01 March 2021

Jerome Smail, freelance journalist, presents the views of seven industry luminaries

The urgent challenges the pandemic has thrown at the payroll profession mean minds have been very much focused on the present. But there’s no escaping the future, and payrollers need to be prepared for whatever it might bring. But what are the key skills that will be needed going forward?

To find out how the future looks for the profession, I spoke to these leading players in the industry:
Elaine Gibson MSc ChFCIPP MCMI FHEA, director of people and quality, Dataplan
Lou Gray ChMCIPPdip, manager, tax ACR, Ernst & Young
James Paton, UK payroll delivery manager, Activpayroll
Nick Phillips ChMCIPPdip, ESC HR/payroll developments manager, Employee Service Centre
Polly Sinclair MSc FCIPPdip MSET, payroll apprentice tutor, West Suffolk College
Dr Sue Smith EdD MA BEd FHEA FCMI Cmgr Assoc CIPD ACIPP, CIPP education director
Karen Young, director of Hays Accountancy & Finance.

Which skills specific to payroll should professionals in the industry look to develop to future-proof their careers?
Elaine Gibson: Technical skills are still very much key. Okay, so we have sophisticated systems that can churn out payslips but they are only as good as the data input. It is vital that payroll professionals understand why they are inputting information and its impact; otherwise, how can they complete the exception report, checking to ensure the payroll is as accurate as it should be? Employees will always have pay queries and they will require a full explanation of how that net pay was calculated. This ensures you can give your customers (employees or clients) peace of mind that you know what you are talking about, that you are an expert. Under technical skills I also include Excel, which is important for data analysing – edging towards the need for advanced level. However, this will depend on how intuitive your software is but there will always be a need for this skill.
Lou Gray: We need to be familiar with a variety of software platforms beyond standard office software such as Microsoft Office and Excel, gaining experience with dedicated payroll platforms. The future of payroll will evolve to become a world less entrenched in process and more concerned with strategic thinking and data management. Eventually, all payroll departments will possess platforms that incorporate AI, machine learning, robotic process automation and self-service functionality. The daily tasks will increasingly be automated, while interactive chatbots and digital assistants will manage enquiries.
James Paton: It is important that payroll professionals have a good level of IT knowledge and skills as these are key to a successful career in the industry. As technology continues to advance and payroll headcounts continue to grow, payroll professionals should push themselves to keep their technical skills continually up to date. It is extremely important in the payroll profession that individuals have a keen eye for detail; this is a skill that should always be possessed and not be overlooked. The more this skill is utilised, in both work and daily life, the higher the accuracy levels will be when completing calculations, payments and deadlines.
Nick Phillips: A focus on compliance, quality-checking and the ability to self-audit rank highly among the pre-requisite skills required by the modern payroll professional. Increased automation may liberate time previously spent arranging input of timesheets or other laborious tasks, but this will quickly be replaced with the need to ensure systems and processes remain compliant with an ever-changing legislative landscape. An undervalued skill is the discipline required to read and ingest the abundance of legislative material produced by HM Revenue & Customs (HMRC), central government departments and industry publications. If I were to flag three specific areas where payroll professionals should focus their continuing professional development, it would be pensions, benefits in kind, minimum wage compliance. These are areas of increased regulator/HMRC scrutiny, and therefore present potential pitfalls for your organisation.
Polly Sinclair: I think that one of the most important skills for professionals is learning how to develop themselves effectively to move from what is traditionally quite a reactive profession into a proactive one. Over the last year we have seen how important payroll as a profession is and the industry needs to ensure that it takes advantage of this rather than sinking back as a behind-the-scenes, back-office function. I believe when calculations around CJRS are audited and businesses are questioned, it will be evident that those who are properly qualified and committed to remaining up to date are invaluable in supporting the government in enforcing whatever legislation they enact, be it furloughing, minimum wage or tax avoidance schemes.
Dr Sue Smith: The increased integration and closer working between payroll and HR observed across the industry is not wholly driven by organisational desires to reduce overhead costs, but a reflection of the increased impact that contractual conditions place on accurate payroll computations. Similarly, integral to effective talent acquisitions and retention, organisations are formulating ever more complicated reward packages for their staff. Payrollers find themselves increasingly involved in the calculation and administration of such packages. It is a mistake to think that the payroller should remain only responsible for the elements of reward that are solely cash-based. Knowledge of reward principles is necessary to enable the payroll to proactively embrace this development.
Karen Young: More and more of our clients in payroll are looking for advanced Excel skills in potential candidates. Specifically, they need those who have proficient knowledge of pivot tables, macros and VLOOKUP. Developing above-average skills in Excel will significantly help payroll professionals to future-proof their careers and stand out to employers hiring this year. System skills, in particular the ability to streamline and implement new systems, will also be key. A lot of payroll functions have plans to transform their payroll functions in light of our changing world of work, so are on the lookout for these skills – especially in the senior end of the market. In addition to this, a breadth of system experience also needs to be on a payroll professional’s radar.

An undervalued skill is the discipline required to read and ingest the abundance of legislative material...

