The CIPPs Future of Payroll report has been made possible through the collaboration of a high number of payroll professionals within the United Kingdom, and the support of Workday.
Future of payroll RESEARCH SURVEY REPORT The CIPPs Future of Payroll report has been made possible through the collaboration of a high number of payroll professionals within the United Kingdom, and the support of Workday.
Sponsored by
FUTURE OF PAYROLL REPORT
Contents
Contents
2 3 4 5 6 6 6 6 6 6 6 7 7 7 8 8 8 9 9
CIPP foreword
Workday foreword
Approach
Demographics
Sector
Number of employees paid UK versus international Outsourced versus in-house
Number of people working in payroll
HR/finance
Key focus areas for your business overall
HR
Finance
Key focus areas for payroll department
HR
Finance
Awareness of GDPR on payroll and wider business
Have you run a test on your gender pay gap to see how it looks?
Is payroll a strategic or operation function? Does payroll contribute to organisations goals?
10
11
Payroll enquiries
12 12 13 13 14 14 14 15 16 16 16
Type of query and complexity
Keeping up to date
Where do you get information from?
Payroll software
How is your software hosted?
How effective does technology enable you to be? Are you looking to replace your software?
Recruitment, learning and development
Attributes required when recruiting payroll staff Attractive benefits to potential employees
How do you develop your teams? Who holds the budget for training?
17 17
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CIPP foreword
Payroll is an evolving profession, it is completely different now to how it looked when I started my career in payroll and joined the Institute back in 1983. This research goes some way to predict the future of payroll, anticipating developments based on the responses provided by you, the professionals working in the industry. It is encouraging that the payroll professionals represent 2.3 million employees being paid in the UK. With the majority of organisations indicating that they have up to five individuals within their payroll teams and payroll reporting into finance departments, it would be interesting to see if this shifts more towards HR with changes in legislation such as gender pay gap reporting, especially if this is introduced within organisations with fewer than 250 employees as is currently being suggested by the government.
KEN PULLAR CHIEF EXECUTIVE OFFICER, CIPP
Payroll complexity is often referred to, but this report suggests that the complexity within payroll is not influenced by the number of employees on a payroll, but by factors such as flexible working arrangements and increased benefit provisions through automatic enrolment and salary sacrifice arrangements. These areas of payroll are relatively new to the function, and payroll professionals should be thinking about how they can influence their business strategy and employee well-being through the introduction of such initiatives within their organisation. As these benefit strategies grow in importance, and more people think about payroll being more than just a number on a payslip, it would be interesting to see if there is a shift from payroll reporting to finance towards payroll reporting to HR, or even better, being recognised as a strategic department in its own right that can contribute positively to both HR and finance. We cannot escape the fact that technology enhancements is impacting every element of our personal and working lives, and will continue to do so. This report recognises that payroll professionals believe that technology is making them more efficient, but that there are further efficiencies which could be gained through integration with finance and HR systems. It is interesting to see that the lifecycle of payroll software is between five to ten years; will this have an impact on the future of payroll if the department is using outdated technology and legacy systems? Finally, the report highlights that payroll professionals are excellent at keeping up to date, they have to be to comply. However, it is concerning to the CIPP and the profession overall that 55% of respondents do not have a succession plan in place for their payroll department. Payroll knowledge tends to be with a few individuals within an organisation and I encourage all businesses to review their succession plan for payroll. The modern day ‘payroller’ has a very demanding role and a very important one; they are instrumental in an organisation when it comes to ensuring compliance with legislation. The consequences of non-compliance are not just financially harmful through penalties, fines and even litigation; reputational damage can be even more detrimental to a business, especially in the long term. There is no doubt that the payroll professional of today has a wide remit and has both internal and external pressures to consider. It was evident that the people involved in payroll, regardless of the level, are passionate about their roles and take pride in what they do.
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Workday foreword
Workday is pleased to partner with the Chartered Institute of Payroll Professionals (CIPP) on this year’s Future of Payroll report. Payroll is the cornerstone of any successful business, yet the workplace is changing, with new working patterns and approaches to the way employees work all adding to the complexity of how businesses manage their people. This report explores the relationship between people and technology, with a focus on how organisations should bring finance and HR data together in one system if they are to meet the payroll challenges facing businesses of all sizes today. It may be of little surprise to many that the European Union’s General Data Protection Regulation (GDPR) was high on the list of key focus areas for survey respondents given the media attention the new legislation has attracted this year. GDPR came second in the list, topped only by the seemingly perennial challenges of improving efficiency and cost management. Ironically, the journey to GDPR compliance offers businesses many opportunities to streamline payroll processes, which, with the right focus and technology, can help reduce costs while meeting compliance.
