At Maersk Air Cargo, payroll is much more than numbers and transactions

For Nickolas Kofod Wilk, Head of HR & Payroll at Maersk Air Cargo, wages aren’t just something a company pays its employees for the work they do. He considers payroll an essential part of the overall employee experience and believes that, if managed correctly, it can foster trust that extends far into the business.

Nickolas welcomes us to Maersk Air Cargo's office in Lyngby north of Copenhagen, where we will, among other things, talk about how he, as the leader of the HR and payroll department, has grand ambitions to leverage payroll as a catalyst for enhancing the overall employee experience.

Nickolas has a background in HR, and though the numerous intersections between payroll and HR have meant that he has always had a relatively close collaboration with Payroll, it is only recently that he has taken on direct responsibility for the area. 

This responsibility has made him even more aware of the connection between HR and Payroll and what the two areas can learn from each other than he was before. 

"My focus is on creating a good 'employee experience', and I have traditionally done this from an HR perspective," he explains. "But I have become more aware of how crucial an element payroll is in the employee experience than I was previously." 

"And because HR is an important contributor to Payroll, it makes sense—at least for us—to combine the two teams. So if Payroll faces a challenge, HR is right next door, and we can quickly find a solution and move on," he explains. 

Because in Payroll, everything just has to work. 

"No one calls Payroll to say: Wow, you're doing a great job—I've received the correct amount for 12 months in a row," he says with a smile. 

But in fact, Nickolas doesn't always feel that it makes a big difference in the daily routine that he has taken on responsibility for the payroll area. 

"As the leader of a department and a team, I consider it my primary task to have a long-term vision and ensure that we are moving in the right direction. And I also have payroll specialists on my team who have the more specialised, professional insight." 

But to lead the payroll area and create a strong lin between Payroll and HR, Nickolas has had to get to know the payroll field. 

"I am a trained psychologist, so it was not in the cards that I should know a lot about reconciliations and internal audits, etc., but fortunately, I like to learn new things," he says. 

In this regard, Nickolas has relied on the team's payroll specialists and gained knowledge from Basico's payroll book ‘Din guide til lønprocessen’ (only available in Danish ‘Your Guide to the Payroll Process’). 

"And I'm not saying this to flatter anyone, but the payroll book has been very welcome because it provides an overview of the tasks and challenges and breaks the area down in a way that is easy to understand – even for someone like me, who is new," he says, adding with a smile: "If someone from the payroll team is sick, I can't run the payroll, but if we need to decide how to handle vacations, I can use my new insight into the area to make an informed decision." 

Nickolas and the rest of Maersk Air Cargo's HR and Payroll department have particularly used the payroll book to create a professional language and ensure that everyone has a common basic understanding of the area – a basic understanding that the department is happy to share with the rest of the business. 

"We have created a roll-up with the book's payroll model and our 'employee experience' model because they fit so well together," says Nickolas. 

The payroll model makes it easier to see where potential challenges arise in the payroll process. "I consider the payroll model a diagnostic tool," explains Nickolas. "If we don't pay correct wages, what is the reason? Is it because we received incorrect data? Or are the processes not working, or something entirely different?" 

"We are a house that has traditionally been working much in silos. And here, the payroll model makes it easier to understand the connections and where the responsibility for the different areas lies," he explains. The HR & Payroll department also uses the payroll model to show their colleagues where the problem lies if something goes wrong: "If a manager who doesn't necessarily understand the complexity of payroll asks us why their employees haven't had their vacation transferred, we can take them over to our roll-up of the model and show them which category their problem belongs to and explain what it is their responsibility to deliver so that we can solve the problem together," Nickolas explains.

The common understanding of the payroll area and Nickolas' team's insistence on making the payroll area more accessible to their colleagues have created new opportunities for dialogue. 

The payroll model has made it easier for the payroll team to provide a comprehensive, confident response, making employees feel heard and assured that things are under control. And this has gradually built a higher level of trust in the organisation. 

"And we have started to get a more structured overview of processes, functions, roles, etc., which also helps create a better relationship with union representatives and professional organisations. Because when we can quickly share an analysis with them and show exactly where something went wrong, we can better discuss how to solve the problem together. And from an HR perspective, this is something that can help bring us together culturally in the organisation instead of standing in separate corners." 

According to Nickolas, this is also a good argument for having HR and Payroll in the same department. "It allows us from HR to develop Payroll into an active contributor to the good 'employee experience'," he says. "We deliver a service to our clients, who are all employees of Maersk Air Cargo. And my claim is that the processes and working with them make us more aware of the output – and the kind of service that we deliver." 

A key to Nickolas' and his department's work with processes is that they have acquired a dedicated project tool, which currently contains about 25 clearly defined and described processes – a number that grows as the department maps more processes. 

And the process tool has many advantages. For example, it generates a visual image of the written process description. 

"For someone like me, who is very visual and also at a more overall level, visual illustrations provide a lot of value," says Nickolas. "And if you are more of a lawyer type or are working in auditing, you can read the more detailed process description if you prefer," he adds. 

Having the processes system-supported also enables Nickolas and his department to share them with relevant stakeholders in the company. Initially, the auditors will get access to the processes in connection with audits, but the intention is that the rest of the organisation should also be able to provide feedback on the processes so that they are always updated and accurate. 

"We are just getting it up and running, so we haven't yet reached the point where it operates naturally. But that's how they should be used," explains Nickolas. "We have introduced Finance to some of the processes so they could provide input. So it's slowly starting to come to life, and the next step could be inviting relevant employees from the business where it makes sense." 

The next thing that needs to be done is that Nickolas and his team finish documenting all the key processes. And then they will start automating. 

"Our team needs to become more efficient, and we can do that through automation. For this, we need new systems, including for handling HR master data, which is the source for Payroll. We don't have that today, and it would make the data flow significantly better and easier. And, furthermore, our current payroll system is about to be replaced," he says. 

And as the new systems and workflows are implemented, the processes also need to be updated to remain accurate at any time. "The processes must make sense based on the tools and systems available. For example, some steps may need to be removed because something is being streamlined, or some approvals need to be adjusted. And we can easily do that in our process tool – if the processes were in a pdf, it would require a completely different form of maintenance." 

Before leaving Nickolas and Maersk Air Cargo, we ask for his best advice for others in his situation. 

"When you give advice, it sounds like you think you’re standing on sacred ground," smiles Nickolas and continues: "But if you know as little about payroll as I did a year ago, my best advice would be to read the payroll book first. And make sure that either you or someone on your team has the structure and overview necessary to run an effective payroll department. And besides that, I think it's important to be professionally curious." 

He thinks for a moment and then continues: "One of the things I think you can take with you if you come from HR to Payroll is the understanding of 'employee experience'. And Payroll can often learn a bit from HR – to remember that we are a service unit that should drive a good employee experience. For it also extends to our employer brand and affects how easy it is to attract new employees. I might hypothesise that there is a greater risk of losing that connection if Payroll is in a finance department. But Finance, Payroll, and HR have many intersections, and the better that trinity works, the better the 'employee experience'." 

Nickolas is quiet again for a moment before – again with a small smile – concluding: "That's probably the most diplomatic way to put it." 

Therefore, things may have changed since the publication of our articles - the participants may have moved on to another job, and the world may have been turned upside down by American presidents, Chinese bats, and other change agents - you get the point. Nevertheless, we hope that you'll read our articles and maybe even be inspired by them.