Y2k bug could bite employee paychecks, Companies lack backup payroll plans, study says

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Y2K bug could bite employee paychecks Companies lack backup payroll plans, study says

By Stephanie Armour USA TODAY

As the new year approaches, serious questions remain about employers' abilities to pay workers in the event of Y2K problems.

Many companies have taken steps to ensure all systems will work, but others are just now putting aside extra money or preparing a full month of payroll in advance. If computer glitches occur, experts warn some employees could find themselves facing 2000 without a paycheck.

''Most small-business owners that process their own payrolls are aware of their need to take steps to prevent Y2K-related computer problems,'' says Aida Alvarez, administrator at the U.S. Small Business Administration. ''But there's another group that's vulnerable, and that's the business operator who has his or her payroll done by an outside service.''

A survey by the Society for Human Resource Management (SHRM) found only 35% of responding companies had made contingency plans for payroll problems. Examples include having enough cash on hand for at least one payroll in case accounts can't be accessed.

Some companies do no not expect to be compliant until next month.

''There are many companies that are still making backup plans and preparations,'' says Thomas Keebler at consulting firm Towers Perrin. ''Some are processing payroll ahead of schedule or cutting checks and getting them out early.''

Even companies that have taken steps worry about others who have not.

''Large companies have this all figured out. Small companies may be where the issues are,'' says Raymond Ochester at Automatic Data Processing (ADP), which handles payroll for more than 200,000 companies nationwide. ''Do I believe there are going to be issues? Sure. There will be issues.''

To avert problems for its clients, ADP ran a simulation earlier this year to test its computer systems. It also set up contingency plans so that if a region or processing center loses power, the work can be shifted to another location.

Millennium Payroll Services in Burr Ridge, Ill., which handles payroll for more than 500 firms, has tested systems to ensure they're compliant. It's also set up two backup power sources to keep systems functioning. Except for the major holidays, employee vacations have been banned through February.

''There are an awful lot of companies that haven't done a whole lot, and it's really going to affect them,'' says John Trahey, sales vice president. ''People's checks may not be there.''

Adds Kristin Accipiter at SHRM: ''Employers have been looking at the computer and technology side so long. Maybe they haven't paid enough attention to issues that affect employees.''

-- Homer Beanfang (Bats@inbellfry.com), November 29, 1999



Klinton says we're 99% ready, so you don't need to post the truth anymo........

So what if an awful lot of sheeple don't get paid, we'll just refer them to NABOB (National All-Is-Well Bank of BFE) for a loan.

Keep postin'

-- PJC (paulchri@msn.com), November 29, 1999.

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