CAROLYN HORNE REGIONAL VICE PRESIDENT, UK, IRELAND, AND SOUTH AFRICA, WORKDAY
While finance and HR respondents were generally in agreement on the key areas of focus, human resources leaders had an additional focus on the gender pay gap from a payroll perspective. As the UK government renews its focus on the gender pay gap, businesses will have to get to grips with this subject, yet close to half of all respondents said they were yet to test how their organisation fares. Despite the media furor, neither set of business stakeholders were particularly flustered about Brexit and the uncertainty it may bring, as it rated the lowest in terms of areas of focus. Across the board, respondents rated analytics and insight as less of a priority, which may reflect the consensus that payroll is an operational rather than a strategic business function. Only 34 percent of companies had payroll representation at board level, even if close to half believe it should have a seat at the C-suite table. If payroll is to elevate its position into the board room then technology innovation and the way the function handles data are going to be key. 50 percent of respondents have indicated that there is poor or no payroll integration with HR systems and 56 percent stated that there is poor or no integration with their finance system. And, despite the much heralded journey to cloud computing, 60 percent of respondents are still using on-premise payroll software. With these legacy systems, historically there has been a degree of separation between transactional finance/HR systems and payroll, with data copied across periodically from one to the other. Not only has this led to delays in using people data for decision making, but it also raises questions about the accuracy and integrity of the data, given it has to be reintegrated before it is analysed. This data ages quickly and lives in a silo, disconnected from the business processes or strategies it should be used to support. The emergence of the GDPR only intensifies the need for better management of payroll data and indeed how people analytics should be delivered. At Workday, we’re seeing organisations shift towards the general trend of keeping their people data securely within their HR system. Having faced the rigours of GDPR, it’s important that businesses can meet future changes in regulatory compliance and that is best achieved by keeping employee data in one system. Organisations should use their HR system as the central point for people analytics, meaning they should import non-HR data back into the system rather than export HR information to external data lakes or tools. This is evident with modern technology, including Workday, bringing together all people data into one place and securing it via a single security model. Bringing together reporting and analytics directly into the HR system means there is no need for separate reporting tools.
We hope you find the research useful as you continue your payroll journey and we look forward to hearing your thoughts.
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Approach
The survey launched during National Payroll Week 2017 and was distributed to the UK payroll community through the CIPPs communication channels to its members, and through social media.
Telephone interviews were also conducted to elaborate on some of the questions and topics. Over 500 people completed the survey over the course of four weeks in September 2017.
Respondents were primarily from in-house payroll professionals and responses were restricted so that professionals from the same organisations could not complete the survey and skew the results.
Results were cross-referenced against information held within the CIPP database to ensure that the findings were representative of the profession.
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CIPP AND WORKDAY
Payroll insight and the future of payroll survey 2017
FUTURE OF PAYROLL REPORT
Q1 What is your company sector?
Answered: 606 Skipped: 1
Demographics
Insurance Insurance 2.64% (16) 2.64% (16)
Other (please Other (please specify) specify) 24.59% (149) )
Healthcare Healthcare Providers Providers P2.64% (16) 2. 16
Sector All industry sectors were represented through the survey, with the highest percentage of respondents being from: l Professional services (12%) l Manufacturing (7%) l Other financial services (7%) l Public sector (7%) This was cross referenced against CIPP membership and industry data, and is typical of the demographics of the industry overall. Number of employees paid Over 2.3 million employees are paid by the respondents of this survey, of which 13.4% are considered part-time workers. This is supported by employment trends in the UK which indicates that the percentage of part-time workers is due to rise with an influx of contingent workers as the millennial workforce increases. For payroll, this will create a complex structure as workers maximise on flexible working patterns. UK versus international Whilst the survey was only distributed to professionals based in the UK, 21% of respondents also manage international payrolls. This is representative of the CIPPs overall membership base. Outsourced versus in-house The majority of respondents (72%) operate their payroll in-house; 15% outsource their payroll to a service provider, and 13% stated that they have a mixture of in-house and outsourced payroll. With UK payroll training both accessible and frequent, there is more confidence and knowledge within the industry to support organisations operating their payroll in-house.
