As a payroll professional, employees rely on you. On a fundamental level, when people don’t have to think about whether they will receive accurate paycheques on a set and reliable schedule that they can literally time their bill payments to, it relieves significant stress from their lives and improves their overall job satisfaction.

Many payroll professionals may find themselves thinking, “Well, I am just doing my job,” but they are nonetheless instrumental to the overall success of the organization they work for.

Increased payroll accuracy

Accuracy in any job is a critical factor in the overall success of a business. Payroll mistakes are sure to be noticed. The most considerable portion of many companies’ expenses is labour costs. According to Paypro Workforce Management, “Payroll as a percentage of revenue should range between 15 and 30 percent,” and, “Labour-intensive service-based businesses can reach payroll costs of up to 50 percent.” Some of the most common mistakes in this realm can include pay miscalculations, inaccurate applications of tax calculations, incomplete records and incorrectly processed wage garnishments. Checks and measures need to be in place for organizations utilizing payroll systems that rely on batch processing, because errors (like underpayments or overpayments) can cause turmoil among many staff members, leading to mass dissatisfaction among staff and a high overall cost to the company to fix such errors. Our Business Ladder reports that, “According to the American Payroll Association, automation can decrease payroll processing errors by as much as 85 percent.”

In addition to automation, encouraging payroll staff to remain committed to continued education and providing them with the time and professional development budget to keep up to date on emerging payroll regulations, taxes and industry trends will save the company money in the long term.

Opening the line of communication

The payroll department is the first place people turn to with questions about compensation or concerns about their pay. The way that the payroll department treats colleagues is often seen as a reflection of how senior leadership feels about their staff. This means that communication efforts must be clear, concise and compassionate; this is essential to building employee engagement and reducing turnover. Inquiries from staff about payroll concerns should be answered promptly and relieve concerns to ensure that staff feel seen, heard and supported.

Jackson & Frank report that, “Research on insurance employees in Nepal found that payroll satisfaction significantly influenced job satisfaction, leading to better performance, particularly in customer-focused roles. When payroll systems are perceived as fair and transparent, employees feel valued and motivated, which drives them to perform at their best.”

Making data matter

Payroll often acts as the link between human resources (HR) and finance, with the data payroll collects providing valuable information about employee compensation, tenure, benefits utilisation, pension contributions, overtime pay rates and hours worked, reimbursement payments, tax liabilities, sick leave and paid time off, bonus payments, and suggestions for overall business cost optimization.

Bobby Hotaling, founder of Hotaling Insurance Services says, “There are many ways to supplement salary by assisting employees in other areas of their lives. You can offer an extra level of life insurance or disability insurance for employees to protect their incomes. Other ancillary benefits, such as dental, optical and wellness, are all well received by employees. And gym memberships and transit benefits are great perks to keep employees happy and healthy. It is important to provide higher benefits so your employees know that you truly care about them and their families.”

Using a model similar to Hotaling’s in ensuring employee satisfaction and retention, payroll professionals can utilize their data to make recommendations to enhance the employee experience, including:

  • Where more staff could be hired based on which employees or departments regularly submit the most overtime hours
  • Trends in sick leave rates and employee turnover rates within a department or the organization overall to pinpoint specific areas of concern
  • Costs of employee benefits (and ways to better utilize them to ensure cost savings and a happier staff)
  • How salaries compare with market standards and within the organization
  • The overall cost of processing payroll and payroll error analytics to improve performance and reduce costs

Conclusion

When employees feel secure in their compensation, they are more likely to stay with a company long term, reducing turnover and the costs associated with hiring and training new staff, and payroll professionals can feel proud of the role they played in that process.





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