More than a process
01 April 2020
Brian Sparling ChMCIPPdip, senior manager, Global Managed Payroll, Ceridian Europe, explains that to add value unlock payroll data
As payrollers, traditionally when we do our job no one notices us. Being paid accurately and on time is a reasonable expectation from employees, so it tends to be the case that when we hear from colleagues, it’s when there is a problem with their payslip. When was the last time someone got in touch to thank you for processing their pay accurately?
However, as businesses plan for growth, our partners from within the wider organisation fall under increasing pressure to extract value from people, processes or technology. Payroll, with access to the people data which often constitutes the highest expenditure within the business, can identify insights into optimised work force planning, productivity and financial forecasting.
So, here are some examples of where we think payroll can be much more than a functional process.
Now more than ever, human resources (HR) executives are responsible for understanding how efficient and effective their teams are at recruiting and retaining the best talent, and where they can help unlock business value.
Utilising technology to capture, monitor and analyse payroll data will enable the HR team to benchmark key performance indicators against both the company’s past performance and against peers, and understand how those key performance indicators have been trending over time to help them make better business decisions.
The payroll data can quantify the value that can be created by incremental improvements and recommend where organisations can focus to maximise value creation.
Improved financial visibility
A global system of record with a real-time view of payroll data, can be game-changing – both from a control and financial savings perspective. Consolidating payroll data and processes can make organisations, particularly geographically disparate operations, standardised and more efficient businesses.
Increased visibility also allows leaders to make data-driven, strategic decisions about people. For example, accurate forecasting five years into the future can shift how we approach headcount management from an individual basis to managing full-time equivalents, which helps with benchmarking and scenario planning.
Better employee engagement
...allows leaders to make data-driven, strategic decisions about people...
An overheating employment market fuelled by record low unemployment rates and a high number of unfilled vacancies then means that it’s increasingly important to ensure that your top talent are happy and engaged.
For your people, how, when and how much they are paid is one of the most important reasons they come to work. Payroll can play a critical part in ensuring your colleagues remain informed and engaged.
By giving your people access to their own payroll record will let them check how much they’ve earned in the pay period so far, how much they can expect to be paid, and enable them to update banking and tax information on demand.
If this information can be delivered on their personal devices, it makes it so much more accessible and encourages ongoing engagement with the payroll team.
Optimise workforce planning
Employee salary tends to be one of the largest outgoing spends for most companies and organisations. So, to have information which can help extract as much productivity out of that spend can have a significant impact on the bottom line.
In workplace environments with complex shift patterns, such as manufacturing and retail, workforce management software helps to ensure managers stick to company budget guidelines.
Warnings can be set up to flag labour costs, such as overtime, that are outside the budget and need to be resolved before pay can be finalised. Managers can then make changes to shifts to make sure everything is on target.
Tax filing can be a challenge when trying to keep up with ever-changing legislation, working time directives and complex employee situations. It’s little wonder that remaining compliant was one of the post ‘popular’ issues that leaders identified as keeping them awake at night in a recent Ceridian survey.
There are many components to manage including employee records, compensation, wages, bonuses and deductions. Taxes and benefits need to be properly deducted and paid, wages must meet minimum requirements, and retirement funds must be placed into the proper accounts. All these steps need to occur within the complicated framework of government tax and regulatory requirements.
With a watertight process supported by a robust system, the payroll team are able to not only manage compliance, but demonstrate it to leadership, internal or external auditors at the few clicks of a button.
This article was featured in the April issue of Professional in Payroll, Pensions and Reward magazine and was correct at the time of publication.