Future of payroll report
Vickie GrahamDipMACIMACIPP, CIPP’s business development director, reveals and comments on survey results
T he CIPP recently ran our third look like in the future. The timing of this year’s survey was particularly interesting as it coincided with the COVID-19 pandemic, which has impacted people’s attitudes towards technology and remote working. The full report has been issued as part of the National Payroll Week celebrations for 2020 and is available on our website. We are also hosting a future of payroll Future of Payroll survey to provide an insight into what payroll might roundtable on 7 September and will produce a summary of the discussion within a future issue of Professional magazine. Our approach to the Future of Payroll survey changed slightly for 2020, and we focussed on four main areas, see below. The survey generated a fantastic response with 441 individuals participating, representing in-house payroll professionals (56%), payroll service providers (28%) and individuals who engage payroll services (16%). How will technology enhance the payroll profession? Artificial intelligence (AI) and automation have been topics of debate within payroll for a while. Historically, these may have caused worry that this enhancement in technology could impact on jobs within payroll, especially as 86% of respondents agree that use of AI and automation will increase within the profession. Positively, despite this, 68% of respondents stated that they see this as an opportunity for payroll professionals to show their strategic value and that payroll is more than the transactional ‘push of a button’. Some 43%
said that though the introduction of AI and automation would not impact the number of jobs in payroll, it would change the role payroll plays within businesses. This theme is addressed more in other areas, such as below in ‘Skills of payroll professionals and job roles of the future’. In addition, 78% of people stated that these advancements would make the payroll team more effective; and 62% said that they could see how technology would reduce costs associated with payroll. There is a fairly even split between where payroll systems are hosted, with 37% stating in the cloud, 37% onsite and the remaining 26% hosted on a client server. Anecdotally, we are seeing that there is more interest in cloud-based software since the lockdown, and through conversations with members, and projects in consultancy, we are seeing that payroll professionals are looking to change solutions as a result. Although traditionally payroll is an area which has seen little investment in technology, this is a trend which is changing as 63% of respondents stated that they are looking for specialist payroll software which integrates well with other specialist software such as time and attendance or expenses. Salary strategies of the future This area focusses on new and innovative methods and frequencies related to pay to keep employees engaged and motivated. It is a generally recognised fact that employees go to work to get paid but pay has become more than the amount paid into a bank account once a month. With five different generations in the
workforce, pay and reward mean different things to different people. It’s a theme we explore within the ‘Future of working’ section of the report as employees want greater flexibility of hours and working patterns. Surprisingly, given the introduction of pay gap reporting in recent years, 59% of respondents stated that they believe that total compensation packages should be confidential. However, 36% stated that they have salary bandings which employees have visibility of, and 5% have a ‘set your own’ salary strategy. It will be interesting to see how this develops over the years. Set-your-own-salary appears to be more popular in start-up organisations and requires employees to review the market place and salaries for similar roles, in line with the actual (or projected) revenues and profit margins of the business in which they are working. This supports businesses in attracting talent which otherwise may not have been interested in working for them. But is it a viable strategy long-term and for established businesses? Whatever your views regarding pay transparency, it is something that employees are starting to demand; and as we will never stop employees discussing pay and remuneration, maybe it is something that helps improve morale if adopted within business? This topic will also be of interest to the government as they seek to reduce pay gaps related to gender, ethnicity and disabilities. Pay on demand is another theme explored within this area of the report. Although a hot topic in recent years, pay on demand is only offered by 3% of respondents; just 12% stated that it would be attractive to employees within their organisations, and 52% answered ‘maybe’. Despite being a hot topic for some years,
...payroll is more than the transactional ‘push of a button’.
| Professional in Payroll, Pensions and Reward | September 2020 | Issue 63 50
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