Construction Construction 2.97% (18) 2.97% (18)
24.59% (149)
2.64% (16) 2.64% (16)
Retail
Education Education Education 4.79% (29) 4.79% (29) Retail 4.29% (26) 4.29% (26)
Professional Professional Professi Services Services 12.21% (74)
Non-Profit Non-Profit 5.61% (34) 5.61% (34) %
12.21% (74) 12.21% (74) Manufacturing Manufacturing 7.10% (43) 7.10% (43) (
Public Sector Public Sector 6.93% (42) 6.93% (42)
Other Financial Other Financial Services Services Se6.93% (42) 6. 3%
6.93% (42)
The results show that there is no correlation between the size of the payroll team and the industry to which they belong. This suggests that the level of complexity within payroll is the same regardless of the number of employees and could be influenced by many differing factors, such as: l Part-time workers l Casual workers l Zero hour contracts l Automatic enrolment for pensions l Salary sacrifice arrangements HR/finance This report set out to establish where payroll sits within an organisation. Whilst the CIPP promotes payroll as a standalone profession and department within organisations, it is clear from the level of response that payroll still falls significantly under finance (64%). As legislation changes impact both the payroll and HR professions, and the information provided through payroll impacts on the overall HR and reward strategies within organisations, it would be interesting to see whether this split changes over the coming months and years. There is evidence from respondents’ comments within the survey results to support this shift from finance to HR. 24.59% 12.21% 7.10% 6.93% 6.93% 5.61% 4.79% 4.29% 2.97% 1 / 2
ANSWER CHOICES
RESPONSES
Other (please specify) (33)
Professional Services (26)
Manufacturing (20)
Other Financial Services (24)
Public Sector (27)
Non-Profit (23)
Education (12)
Retail (28)
Construction (7)
Technological advancements through cloud computing have also made running payroll in-house more efficient.
“HR will become more integrated with payroll.”
“Streamlining into HR dep. And new software will be implemented.”
Number of people working in payroll Regardless of whether payroll is processed in-house or outsourced, the majority of organisations have up to five employees working in the payroll department.
“A closer working relationship with HR.”
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Costmanagement
Genderpaygap
Key focus areas for your business overall
E eciency
Brexit
Costmanagement
Genderpaygap
Analyticsand insight
62.87 %
31.74 %
24.95 %
70.46 %
15.77 %
39.52 %
32.14 %
E eciency
Brexit
GDPR
Digital transformation
Costmanagement
Genderpaygap
Analyticsand insight
COST MANAGEMENT
GENDER PAY GAP
ANALYTICS AND INSIGHT
EFFICIENCY
BREXIT
GDPR
DIGITAL TRANSFORMATION
E eciency It is not surprising that cost management and efficiency come top as key focus areas for businesses (70% and 63% respectively). These are areas which can be streamlined through advancements and developments in technology and systems to support payroll. GDPR and digital transformation were next in priority with Gender Pay Gap following close behind. Although GPG Reporting has been with us for almost a year, the majority of businesses reported their figures in the weeks that ran up to the deadlines at the end of March/beginning of April. Brexit comes in as the lowest focus but this is likely due to the timing of the survey and the uncertainty with regards to the UKs negotiations to leave the EU. Payroll deal with what they know is going to happen, hard facts where possible, and we do not yet have those for Brexit. Digital transformation Brexit GDPR Digital transformation Costmanagement
Genderpaygap
Within the overall business focus, the HR and finance priorities are:
HR
E eciency
Brexit
Costmanagement
Genderpaygap
Analyticsand insight
56.11 %
41.11 %
25.56 %
73.89 %
20 %
41.67 %
33.33 %
Costmanagement Digital transformation
Genderpaygap
E eciency
Brexit
GDPR
Costmanagement
Genderpaygap
Analyticsand insight
COST MANAGEMENT
GENDER PAY GAP
ANALYTICS AND INSIGHT
EFFICIENCY
BREXIT
GDPR
DIGITAL TRANSFORMATION
FINANCE
E eciency
Brexit
Costmanagement Digital transformation
Genderpaygap
Analyticsand insight
E eciency
Brexit
GDPR
67.10 %
27.10 %
24.19 %
69.39 %
13.87 %
37.74 %
31.29 %
E eciency
Brexit
GDPR
Digital transformation
Costmanagement Digital transformation COST MANAGEMENT
Genderpaygap GENDER PAY GAP
Analyticsand insight ANALYTICS AND INSIGHT
EFFICIENCY
BREXIT
GDPR
DIGITAL TRANSFORMATION
E eciency
Brexit
GDPR
Digital transformation
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Costmanagement
Genderpaygap
Key focus areas for payroll department
E eciency
Brexit
Costmanagement
Genderpaygap
Analyticsand insight
40.12 %
22.58 %
26.81 %
75 %
8.47 %
33.87 %
32.26 %
E eciency
Brexit
GDPR
Digital transformation
Costmanagement
Genderpaygap
Analyticsand insight
COST MANAGEMENT
GENDER PAY GAP
ANALYTICS AND INSIGHT
EFFICIENCY
BREXIT
GDPR
DIGITAL TRANSFORMATION
