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Managing payroll can be a nightmare and one mistake could affect the entire team. And even more so if the HR team of three or four is managing payroll for a company of more than 100 employees all by itself. But even if you are a small organization, there is so much you could do when it comes to payroll management in HR, beginning with going for a cloud-based payroll solution to automating certain steps in payroll.
But what’s the best way forward? Outsourcing payroll entirely to a third party is the best way forward if you want to utilize the experience that a third party has to offer for payroll management in HR. But before we get into what you could do, let us define what we mean by payroll management in HR first.
Definition of Payroll Management in HR
A list of the employees in a company and the amount they must be paid as salary within a specified time is called payroll. The process of managing the payroll in a business, including the administration of all the processes, data, taxes and other policies related to it is called payroll management in HR. There are several steps in the payroll process, regardless of who is handling the payroll. And there are several stakeholders too who are involved in the payroll process.
Importance of Payroll Management in HR
Payroll management is very important to ensure timely and accurate payments for all employees. Maintaining a well-managed payroll also helps you avoid any issues with compliance. Many companies in fact offer a payroll compliance service as well in addition to the labor law compliance they provide as a part of their HR consulting services.
What are the end results of great and well-streamlined payroll management? The first is of course boosted efficiency in the payroll team. The second and third are boosted employee engagement and improved employee retention, both of which contribute to getting your employees to contribute more to the company and recommend your company to top talent, which in turn over time leads to a boost in the company’s ROI.
How to Streamline Payroll Management in HR in 2025?
1. Implement AI-Powered Systems
AI can automate time tracking, oversee leave management, and do tax and salary calculation, leading to an increased accuracy in payroll and a fall in the time needed.
2. Integrate HRIS or HRMS with Payroll Software
Connect your HRIS or HRMS with the payroll software to seamlessly integrate the employee data and to ensure uniqueness and accuracy of the data.
3. Employee Self-service Portal
An employee self-service portal can also reduce the administrative burden on your payroll team by allowing employees to view and download their pay slips, their tax records and other details.
4. Data Cleaning and Validation
Clean and validate the data periodically to ensure that the payroll calculations in a cycle are not affected.
5. Cloud-based Payroll Solutions
You could consider a solution that does not involve installing an application on your desktop. You can opt for a cloud-based payroll solution, accessible from anywhere and at any time.
6. Advanced Analytics
Make use of data analytics and predict trends, observe any issues with the payroll system and prepare reports highlighting recommendations to improve the payroll process.
7. Availability on Mobile
Ensure payroll functions and information is available to the payroll team for any kind of immediate action on their mobile too, even on weekends or public holidays.
8. Training and Upskilling
Train your payroll team on the payroll process, how to be an active stakeholder in it and how to suggest improvements to it.
Are You Looking for a Payroll Agency?
Your search ends here, with Alp Consulting, a payroll agency with more than two decades of payroll management experience. Let us advise you on managing the payroll process better for your business. Gain greater efficiency, accuracy and walk into an office full of happy employees, thankful to you for the safety and solace of an on-time salary credit that you provide. Talk to us today and let us help you manage the payroll process better.
FAQs
1. How to calculate Payroll in HR?
Payroll in HR can be calculated by following the steps in payroll, pre-payroll, payroll, and post-payroll. Each step in the payroll usually has a different stakeholder or stakeholders assuming responsibility for it.
2. What are the five payroll steps?
The five steps in payroll are defining a payroll policy, gathering employee, tax and related data for the payroll processing, calculation of payout and tax and other deductions, managing payroll compliance and reporting on the payroll process.
3. Who is responsible for managing payroll?
There could be an in-house payroll team that takes care of the payroll calculation, it could be outsourced to a payroll partner or managed by bookkeepers and consulting accountants. In our opinion, the second option is the best for payroll management.
