the plans that are eligible for selection by employees during open enrollment or benefit change events), this module also allows HR managers to automate benefit events; including new hire enrollment, benefit change events, terminations, and passive events. Customers can further set up default enrollment logic for employees that miss the benefits enrollment window, and additionally configure what benefit changes are allowed for different types of events.

    Workday's Cloud Connect for Benefits complements this primary module by providing HR organizations with a catalog of pre-built integrations to benefits providers—essentially giving companies the ability to evaluate, select, and offer the most appropriate plans for their workforce. This option allows companies to choose from a pre-populated list of benefits providers (160+ currently) without having to deal with the providers’ technical specifications. Workday automatically populates relevant personnel information and presents the templates, maps, and required company-specific information to the benefits administrator. When benefits providers change their specifications, Cloud Connect for Benefits updates the integration with no additional IT investment required from the customer.

    Workforce Lifecycle Management

    Workforce Lifecycle Management is the global core of the Workday solution and consists of the tools to plan, hire, manage, and analyze a global workforce. Specifically, this module allows for: the establishment of a workforce plan with headcount, position, and cost budgets; the setup and maintenance of jobs and positions; the assignment of compensation; and the configuration of business processes (by region, division, or organization). Further, with regards to analysis, this module serves as the reporting feature for drilling into global positions, headcount, turnover, demographics, employee/position history, and compliance. The higher level functions that Workday's Talent Management offering provides appear to all originate from this module. Speaking of talent management, while a recruitment option is in the works for the company, given that this functionality falls more in line with an integrated talent management suite rather than Payroll/HR, it falls outside of the scope of this review.

    Organization Management

    Workday's answer for creating/tracking multiple organization types; easily reorganizing when necessary; segmenting necessary (and global) reporting, and securing organizational data access; this module is one of the hallmarks of Workday's software and gives the ability to accurately represent organizational structures in a timely manner and react quickly to organizational restructuring—a unique value proposition from the Workday solution given that most traditional ERP systems allow for only a few organizational structures that are difficult to change during the normal course of business.

    Absence Management

    A simple, consistent tool that shares its calculation features with Workday Payroll, Absence Management is a straightforward solution for (you guessed it) calculating absences. Though not uniquely different from similarly-situated absence management approaches, Workday’s approach yields reliable and steady calculation results. Plus, due to the nature of the shared foundation of payroll and absences, additional features in the form of self-service (and access to information) through a single administrator/employee portal can be found in this module. Specific functionality for this module includes the ability to: establish eligibility criteria for different groups and organizations for different time-off or leave benefits; configure business processes and rules for approving and routing time-off requests; provide an intuitive user experience for employees to request time off or check time-off balances; and maintain consistency of accrual calculations between Workday Absence and Workday Payroll Management.


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