Whatever computer systems design solution is used, it is recommended that a process be considered for employee verification of information after the Y2K adjustments are made. This verification procedure could take the form of a printout of all relevant data on each employee in the workforce and the requirement that all employees signify written acceptance of the information on this hard copy.
If the verification process were staged, by employee group, over time, corrections and supplemental information could be incorporated into the employee information system over a span of several months. Thereafter, unless the verification process were seen as fraudulent or misleading, once an employee had the opportunity to correct information, any information not corrected by the employee would, in most cases, be held to be accurate for the future. The extra staffing required by this individual employee sign-off would appear to be a worthwhile investment, especially where compensation and related benefits computations are complicated.
An important concern is that if there were a substantial change in an employee information system that resulted in an error in, for example, the calculation of compensation, unless that error is dealt with, the potential for years of back pay liability exists should the error later be found. A further concern is that a non-disclosed error, which has the effect of, for example, reducing retirement benefits, may not be cured by a waiver, which relates only to disclosed information about the calculation of retirement benefits.
The conversion of payroll calculation software can result in slight differences in actual pay, depending upon how the software system deals with such issues as the exact hour(s) of the workweek, employee cost sharing for benefits, the calculation of withholding and federal employment taxes and the computation of employee payroll deductions for tax sheltered income deferral plans. These slight differences may result in a few dollars difference in take-home pay at the point in time when the conversion takes place.
To avoid widespread confusion and morale among members of the workforce, when changing software to accomplish solutions to the Y2K problem, explain well in advance of the conversion that there will be slight differences in the final paycheck numbers and consider adding a one-time "conversion bonus" in a small dollar amount to preclude the need to deal with each employee on minor differences.
Compensation and benefits are mandatory subjects of bargaining under the National Labor Relations Act. During the period between contract negotiations, an employer may not make any unilateral change in the terms or conditions of employment that are covered in the Collective Bargaining Agreement. Any change in the method or means of calculating pay or benefits which would result in any difference in compensation paid to union members cannot usually be done between contract bargaining without the Union's consent.
In approaching this matter, bear in mind that a union may seek to open up the contract to a broad number of compensation issues during talks, which the employer initiated solely to deal with a computer conversion to manage the year 2000 issues. There is some labor law to the effect that if the parties agree to reopen negotiations over any aspect of wages, they have, in effect, agreed to open up the entire subject. Therefore, great care should be exercised in broaching the subject of a Y2K change in the computation of employee compensation and benefits in a union environment.
Finally, if contractors are retained to structure a solution to the Y2K issues in an employee information system, that contract should contain representations and warranties regarding the performance of the system after any changes. Unless a contractor is willing to be financially responsible for the continued accuracy of the employment information system, over time, it may not be possible to protect the employer from financial liability for subsequently discovered errors.