Which of the so-called ‘soft skills’ are most relevant for a future in payroll?
EG: Understanding that teams are made up of very different skillsets, even if they are performing the same role, helps with team cohesion. Also understand that customers believe they are the only important one, the one that pays your salary! Of course, this applies to all small and medium customers as well as the big ones. Telephone etiquette is important as this is a shop window to your service provision. Learn how to deal with difficult customers as well as the easy ones.
LG: Emotional intelligence is the capacity to be aware of, control, and express one’s emotions, and to handle interpersonal relationships judiciously and empathetically. You need self-awareness (being conscious of your own feelings and motives), self-regulation (pausing and thinking about the consequences of an action before proceeding), motivation (thinking about the bigger picture and assessing how your actions will have an impact), empathy (being a good listener, slow to judge and understanding the needs of others) and social skills (collaborating in a team with strong communication skills).
JP: Traditional skills such as time management, organisation, communication and confidentiality will always be relevant. However, with ever-changing statutory legislation, the CJRS being a recent example of this, adaptability is an important trait to possess. Employers will value their employees a lot more if they can successfully manage change without any major mishaps or concerns.
NP: Establishing and maintaining a network of contacts, whether it be through LinkedIn or bodies such as the CIPP, is an invaluable skill and one which has the ability to create new opportunities or just provide support and encouragement in challenging times. We have a great community in payroll and it’s something we should seek to leverage for all of our benefit. Engaging with new media like YouTube or podcasts is another avenue payrollers should not be afraid to go down.
PS: I think a questioning and sceptical mindset is the most valuable tool for a future in payroll. A professional cannot be expected to keep abreast of every nuance in legislation but by remaining up to date and questioning and challenging information then you would provide the best service to your employer or clients. A big part of this will of course be communication skills as it is not about being accusatory or intimidating but about knowing when to ask questions and to know when further information is needed.
SS: Payrollers have to communicate with a wide range of stakeholders, from employees to heads of other departments, but must do so without confusing the recipient. They are obliged to translate technical jargon into everyday language while retaining the accuracy of the message conveyed. For payrollers, effective leadership and management skills also have a heightened necessity to enable the department to adapt and thrive in a rapidly evolving profession.
KY: In our most recent research, communication comes up as the soft skill which payroll employers say they most need (52% said they require this). This is somewhat unsurprising considering the dramatic shift to remote working in response to the pandemic, which has completely changed the way we work and interact. But remote working looks like it’s here to stay in some respect, so going forward, developing strong communication skills will be incredibly relevant for payroll professionals.

...to be aware of, control, and express one’s emotions, and to handle interpersonal relationships judiciously and empathetically.

Does the constant technological evolution in payroll mean the balance is tipping in terms of the kind of skills needed in the profession?
EG: I believe so. For the foreseeable, I can see the hands-on approach to payroll (by which I mean ensuring excellent technical knowledge) is still going to be key; however, it is apparent that our customers and clients at Dataplan require more than just the payroll service provision. At Dataplan we are already diversifying and provide e-payslips (which does a lot more than the title suggests), troncs, pensions and not just calculations of deduction – we calculate and submit monthly returns for our clients.
LG: Technology is revolutionising our payroll profession and the people who work in it. AI and technology assist with payroll compliance, and if used effectively eliminate repetitive tasks and offer improved data security. The reporting functions powered by the technology empower our business leaders. Payroll data offers managers and stakeholders information to allow them to make decisions for the business tomorrow.
JP: There are certain aspects of the payroll process that will always remain the same, yet no longer is it sufficient to know the normal statutory regulations and procedures. With the ever-increasing corporate demand and desire for efficiency and accuracy, the use of IT and technology is now considered normal. Payrollers are now expected to utilise a variety of IT applications from traditional systems, such as Excel, to payroll software, bespoke internal applications, secure file transfer software, third-party middleware, and everything in between!
NP: Yes, but I am made nervous by the idea that technological evolution is an excuse for payroll professionals to dispense with core skills, such as the ability to perform manual gross-to-net calculations. The challenge for payrollers is that in addition to our traditional skillset, we must now also develop hybrid skills that might previously have been the domain of the IT professional – for example, a greater understanding of releases and upgrades, workflows and more powerful self-service functionality.
PS: Technological evolution really just highlights that while more can be done with our software and systems, it means more onus on payroll adding value to the organisation. Too many businesses buy into a software product based on the sales pitch of what it can do for you and all the data it can deal with, but if there is no one there to interpret that data and translate it into useful organisational change then it is irrelevant.
SS: Perhaps surprisingly, not really. Technological advancement serves to aid diligent and forward-thinking payrollers, but does not replace them or force their evolution into a new being. But the core knowledge and skills required remain the same.
KY: Absolutely. We’re seeing an increased adoption of tech and automated processes in payroll placing emphasis on the importance of IT and system skills. Not only are professionals required to master these skills, but they also need to be able to adopt them quickly in order to keep up with changes in our world of work.

Featured in the March 2021 issue of Professional in Payroll, Pensions and Reward. Correct at time of publication.