How to futureproof your payroll

Steve Cox of IRIS FMP

For centuries, payroll has been part of company life. From handing in your slip to get a shilling, to now, where advanced systems automate a lot of the processes, payroll is only going to get smarter, more secure and end-user focused. 

We’ve lived through a pandemic, had to find ways of working that aren’t what we’re used to, and payroll is the same. Covid has triggered some kind of a change in our world, but what if this was already happening, and is there more change to come?

From sustainability arguments to transparency around best practice, the face of the world is changing, and with that the employees, business practice and more needs to change with it. 

High-level finance executives, all the way up to CEO level, are the ones who can push for real change. A network and system of everyone striving to create a futureproofed payroll method is the only way change can happen. Those with decision-making capabilities are the ones who are most effective at leading change. In theory, sounds fantastic. But in practice, what can actually happen to make change?

Sustainability and ethics – a growing concern

BCorps, sustainable practices and other similar concerns have been rearing their head. Apps like Good On You that rate companies based on their sustainable practices are growing, and younger generations especially want to know that the company they work for, or buy from, has good practices.

Sustainability doesn’t just mean going paperless, it means being ethical, having a transparent supply chain and investing in people. 

When it comes to creating sustainable payroll, you can choose a vendor that pays their staff well, works on their carbon footprint and promotes good working habits. 

Earnd, an Australian company is an example of this. They offer ‘earned wage access’, which is essentially a way to get paid on demand. Financial wellbeing is the number one cause of workplace stress, according to BlackRock and many other studies. Therefore, to create a more ethical workplace, reducing financial stress, earned wage access companies like Earnd are promoting a future of transparent and ethical payroll vendors. 

Payroll as a metric – tracking the workforce

Payroll data is some of the most valuable a company can hold. Utilising this data is one of the easiest changes to make to futureproof your workforce and your payroll itself. For example, is there a particular week or month where overtime requests go up, is one team constantly pushing their limits?

Mapping payroll data alongside business growth plans cements payroll as a key foundation of any business. By noticing areas for improvement earlier on in your business growth, you can help your company to grow in a manner that suits employees and directs funds where it is needed most. 

This requires technology, algorithms and reporting dashboards to make a stand. Gone are the days of calculations done on the back of a napkin, payroll can no longer afford to be on paper. 

The sooner all payroll is digital, the quicker a company can act upon the data at hand and grow more efficiently as a company. Zion Market Research forecasted that the cloud based payroll software market will be worth nearly $14 Million By 2026 back in 2019, and COVID has catalysed this forecast uptake. 

Going to the cloud

Cloud-based working had to be plumbed in overnight when Covid hit. Using Teams, Google Chat or Slack became our new normal in March 2020. Payroll had to catch up as well. 

Security is a concern with payroll, and building custom systems from the ground up is impossible in short spaces. Cloud based payroll software that could provide instant turnaround saw an uptick in use as payroll managers and admin staff struggled to balance furlough payments, SSP claims, and more payroll difficulties. 

However, this shouldn’t be a temporary change. Cloud-based working solves common issues such as data protection, loss of files and unwanted access. 

It also gives employees control over their data, their access to old payslips and more. When applying for bank accounts and mortgages, an employee can easily download and sort out their paperwork without undue stress to admin staff. The carry-over benefits of digital solutions reach far out into your business, as automating processes means that you can easily and simply free up time and energy to human centric problems. 

Agility and resilience of a zero-touch payroll

Zero-touch payroll, an up-and-coming buzzword in the payroll world, is a sign of the agility that payroll users now have. 

It is the act of automating complex payroll process to make it a hands-off approach, designed to run in the background and speed up the end process. It involves audit processes, predictive analysis, and links with tracking software’s to allow for automated processes such as automatic pay and similar. 

Automation is a growing interest in every aspect of working life and payroll is often a time-consuming task. Adding in areas of automation, such as billing considerations and blending multiple payroll vendors. 

A large area of zero touch payroll is the reliability aspect, removing excessive manual input and therefore human error. While human aspects can never be removed from such an integral part of a company’s working, it can be used to assist stretched payroll teams in complex tasks. 

When scaling internationally, nuances such as bank holidays, specific cultural and legal regulations all need consideration. An automated payroll process that is little touch can assist, creating a system that works around nuanced aspects of any country to ensure compliance and regulation.

Steven Cox is Chief Evangelist at IRIS FMP, an outsourced payroll provider for SMEs and start-ups. More on them here