The past year has seen organisations of all sizes forced to adapt to uncertain times. Industries have had to become more agile as situations changed rapidly and new restrictions on work were coupled with a sharp economic downturn. One area where increased
agility has been vital has been in organisations’ payroll processes. So just how have businesses adapted their payroll operations during the pandemic, and what steps can now be taken to increase agility in uncertain times?
Making payroll agile
The term “agile payroll” is a broad concept describing a technology-enabled approach to payroll services that emphasises fast and responsive access to relevant and critical data. Not only does this approach deliver greater accuracy and cost efficiency, it
also enables payroll to function more responsively, allowing it to play a more strategic role within the business.
Those at the forefront of the payroll industry are striving towards a scenario where sophisticated software tools are used to keep organisations in a ‘pay-ready’ state. In simple terms, this means that even large and complex workforces can be paid reliably
at any time, with a very high degree of accuracy. And all without adding any extra work for payroll professionals.
Easier and more agile payroll processes can be achieved by utilising two key innovations – Faster Payments and automation.
Moving to Faster Payments
Making payments faster thanks to digital technology has been a game changer in the payroll industry. The days of the three-day BACS process may be well and truly behind us as organisations turn to the Faster Payments Service, which enables real-time money
transfers between UK bank accounts.
Same day payments have several major benefits, with the most obvious being payroll teams gaining three days back to complete extra checks and ensure attention can be given to any potential errors in the payroll process. As we enter the next stage of the
Coronavirus Job Retention Scheme in the UK, having time freed up to focus on avoiding any clerical errors in the new tapering process, for example, will be a vital boost for a payroll industry already struggling to keep up with the ever-changing furlough situation.
Avoiding the three-day delay in payment also allows teams to spend more time inputting and checking any changes in pay data before signing off a final pay run. Not only does this help to weed out any inaccuracies, it is also incredibly beneficial to payroll
professionals who administrate weekly payrolls and currently have only a couple of days to complete data inputs before the start of the BACS transmission process. It also reduces the volume of any late leavers being processed in a cycle, reducing overpayments.
The Faster Payments Service ensures a timelier process across all types of payroll operations and will save an organisation money in overpayments, CHAPS fees and processing of corrections in the next pay period.
Automation is also bringing huge benefits to payroll operations in organisations of all sizes and across almost every industry. Automated payroll processes offer the starkest upgrade to those teams still relying on paper-based methods, with a streamlined
process that will enhance efficiency and cut down on the time spent by employees on laborious manual tasks. From automatic bulk uploads of annual bonuses to real-time error alerts that slash the risk of costly overpayments, automation is both a time saving
upgrade and one that significantly improves the accuracy and compliance of payroll processes.
Automation also helps with the automatic re-calculation of sickness entitlements, as well as being able to seamlessly update payroll operations with the latest legislation on furlough and other regulations that have impacted and continue to impact the payroll
industry during the course of the pandemic. Decreasing the risk of costly errors, as well as streamlining processes and efficiency, will be another important tool in the payroll industry’s arsenal as it gears up to face a summer of pandemic-related challenges.
Avoiding a summer payroll collapse
Last year was transformative in so many ways, with almost every sector changed in some way by the need to move to remote operations, often through increased digitalisation. As we approach a summer of payroll upheaval, organisations should work with their
providers to review how they can work more effectively to create some much needed capacity for over worked teams.