The five hurdles of pharmacy payroll

Making it to the end of a payroll cycle with the right amount paid out: that’s the goal. But to get there, you’ve got to clear several hurdles. If your business stumbles, or is flawed, at any stage, you can face major set-backs and serious errors. You risk overpaying your workers, blowing out your staffing budget. Among other ramifications, you risk not complying with industry Awards, with all the headaches that follow. At easyEMPLOYER, we’ve been working with pharmacists for more than 10 years, so we understand your industry. And as technologists, we’re seeing new tools emerging that will help you clear each hurdle.

Hurdle #1: Rostering staff

Where pharmacies trip up:

It’s a fine balance: getting the right level of experienced staff to match the ebbs and flows of customers over the hours, days, weeks and months. When pharmacies rely on ‘guestimation’, we often see them overshooting or falling short of the mark. In an over-staffed pharmacy, staff stand idle in slower periods. Understaffing can be even more costly in the long run. Customers aren’t attended to quickly enough which means sales are lost and it’s costs you customer loyalty.

How to clear this hurdle:

Instead of relying on intuition and guesswork, use automatic roster generation to get much closer to optimal staffing levels. How does it work? Once you’ve determined what shifts to fill, the software automatically assigns the shifts to meet requirements. And with instant access to rosters from a template or previous periods (i.e. this period last year), you have a ready reference to help make informed, intelligent rostering decisions. No more shooting in the dark!

Hurdle #2: Time-clocking

Where pharmacies trip up:

Even pharmacies that have adopted cutting-edge time-capture technology like finger-print scanners often don’t have intelligent systems behind the device. When the scanner is linked with your rostering and fully integrated with your payroll systems, a whole raft of possibilities open up. Pharmacies can instantly compare the time-clocking data against rosters for accurate and useful variance reports. You can fully automate the entire payroll process, from an employee clocking on each morning, right through to receiving money in the bank. Without that intelligent integration, all you have is an expensive punch-clock.

In saying that, biometric time clocking is really important because whenever staff are left to manually enter data, there are going to be errors. Much of this will be down to mistyping. However, in a handful of cases, staff deliberately fudge the numbers. They ask a colleague to clock on for them. Or they enter themselves as starting work at 9.00, when actually they didn’t turn up till 9.05.

Paying someone an extra five minutes is a small cost for that one employee. Across a whole year, though, it adds up. For example, let’s take a pharmacy of 20 employees with an average pay rate of $20 per hour. Just five minutes of time-creep a day will cost that pharmacy $35,000 a year!

Of course you could constantly monitor your staff’s movements. But most pharmacists have other things they’d rather be doing than tracking their staff’s comings and goings.

How to clear this hurdle:

Use automatic time capture technology to eliminate the room for human error. If your timesheet receives data directly from a time scanner, there’s no room for your staff to get their 8’s and 3’s mixed up. There’s also less room for deliberate manipulation.

Furthermore, automated time-clocking gives managers useful insight. You can drill into questions of attendance right from your desktop: is that one employee really consistently turning up late, or was it just a one-off? Is that person always calling in sick on Mondays? Or is someone always overshooting their allotted break time?

Hurdle #3: Timesheet management

Where pharmacies trip up:

It’s a big ask. Every pay period, a load of timesheets lands on the manager’s desk, all of which have to be checked through for errors and glitches. It’s almost inevitable that something slips through.

As with time-clocking, manual timesheet management leaves room for simple human error. Your staff member makes a mistake, and you don’t pick it up.

At other times, the data is accurate but doesn’t fit your business rules. For example, if your staffing budget is tight, you might decide to rein in overtime. What do you do when a staff member doesn’t do everything they were meant to during their shift so they decide to stay back to get through all the filing? Should you pay them for not being productive enough during their shift? If you spot it while sorting through the timesheets, you can query it with the staff member. But if it’s one exception in ten to fifteen timesheets, you may not catch it.

How to clear this hurdle:

Use automated quality assurance to support your manager’s review. Set business rules (such as whether overtime is permitted) and configure your workforce management software to flag exceptions and suggest solutions.

Automation is a game-changer for quality assurance. Managers don’t need to slog through every line of data in every timesheet. Instead, they can jump straight to the alerts, which are there to bring attention to anomalies, and make a call. Do they approve the exception (and pay the overtime, for example). Or do they decline the overtime, in line with normal business rules. With automation, the manager is free to actually manage — to make judgment calls about the business — rather than burning up time checking spreadsheets by hand.

Hurdle #4: Award management

Where pharmacies trip up:

Are you confident that your Award information is up-to-date? Several Awards relevant to pharmacies include a yearly pay increase. If you haven’t updated your systems, you can find yourself very quickly accruing a large payroll debt to your staff.

It gets even more complicated. Are your systems set up to handle cases where staff step up to fill in for more senior roles? Let’s say that Janice is filling in as managing pharmacist while Aidan is at a conference. Of course Janice’s pay should be increased to the higher rate. However, we often see pharmacies tripping up when multipliers come into play. For example, Janice works through ANZAC day. By rights, Janice should be paid at the managing pharmacist rate multiplied by the public holiday rate. Instead, some pharmacies would mistakenly apply the public holiday rate to Janice’s original rate.

Looking at the situation in the abstract, it’s easy to see the right approach. Complying with the Award means paying staff all that they’re entitled to — including holiday multipliers and higher-pay. However, integrating that principle into your payroll is not that straight forward.

How to clear this hurdle:

To stay up-to-date with Award increases, it’s worth considering Award management services. This is where your solution provider automatically updates your system’s Award data, so you know it’s always accurate.

Hurdle # 5 Paying staff

Where pharmacies trip up:

We come back to manual handling for this error. There are still some pharmacies manually entering payroll. There’s room for data entry errors — or worse, if the staff member responsible for payroll is out of action, whose going to pay your staff and do they have the knowledge to get it right?

How to clear this hurdle:

Look for a workforce management system that integrates with major payroll providers, so you’re automating as much of the chain as possible. That’s definitely a plus in the pharmacy sector, given the varying rates managers have to deal with. Ideally, look for a workforce management system with its own fully integrated payroll plug-in and/or a managed payroll service. You eliminate the headache and double-processing of maintaining two systems.

Jumping the Hurdles

That’s quite an array of factors to keep in mind, and a lot of room for error… and before you can even find ways to better jump the hurdles you have to first identify where they are in your business.

At easyEMPLOYER, we help businesses get total visibility and understanding of all of the elements of their staff management, and then we help them clear all of the hurdles.

We do this with our comprehensive Workforce Management Health Check. The Health Check assesses all of your current workforce management practices and finds ways to streamline your systems and process. The Health Check can help you to save up to 95% of time spent managing your staff and up to 10% of your weekly payroll.

The Workforce Management Health Check is usually a one-off investment of $1495 but for Transpharmation readers the Health Check will be conducted as a complimentary service. Register your interest in your free Health Check and see how you can change your staff management for the better.

Let us help you check all of the staff management workflows and administrative practices in your pharmacy and refine your processes so you can quickly and easily complete error-free pay runs, every time.