Payroll and finance in K-12 is a complicated balance of managing various factors influencing each employee's paycheck.
Unlike other industries, education hires union members and non-union employees, has expansive salary grids, and meets regulations and collective agreements, to name a few of the challenges that need to be managed.
K-12 school districts must adopt a purpose-built Enterprise Resource Planning (ERP) platform developed with the needs of education in mind. A generalized ERP platform may struggle to precisely meet the unique and complex challenges of operating a modern school district, making education ERP software critical.
Managing education payroll and finance is no small task in the face of unique pay grids and compliance requirements. Districts face significant challenges that need to be tackled head-on — and the right software is at the core of solving them.
So, let’s break down the core challenges facing modern K-12 districts and how to overcome them. Keep reading to reduce operational expense errors and build employee loyalty.
Tracking and managing absences is a common process, but with siloed departments and legacy methods, coordinating between HR and Payroll can be challenging.
The process often begins when an employee has planned or unplanned absences, which HR and payroll must then sign off on. This level of collaboration can be seamless, but all too often, it’s still dependent on email chains or even paperwork. The result consumes more time, increases the likelihood of errors, and may fail to consider all the necessary data about the employee.
An education-focused ERP platform unites both departments and unlocks a new level of frictionless collaboration. Both departments can access a single source of truth for HR to sign off on the absence, adjust absence banks, and then automatically involve payroll to ensure accuracy of payouts.
While absence management in general is a common practice, education organizations must meet regulatory and union requirements that many other industries do not face. Absence banks can include short-term disability or sick time, and they need to be updated by both departments at different times, depending on the situation. ERP software makes this challenge easy to overcome.
Additionally, a platform like Sparkrock allows for position-based attendance plans. When a new employee is hired, a specific attendance plan will be generated to help better manage planned and unplanned absences.
K-12 districts don’t have the relative ubiquity in contracts that other industries might enjoy, where every employee has roughly the same contract. Instead, K-12 employees can have significantly varied contracts for each employee and department.
The terms and conditions in every contract must be met; otherwise, there’s a risk of legal issues and non-compliance. Your chosen platform should be ready to accommodate each role found throughout education, such as:
To make matters even more complex, there are different types of contracts for each of the above roles, such as:
While maintaining your agreements is critical and challenging in its own right, these contracts also inform how you make hiring and budgeting decisions. You’ll need to be ready to answer the following questions to manage finances:
A purpose-built ERP system will help you answer these questions to help manage expenses and available resources. You’ll be ready to handle an employee’s pay grid, work schedules, absence banks, and pay frequencies — all without the time-sink of legacy methods.
Education institutions have unique pay structures compared to other industries, and they can be highly complex, making them harder to manage. Other industries don’t usually have regulated salaries or complicated agreements to uphold.
However, education faces regulations and collective agreements that must be managed without issue. These grids involve a base salary and then additional pay or benefits based on qualifications and experience, varying by specific agreement.
An ideal HRP solution for education allows for configuring pay grids for streamlined management. After the platform is set up, administrators only need to enter the right status to assign the correct salary from the pay grid.
Pay grids can have a wide range of variances that can be easily managed with the right software. Some of the complexities and factors to manage include the following:
Managing these moving pieces with spreadsheets or disconnected legacy systems can be significantly challenging, especially as employees must move between categories.
The right ERP platform allows you to configure and update paygrids as necessary and then apply them to specific employees once. This will significantly save time while ensuring accuracy at every step.
Educational institutions often offer deferred payments so employees are paid continuously over 12 months rather than only the 9 months they teach. The total amount is the same, but payments are spread throughout the year.
When combined with the above pay grids, managing deferrals can be challenging as it changes the specific paychecks for employees. As with pay grids, an ERP platform made for education makes deferred payment structures much more straightforward and less error-prone.
Educators and other employees have salary changes throughout employment, sometimes with annual increases, other times with earning new credentials. Managing these changes is critical to paying employees the right amount alongside having the right balances.
General-purpose ERP software typically has this basic feature built in, but education-focused platforms account for the uniquely complicated pay grids in education. Pay needs to be calculated due to promotions, changes in contract terms, and types of contracts.
In addition, reconciliations or true-ups need to be accounted for as employees start in the middle of the year, retire, or change roles. A true-up balances out any discrepancies between employment changes that don’t neatly align with annual contracts, usually by making a one-time larger payment to balance out changes.
There is a wide range of collective agreements to be aware of in K-12 education, including educators' support staff. Collective agreements with unions must be managed precisely, which we’ve touched on already.
However, pay grids and absences aren’t the only clauses in collective agreements that require careful tracking to make sure these agreements are maintained. A simple error can result in underpayment or mismanagement of benefits, inviting new risks.
Specific terms and conditions must be understood and included in several processes, including paid vacation time and regular pay increases. An ideal platform also provides insights into when a conversation with a union representative may be necessary.
Additionally, grievances might be made by students and employees alike. Effectively tracking and handling grievances is necessary to avoid legal and compliance issues. With legacy systems handling grievance tracking, it’s all too likely that they’re not accurately handled, reported, and resolved in a timely manner.
School districts need to create several reports throughout the year. When depending on legacy methods, employees will need to navigate disparate systems and departments, manually input data into a spreadsheet, and make sure every report is accurate.
Fortunately, leading-edge ERP platforms designed for education know the need for these reports. Instead of a time-intensive manual process, necessary reports can be generated quickly and accurately.
Let’s break down a few of these common reports to demonstrate why overcoming this challenge is critical.
Schools need to generate Records of Employment (ROE), making it an essential feature for an ERP platform. These reports are necessary for employees to claim any benefits, so they need to be accurate and generated quickly — they need to be issued within five days in most cases.
Failing to provide an ROE can create significant issues for claimants that can reflect back on your organization. A purpose-built platform helps you generate them quickly to help move these processes along.
T4 slips are critical tax forms that employees need. A T4 slip should be issued that breaks down taxable allowance and benefits for all employees. These forms are needed for employees to file their taxes, and there’s no room for error or delay.
An ideal platform can generate T4 reports that break down employment earnings and deductions for the year. Relying on outdated methods and legacy systems to generate these reports can invite inaccuracies and delays that can have severe results for employers and employees alike.
Employment Data and Analysis System (EDAS) reports involve data from the public school system. An EDAS report aims to provide workforce management information to support local operations with accurate data for collective bargaining. Additionally, EDAS reports inform how budgets are allocated.
Our platform generates EDAS reports quickly by using data that is already available. Instead of these reports involving manually finding and parsing necessary data, Sparkrock’s platform can generate them with a simple request.
HR, payroll, and overall financial management are always challenging regardless of industry, but education has unique hurdles that must be addressed. Relying on outdated legacy systems and processes can create severe inefficiencies and inaccuracies that may have disastrous results on the educational institution.
Fortunately, modern ERP platforms help businesses handle financial management, human resources, and payroll within a single source of truth. Education ERPs are designed specifically to meet the needs of school districts. A few ways our purpose-built ERP helps school districts include:
Is it time to upgrade how you handle critical processes throughout the district? Book a demo today to see how Sparkrock helps you jump the many hurdles facing modern K-12 school districts.