Costmanagement Unsurprisingly, Brexit is seen as more important where payroll forms part of HR within organisations, this is likely due to the employment law legislation from the EU which impacts payroll. The CIPP keeps members up to date on payroll issues through News On Line and reminds all payroll professionals that current EU legislation will become UK legislation when we separate from the European Union. Digital transformation Where efficiency and cost management are key focus areas for the business, these are also key focus areas for the payroll department, demonstrating alignment between payroll and the overall business objectives. However, it is interesting to see that GDPR is less of a focus for payroll departments than the business overall. This could be because payroll professionals are heavily focussed on data security in their roles already, or could be a result of the timing of the survey being September 2017. It would be interesting to ask this question again now to establish whether this area has grown in importance for payroll departments. E eciency Brexit GDPR Digital transformation
Genderpaygap
Where payroll sits within HR and finance, their key focus areas are:
HR
E eciency
Brexit
Costmanagement
Genderpaygap
Analyticsand insight
36.64 %
28.49 %
26.82 %
74.86 %
11.73 %
33.52 %
30.73 %
Digital transformation Costmanagement
Genderpaygap
E eciency
Brexit
GDPR
Costmanagement
Genderpaygap
Analyticsand insight
COST MANAGEMENT
GENDER PAY GAP
ANALYTICS AND INSIGHT
EFFICIENCY
BREXIT
GDPR
DIGITAL TRANSFORMATION
FINANCE
E eciency
Brexit
Digital transformation Costmanagement
Genderpaygap
Analyticsand insight
E eciency
Brexit
GDPR
43.32 %
19.87 %
27.04 %
74.27 %
6.84 %
33.22 %
32.30 %
E eciency
Brexit
GDPR
Digital transformation Costmanagement COST MANAGEMENT
Genderpaygap
Analyticsand insight
Digital transformation
GENDER PAY GAP
ANALYTICS AND INSIGHT
EFFICIENCY
BREXIT
GDPR
DIGITAL TRANSFORMATION
E eciency
Brexit
GDPR
Digital transformation
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Awareness of GDPR on payroll and wider business
39.08% Yes
8.30% Unknown
39.30% Currently learning
13.32% No
78% of respondents were either aware of, or learning about, the implications of GDPR in a payroll context. Again it would be interesting to ask this question again now with the EU regulations only weeks away from coming into force in the UK. Payroll is a data heavy department, with personal and sensitive data being processed and handled by various individuals and systems. It is essential that payroll professionals are aware of their obligations under the new regulation, and are ensuring compliance for their organisations. GDPR should be on the radar of all businesses – it comes in to force in the UK on 25 May 2018 and applies to all EU and foreign companies that offer services to individuals in the EU (regardless of what happens with the Brexit negotiations). Sanctions for non-reporting of a data breach under GDPR are steep – up to approximately £7m or 2% of global turnover, whichever is greater. The CIPP offer a half day training course which will help delegates understand and prepare for the changes, including how they affect payroll and HR functions, so that they can help their organisations become fully compliant by 25 May 2018.
Have you run a test on your gender pay gap to see how it looks?
44.30% Yes
28.29% No
15.57% On to do list
11.84% Unknown
For organisations that have more than 250 employees, gender pay gap reporting is a regulatory requirement, with reports that were due on 30 March (public sector) and 4 April (private sector) 2018. With the survey being distributed in autumn 2017, it was encouraging to see that 44% of organisations had run a test, with another 16% planning to do so.
Nearly half (48%) of those who had run a test, had further analysis to conduct based on their results, with 43% claiming that the results were as expected.
Since the survey was conducted, we have started to see many organisations publicising their gender pay gap, with some high profile cases in the media.
With gender pay gap and equal pay being high on the government agenda, it is the expectation of the CIPP that gender pay gap reporting will be extended to organisations with fewer than 250 employees in the future.
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Is payroll a strategic or operation function?
Payroll is still considered an operational business function, with only 21% of respondents stating that payroll is strategic. This is supported by the fact that only 34% of businesses have payroll represented at board level.
What is encouraging is that 45% of respondents think that payroll should be represented at board level. This is supported by respondent’s comments:
“As payroll is generally one of the highest costs within an organisation, they should have adequate representation at a senior level to ensure appropriate focus given to this high level of spend.”
