27 Sep Top Payroll Challenges to Avoid
Your payroll may have been simple to manage back when your business was tiny. The humble beginnings when it was just you as the manager of everything, your son did the sales plus deliveries, and your daughter managed the wages from your banking app. But businesses grow, and so do their payroll systems requirements. In this guide, we discuss the top payroll challenges to avoid.
It’s simple for business leaders to assume payroll processing to be a simple task. Yes, this may have been true when the business and its team were small. However, this does not apply when businesses grow. Payroll errors can be extremely costly. Get your employees leave days wrong and see how their morale declines. Or, even worse, financial losses due to fraud or extreme tax penalties for incorrect tax submissions. These are some of the common payroll challenges to avoid.
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A Lack of Automation
Poor systems and controls are the roots of most payroll challenges. Human errors are inevitable in any environment that requires extensive manual data entry and processing. This can be eliminated through the power of automation. Avoid making errors in calculating employees’ salaries and deductions, compiling your tax submissions, and recording employee information and transactional data.
Automation not only helps eliminate errors relating to manual data entry but also saves your HR team time. Empower your HR team to focus more on understanding payroll costs, identifying trends, and reviewing insight on how to improve the employee experience.
Nothing spells vulnerable like a payroll processing system that has no controls in place. You do not want to be that business owner who discovers payroll fraud by accident. This is definitely costly. Modern payroll systems allow management to enforce segregation of payroll duties rather than giving a single accountant and payroll clerk complete autonomy over their payroll system and business bank account.
Different people should have responsibility for capturing payroll data and for managing access to the system as well as adding and removing employees from the payroll. Yet another person could be tasked with checking that the numbers add up.
There are many other payroll challenges that businesses can face. Including poor control over leave days, and travel allowance pitfalls. Speak to one of our experienced payroll consultants and we will be happy to guide you on the top payroll challenges to avoid, and what system would be ideal for your unique business case.