New Workforce Institute at Kronos Survey: Payroll Problems Affect 82 Million American Workers

CHELMSFORD, Mass.–(BUSINESS WIRE)–#Engagement–As Americans file their Form 1040 U.S. Internal Revenue Service (IRS)
income taxes ahead of the April 18 deadline, a new survey from The
Workforce Institute at Kronos
Incorporated reveals an estimated 82 million¹ Americans –
more than half of the U.S. workforce – have experienced a problem with
their paycheck during their career. The survey also finds payroll errors
cost both employees and employers more than just dollars and cents.

The “Engaging Employees through Payroll” survey examines the hidden
costs of payroll errors and explores the vital role payroll
professionals serve in building an engaged workforce while directly
impacting the 152 million² workers who make up the American
workforce.

News Facts

• Paid too little, too late, or not at all: 54 percent of Americans
  have had a paycheck problem, while salaried, hourly, and gig (i.e.
  freelance / contract) workers each face different challenges.
  • More than a quarter (26 percent) of hourly workers have been paid
    too little, while 15 percent say they’ve been paid late. Just one
    in 20 – six percent – have been overpaid.
  • For the salaried worker, 15 percent say they’ve been shortchanged
    in their check. Although 16 percent report being paid late,
    another 23 percent say they’ve been paid early – a nice problem to
    have! Nine percent have had a paycheck bounce, though, which is
    more than hourly and gig workers combined.
  • While still a small group, gig workers might be the toughest to
    pay correctly. One in five (20 percent) have been paid late; one
    in five (20 percent) have been paid too little; and 16 percent say
    they’ve had their paycheck direct deposited into the wrong account.
  • Overall, at least 10.6 million³ workers (seven percent)
    have had a paycheck bounce.
  • The survey found, on average, American workers say they must
    likely be overpaid a staggering $463 before alerting their
    employer to the mistake.
  • It would take more, on average, for salaried employees ($735) to
    alert their employer if they were overpaid versus hourly workers
    ($160).
  • Men may be more dishonest than women – over two-times more, in
    fact – as men, on average, would pocket $623 extra before saying
    something, compared with $258 for women.
  • Employees can’t claim they didn’t notice the error: more than
    three-quarters (77 percent) of Americans check their paystub every
    payday to make sure their taxes, withholdings, and overall
    earnings are correct.
  • Almost three out of five employed Americans – 58 percent or 87
    million workers and their families – live paycheck-to-paycheck,
    according to the survey, while hourly employees (65 percent) are
    more likely than salaried employees (52 percent) to report this.
  • Payroll errors have forced over one-third (37 percent) of American
    workers to make a late payment on a bill such as their car loan,
    credit card, mortgage, or apartment/home rent.
  • Salaried employees (45 percent) are more likely than hourly
    employees (29 percent) to have made a late payment because of a
    payroll error.
  • The survey discovered 42 percent of all employees say taxes and
    deductions on their paycheck are confusing to read and understand.
  • Year-end tax forms confuse American workers, too. While half say
    they’re confident they have never had a problem with documents
    such as an IRS W-2 Form, 35 percent of employees have had a
    problem such as a mistake. Another 15 percent admit they do not
    understand their tax forms enough to even recognize an error.
  • Nearly half of American workers (45 percent) say they would feel
    more engaged with their job if their employer helped them better
    understand the impact of taxes and deductions on their overall
    earnings.

  Supporting Quotes

  • Joyce Maroney, director, The Workforce Institute at Kronos
    “Payroll
    professionals support more than 152 million American workers every
    payday – and their efforts often go underappreciated. For
    organizations seeking to gain an edge in their employee engagement
    initiatives, the payroll department is a valuable resource capable of
    making a vital and instant impact. To unlock payroll’s true potential,
    it must be relieved of the burden created by outdated, manual, and
    often spreadsheet-based processes. Providing modern tools and
    technology will not only reduce the number of costly and potentially
    engagement-ending errors, but it will allow payroll experts to excel
    as true knowledge workers capable of taking on a more strategic and
    proactive role in supporting organizational transformations.”

  Supporting Resources

  • See how Kronos empowers organizations with Kronos
    payroll solutions.
  • Learn about Kronos
    Workforce Ready, a unified platform for the entire workforce.
  • Connect with Kronos via Facebook,
    Twitter,
    LinkedIn,
    Instagram,
    and YouTube.
  • Follow The
    Workforce Institute at Kronos for insight, research, blogs, and
    podcasts on how organizations can manage today’s modern workforce to
    drive engagement and performance.
  • Learn about the Kronos
    WorkInspired culture and check out Kronos
    job openings.

  About Kronos Incorporated
  Kronos is a leading provider of
  workforce management and human capital management cloud solutions.
  Kronos industry-centric workforce applications are purpose-built for
  businesses, healthcare providers, educational institutions, and
  government agencies of all sizes. Tens of thousands of organizations —
  including half of the Fortune 1000^® — and more than 40
  million people in over 100 countries use Kronos every day. Visit www.kronos.com.
  Kronos: Workforce Innovation That Works.

  Survey Methodology
  Please cite the above research as the
  “Engaging Employees through Payroll” survey conducted by The Workforce
  Institute at Kronos. This online survey was conducted by Regina Corso
  Consulting on behalf of The Workforce Institute at Kronos between Feb.
  23-28, 2017 among 1,013 employed U.S. adults, aged 18 and older. Figures
  for age, gender, education, income, and region were weighted to bring
  them into line with their actual proportions in the U.S. population.
  Because the sample is based on those who agreed to participate, no
  estimates of sampling error can be calculated. For more information on
  the survey methodology, please contact daniel.gouthro@kronos.com.

  Footnote 1: Calculation based on the U.S. Bureau of Labor Statistics
  report from January 2017 that estimates there are 152.08 million
  employed people in the U.S.: 152.08M x 54% = 82.12 million.

  Footnote 2: Per the U.S.
  Bureau of Labor Statistics report from January 2017, there are
  152,081,000 million employed people in the U.S. (Page 4, Summary Table A)

  Footnote 3: Calculation based on the U.S.
  Bureau of Labor Statistics report from January 2017 that estimates
  there are 152.08 million employed people in the U.S.: 152.08M x 7% =
  10.64 million.

  Footnote 4: Calculation based on the U.S.
  Bureau of Labor Statistics report from January 2017 that estimates
  there are 152.08 million employed people in the U.S.: 152.08M x 9% =
  13.68 million.

  Footnote 5: Calculation based on the U.S.
  Bureau of Labor Statistics report from January 2017 that estimates
  there are 152.08 million employed people in the U.S.: 152.08M x 37% =
  56.26 million.

  Footnote 6: Calculation based on the U.S.
  Bureau of Labor Statistics report from January 2017 that estimates
  there are 152.08 million employed people in the U.S.: 152.08M x 42% =
  63.87 million.

  © 2017 Kronos Incorporated. All rights reserved. Kronos, the Kronos
  logo, and Kronos Workforce Ready are registered trademarks and Workforce
  Innovation That Works is a trademark of Kronos Incorporated or a related
  company. See a complete list of Kronos
  trademarks. All other trademarks, if any, are property of their
  respective owners.

  Contacts

  Kronos Incorporated
  Dan Gouthro, +1-978-947-7310
  Daniel.Gouthro@kronos.com