2018-2019 will undoubtedly bring new challenges for payroll teams so there has never been a better business case for ensuring your payroll systems are used to their maximum potential – whether this means improving current processes or upgrading your system altogether.
We take a look at some of the benefits of implementing the right payroll software and the benefits it can bring to your business…
Using the right software for your business needs
The start of a new financial year is an opportunity to audit and evaluate your payroll processes.
Businesses can change rapidly, and with continuous developments in technology, it’s important to regularly assess whether you are using the most appropriate system for your needs.
Vendors such as Iris and Xero recommend undertaking regular audits of your payroll software so you can check its efficiency and ensure it is still providing value for money.
An audit will not only detect if you need any software upgrades, but it will provide an opportunity to identify any additional training requirements, reducing the likelihood of any human errors.
Payroll systems and GDPR
Payroll departments must pay close attention to how the new GDPR rules will affect the way in which they store and process confidential employee data.
For those in any doubt, payroll departments will be classed as ‘data processors’ under GDPR, as confirmed by the CIPP in their GDPR for Payroll guidance. As such, “there will be the need to adapt to a new way of working to ensure compliance.”
As holders of personal employee information, payroll teams will be responsible for extracting personal data under any ‘subject access requests’ from employees (previous or current). With a reduced 40-day time frame to provide this data, there is a clear need for businesses to invest in a centralised online system that enables them to access this data easily and within required timeframes.
The CIPP also suggest that payroll departments will have the responsibility of reporting any personal data breaches to both the Information Commissioner and any affected employees. Under the new rules, this means reporting any security breaches within just 72 hours.
We would also recommend speaking to your vendor to find out what processes they have put in place to prevent any security breaches.
Cloud-based Payroll Systems
Whilst HR departments have widely accepted cloud-based HR systems, there is a continued reluctance to implement similar payroll systems.
Although cloud-based software has been around for years, many businesses prefer to continue using on-premise systems due to perceived security concerns. However, with vendors continuing to invest in, and develop, new security standards, it could be argued that cloud-based software has the edge in this respect.
CoreHR point out that “As a software provider, there’s a vested interest in ensuring that security standards are second to none, as any potential risks would completely jeopardise the whole business”
It’s not just the security that makes cloud-based payroll systems so effective however.
There are numerous advantages including the ability to access data from anywhere in the world (particularly beneficial for global organisations), automatic updates and back-ups, easy integration with other systems and simplified reporting thanks to real-time data.
Protection against mistakes
Online payroll systems can not only offer more efficient ways of working but can also help you protect against accidental errors.
Providing your payroll system is configured correctly, it can help to ensure that employees are paid on time (you really don’t want to get that wrong), as well as prevent your business from experiencing a crisis.
We all read the stories last year about RyanAir being forced to ground flights after “messing up” annual leave allocations for its pilots, whilst Debenhams was also forced to apologise for paying staff below minimum wage after miscalculating its payroll calculations.
A good payroll system will be able to alert you of any discrepancies when it comes to data input, as well as allow you to automate payments and seamlessly update employee details including tax status and any change in circumstances.
One of a business’s biggest expenses is payroll, so it really does pay to ensure your systems are fit for purpose, both for now and the future. Investing in regular training for payroll departments can help with this – regularly updating your team’s knowledge and understanding of their chosen software will not only keep bad habits at bay, will also ensure that potentially costly mistakes are prevented.