The Future of Payroll – credit where credit’s due

Over the past 25 years, the Payroll function has evolved and is now recognised as a profession in its own right! Approximately 32.5 million employees are paid in the UK every year. No matter the size of your Payroll with... Read more

Blog26th Oct 2018

By katy Christiansen

Over the past 25 years, the Payroll function has evolved and is now recognised as a profession in its own right! Approximately 32.5 million employees are paid in the UK every year. No matter the size of your Payroll with continual changes to legislation, flexible working arrangements, GDPR, salary exchange and auto enrolment to name just a few, few people will disagree that Payroll is complex…

Individuals processing Payrolls may find themselves locked in a monthly battle between HR and Finance as there is often considerable overlap between the various departments. However, this begs the question, where does the Payroll function sit best? With benefits evolving and employers providing a more flexible environment for their employees, is Payroll becoming a department that falls more in line with HR or is it shifting over to Finance who want control over the facts and figures?

In recognising these complexities, consideration needs to be given as to whether we truly are supporting our Payroll teams. As businesses grow and focus on technology and efficiencies, care should be given to not overlook your Payroll department! Payroll software providers are working endlessly to ensure their systems are compliant with legislative changes and providing the required support to all Payroll professionals in the UK, but internally are employers supporting their Payroll department? Do you have legacy HR and Finance systems that do not share data with your Payroll system resulting in an increase in manual data input, time spent processing and costs? Do you have a monthly cut-off date which more often gets pushed as everyone always wants to squeeze through a last minute monthly change?. These scenarios are common, but no one appreciates the impact  this has on the Payroll professionals and the time involved in ensuring Payroll is processed accurately.

Payroll departments can sometimes get some stick… Most people’s perception is that these days Payroll is fully automated and that everything can be processed at the click of a button – we wish! If something goes wrong in Payroll, everyone knows about it but why is this? It is so important to get pay calculated accurately and remitted into the employee bank accounts on time. The impact Payroll errors have can be extremely detrimental to the relationship between employee and employer. It is a sensitive topic. If errors do occur it often has a financial impact on an employee and due to the delicate nature of it, the talk around errors can seem louder than errors in any other departments.

Supporting your Payroll team to provide them with an environment and technology that works efficiently and seamlessly in what is a very time restricted, complex process is a must for any business. Payroll professionals are only human, errors do happen, but a focus on supporting the Payroll function with technology, streamlined business processes and sticking to the agreed procedures and timelines can help reduce the probability of error. If it goes wrong, an unhappy workforce will have a huge impact on company morale, not to mention the potential penalties and fines for non-compliance with HMRC.

When reviewing business strategies and technology enhancements, please consider your Payroll department as an integral component to ensure business success. Consider your options, support the current day and plan for the future! It is not just HR and Finance – its HR, Finance and Payroll working together for the benefit of your business and its employees.

A2+B LLP can help your business plan for the future. Should you be interested in a business process review focussed around Payroll, or even just want the peace of mind that you are operating Payroll in the most efficient and accurate way possible then please get in touch with or your usual AAB contact.

To find out more about Katy and the Payroll and Employment Taxes team, click here.



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