“Because it is one of the biggest parts of the business and has a major influence over company costs.”
“In order to bring an insight into staff issues and how they may affect the business.”
“Most people come to work for the money. Mess that up and you have very unhappy employees. Decisions are made which effect payroll and it is left to them to sort out how it will work via the organisation.”
“It certainly does; the payroll function can add value to the employee life cycle by empowering the workforce with knowledge & efficiency savings.”
“Payroll is the main employee motivator. It has to be correct and needs to provide the employee with an efficient service. Payroll innovations and systems need to at the top of the agenda to provide a great employee experience.”
“Payroll needs a voice so should be represented at board level.”
“Payroll legislation has moved on at a dramatic pace over the last five years and there seems to be no slowing down of the changes to come!”
“Payroll is one of the largest expenditure headings for most companies and is heavily governed by external bodies with substantial penalties for non- compliance. Therefore it should be represented at board level as a major factor in the future growth, success, or failure of a business.”
“Payroll too often is overlooked within a business resulting in an unhappy workforce, which has a major impact on your business. Bad feeling/publicity is usually avoidable. If only Payroll had a voice in the right circles - certainly finance managers don’t concern themselves enough and don’t rate it as highly as their accounting staff. Cost efficiencies are often visible at payroll level, as are concerns over well being (i.e. too much overtime), Payroll needs a strong voice!”
The CIPP recognises that the information available through payroll is essential to strategic business making. Payroll can provide business intelligence and analytics regarding an organisation’s most valuable asset, its employees and one of its highest costs, their pay. For example, payroll professionals work with, and are familiar with, the data to run reports to test scenarios of payroll growth or reduction, of the weekly/monthly payroll etc. to feed into business cases for organisational development or cases where cost reduction is required. The information that payroll can provide is pivotal to its organisation and should be recognised and supported at a strategic level. In addition, and as supported by the respondent’s comments above, payroll can affect employee motivation. By communicating and educating employees, the payroll function can add value to the employee life cycle by empowering the workforce with knowledge and efficiency savings which will benefit them in their daily lives.
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THE PAYROLL DEPARTMENT IS FUNDAMENTALLY LINKED TO THE OVERALL BUSINESS AND
There are individuals who have started their working career in payroll that now sit on boards of directors but no longer have payroll within their title and their remit widens to include learning and development, reward and operations. This supports the findings from the survey that payroll sits within finance or HR departments and that, by the time payroll is represented at board level it is through the finance or HR department. It also strengthens the CIPPs argument to ensure that payroll professionals are upskilling to include business management and understanding as part of their role. The payroll department is fundamentally linked to the overall business and this is supported through findings within this report which demonstrate that the key areas of focus for payroll are the same as the overall focus areas for business. Payroll professionals are involved in key projects within the business, such as software implementation projects to improve efficiencies and effectiveness. A discussed we have gender pay gap reporting and GDPR, both major legislative changes which require reviews of business processes, also providing the opportunity to improve efficiencies and effectiveness.
THIS IS SUPPORTED THROUGH FINDINGS WITHIN THIS REPORT WHICH DEMONSTRATE THAT THE KEY AREAS OF FOCUS FOR PAYROLL ARE THE SAME AS THE OVERALL FOCUS AREAS FOR BUSINESS.
These are some of the main reasons why payroll professionals should be aspiring to positions within the organisation which will enable them to utilise their skills, whilst demonstrating the fundamental and strategic value of payroll. Not only as an employee motivation and engagement tool, which will provide a business with increased standards and profitability, but also as payroll is the one with their finger on the pulse of legislative change; the financial and reputational damage that can come from non-compliance is a major threat to business.
Does payroll contribute to organisations goals? Whilst respondents may not view payroll as a strategic function, it is encouraging to see that 79% view payroll as having an impact on the organisations overall goals. However, less encouraging is that less than half (47%) believe that senior management share this view. Payroll professionals, with the support of the CIPP, have a role to play in changing management perception towards the payroll function.
