One of the key elements of a great payroll operation is reliability. In normal circumstances, the work of a payroll team goes largely unnoticed, as long as employees and executives are paid accurately and on-time. But the last few months have fundamentally threatened this rudimentary, yet vital process like never before.
COVID-19 has put payroll departments under unique pressure, being forced to deal with the significant impact on operations, dramatic changes to the regulatory landscape, as well as dealing with an uncertain future. Through several months of lockdown, businesses have had to continue running payroll while meeting constantly moving targets, making payroll resilience more critical.
With businesses of all shapes and sizes likely to be permanently changed by the pandemic, the characteristics of strong, resilient global payroll have shifted too. These five tips can help you ensure your payroll always runs smoothly, whatever the future may hold.
1: Prioritise the release of bank payments and general cash flow
Payroll can’t run without cash, and cash is the safest way to ensure business continuity during a time of economic uncertainty such as this one. It’s therefore absolutely critical to maximize credit lines and manage debt and cash flow to ensure the money is there to successfully run payroll every time.
And with home-working likely to become a long-term or even a permanent arrangement for your payroll team, it’s also important to establish reliable remote access to banking information for relevant team members.
2: Go digital
Certain payroll processes still have to be conducted physically, but many others can be automated and digitized, such as using digital signatures instead of physical ones. Transitioning to these new ways of working can help support a more resilient payroll in the months and years ahead, but this will require payroll staff to develop a new level of technological skill and capability.
The sudden switch to remote working, enforced by lockdowns, has caught many teams and workers out as they have struggled to adapt to more tech-based processes. You may need to help those team members broaden their skills if they’re lagging behind, especially in using screen-sharing and instant messaging applications that are critical for allowing them to function as a single team unit.
3: Rapidly respond to legislation changes
If there wasn’t enough payroll legislation to keep track of to begin with, the pandemic has generated even more regulations, often at short notice and frequently subject to change.
For example, the Coronavirus Job Retention Scheme introduced by the UK Government was announced, implemented and will taper off, all in the space of just over seven months. And in the United States, employers have been allowed to defer Social Security contributions until the end of 2020. Every responsible payroll team member should be constantly monitoring for changes to these regulations, while legal and compliance advisors who specialize in these areas should be able to assist if required.
4: Consider the availability of your payroll staff
Although your payroll team is responsible for ensuring your staff gets paid, don’t forget that they’re also staff themselves. They will have faced their own challenges and circumstances in recent months, and they’re just at risk of becoming unavailable as anyone else, if they or someone in their family becomes ill.
There’s no time to lose in planning ahead for how your payroll will operate in the event of your team being short-handed. This could be in terms of how duties can be redistributed, or whether additional resources can be pulled in from elsewhere within your organization.
5: Ensure your data is accessible, but also more secure
There’s a tricky balancing act to be struck between the availability and the security of payroll data. On the one hand, team members need access to payment files, payslips, pay register, general ledger files and other information. But on the other hand, those files contain highly sensitive employee data that is now being handled by the team remotely, through their own internet connectivity and possibly their own devices, which may not have proper security measures in place.
Consider how your staff accesses and handles that data, and what steps you can take to ensure it never falls into the wrong hands. With cloud applications leveraging technology such as two-factor authentication (2FA), extra layers of security can be implemented to minimise the vulnerabilities associated with remote working. And it’s also important to ensure your teams are made more cyber security aware to ensure they don’t fall victim to social engineering and other such attacks.
In many ways, the pandemic has accelerated the move towards a more digital way of working, so it is critical that you ensure your operations are hardened to the new dynamics such an environment creates. Ultimately, this will help you build a stronger and more resilient payroll operation that can easily respond to the unpredictable changes and challenges ahead.
However, to make that happen, your digital transformation project needs careful planning and execution. Why not listen to this podcast, which outlines the most important elements to ensuring the transformation runs successfully and delivers on its promises...