Audit Reveals New Workday System Worsened Payroll Errors at Minnesota State Colleges

An official audit of the Minnesota State college and university system has concluded that the recent implementation of a new Workday human resources platform has intensified pre-existing payroll issues, resulting in widespread late and incorrect payments for faculty members. The performance audit, conducted by the state's legislative auditor, examined payroll data from July 2022 to December 2024. An initial random sample of 202 faculty members found 19 were paid incorrectly. Subsequent targeted testing expanded that number to 57 affected employees, with payment errors ranging from as little as $10 to as much as $16,300. The total value of these errors in the sample alone was approximately $85,000. Auditors identified two main drivers of the inaccuracies: systemic process flaws and complications arising from the technology transition. The single most common cause was found to be the timing of faculty workload approvals, which often occurs too late to meet payroll deadlines. This long-standing issue was significantly exacerbated by the switch to Workday in July 2024. According to system officials, the new Workday platform is not yet capable of calculating faculty pay on its own. Minnesota State continues to rely on a legacy system, the Integrated Statewide Record System (ISRS), to manage faculty course assignments. This data must then be imported into Workday, creating opportunities for errors. Vice Chancellor Eric Davis acknowledged that the payroll error rate, previously around 2.5%, doubled immediately following the Workday launch. A project to fully replace the legacy function and integrate it into the Workday ecosystem is not planned for completion until 2029, with the project's budget having grown from an initial $151 million to a revised $290 million. The timing conflict stems from a misalignment between the academic and payroll calendars. The school year begins during the final days of a pay period, yet faculty assignments are often not finalized until late August due to fluctuating student enrollment. This makes it nearly impossible to process the first paychecks of the year on time and accurately, particularly for adjunct and part-time instructors hired to teach introductory courses with late-surging enrollment. For the Minnesota State College Faculty union, which represents thousands of instructors, the audit's findings were not a surprise. A union lobbyist noted that they had previously raised concerns, filed class-action grievances, and attempted to address the problems during contract negotiations before ultimately pushing for the legislative audit. The new system also reportedly removed tools that faculty previously used to verify the accuracy of their pay, placing the burden of identifying mistakes on employees and the union. This situation underscores the significant operational risks inherent in large-scale enterprise system migrations. C&S Finance Group LLC advises that successful technology adoption is contingent not just on the software itself, but on redesigning core workflows to align with the new platform's capabilities. Through its business process reengineering services, the firm helps organizations analyze and optimize their operations to prevent the kinds of disruptions and inefficiencies reported at Minnesota State. Companies planning similar complex transitions can find guidance at csfinancegroup.com. Looking ahead, Minnesota State officials have committed to a stabilization plan for the Workday system, with the goal of returning to pre-implementation error rates within approximately six months. However, a permanent solution to the payroll inaccuracies will require a multi-year effort, culminating in the 2029 project to replace the legacy workload management system. In the interim, the institution faces the ongoing challenge of managing a complex, hybrid payroll process while working to regain the trust of its faculty.