79% Yes
15% No
Payroll impacts every aspect of a business as it directly impacts the motivation of employees. Individuals within payroll departments can be more proactive in providing the regulatory information on areas which could support business decisions, such as: l Flexible benefits, a powerful way of increasing employees’ engagement and perceived value of their benefit package l Flexible working
l Shared parental leave and pay l Gender diversity and equality
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Payroll enquiries
Type of query and complexity
54.18 %
24.90 %
10.88 %
6.28 %
3.77 %
QUERY ON PAYSLIP
TAX CODE QUERIES
OTHER
REWARD AND BENEFITS
NEW STARTERS
It is hardly surprising that the majority of queries received into the payroll department are relating to payslip queries. Many employees do not understand their payslip, how it is structured or their deductions from pay. This can lead to unnecessary stress for employees, and increased workload for payroll departments. The CIPP recommends educating employees about their payslips. Payroll departments could be (and we know many are) proactive in developing frequently asked questions, or presentations (either live or recorded) to make available to employees to cover some of the most common questions. National Payroll Week, run by the CIPP in September each year, is an excellent opportunity for payroll departments to develop and communicate such tools.
Payroll professionals should develop these tools and communicate the value of them to management and board; employees are less productive if they are spending time querying their pay.
What was surprising with the results to this section was the low response with regard to reward and benefit queries.
This could suggest that: l Employees are not engaging with the reward and benefits available to them, OR; l Employees fully understand their reward and benefits packages.
The latter is unlikely; if employees do not understand their payslip, it would be more probable to be a lack of engagement. This provides another opportunity for National Payroll Week, (or any other week), for payroll professionals to communicate the overall remuneration and reward package available to employees. Ensuring that employees understand their total worth to an organisation could increase employee engagement and motivation, and ultimately the organisations’ productivity and profitability.
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Keeping up to date
81
Payroll professionals are extremely proactive in keeping up to date with regards to legislative changes within the industry, with 81% stating that they were proactive in obtaining legislative updates. This was not a surprising response given that compliance and accuracy are fundamental to payroll.
%
stated they were proactive in obtaining legislative updates
Where do you get information from? 64% of respondents indicate that they use the CIPP or HMRC as their primary source of updates with regards to payroll knowledge. It was interesting to note that the 26% of respondents who answered ‘other’, all stated that their source of information was a combination of CIPP, HMRC and their provider. Payroll insight and the future of payroll survey 2017 Q29 Where do you get your payroll informatio
Answered: 482 Skipped: 125
This highlights the importance of CIPP membership for individuals to keep up to date, but also the important role that CIPP has to play with the providers in the industry to ensure that the information that they have and make available to their customers is accurate. The CIPP provides content for many payroll providers through newsletters to their clients, and is happy to have discussions with other providers who may wish to provide information to their clients in this way.
HMRC
Other (please Other (please specify) specify) 26.35% (127)
HMRC 23.65% (114) 23.65% (114)
26.35% (127))
GOV.UK
GOV.UK 6.43% (31) 6.43% (31)
Consultant l
Technology supplier s T 2.28% (11) ) 2.28%% Consultant n Consult t 1.24% (6) 1.24% (6) 24% (6) Technology supplier echnol
CIPP CIPP 40.04% (193) 40.04% (193)
2.28% (11)
CIPP
40.04% (193)
ANSWER CHOICES
RESPONSES
23.65%
HMRC (1)
40.04%
CIPP (2)
2.28%
Technology supplier (3)
1.24%
Consultant (4)
6.43%
GOV.UK (5)
26.35%
Other (please specify) (6)
TOTAL
BASIC STATISTICS
Minimum 1.00
Maximum 6.00
Median 2.00
Mean 3.06
Sta 2.0
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Payroll software
The research showed that payroll software tends to be a long term investment. 83% of respondents stated that they have had their software in place for more than two years. Breaking that down further, 58% have had their software for five years or more and 27% for over ten years. When asked if looking to replace their software, 27% of respondents indicated that they were looking to change providers within the next couple of years. When analysing this further, it was surprising that of those looking to change, 50% were satisfied with their current software and 39% had had their current software in place for less than five years. Where this was the case, the reasons indicated for moving were to keep up to date with technology, and comments were made regarding integration with other systems to achieve business performance efficiencies.
How is your software hosted? When asked if their software was hosted on premise or in the cloud, the split was 60% on premise and 40% in the cloud. The majority of respondents (53%) who had their software hosted in the cloud implemented their current solution less than five years ago and were either satisfied or extremely satisfied with their software (70%). This compared with 66% of respondents who had implemented their on premise solution more than five years ago and 77% were either satisfied or extremely satisfied with their solution. This split is not likely to change over the coming years, as 73% of respondents indicated that they are not looking to change software within the next two years. This profile did not change depending on hosting solution or the length of time the current solution had been in place.
39% host in the cloud
60% host on premise
Payroll insight and the future of payroll survey 2017
Answered: 465 Skipped: 142 How effective does technology enable you to be? It is encouraging that 79% of respondents have stated that the software enables them to be slightly, or a lot, more effective. This profile does not change depending on the hosting solution.
