Nowadays the world is rapidly changing and that means it has extensive implications for payroll services. Globalization and the rapid advancements in digital technology are the two major forces that are driving multinational organizations to rethink the payroll services. The pandemic has brought about social distancing norms which are challenging workplaces to reimagine their payroll processing services. In the work from home, scenario complexities have increased quite a bit because of the new normal and hence the payroll systems have to be updated accordingly.
The increase in economic and social disruption due to the pandemic has led to companies changing their business strategies and trying to improve their payroll management services. Companies are busy trying to build their payroll operations keeping in mind the future trends. Most companies are busy trying to expand their business on a global level and generate newer revenue streams. This means there are more payroll implications that have to be taken into account. In this blog few of the future payroll trends will be discussed and how exactly companies can prepare themselves for the future.
Future of Payroll Trends
Here’s presenting the future payroll trends that you have to watch out for and should stay updated about to always remain a step ahead in the game:
- The up-gradation of digital technologies poses both a challenge and an opportunity for organizations. This is making companies rethink their payroll structure and make it a cloud-based model and move away from the traditional on-premise systems. The rapid development in artificial intelligence (AI), robotics process automation (RPA), blockchain, internet of things (IoT), and chatbots are forcing companies to move towards an automated system and denounce the manual payroll system since that is a very slow procedure and requires a lot of resources. Automation of payroll systems is extremely significant to sustain the future and also implement the existing resources into the other sectors and avenues.
- Business continuity plans (BCP) is a document that basically has a plan outlined of how the company is going to work when an unplanned disruption occurs in service. It is a process of building systems of prevention and recovery so as to deal with the potential threats to a business. BCP also enables ongoing operations during the execution of disaster recovery. The BCPs in today’s day and age has to be a lot more vigorous, full-bodied, and sturdy. Assessing the status quo of your payroll services and thinking about the continuity scenarios at the same time isn’t an easy task. There are a few particular areas that companies have to focus on and assess the payroll function accordingly. The payroll organization has to be carefully monitored and companies have to always keep a check on the staff responsible for payroll activities in each of the locations and how they are performing. The organizations have to make sure whether there are sufficient BCPs places in all the locations and effective they are for third-party providers or in-house. Staff capability and availability have to be kept in mind at all times. Companies have to ensure that the staff is being continuously trained and being notified of the newly developed systems and technologies.
- Owing to the pandemic, work from home is the trend that has been adopted by companies globally and it is here to stay. In such circumstances, it is critical that organizations are fully confident of their workers, especially payroll personnel, practicing work from home and how efficiently they are being able to perform. Companies have to ensure the fact that the payroll staff is equipped adequately and have the necessary arrangements to work from home. They also have to check on the data confidentiality and whether it is being maintained in the work from home scenario.
What are the payroll trends that will *actually* help you in 2021?
Some of the future trends are being discussed down below that will help companies and businesses benefit in 2021:
1. Integration of payroll services and HR is integral considering the number of benefits it has to offer. Even though the two sectors are of varied disciplines, they are interlinked. The integrated system will help the staff members and managers to get hold of information from one dashboard. When the payroll process and HR is combined then the efficiency in managing employee data becomes a lot easier. Medium-sized businesses consider the investment in HR technology to be very expensive but that is not always true. The HR software will make scheduling and time tracking a lot easier and when the payroll software gets integrated with that then the data can easily be shared across all the systems. This will also make sure of the fact that there aren’t any payroll frauds taking place since the employee working hours can be tracked with a lot more accuracy.
2. Hiring payroll outsourcing services is another trend that is going to help companies benefit tremendously in the coming year. Most of the big companies globally have already switched to outsourcing their payroll because not only is it time-saving but also helps in investing the company’s resources in other core functions. Payroll processing is quite a tedious job and demands a great amount of attention to the minutest of details. Payroll outsourcing companies take the right kind of security measures and keep in check with the tampering of information and any other kind of frauds and this, in turn, helps companies save on the huge losses that they would have to sustain otherwise. The services providers heavily invest in taking these measures that aren’t really feasible for in-house members.
3. A trend that is soon going to become a must is including a financial wellness program in the payroll system. Employee retention rate is directly associated with employee satisfaction. Productivity in the workplace can be boosted only if the employees are motivated to work. Many times employees aren’t able to fully concentrate on their work due to constant worry about their financial well-being. Hence a financial wellness program is a must because it includes financial counseling that will help employees understand how to plan their retirement better and how to properly allocate their money.
4. Companies are also trying to make wage information more accessible to employees because that ensures pay transparency. Payroll services in India are disclosing how the pay structure of a particular company is created. This trend will definitely help companies build a good relationship of trust and loyalty with their employees because they will be informed of the reason as to why they get paid and what amount they get paid. This entire process helps promote equality within the company.
How companies can prepare for the payroll of the future (2021)
The changes in payroll are evolving with each passing day and companies have to start preparing themselves for the future accordingly. The automation of payroll is one of the major changes that has taken place in recent times and rightfully so because they have helped reduce the manual labour and sped up the process. A few ways in which companies can prepare themselves for the future are discussed below:-
- The workforce in most companies nowadays feels very comfortable in mobile working, be it for a short business trip or for long term projects. Business mobility has to view tax implications because of this trend. When companies are trying to manage their workforce, different providers are allotted for payroll and mobility. Most of the time company owners get stuck managing the coordination between both these operations and hence they have to prepare themselves to bridge the gap between these two operations because it is important for effective payroll compliance management.
- The payroll professionals have to reskill and upskill themselves to prepare for the future. Since data plays a very significant role in this entire function, payroll service providers need to have a thorough knowledge and understand the data inside out. Companies have to train their payroll professionals appropriately to sustain in the future and also recruit people from a wider talent pool. Since the future is all about automation of payroll, payroll professionals have to accordingly mould themselves and prepare themselves well in the technological field.
- To prepare for the future, it is very important to assess the technical weaknesses or vulnerabilities of a company. The IT infrastructure of a company plays a vital role when it comes to payroll functioning. Companies have to check for the accessibility of payroll source systems and whether all the payroll inputs are being received on time. Companies have to always keep a check on the security of their IT infrastructure because that will ensure the smooth functioning of the payroll operations.
- The payroll professionals usually do not work at the forefront and are silently doing their jobs at the background and they navigate the company through unprecedented times. If a company has to sustain in the future, it is very crucial to have strong payroll business continuity planning because that will make all the difference. It will ensure that whether the employees are being paid on time or not and that is how the trust-building develops between the company and its employees.
- Another very critical aspect that companies have to keep in mind is whether they choose to carry out their payroll operations internally or outsource the payroll. Owing to the Covid-19 pandemic it has been seen that companies who were conducting payroll operations internally have been badly affected in comparison with those companies who outsourced their payroll. This goes on to show that the payroll processing structure has changed quite a bit and to keep going in the future years it is best to outsource payroll. The companies that were conducting payroll processes internally had professionals who weren’t able to operate remotely and hence couldn’t meet their deadlines. Professional payroll services are adept at working remotely and also keeping up with the frequent changes.
The delivery and strategies of payroll are evolving and continuously changing to accommodate the advancements globally. If companies have to sustain the future and the new normal then an agile, compliant, and resilient payroll system is extremely crucial. An efficient payroll function will define the future of a company. Payroll might look like a simple job at its core but if it isn’t carried out effectively then it gets complicated because of the several deductions that come into play.
The payroll system of a company has to be active and efficient to make sure employees are getting their salaries on time and accurately. Good payroll management can help benefit companies in varied ways. Most importantly it develops trustworthy and meaningful relationships with employees which is.