If you work in HR, you must be familiar with hearing the common complaints, like “why isn’t my salary credited?” or “I haven’t yet received my payslip.” One of the most challenging HR (Human Resources) processes is undoubtedly payroll management. Payroll processing in HR is much more than just salary computations. And it can often be difficult for small to medium enterprises to tackle the numerous legal and financial aspects related to it and generate an accurate payroll process.
What are the 5 major Payroll Challenges?
- Changing Rules and Regulations of Statutory Compliances
- Payroll Computation errors
- Leave and Attendance Management
- Employee Lifecycle Management
- Data Security Threat
How to Tackle them?
1. Changing Rules and Regulations of Statutory Compliances
It is important to stay updated on the changing statutory compliances regulations as defying this can put the organization at great risk with consequent regulatory, financial, and legal implications that shall follow. Some of the common solutions include outsourcing or investing in automated technology. According to Forta, companies that enabled compliance technology saved an average of $1.45 million in compliance costs. Investing in an automated payroll management system can ensure that the company adheres to the evolving compliance requirements.
2. Payroll Computation Errors
Spreadsheets, manual data entry, and payroll computations continue to be used by the majority of small and medium-sized businesses. This process is not only outdated but also time-consuming and susceptible to numerous errors. Manual payroll processing can make it difficult to store and retain data for future use. According to the IRS reports, 33 % of employers make payroll errors costing the organization billions of dollars. Automating payroll processing shall help credit the salary on time, prevent any such errors and maintain accessible data records, saving the time & energy of both the employer and employee.
3. Leave and Attendance Management
Attendance data is crucial for all organizations and must be properly replicated, exported, and transferred across teams before being used to determine compensation and other incentives. Leave and attendance management has an intricate chain of approvals and paperwork is indeed a daunting task. Various kinds of HR software such as PayWheel can now incorporate the complex leave and attendance data to an online platform, making the process hassle-free and accurate.
4. Employee Lifecycle Management
A critical aspect of the HR function is optimizing the employee lifecycle. However, it can be challenging to manage the employee lifecycle of multiple employees. An HRMS system or software such as PayWheel can aid in this process with comprehensive employee data, performance reports, role changes and more. Employees can also manage their working hours, time-offs, benefits, requests and update their personal information. These factors together can contribute to better work experience for both the employer and the employee.
5. Data Security Threat
According to Purplesec, a data breach can cost a small organization up to 1.24 million dollars. Even the smallest security lapse can result in the loss of critical assets and, more significantly, the trust of the employees. Manual data and payroll processing can expose your payroll data to multiple security threats from phishing to cyber-attacks. Consistent payroll audits are essential to make sure that all activity is tracked and measured. A cloud-based payroll management system like PayWheel, ensures a safe and reliable mode to store your confidential organizational data with advanced encryption standards.
Calculating wages, filing taxes, and managing employee benefits can be time-consuming and challenging in payroll processing. Major payroll challenges such as computation errors, data security, keeping up with changing policies and compliances can be easily resolved with the help of robust and modern payroll management software.
Fortunately, there are many kinds of software that now offer comprehensive payroll solutions, such as PayWheel. You can now streamline your payroll processes and ensure that your employees are paid accurately and on time, with the help of PayWheel. This cloud-based HRM solution provides a range of services, including payroll management, location-based attendance & leave management, statutory compliance reports, among others.