Every HR manager and payroll professional knows that there’s more to a paycheck than meets the eye.Countless hours, not to mention tons of stress and anxiety, go into payroll preparation. This is not just a pointless assumption.
Payroll experts echo the complexity HR managers face in preparing payrolls. Here are some of their insights:
- “The list of elements that make up payroll is endless,” says senior policy and research officer at the Chartered Institute of Payroll Professionals (CIPP) Samantha Mann. She added: “Under-resourced people in payroll are struggling. This complexity is tripping up well-qualified professionals.”
- “It is becoming complex and the rules and regulations that you are complying with change. There are a lot of things going on that employers have to know about,” explains CIPD performance and reward adviser Charles Cotton.
As every HR manager knows, all paycheck mistakes, regardless of the amount of the error, take the same amount of time and energy to fix.
Inaccurate payroll results in unhappy employees and possible penalties for a company. Looking at it from this perspective, you might think that the significant number of hours spent on payroll should be worth it. However, HR managers are always pursuing ways to save time on this task.
How do I get started and save time on payroll-related processes?
Create a manual for standard payroll policies and procedures
Guess what? One of the painstaking payroll-related tasks HR managers need to do is to repeatedly answer questions and clarify rules and processes.
One way you can save time on this is to create a comprehensive payroll manual to be distributed in print or electronic version. This will require some time to plan, strategise, and execute at first, but the return on investment is well worth it.
Include the following basic information in your payroll manual: pay periods, tax deductions and PTO policy. Make sure that you make it an employee policy to consult the manual first before approaching HR for clarification. You can also make this a part of your employee handbook if you have one.
Develop a checklist to ensure compliance
Create a standard checklist for any and all payroll-related tasks that require compliance. Make sure everyone understands how to use the checklist through proper orientation and instructions. Further, perform regular audits to make sure your checklists remain up to date and useful.
Systematise data entry into your payroll software
Streamlining and standardising how you get data into your payroll will save you significant time and minimise the risks of errors being committed. Here are a few tips on how you can do this:
- Use Excel spreadsheet templates to get the information you need from individual managers. If your business has several branches, these templates will also be useful in making the process intuitive and straight-forward.
- Make sure you control the information that the individual managers provide like hours worked, bonuses and overtime. Ensure that you have strict deadlines in place that everyone follows. This will allow you to double check the accuracy of the information that you’re going to receive.
If you have a HMRC (Her Majesty Revenue & Customs) vetted payroll software in place, you should be able to import these spreadsheets directly into the system, saving you hours from manually entering the data. This process should be quick, secure and straightforward.
Implement an automated time tracking and attendance software
While implementing templated Excel sheets saves you time, using an automated time tracking and attendance software will supercharge your payroll productivity. Not only that, it will save your company a significant amount of money from paying wages for inaccurately reported work hours.
According to Experian, the payroll fraud rate in the UK is estimated at 1.7% and costs the UK economy £12.7 billion annually.
Even if your employees are completely honest, manually filling out time sheets is prone to honest mistakes on how they record and report their time.
An automated time and attendance software solves all these issues, plus the following benefits:
- Improves accuracy of payroll data
- Boosts security by calculating claims vis-a-vis the hours worked and absences incurred
- Saves HR managers time not only by reducing manual keying but also in correcting erroneous time entries
- Improves staff productivity and overall employee morale
Accurate time tracking coupled with a robust payroll software is a powerful one-two punch HR managers could have to save time on payroll preparation.
Embrace other technologies
It’s estimated that 4 out of 5 adults in the UK now own a smartphone, which means that almost 100% of the workforce is used to receiving important information on their mobile devices. HR managers can take advantage of this and deliver important payroll information to employees’ smartphones.
For instance, instead of printing and distributing payslips, you can opt to switch to electronic payslips that employees can access from their mobile devices. In addition to saving time, it will also save your organisation money. According to the CIPP, those who switched from paper payslips to electronic payslips saved between £1,200 and £6,000 annually depending on the size of the organisation.
Aside from electronic payslips, you can also use technology to deliver communications to employees regarding their P60s and pension.
Less payroll time, more HR tasks accomplished
The dread is real - while everyone in your company gets excited whenever payroll comes around, you get anxious knowing the enormous amount of work required to ensure paycheck accuracy and labour laws compliance.
The fact is, as an HR manager, you have other things on your plate aside from payroll. These are equally important things such as talent management and development; responsibilities that impact your organisation’s growth. These should not take a back seat because you’re spending excessive hours preparing payroll.
Smart payroll decisions, automation, and simplification will eliminate unnecessary manual payroll tasks, decrease errors, and ensure compliance, saving you hours along the way. At the end of the day, pushing for these changes don’t just benefit HR Managers and their departments, but the entire company as well.