Feature insight - compliance
objectives that prioritise aspects of compliance. They should regularly
who have been paid incorrectly. You may also end up training your staff in a format which they don’t understand. It could ultimately lead to a loss of motivation within the team – and the wider employer organisation – resulting in a loss of key staff and reputational damage. “Basically, everyone is unhappy,” summarises Thomson. “Employees who miss out or bear the consequences of errors; and the employer, normally through penalties and or union activity; to name but a few.” Training and development Training and development is important because staff must have the skills and knowledge to understand the importance of various compliance responsibilities, and how to meet them, according to Macarthur. “Staff need to develop so that they become ready to step up, whether through succession planning or when vacancies arise unexpectedly or when new roles are created to meet new challenges,” he says. “And everyone needs to keep their skills and knowledge up-to-date.” When new legislation is introduced or announced in the chancellor’s Budget, UHB organises group training sessions that cover the implications of the changes. The organisation also carries out annual reviews, as well as mini-reviews throughout the year, which help to identify staff training needs. These are then discussed between line managers and the training manager to establish how the individual concerned can be supported. “Training is key to the operation because if you haven’t got staff with the right level of knowledge the whole operation is going to fall over,” explains Fitzgerald. “When staff don’t know what they are doing that’s when payroll goes off the rails.” The CIPP PAS The CIPP’s PAS has been developed to help organisations keep up their professional payroll standards. Gaining accreditation enables employers to reassure staff and customers that their payroll is up to date, compliant and accredited by the CIPP. The scheme is available for both employers and bureaux or other outsourcers, such as accountancy firms. It incorporates two modules – the payroll module and the payroll people module.
what payroll compliance means to them and where responsibility for compliance ultimately lies. ...staff must have the skills and knowledge to understand the importance of various compliance responsibilities... The cost of failure There are a number of problems that can arise for organisations that are non- compliant. These include penalties from a range of official bodies, including HMRC, the Information Commissioner’s Office and The Pensions Regulator (TPR). Some of these bodies also ‘name and shame’ companies that get it wrong. For example, in May this year TPR published for the first time the details of every business that it has secured a court order against after the employers neglected to meet their automatic enrolment responsibilities. In circumstances such as this, the organisations concerned could also suffer further from negative media or social media publicity, as well as legal action from other businesses or creditors. “You could end up losing customers, damaging the reputation of the organisation and tainting its name,” warns Fitzgerald. Within the business, employers could be faced with disgruntled employees
access a range of different information sources such as CIPP, HMRC, and the Department for Work and Pensions, and ensure that updates are shared within the entire payroll team as well as with other departments involved in employer compliance such as legal, tax and finance. It is imperative that all teams involved in employer compliance responsibilities work openly and collaboratively together to share information promptly. Third parties – such as professional advice or consultancy service providers, payroll bureaux and training providers – can also help employers meet their obligations. “Keep up to date, or ensure your provider keeps up to date, with legislation,” advises Thomson. “Ensure your payroll or HR [human resources] software is also up to date and, if bought off-the-shelf, check you have run the new tax year uplifts or any in-year uplifts.” She adds that employers should attend user groups where possible, and make sure HMRC returns are made on time and that the right amount of tax is paid at the right time. Organisations should also take care to set out exactly what they want from a payroll function, whether it is in-house or outsourced, and be very clear about what they want from their service. Very often they fail to clearly articulate their specifications, leading to the supplier and customer being miles apart in their expectations from the level of service, and invariably things go wrong. Therefore, both parties need to be clear about
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| Professional in Payroll, Pensions and Reward |
Issue 35 | November 2017
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