Over the last 10 years, a payroll department’s workload has grown considerably. Unfortunately since HMRC introduced Auto enrolment & RTI (Real Time Information) more have been subject to receiving a payroll or pension related penalty every year. Most of these penalties are due to filing errors, late payments or failure to comply with ever changing legislation.
This isn’t surprising, since calculating payroll is not a simple task. When you’re juggling factors like salaries and wages, incentives and benefits, and pension administration things get complicated quickly. Throw in wildcards such as furlough and it’s easy to miss details if you’re not careful. This is before even considering new legislation that’s in the pipeline such as IR35 from April 2021.
It’s essential to stay up to date with the latest trends in the payroll industry to remain one step ahead. Running a business is expensive enough without additional payroll penalties. Thankfully due to technological advancements, it’s getting easy to optimise and carry out your payroll process smoothly.
So far this year, payroll departments have had quite a lot to contend with. It is important to note there have been many other changes to payroll.
Along with the usual tax considerations and year-end reviews, these have included:
We would like to think it’s a thing of the past, but alas no. Sexual harassment in the workplace is still a problem and the government is taking a closer look to see how well employees are protected at work. It’s been 10 years since the Equality Act 2010 and time to review if the existing legislation could go further.
We’re always striving a balance, but some MP’s feel that families could be better supported with their work-life balance. One positive from Covid-19 has proved that different ways of working can and do work. We’ve been remotely working and proven there is no need for payroll to be 100% office-based in the future, matched with the right communication and technology systems. Online meetings have allowed teams to function well while working remotely too. Further ideas are being discussed regarding neonatal leave and pay for those with babies whom need special care after birth along with transparency of flexible working opportunities.
New mothers and pregnant women will be protected from redundancy for an extra 6 months, equating to protection for up to 2 years. (This includes adoptive parents).
There is conversation in government regarding the idea of creating one body to address and enforce employment rights for businesses and employees. This includes rights regarding everything from modern slavery to discrimination and health and safety.
This allows employees on-demand access to funds without having to wait until payday, for little or even no cost. Payroll doesn’t have to be monthly or weekly.
This has been delayed but is not going away. Please see our separate blog.
Payroll data may become crucial to provide actionable insights. This could help add to the success and growth of the company. Unnecessary expenses could be identified and the data used to help to shape the company’s budget.
As software develops in the Cloud, there will be more employee engagement and collaboration. Employees will have the ability to update their own personal details, without having to go through their managers. This will be a great time saver, although payroll departments will need to ensure their systems are secure and have adequate checks in place to ensure data is accurate.
It’s not surprising that within Payroll the software market is expected to grow over the next 5 years. Covid-19 has really hit businesses still relying on paper checklists, records and payslips. It’s a wakeup call to recognise that hard copy records & the production of paper payslips must be reduced. We all need to mitigate the impact, if this situation were to reoccur again. Technology demands have definitely been brought forward due to lockdown.
The outbreak highlighted businesses requiring access to data from anywhere, on any device. Working from home is looking the new normal, and managing payroll remotely is already a pressing requirement. Cloud based software also has the advantage of allowing payroll staff, HR managers and employees to access their payroll information in real-time. This needs to include pension letters and holiday bookings.
Hackers and cybercrime are an increasing risk and could cost you financially as well as your reputation. To avoid this, most cloud based packages include protection so your data is safe.
In conclusion, it may well be time to research technical solutions and look to improve your existing processes and systems. We are here to help clarify any of the points raised and support you through all the upcoming changes. Equally please chat with us before purchasing new software as we can discuss the pros and cons of each. The last thing you want is a new system that doesn’t do what you need it to. Let us work with you and ensure as your company grows long term, your payroll functionality grows with you.