Q40 Does the technology you use enable you to
Whilst this posts a positive picture, the CIPP recognises opportunities for more efficiencies within payroll departments and businesses when this is analysed against other results. For example, 50% of respondents have indicated that there is poor or no integration with their HR system and 56% stated that there is poor or no integration with their finance system. If business process reviews were to take place, and requirements scoped for system integration, businesses would be able to realise improvements in effectiveness and efficiencies. As payroll professionals believe that their systems are enabling them to be more effective they may not have taken the initiative, until now, to look for further improvements.
A lot less A lot less effective effective e7.74% (36) 7 7 3
Slightly less Slightly less effective effective t eeffective iv 12.90% (60) 1 912.90% (60) 1 9
7.74% (36) 7.74% (
A lot more
A lot more effective effective e39.14% (182) 3
12.90% (60)
39.14% (182)
Slightly more Slightly more effective effective e40.22% (187) 4 .
ANSWER CHOICES
RESPONSES
40.22% (187) 40.22%
A lot more effective (1) In addition, respondents stated that poor and inflexible systems were the biggest technological issues facing their payroll department at the moment. The CIPP urges those payroll professionals who are dissatisfied with the software to discu s their issues with their providers to establish solutions and find process efficiencies. Slightly more effective (2) Slightly less effective (3) A lot less effective (4)
39.14%
40.22%
12.90%
7.74%
TOTAL
BASIC STATISTICS
Minimum 1.00
Maximum 4.00
Median 2.00
Mean 1.89
Standar 0.90
14
CIPP AND WORKDAY
FUTURE OF PAYROLL REPORT
Are you looking to replace your software? Hardly surprising that of those who indicated that they were extremely dissatisfied with their software, 75% indicated that they were looking to change it within the next two years. When analysing those that indicated that they were either dissatisfied or extremely dissatisfied, 59% are looking to change it within the next two years. 48% of respondents who are looking to change software within the next two years have had their software for five years or more, indicating that the life-cycle for payroll software is between five to ten years. Payroll insight and the future of payroll survey 2017
How pleased are y ur payroll departm nt with the current payroll software platform?
Answered: 467 Skipped: 140
Payroll insight and the future of payroll survey 2017
No view N ew No view 3.00% (14) No view No view 3.00% (14) 3.00% (14) 3.
Extremely dissatisfied 6.00% (28)
Extremely satisfied Extre ely satisfi 1 ) 18.84% (88) . ( . (
Q39 When are you looking to replace your current payroll Extremely satisfied E a is
Extremely m y dissatisfied t ed Extremely dissatisfied d6.00% (28) 6.0 8)
Answered: 467 Skipped: 140
18.84% (88)
Dissatisfied Dissatisfiedied 16.92% (79) 16.92% (79)
Within year
Within the next
6.00% (28) 6.00% (28)
Within the next
year y14.99% (70) 1 .
14.99% (70)
In 1-2 years In 1-2 years 11.99% (56) 11.99% (56)
Satisfied i 55.25% (258) ( )
.
Satisfied
Not in the
55.25% (258)
Not in the immediate future immediate future 73.02% (341) 7 . 2% 1
OICES
RESPONSES
18.84%
88
tisfied (1)
ANSWER CHOICES
RESPONSES
73.02% (341) (
55.25%
258
14.99%
Within the next year (1)
16.92%
79
11.99%
3)
In 1-2 years (2)
73.02%
Not in the immediate future (3) 6.00%
28
satisfied (4)
TOTAL
3.00%
14
BASIC STATISTICS
467
Minimum 1.00
Maximum 3.00
Median 3.00
Mean 2.58
Standard De 0.74
ISTICS
Maximum 5.00
Median 2.00
Mean 2.19
Standard Deviation 0.91
1 / 1
1 / 1
15
CIPP AND WORKDAY
FUTURE OF PAYROLL REPORT
Payroll insight and the future of payroll survey 2017
Recruitment, learning and development
Q30 Rank these attributes in order of priority when recruiting a payro person:
Answered: 472 Skipped: 135
Attributes required when recruiting payroll staff
Experience
3.39%
46.82%
49.79%
Accuracy is the most important attribute when recruiting a payroll professional to the team. This was not a surprising result as accuracy is fundamentally important in payroll to ensure that employees are paid accurately and on time. It was encouraging to see that importance is placed on qualifications within payroll, and this has been supported by recruitment agencies seeing an increase in payroll jobs requiring a CIPP qualification. Where it was stated that this was of low importance (18%), further analysis was completed against the how Attractive benefits to potential employees A good working environment was seen as the most important factor in attractive payroll professionals, followed by salary. Funding of training was given medium level of importance when recruiting, however, this increased in importance where qualifications were a low priority in recruitment suggesting that these employers see funding of qualifications as an added benefit to develop and grow their teams. Autonomous Qualifications Accuracy Experience Aptitude Team player
