COMPLIANCE
How does this now look, in terms of payroll's strategic approach? This falls into three key focus areas: 1. Payroll / benefits costs Organisations run on costs (as we know), and these impact decisions. As one of the highest expenditures to a business, it’s imperative that payroll costs are continually reviewed. This doesn’t just include standard costs but other, non-accrued costs, such as payroll errors. Publishing these figures, along with savings and impacts, will help to highlight the importance of the team. Along with this, publishing the savings made by the department will showcase how your team / department helps improve an organisation’s overall operating costs and, eventually, its profitability. 2. Data is key Companies generally don’t make decisions unless they have the relevant data. Quite often, this feeds into a wider strategy, using business plans which need to be underpinned by data. In essence, data equates to information and information drives decisions.
Payroll holds a significant amount of this data. Not just the net wages bill, but also information regarding on-costs and third-party costs linked to payroll. Added to this is the need for organisations to publish other information such as gender pay gap reports, as it’s become more important for businesses to promote how fair they are in terms of recruitment, pay and rewards. 3. Environmental factors It's fair to say we’ve seen a significant number of environmental factors over the past year, including: l Brexit l Covid-19 l changes in prime minister (affecting changes in legislation) l the cost-of-living crisis. In addition to this, as payroll has the right information, it can now start to predict costs
going forward, including those associated with upcoming legislation or rate changes. This is important, as decisions will quite often be taken based on revenue vs costs. 4. Being as agile as we can We’re now working in an environment which is much more fast-paced, with change happening more frequently and in a shorter timeframe. Within the team, it helps to take a more
| Professional in Payroll, Pensions and Reward | should no longer simply be seen as the team which pays everyone’s salaries, but as the department which can be relied on to help feed into an organisation’s key strategies. n 3 29 agile approach within the organisation. Being agile is about delivering projects faster with minimal impact. Without this approach, there’s a risk that upcoming projects will have a big impact on the resources involved, as well as the timelines. As an example, if your organisation is acquiring new companies, it’s imperative that payroll is involved at the earliest stage, so planning to onboard can take place. The same is true when engaging with any new software vendor suppliers. In summary, the payroll department phase3.co.uk System health checks & selection Payroll audits & process reviews Managed/outsourced payroll services
“Data equates to information and information drives decisions”
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Issue 92 | July - August 2023
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