FUTURE OF PAYROLL REPORT
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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CIPP AND WORKDAY
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