Understaffing at Alaska state payroll department causes errors and delays in services

ANCHORAGE, Alaska (KTUU) – The Alaska State Division of Finance’s payroll services team is facing high vacancy rates resulting in the wearing down of morale along with errors and delays in services, which will likely have no end soon.

The payroll services section is in charge of paying Alaska’s 14,000 state employees, but there have been reports of employees getting paid late and sometimes the wrong amount.

The Department of Administration says the vacancy rates of its payroll services team within the Division of Finance have been fluctuating around 45% for some time. In February, the vacancy rate was 35% and now the current vacancy rate is 46%.

Heidi Drygas, the executive director of the Alaska State Employees Association, maintains this ‘snow-balling crisis’ is not a new issue and it’s something the union has been warning about for years.

“When you don’t treat employees well, when you don’t treat them with good pay, with good benefits, like a living wage and a pension, you’re going to lose employees, you’re not going to be able to attract employees to state service and you’re not going to be able to maintain employees who are working for the state and that’s what we see happening,” Drygas said.

Drygas believes the crisis started when the state switched its retirement system from a defined benefit pension system to a defined contribution system. She believes it’s a crisis of their own making as they outsource jobs to contractors out of the state.

“Now we have sort of this foundational backbone of state government paying its employees on time and that’s being threatened — that’s unacceptable,” Drygas said.

Drygas says the notice of pay problems is being unaddressed and unresolved due to the state not having the staff to keep up with the workload. Drygas maintains it’s impacting businesses too by hampering oil and gas leases, fisheries, and others.

“We’re seeing the results of what happens when you take it out on public employees,” Drygas said of fiscal crises that force the Legislature to make budget cuts.

“They are extremely stressed and demoralized, and it’s a difficult, challenging work environment, I mean in a perfect scenario paying 14,000 employees every other week is a challenge,” said Jeff Kasper, the business manager of the Alaska Public Employees Association.

Kasper believes the issue could get really bad and thinks the state is failing to operate basic functions of business.

“There’s no end in sight, they don’t have any hope that this is going to get better,” Kasper said. “I was told they don’t feel like management even knows that they exist. They’re not provided any sort of help from upper management and the Dunleavy administration and that’s where it meets my assertion that this is deliberate, they’re deliberately running parts of government into the ground.”

Kasper agrees with Drygas that they’re contracting the jobs out to private entities, where they’re paying them more, which he feels is not good for Alaska.

Drygas pointed to a solution, and it’s simple — strong leadership.

Ken Truitt with the Department of Administration maintains there are several efforts underway to address the current vacancy rate.

“In the short-term, the Department of Administration (DOA) is reassigning staff that have previous payroll experience from DOA divisions to the Division of Finance (DOF) payroll team and ramping up job recruitment efforts while working to accommodate employees’ abilities to process payroll remotely,” Truitt wrote in an email. “DOA is also securing temporary contract assistance, restructuring the front-end DOA payroll process to streamline the work, and changing the LOA process to ensure those that affect payroll are addressed quickly.”

The state will also be investing in technology and new processes that will in turn increase efficiency within the payroll department. They hope it will also create a more engaging work environment.

“In the longer-term, among other efforts, the State will be shifting to a more standardized, digital payroll process,” Truitt wrote. “This will help to simplify payroll processing, making it significantly more efficient and manageable. All these efforts contribute to a more reasonable load, and more enjoyable jobs, for payroll employees.”

Truitt maintains although it will take time, they’re confident those efforts will improve outcomes for the employees and will provide a solid foundation for the future.

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