O N L I N E L E A R N I N G
REWARD
Learn how to process a number of common termination packages correctly, from redundancies to contractual breaches, retirement and death-in-service. Termination payments
highlighting variable costs, but also about providing a perspective of what alternative costs may be. We often look at overtime costs as being an avoidable overhead but let’s offset that against what the overtime achieved, or the alternative of trying to engage casual labour at short notice. What I like to see is rolling trend analysis and comparison of year-on-year trends to identify significant movements in absence costs, holiday trends and benefit take-up to then determine what has changed and what may need to happen. Costs associated with labour tend not to become a problem overnight, but are more of a growing trend that can be identified early. I think the data is also particularly powerful if overlaid with other employment demographics to understand if there are also any gender pay issues emerging. SJ: For small and medium-sized enterprises (SMEs) especially, salary exchange is often underused and so offers many employers a way to reduce the tax that both employees and the employer pay. For a business with fifty employees, an average salary of £30,000 and in a group pension paying 5%, typical annual savings for the employer could be £10,350 per annum. With employers looking at ways to negate the costs of the new health and social care levy, salary exchange could help. Payroll can be proactive in analysing which clients and pension members don’t use salary exchange to work out potential savings. Even low take-up schemes can increase savings with a rejuvenated communications programme. Generally, anything lower than 70% take-up should be reviewed. GK: Payroll teams have access to valuable data and knowledge to help provide guidance to other stakeholders within Payroll teams have access to valuable data and knowledge to help provide guidance to other
their organisation. For example, using timesheets and pay information, payroll teams can see how much is spent on employees working overtime. This information can be passed on to relevant departments to evaluate what areas of the organisation need help with working more effectively and efficiently to reduce unnecessary overtime costs. By cutting the expensive overtime costs, the core jobs of employees are more likely to be protected. Do we need to think about se5ing objectives that are more focused on influential change despite the fact that transactional processing should always come first? EH : I agree that transactional processing is important, but should it always come first? I’m not so sure. Processing accurate and timely payroll is absolutely the priority but, like in the answer to one of the points above, we should consider utilising technology more effectively so that transaction processing is reduced because of automation. This will result in the whole payroll function being more strategic and offering payroll teams more in-depth roles than just that of data processing. IH: Absolutely – we do for management and leadership roles and we need to get the wider team involv ed in supporting the change programmes alongs ide the day- to-day operations. That is what keeps roles interesting, fresh and exciting. SJ: For larger employers, health and well-being governance committees are becoming more and more common with representatives from HR, pensions, reward and payroll coming together. Terms of reference and objectives are set at outset. A collaborative approach to health and well-being should always involve payroll and we are seeing more and more of this happening. GK: Payroll’s core responsibility will always be to pay people accurately and on time. But as payroll teams start to use automation technology, they will spend less time on manual and administrative tasks and use the time saved to focus on other higher-value tasks such as providing guidance on financial awareness and insight to help improve employee well- being. It’s tasks like these that will help payroll become involved in, and influence, strategic decision making within their organisation. ■
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| Professional in Payroll, Pensions and Reward | November | Issue 75 38
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