CIPP future of payroll research report 2020


Zellis foreword The future of work is a hugely important topic for the payroll community. As the workforce evolves and diversifies, so too must the payroll function, particularly as new and often complex regulations are introduced to meet the needs of today’s employees. Now, as we hopefully enter a post- pandemic period, payroll staff are perhaps under more pressure than ever to keep pace with these changes and continue to develop best practices. At the same time, the payroll community must address its own future of work. In other words, how payroll professionals should upskill and adopt technology in order to continue meeting and exceeding expectations in the ‘new normal’. Beyond this, the future of work also means pushing for the recognition of payroll as a strategic, rather than purely operational, business function. This year’s Future of Payroll report reflects on trends and developments which will lead to increased complexity for payroll teams.

Jaspal Randhawa- Wayte ChMCIPP Director of product management - payroll solutions, Zellis

The COVID-19 crisis will further accelerate a trend that was already very much in motion, the shift towards flexible working, with 67% of this year’s survey respondents saying they have seen an increase in requests to work compressed hours, work more fluidly within core hours and, of course, work from home. This shift in behaviour only serves to underline the importance of capturing accurate employee working hours to minimise the risk of errors, underpayments, and overpayments – something which can be achieved with a stronger integration between T&A and payroll systems. Time tracking is essential to avoid National Minimum Wage/National Living Wage underpayments, particularly as there seems to be a trend towards remote employees working longer hours than if they were in the office. The complexity of payroll calculations will also be increased by the scope and choice surrounding benefits, particularly with the growing popularity of options such as childcare vouchers (offered by 80% of organisations), salary sacrifice ( 65% ), and the ability to take paid or unpaid sabbatical ( 41% ). As benefits become an even more integral part of the employee experience, we should expect more organisations to join up the pay and benefits processes through the introduction of ‘total rewards’ statements and stronger integrations between employee self-service and benefits platforms. The Good Work Plan, which will implement the recommendations made by Matthew Taylor in his report on modern working practices, is widely recognised as a positive development in the world of employment. However, we must acknowledge that as the Good Work Plan is implemented, payroll teams will naturally need to adapt – and therefore they should work to prepare for such changes as far in advance as possible. The potential introduction of a single enforcement authority for employment rights could help reduce some of the complexity, with 64% saying they think it would have a positive impact. So, what changes will we see to how payroll teams themselves operate, particularly in the ‘new normal’ of remote working? The short-notice shift to working from home will have exposed the limitations of on-premise software solutions for the 37% of organisations that use them, and it likely caused many of them to worry about their ability to process payroll accurately and on time. The proportion of organisations using cloud-based software has increased significantly from 25% last year to 37% this year – and we should expect to see a further leap in cloud adoption in order to support a more efficient, flexible, and agile way of working post-pandemic. For similar reasons, we anticipate that technology used in areas such as data security and remote communications will also become increasingly important. Above all, the payroll profession’s focus during this indeterminable period of uncertainty should be to stay as informed and ahead of change as possible. This means working closer than ever with industry associations, regulatory bodies, and technology suppliers to receive the right guidance and assurances on pressing topics such as National Minimum Wage, IR35, salary sacrifice, holiday pay, pay gap reporting and, of course, COVID-19. We should remember that in every crisis, there is opportunity. And while the pandemic may bring the future of work to bear sooner than we might have expected, we should look to embrace the opportunity for positive – and perhaps long overdue – transformation. In doing so, we can truly showcase the essential and highly strategic role payroll plays in our organisations.


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