TECHNOLOGY
Employee benefits: processes and technology
Susan Ball, tax partner and Flora Barnes, director from RSM UK remind us of the importance of regularly reviewing your processes and controls, and how extending the use of software may be helpful
I n the post-Covid world, employee benefits have only gotten more complex. Employers are realising how much lower employee costs were during the pandemic, and wondering how much of that saving can endure. Some are downsizing or even closing offices, raising the question of commuting costs. Hybrid working is becoming essential to certain organisations to retain key talent, with employers taking different stances from the ‘work anywhere’ touted by some employers to attract the best people, right through to employers offering free lunches and other perks to get employees back into the office. Many employers who had good processes pre-Covid now seem to be picking them back up only as an afterthought or realising that they now need significant changes to adapt to the
current reality. Contracts are being agreed with terms that have tax implications, and payroll are informed late or not at all. Any human resource (HR) professional with more than a handful of employees also knows that benefits administration and enrolment is a tedious, time-consuming and often expensive process. However, employee benefits remain one of the most influential factors affecting employees’ job satisfaction. Given the correlation between employee benefits and overall engagement, it’s crucial for employers to provide a range of options that add to the bottom-line. At the same time, HM Revenue and Customs (HMRC) is increasing compliance activity after some years of partial dormancy, particularly in the case of business risk reviews for large corporates or national minimum wage
(NMW). There’s a growing understanding that employers with large or complex workforces need to rely on good policies, processes and controls, rather than manual testing of inputs. In an era where artificial intelligence (AI) is developing exponentially, and there’s more tax, HR and benefit software on the market, what technological options are there? The good news is the best solution may well be one that employers already have, and we would recommend starting here. Most payroll software has features built in to deal with many kinds of employee benefits, many of which payroll teams often don’t know exist, don’t know how to use or haven’t been activated. For example: ● could the organisation move from P11Ds to payrolling benefits to deal with changes in real time? ● could the payroll system be used for monitoring NMW? ● do you have fields to record the type of contract an employee might be on, and
“Contracts are being agreed with terms that have tax implications, and payroll are informed late or not at all”
| Professional in Payroll, Pensions and Reward | October 2023 | Issue 94 54
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