01 March 2021

Jennifer Morrell, payroll service director for Moorepay, discusses how the pandemic is driving change

Is swallowing wriggly grubs, wrestling with snakes in an underground crate, and lying awake to the deafening snores of Beverly Callard, scary? Not really; no, what really frightens me is on-premise payroll and human resources (HR) software.

Why’s that, you ask? Well, because of the challenges that on-premise software poses for businesses and their employees – something I’ll come back to. But before I do, let’s talk about the uptake of cloud-based software and the impact of Covid-19 on payroll teams.

Both the CIPP’s Future of payroll report 2020 (https://bit.ly/2K3MfBl), and last year’s Moorepay Annual Payroll Survey found that people are – perhaps unsurprisingly – shifting to the cloud. The CIPP found that users of cloud-based software increased significantly from 25% in 2019, to 37% in 2020. Likewise, reviewing the same year-on-year trends, our Moorepay survey findings saw a 14.6% uplift in cloud-based software users.

But what’s surprising is the number of people still using on-premise software. The CIPP’s report states that 37% of their survey respondents are using software that’s hosted on-premise. Similarly, in our own survey, 41% of people said they’re using on-premise payroll software. These percentages amount to hundreds of thousands of businesses, and millions of employees

...the first law of payroll still stands: workers need to be paid on time, every time.

When the initial impact of the pandemic was felt early last year, our sister company Zellis ran a survey that found 98% of payroll team members were asked to work from home.

Combining the large numbers forced into remote working with the hefty numbers that didn’t have access to cloud-based payroll software, it follows that nearly a third (30%) of organisations faced the challenge of losing payroll capacity in March and April 2020 (Covid-19 Measuring the Impact, Zellis)

So, let’s look at some of the challenges on-premise payroll software users have faced.

Resilience – This time last year, organisations across the UK were quick to dust off their business continuity plans. Swathes of business owners and senior leaders were asking questions like: What if this Covid-19 thing spreads across the UK? How will this affect us? Will we stay open? Where will our employees work?

A year on and we can’t quite believe we’re still operating in and out of ‘lockdown’ rules. And we’re not sure what things will look like in the coming year.

What we do know is that the first law of payroll still stands: workers need to be paid on time, every time. And for that, cloud-based payroll software is rather handy. Unlike its on-premise counterpart, payroll software in the cloud makes disaster recovery and business continuity far easier.

Put simply, data that’s in the cloud can be backed-up and ‘mirrored’ in multiple places on a cloud provider’s network. Meanwhile, data that’s on-premise is exactly that – stuck on a server in an office somewhere, forcing users into the office and – in the context of an ongoing pandemic – putting them at unnecessary risk.

Cloud-based payroll software gets rid of the risks associated with storing payroll data in a physical location. This makes businesses far more resilient in the event of scenarios such as pandemics, fires, and floods.

Flexibility – It’s likely that the long-term impact of the pandemic will see an increased demand for more flexible working arrangements.

Back in May 2020, we surveyed more than 2,000 visitors to our website and 56% said they wanted to see a shift towards more homeworking. In parallel, the CIPP’s Future of payroll report shows that 67% of businesses received an increased number of flexible working requests.

Moving your payroll and HR software to the cloud makes it available to anyone with an internet connection and the required logins. This improves flexibility and enables greater work/life balance for those working in the payroll profession.

Compliance – In 2020, we saw the all-new and constantly changing job retention scheme, including flexible furlough rules and frantic claim reporting, as well as statutory sick pay for Covid-19 illness, pension contributions for furloughed workers, and so much more...

Payroll teams everywhere were exhausted, feeling like: ‘this is insania.’ (Peter Andre, you hit the nail on the head, there mate.)

And for payroll providers, it was equally hard to keep up with the speed of change across the industry. Normally, we’d have months (sometimes years) to prepare for new legislation and ensure our software was compliant. Last year, we had just days to figure it all out and deploy the necessary updates.

Thankfully, with cloud-based payroll and HR software, we were at least able to administer the changes themselves quickly, with ease, and of course, remotely (which meant safely).

In summary
Cloud-based payroll and HR software isn’t the future – it’s the here and now. And for the payroll profession, the trials and tribulations of this last year have reinforced the importance of moving to the cloud.
Don’t ignore the cries of your payroll comrades, stuck in the office with software that’s not compliant, screaming “I’m a payroller, get me out of here!”


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