TECHNOLOGY
The future of payroll is here – embrace it!
Sheryl Steele ACIPP, Director of Operations and Business Performance, PayCaptain, explains there are many opportunities for payroll improvements available; to stay ahead, we must be able to accept them
T he exciting truth about payroll’s future is that it’s already here. The right software, equipped with advanced automation, artificial intelligence (AI) capabilities and seamless integration is available now to revolutionise payroll processes. These systems can manage everything from fluid payments and real-time updates, to round the clock support and digital payroll assistants. These innovations aren’t just about making payroll faster or more efficient; they’re about fundamentally changing how payroll systems operate and interact with both employees and payroll professionals. The future of payroll is about more than technology; it’s about meeting people where they are, whether that’s providing instant support at midnight or offering flexible pay options. By combining automation, AI and human insight, payroll systems can create a world where payroll is no longer just a back-
support for a changing world The concept of digital payroll managers, AI-powered virtual personal assistants, is transforming how payroll teams interact with employees. These automated agents go beyond task execution; they provide seamless support, anytime and anywhere. Round the clock support Not everyone operates within traditional 9am to 5pm hours anymore. Since the shift to remote and hybrid working, flexibility has become the not so new norm. Employees now expect support which aligns with their schedules, even if that means addressing payroll queries out of hours or at the weekend. And if they do have a payroll query at midnight, why shouldn’t there be someone there to help them when they need it? Digital payroll managers can: l answer frequently asked payroll questions, such as why have I paid more tax this period or why have I been enrolled in a pension scheme? l facilitate requests for on demand pay or emergency payments, or set up charitable giving, for example l escalate complex queries to human specialists when necessary, ensuring a human touch when it’s needed most. By providing 24/7 support, payroll systems adapt to how people live today, flexibly and on their terms. The future of payments: the death of payday One of the most exciting shifts in payroll is the move away from rigid payday schedules. Thanks to faster payment systems and mobile technology, the concept of waiting until payday is giving way to a more fluid, responsive payment experience. So, what does this mean for employees? On demand pay Employees can access accrued earnings instantly, reducing financial stress and offering greater control over their cash flow.
office function; it’s a vital part of employee engagement and organisational success.
Beyond automation: adding value with AI AI is often viewed as a tool for automating repetitive tasks, but its real power lies in enhancing and integrating with existing workflows. Payroll is no longer just about logic-based automation; it’s about intelligent systems which apply AI where it delivers the most value. Traditionally, AI has been used to identify anomalies and flag issues for human review. Today, AI is evolving to take direct action where human judgment isn’t necessary, streamlining processes and reducing manual work. Let’s use payroll data entry as an example, being sent to a payroll professional via email / multiple emails to enter to a payroll system for processing. AI can now extract information from the email, validate certain information to ensure accuracy and then input the payroll data within pre- defined parameters. By leveraging natural language processing and machine learning, AI can interpret structured and unstructured data, autofill fields and cross-check entries against compliance rules. If an anomaly or exception arises, or one which falls outside of established parameters, AI can escalate this to a payroll professional for expert review. This intelligent delegation delivers efficiency while maintaining high levels of accuracy, and can remove most of the data entry element from the payroll process,
Take the example of processing a P45 document:
Data capture Advanced tools can scan / read and extract information from a P45 document automatically, they can check whether the document is valid, find the relevant employee based on the personal information in the document and perform all relevant checks against the employee’s start date as to whether the P45 figures / tax code should be applied. System updates Once validated, the P45 should be actioned to the pay period. AI agents can now action the tax code, student loan and previous year to date totals to the employee record instantly, removing the need for manual input altogether. AI-driven checks AI algorithms can verify the accuracy of these updates, ensuring compliance and minimising errors.
reducing strain on payroll teams. This isn’t just about speeding up
processes; it’s about l ensuring accuracy
l reducing the volume of mundane administrative tasks which can result in human error l freeing payroll professionals up to focus on higher value tasks, like compliance and supporting employees.
Digital payroll managers: 24/7
| Professional in Payroll, Pensions and Reward | April 2025 | Issue 109 42
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