“It takes less time to do a thing right than to explain why you did it wrong.”
― Longfellow

There is no department which demands more precision in operational tasks than payroll and we’re here to discuss just how important this aspect of HR is. Granted, to put a disclaimer in the beginning, there is a debate to this day whether payroll should belong to HR or finance departments because the two are quite closely linked with the agenda to close the gap between them as closely as possible and basically combine numbers and people. However, it is more common for payroll to be integrated into HR departments so we will look at it from that aspect. HR usually works very hard in couple of different elements such as employer branding, employee engagement, benefits and compensations on offer or simply just company culture but nothing from those aspects matter if the numbers on the payslip don’t match the contract or timesheet and this article suggests, without even needing to state it, salary is still the leading motivator. Huge companies and corporations can be heavily emphasized in this regard, especially in manufacturing or logistics industries because of blue-collar prevalence. With that working environment, the payroll department has to have a good dozen set of eyes which work with high-level precision and detail-oriented mindset because of all of the different timesheets and shifts. But what are the challenges that payroll faces and what do they need to follow through with such demanding tasks? Let’s dive in.

Payroll challenges

How do you know that payroll is working perfectly? It’s quite simple actually; if there is no noise after the payslips are sent, it means all the numbers added up and that much needed accuracy was executed. The effect has to be invisible in order to deem it successful, essentially. As mentioned earlier, attention to detail is really needed here so many companies opt for outsourcing their payroll because many offer this as a specialized service. Four eye principle should be ever-present and doubled in the sense that there is usually more employees needed the higher the number of the overall employees in the company is. Oftentimes where payroll struggles, just like HR in some cases, is visibility of the workload and its performance which then incidentally follows up with lower estimation of how difficult in practice it really is. Then, you have an HR aspect of the payroll in which payroll specialists deal with employees on a daily basis and that in on itself, as we all know, requires high levels of emotional intelligence, stress resilience and ability to ad hoc get things done. Time consumption in operational tasks is daunting for payroll as well, especially when dealing with time management of the employees; mostly blue-collar as mentioned. All quite negligent facts when casually talking about payroll but nevertheless really important and challenging in practice.

How HR can assist

Since payroll is an integral part of HR, they can understand and feel the pressure that payroll faces on the daily basis. The common denominators for both HR and payroll are administration and dealing with people/employees so you could say that the overall understanding is mutual. The best parameter of where HR can help payroll is the accuracy of the operational tasks such as administration. As I mentioned that payroll has a huge time consumption challenge, the inaccuracy of HR operations can prove their tasks to be even more difficult than it already is. The human error is a common theme in these type of tasks so even the most proficient employees/teams can expect to miss sometimes but to best avoid or mitigate such situation is effective communication between the two. Being close in proximity physically and constant e-mail communication as an MO is vital for each process to go smoothly. Just these two factors alone can make up for potential lack of budget resources in staffing in some companies. Add a good process with defined steps and you have a winning ticket between two departments.

Things to consider

To assure the burnout doesn’t manifest within the payroll department/team, a careful management of it has to be implemented, which is often ignored, as mentioned. The precision required should be accommodated by various workplace benefits such as home office, displaced desks in the company, appropriate budget for staffing, right tools to compliment such precision etc. Obviously the general management of the department, mainly because of coordinating the workload, also helps but needs no mention.

Takeaway

As the title suggests, the above claims definitely make payroll an integral part of HR department or strategy. Any HR endeavor is rendered useless if the employees’ bank account doesn’t state the right number in the beginning or the end of the month. The right business harmony between HR and payroll is absolutely necessary for the process to be as proficient as possible, with as little human error as possible. Management or any HR leader needs to make sure that payroll as a whole department/team is provided for in terms of having the right and necessary resources to do the job. Its competence is one of the core drivers of that end business result and you should make sure to have it effective at all times.