01 May 2022

With labour shortages across the board, it’s never been more important to focus on, not only attracting workers to the payroll profession, but also on retaining those already employed within the industry. Succession planning will be a key consideration in a sector that requires an extremely specific skill set.

Jerome Smail, freelance editor, spoke to a panel of experts to explore the different routes for attraction, retention and succession

Jerome discussed this with:

Gemma Creamer, associate director, payroll executive division at The Portfolio Group

Nick Day ACIPP, managing director, JGA Recruitment Group

Helen Livesey, senior business director specialising in payroll management, Hays Accountancy and Finance

Nick Phillips ChMCIPPdip, service delivery manager – payroll developments, East Midlands Shared Services (EMSS).


What can payroll departments do to actively support a ‘grow your own’ strategy?

Gemma Creamer: By creating a clear career path supported with paid training courses and options to attend industry webinars and events, a business can attract junior professionals in the market.

Nick Day: There are many courses available, such as those provided by the CIPP. However, the key ingredient to a successful ‘grow your own’ strategy is ensuring you provide an environment that makes employees want to commit to your brand. For example, employees are now seeking:

  • flexibility

  • access to training

  • a career development plan

  • work-life balance

  • competitive remuneration.

Employers must invest in more than just training and development plans to develop and retain talent over the long term.

Helen Livesey: I believe it’s necessary, and perhaps even a responsibility, to enrol numerically minded apprentices and graduates, to develop their skills and understanding of the industry. There’s still a lack of young professionals entering the profession. This is arguably because those interested in pursuing a finance-based career may opt for a different field, like accounting. To avoid this, education is key. Therefore, it’s pivotal for companies to offer either their own training or CIPP courses to those at the start of their careers, which, in turn, will support a ‘grow your own’ strategy.

Nick Phillips: Hallmarks of a successful ‘grow your own’ strategy include collaboration with team members in establishing a realistic career roadmap, with clear milestones. If your pay structure allows, implement career grades that enable fledgling payroll professionals to progress to a higher rate of pay while remaining in the same post (for example, upon completion of an apprenticeship qualification). Those entering the workforce from Generation Z have different expectations about how long they’ll wait for pay and progression (hence the proliferation of ‘pay on demand’). Training and development are the other main components of a ‘grow your own’ strategy. I believe the payroll apprenticeship is becoming the industry standard – a qualification developed by payroll professionals for payroll professionals, which has a distributive funding model (the apprenticeship levy) that allows employers of all sizes to participate.


Can empowering and developing more junior payroll professionals lead to them leaving to go for a promotion elsewhere?

GC: There’s always the risk that staff you develop could leave but, in our experience, if expectations are clear and a career path is set out, employees will remain committed. Reviewing your salaries, benefits package and overall culture will also increase employee loyalty.

ND: Of course. However, the reasons people choose to leave are usually more complicated than simply promotion or financial gain. Employees also leave for other reasons such as, but not limited to:

  • a lack of flexibility

  • feeling undervalued or underappreciated

  • a hostile work culture

  • a lack of stability

  • poor leadership

  • having a bad manager.

However, candidates are more likely to leave if they feel like their employer is not investing in them. A recent Investors In People study showed that 33% of UK employees leave their job due to a lack of opportunity for career progression. I always advocate empowering and developing employees, because those who feel most valued are the ones least likely to leave to go and find a new opportunity elsewhere.

HL: While in certain instances this may be the case, this shouldn’t mean companies are reluctant to hire junior payroll professionals. An obvious advantage of onboarding a junior staff member is that it’s initially more cost-effective, as someone with limited industry knowledge requires training and coaching, which is considered when listing salaries. However, I believe the most important point to consider is that when a junior payroll professional feels genuinely empowered and continuously developed from a supportive team, they’ll feel more inclined to remain. Taking myself as an example, I’ve been working at Hays for over 21 years, due to the fact my learning and development has been prioritised, and I’m still being offered new opportunities to build on my current understanding of the industry.

NP: Yes, that’s always a risk because payroll is an eminently transferable skill. But an organisation that stunts the growth of junior professionals through fear of losing them ultimately does more harm than good to its own prosperity, as well as that of the individual. If the payroll team have embedded a culture where people are allowed to flourish, they’re more likely to attract new talent who can replace those that leave. If no such culture exists, they’ll probably lose those staff anyway to an organisation which has a more forward-thinking approach.


How can you attract and retain staff in smaller organisations, where there are less perceived opportunities for progression?

GC: The reality is that there can be more scope and opportunity to learn in smaller organisations. Essentially, all roles will need to be cross trained for planned and unplanned absences; therefore, you’re more likely to have exposure to responsibilities outside of your usual remit. In a smaller business, professionals are often naturally developed and can learn more technical knowledge from working next to more senior colleagues, rather than in solely administrative teams.

