Error-free payroll calculations
European construction company uses Avola Decision to make payroll calculation process more efficient
Striving for a more efficient payroll system
As an international construction company, you are bound by several collective bargaining agreements (CLAs). When employees need to be paid at the end of the month, you want to make sure this process goes smoothly and that everyone gets paid what they are entitled to. Avola Decision helped our client track collective bargaining agreements, saving 14 FTEs and improving employee satisfaction by significantly reducing the number of errors in paying out salary.
- More efficient payroll processing
To ensure that every employee gets what he is entitled to. - Improve employee satisfaction
Through fewer errors. - More transparency
Because rules are laid down in Avola Decision.
Track and interpret various collective bargaining agreements for correct wage calculations
The collective bargaining agreement complements the individual employment contract and establishes agreements and regulations on wages and other terms and conditions of employment. Because the client operates in the construction industry, the company is bound by many different collective bargaining agreements. For example, carpenters, painters, metalworkers and construction workers all have their own collective bargaining agreements. Employees also work different shifts, day and night shifts, with different compensation and rewards.
Once employees record their monthly hours, our client must match the recorded hours with the employee’s corresponding collective bargaining agreement and calculate the compensation to which the employee is entitled. This sounds quite simple, but in reality this process proved prone to errors and lacked transparency.
The biggest obstacle to a smooth process was that the company did not have one central system in which all the different collective bargaining agreements were tracked and automatically interpreted. As a result, they could not guarantee that the rules applied were up-to-date. Instead, our client used several different systems that all interpreted the collective bargaining agreements differently. This frequently led to incorrect calculations that then had to be manually tracked down and fixed by an HR employee in a Microsoft Excel spreadsheet. This took an enormous amount of time and, in addition, the process also caused a lot of frustration for the employees who were regularly confronted with a paycheck that was incorrect.
Decision Management as a solution for salary calculations
The best way to solve our customers’ problems was to start by setting up one central system for timekeeping. For this, we used the Mendix low-code platform. The next step was to integrate a system that could maintain and interpret each collective bargaining agreement. To integrate the salary calculation process and apply decision management, Avola Decision was chosen. The Avola platform helps identify the logic and rules used to make decisions. The specifications of each CLA were converted to business rules. Then all business rules were merged into decision models that were automated through Avola Decision.
When an employee records his or her working hours, the system automatically applies the appropriate collective bargaining agreement. Payroll calculations are performed fully automatically without human intervention. If there is a question about a calculation, the HR person can easily access the system and check the logic of the calculation, as all calculations are logged. This way, it is completely transparent why the system arrived at this particular amount.
Version control and governance
Since collective bargaining agreements are changed frequently, the system had to be easily adaptable and manageable. A new collective bargaining agreement or existing ones could be added or modified. Especially for this purpose, Avola Decision provides functionality for version control and governance. Thus, people can build different versions of a decision model. This allows the construction company to run both the old and new versions of each collective bargaining agreement, allowing them to predict and simulate how a change in a collective bargaining agreement would affect the company’s bottom line.
What is Avola Decision?
Reduction of 14 FTEs in HR, increased transparency and improved employee satisfaction.
Now that the interpretation of each collective bargaining agreement has been automated, HR staff are no longer busy manually fixing errors in payroll calculations. Using Avola’s decision models, the HR department was able to downsize by 14 FTEs within 6 months of implementation. If employees have questions about their salaries, HR staff can now easily log into the system and give them an answer.
Flexible and future-proof
With Avola Decision, there is now complete control over work time allocation. HR staff have the ability and knowledge to modify any collective bargaining agreement in the central system. They can also create an additional collective bargaining agreement if necessary, such as in the case of a takeover. This flexibility makes the system future-proof. And when negotiating collective bargaining agreements, Avola Decision can be used to simulate how specific scenarios would affect their earnings. Thus, the system also contributes to strategic decisions.
The construction company’s HR department is now rarely contacted by frustrated employees who have received the wrong pay. The importance of this should not be underestimated because the competition for talent makes it difficult to attract and retain employees. Ensuring that people get what they are entitled to is an important foundation that has significantly improved employee satisfaction.
Related:
- Savings of 14 FTE
Through the use of decision models. - Increase employee satisfaction
By far fewer errors in payroll calculations. - Full transparency
Because all CLA rules are established.
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