A recent payroll survey found more than half of companies believe there is room for improvement in their payroll process. Not only that, but organizational consistency in the payroll process was reported to be one of the primary issues organizations faced.
The most frequent payroll errors were found to be incorrect tax withholdings, overpayments, and underpayments, but 24 percent of respondents in the survey reported having issues in other areas.
It’s no wonder. HR, payroll, and employee data can be cumbersome if storage and processes are not organized. Disorganization and long, repetitive processes lead to errors, which can set the payroll department back several days.
Here are a few potential payroll problems you may encounter as an HR professional and how you can prevent them:
1. Software Incompatibility
Not all payroll programs are compatible. The same program used to store employee profiles or records could be different from the one used for pay and benefits, which is different from the one used for performance tracking. Why not wrap these all up into one program?
Reducing the number of steps you take in payroll will help the entire department function more efficiently as a whole. This is especially true for small businesses when time is of the essence. Spending so much time using multiple programs to manage hiring, payroll, benefits, and employee records is taking away from other projects you could be working on.
2. Data Loss
As one of HR’s worst nightmares, data loss in payroll could be a crippling crisis, especially if files aren’t backed up to an external drive. The typical, archaic HR software uses a computer hard drive or a server to store files. That presents big problems when a computer or server crashes, losing all information. No HR manager wants to spend days reentering all employee data and recollecting lost forms.
Instead, use a software that operates in a cloud so you never have to fear data loss. Cloud storage is a remote database managed by a third party where all of your data can be stored safely. You can connect to and retrieve your data when you need it through the Internet. Because you no longer need to access your information from a physical place such as a specific computer or server, this system allows for more portability and flexibility.
3. File Disorganization
“Where did I put that record?” you thought as you rolled your chair over to the filing cabinet towering above you. Or perhaps you’ve put your paper records days behind you for one of those digital filing systems that comes with a scanner. But is the record you seek in the employee’s profile folder or somewhere else? What did you name it again? You’ll probably have to open and search through all of the files.
You can avoid this frustration of finding files altogether by using a payroll software with all human capital management and payroll functions integrated. Just simply type in a keyword you think may be in the name of the document and options will pop right up.
4. Clerical Errors
Mistakes are a part of life, but they don’t need to rule your payroll department. Errors in data entry can lead to overpayment and misapplying pay rules. These expensive mistakes can be easily avoided by using an integrated software that connects employee profiles directly to payroll.
All human resources has to do is ensure employee profiles are set up with the correct payment classification. Is the employee hourly or salaried? What is the rate? Does the employee receive overtime? Is the employee exempt or nonexempt? Are any wage garnishments associated with the employee?
Once you’ve ensured the employee’s profile has all of the correct information, everything will transfer over to payroll smoothly when using a software with integrated platforms. This reduces the risk for errors, as well as time spent on data entry in general, so you have more time to work on other projects.
5. Lack Of Mobility
Let’s say the payroll manager is out of the office and there’s a payroll issue. Checks aren’t printing correctly or numbers are wrong. An adjustment must be made. Typically, the payroll manager would need to come into the office to fix it. However, with a mobile payroll solution, adjustments can be made right from a smartphone.
When choosing a payroll software, choose one that can be used on mobile so you can manage all HR functions from virtually anywhere. No more will your time off be interrupted with an office visit to troubleshoot a problem or correct a mistype. You can make corrections right from your phone.
These are just a few of the ways using an integrated payroll solution with cloud storage can help save your payroll department time and unnecessary stress. Want more help decoding HR's most "taxing" responsibility? Check out our free ebook, The Definitive Guide to Payroll for definitions, compliance and software solutions.