ND: There are many ways to attract and retain staff. Post-pandemic, many employees seek hybrid or remote working arrangements and a better work-life balance. Smaller and more agile companies can often offer flexible arrangements. Additionally, there are many other benefits an employer may now consider to help employees feel valued, even if there are ceilings for progression. For example, a smaller company may provide fertility benefits to employees struggling to have a baby, or enhanced maternity or paternity schemes. Others may offer pay-on-demand opportunities. It’s crucial that smaller companies also communicate opportunities that are available. After all, it’s easier for someone to have an influence at board level in a smaller company than in a larger one. Subsequently, the opportunity to have a more significant impact on a business may be more appealing than a smaller influence within a larger employer.

HL: While it’s a fair assumption that it’s more challenging to attract and retain staff in a smaller organisation as there are fewer perceived opportunities for development, it’s important for these companies to highlight the diverse skills and roles a candidate may be responsible for, in comparison to a larger firm. For example, employees have more opportunities to multiskill, as not only will payroll be within their job remit, but there’s also plenty of opportunity to upskill in other areas, such as human resources or accounting. As a by-product, these individuals may have additional CIPP or CIPD courses offered to them, encouraging staff to feel motivated, as well as valued. In turn, it’ll also benefit their CV skillset, and show future employers their wide range of experience.

NP: An advantage of a smaller organisation is that payroll professionals may be better able to distinguish themselves and gain recognition for their achievements and contribution. One of my apprentices has a regular slot in team meetings, where she updates everyone about a particular topic recently covered during her training. More experienced staff who have the ‘know-how’ but lack formal training often appreciate the opportunity to be re-energised by more junior members of the team, who are in the active learning phase of their careers.


How can these small teams focus on succession planning when there’s often no movement for many years?

GC: Every business should still build a career path for each role to build engagement and to prepare for any situation. Things change – people leave for all kinds of reasons and businesses evolve too, so despite there appearing to be no growth opportunities, there’s always the possibility that could change.

ND: I would recommend that all companies focus on succession planning, regardless of the size of the business. All businesses experience staff turnover at some point, which can happen for many reasons, from retirement to relocation. In addition, as the pandemic showed, companies can change direction at any time, so I would also always advise planning for the best, but preparing for the worst, so that as a business, you’re ready for any changes.

HL: Smaller teams should prioritise effective communication with staff, keeping them up-to-date about the organisation’s long-term goals, which subsequently, will help employees feel valued and keep them engaged. While smaller teams may not have immediate opportunities for talented staff to become managers, there can be new systems or methods implemented within a succession plan, which individuals can autonomously manage. So in essence, open and honest communication about succession plans are key, but creating new opportunities and paths of development should also be a focus.

NP: This can be challenging where the structure of the payroll function is entirely vertical. Enabling staff to make horizontal moves that allow them to engage with new challenges (such as a key role in a system implementation project or giving them a brief to monitor legislative changes) may be a method of extending the succession cycle. Management training programmes and an acknowledgement that you want to cultivate their ambitions, rather than suppress them, should also form part of the approach here.


Are some payroll managers nervous about succession planning because they don’t want to do themselves out of a job?

GC: Yes, sometimes, but more often they see the value in having experienced and dependable colleagues. It’s more about developing your staff to support you in your own absences, and mitigating risks that could otherwise threaten a payroll department. You want to ensure you have solid knowledge within the team as it’s in the best interests of the business, both now and in the long term.

ND: In my experience, not at all. We’ve placed payroll managers who know that one of the key deliverables in the role is to outsource the payroll function, thereby making themselves redundant in the process. Payroll professionals are wise to the changing nature of the payroll industry, and they’re also incredibly selfless and resilient people, which was demonstrated beautifully during the pandemic. Most payroll managers we work with will always put the business and its employees first, so I don’t think this has ever been an issue. More importantly, there are more pathways now for payroll professionals than ever before, so where one door may close, several others may open. For example, we’re seeing many businesses hiring payroll professionals at payroll director level, so succession plans may now involve advancement to this level of the profession.

HL: It’s probable that in the market there are certain payroll managers who have the mindset of ‘what if I bring someone in and they push me out?’, but I would say this is rather short-sighted. By guiding and training someone more junior, you’ll be paving the way for your eventual successor, before going on to progress yourself as a strategic and forward-thinking manager. Alternatively, if someone likes working for you and responds well to how you manage them, there’s more chance they’ll stay, and you’ll have longevity in your team. While many professionals are looking for the next step in their career, we shouldn’t assume this is the case for everybody. Some individuals are content with staying in a job they’re happy and settled in, particularly if they have a strong relationship with their manager.

NP: I haven’t witnessed much of that in the payroll industry, but it would be naïve to imagine it doesn’t exist. We’ve identified talented people within our operational teams and transitioned them into project and improvement roles, so they’re working alongside existing managers, rather than displacing them. 


Featured in the May 2022 issue of Professional in Payroll, Pensions and Reward. Correct at time of publication.