COMPLIANCE
W hen I first joined the payroll unloved department that only received attention when something went wrong. But fast forward two decades and payroll has transformed from an undervalued function attached to either finance or human resources (HR), to a recognised and stand- alone trusted service and the ‘control room’ for a significant amount of key business data. This evolution has been the result of several factors combining in a powerful way to create a profession — technology, data, service levels and advisory services have come together to provide insight over how a business runs, not just its payroll function, but also how it manages its workforce. And this is as it should be, when you consider that payroll can often be a business’s largest expense and it holds the vital data surrounding this expenditure. profession it was seen very much as a ‘push-button’ function — an Payroll can often be a business’s largest expense and it holds the vital data surrounding this expenditure In recent years, the payroll function has become increasingly important in an employee’s journey through the business, from joining to leaving, and at all points in between. Add to this the increasing complexity in areas such as pensions, benefits, maternity, paternity and shared parental leave, National Insurance and devolved income tax, and you can see why payroll professionals today need to be at the top of their game. Specialist knowledge and understanding are now part of the payroll professional’s armoury. Without the right expertise, businesses face considerable risk of making incorrect staff payments. The profile of the payroll function has increased considerably — when staff have questions, the payroll team need to have the answers, and these change as government policies evolve. Proof, if needed, came during the pandemic. Furlough was rapidly introduced, and payroll professionals were expected to process millions of payments based on whether an individual had been
furloughed, rather than laid off, during the height of the pandemic. But had the role already changed? Definitely. So much more over the years has fallen into payroll’s responsibility, bringing in more complexities, including the introduction of real time information (RTI) and electronic filing requirements, pension automatic enrolment, holiday accrual schemes and global mobility regulations. Payroll professionals have expanded their knowledge and expertise in these and many other areas, while information held by the teams has been recognised by the business to support strategy and insight. Technology Technology has, of course, assisted this transformation. Technology is not only driving the efficiency and effectiveness in how payroll services are delivered; it gives individuals immediate access to their ‘remuneration dashboard’. This means they’re able to keep track of their salary and check important details, such as tax codes and overtime payments. Technology is the driving force behind the capture and analysis of data, which provides greater insights for the business and highlights better ways to manage staff costs. Technology has been critical in developing client engagement portals and data transfer programs, along with robotic process automation and artificial intelligence. It has provided the power behind moves towards more flexible ways of working. Had we not adopted new technology at a very early stage, then we may not have been able to operate as well as we did during the pandemic. It allowed us to work remotely, while at the same time ensuring we protected our clients’ data, remained fully compliant with General Data Protection Regulation requirements and, perhaps most importantly, delivered the same high-quality service expected of us. Data New technology has enabled the greater use of data, which gives businesses much greater knowledge about their most important asset — their people. Therefore, more businesses are turning to workforce management solutions. Payroll can now give the business greater understanding of all elements of the employee journey, and their costs in real time, not retrospectively. Data will become increasingly important
Payroll – the control room for your business
Maria Mason MCIPPdip, national payroll partner at BDO, discusses how the perception of payroll has evolved from an undervalued function to a service in its own right
| Professional in Payroll, Pensions and Reward | October 2022 | Issue 84 28
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