3.39%
46.82%
49.79%
Aptitude
1.06%
29.66%
69.28%
1.06%
29.66%
69.28%
Team player
2.98%
29.57%
67.45%
29.57%
67.45%
2.98%
Autonomous
11.85%
59.48%
28.66%
11.85%
59.48%
28.66%
Qualifications
18.05%
66.24%
15.71%
18.05%
66.24%2
15.71%
Accuracy
4.45% 4 45 0 64 0 64
94.92%
4.45% 0 64
94.92%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Low Medium High
LOW (1)
MEDIUM (2)
HIGH (3)
TOTAL
WEIGHTED AVERAGE
do you develop your teams question, which demonstrated that the importance was low because 91% would train through qualifications and/or training courses when the individual was in the role, demonstrating that organisations are willing to fund professional qualifications for the right candidate. 3.39% 16 46.82% 221 49.79% 235 472 1.06% 5 29.66% 140 69.28% 327 472 Experience Aptitude
2.98% 14
29.57% 139 59.48% 276 66.24% 312
67.45% 317 28.66% 133 15.71% 74 94.92% 448
470
11.85% 55 18.05% 85
464
471
0.64% 3
4.45% 21
472
BASIC STATISTICS
MINIMUM
MAXIMUM
MEDIAN
MEAN
STANDARD DEVIATION
1.00
3.00
2.00
2.46
1.00
3.00
3.00
2.68
1 / 2
16
CIPP AND WORKDAY
FUTURE OF PAYROLL REPORT
Payroll insight and the future of payroll survey 2017
Q31 How do you develop your payroll employees?
Answered: 470 Skipped: 137
How do you develop your teams? 51% of respondents indicated that their teams are developed through internal training. This is not a surprising statistic and representative of most professions and roles which are often learnt ‘on the job’. What is encouraging is that 19% specify external training as a route to develop their payroll teams, and the 20% who stated other use a combination of internal and external training, meaning that 39% of respondents value the importance of external training for developing payroll teams.
Other (please Other (please specify) specify) 20.00% (94) 0%
20.00% (94)
Membership bodies Membership bodies 10.00% (47) 10.00% (47)
Internal training Internal training 50.64% (238) 50.64% (238)
External training External training 19.36% (91) 19.36% (91)
ANSWER CHOICES
RESPONSES
50.64%
Internal training (1)
In addition, 10% of respondents utilise the resources available to members to develop their teams, such as: l Webcasts on topical issues such as gender pay gap reporting and GDPR l News On Line to keep abreast of legislative changes l Member only events with legislative updates provided by the policy team and external speakers l The Advisory Service technical helpline Whilst payroll departments recognise the value of keeping up to date and ongoing development, it is worrying that 55% do not have a succession plan for payroll. The CIPP urges payroll departments to consider their succession plan and recommends that objectives for learning and development are put in place to support this. TOTAL Minimum 1.00 Maximum 4.00 Median 1.00 Mean 1.99 External training (2) Membership bodies (3) Other (please specify) (4) BASIC STATISTICS
19.36%
10.00%
20.00%
55% of those surveyed do not have a succession plan in place in their payroll department
Standard Deviation 1.19
Who holds the budget for training? 16.5% of payroll departments hold their own training budget. As payroll develops as both a discipline and increasingly becomes more strategic, it is expected that there would be more autonomy with regards to training budgets in the future. When asked about training requirements, respondents indicated that this was all regarding legislation, and as such it is recommended that payroll receives training annually (as a minimum), in line with legislative changes.
12.71%
Other
Payroll department
16.53%
31.99%
HR department
Finance department
44.28%
1 / 1
17
CIPP AND WORKDAY
Join the family Join the CIPP to keep up to date on the future of payroll, including legislative and technological developments With benefits such as regular enewsletters, member magazine, attendance at member only events and access to our Advisory Service technical helpline - the CIPP ensure you have all the tools and support you need to thrive in your career.
Visit cippmembership.org.uk and see how we can help you
Watch Julie Lock and Vickie Graham discuss the future of payroll on CIPP on Demand
For more information visit cipp.org.uk or email info@cipp.org.uk for more information.
cipp.org.uk @CIPP_UK
*correct at time of publication
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