The GoSmartHR Blog

What are the top 5 pain points for Payroll management?

Payroll management is a big responsibility with strict deadlines that takes up a huge chunk of time and can seem like a very dispensable task. But, as an essential business function, many organisations deploy technology applications to aid in the ease of workflow. 

A proper payroll management system is critical for a well-functioning business and will save you, both time and money in the long run. Alleviating the pains of legal and internal issues that may avoid greater problems in the future.

Let’s take a look at some of the most common pain points for payroll management today.

1. Administrative Overwhelm

While bigger companies may have the luxury of hiring payroll experts into their teams who specialise in managing payrolls seamlessly, most SMEs and smaller businesses don’t have the budget to accommodate such specialists. Therefore payroll management is handled in-house and manually. This process is firstly, extremely overwhelming for the people managing it and secondly, can be unfortunately prone to human error. Payroll processes involve a lot of paperwork and each employee’s payslip is different. The list of factors to calculate for each payroll (be it annual and sick leave, overtime and expenses, or tax deductions) using an outdated method of manual paperwork and archaic software to handle such a complex process is bound to lead to slip-ups and result in miscalculations and mistakes. An incapable payroll process can lead to legal issues and employee discontentment, and the HR staff, usually have to take the brunt of responsibility.

2. Compliance Issues

With the SA government every so often changing a policy and introducing a new term in the Employment Act, it is very easy for HRM personnel to miss a new policy update that has to do with payroll, given that this is only one of the many duties involved in HR Management. Questions you should be asking are; is your payroll compliant for South African legislation? How are updates delivered? Does it deal with local medical aid schemes or do these need to be loaded individually? If left undetected for long enough, internally there may be disputes or even worse being that the labour department steps in for non-compliance penalties and fines.

The key is to constantly be on the ball and adjusting for the latest policies, which can seem a burden for HRM teams. Alternatively using a system like SmartPay that sends updates which automatically sync, ensures that all yearly tax tables and medical aid rates are never outdated.

3. Time & Absenteeism Tracking

Employees have multiple reasons for absence throughout the year. Be it for study leave, maternity leave, incomplete months, and unpaid leave. This becomes a concern, as keeping track of all the employees’ whereabouts is a complicated matter and inputting it on the payroll is at risk of being forgotten. Keeping tabs on working hours also becomes difficult when employees have common discrepancies like forgetting to fill in timesheets or manually clock in and out, among other faults. This accumulates to inaccurate salary calculations, sometimes overpaying, sometimes under.

Using a system for time and attendance as well as leave, that integrates into payroll, alleviates these issues

4. Incompatible Software

With technology rapidly advancing in a digital world, it is truly problematic that so many HR teams are still using dated processes. A significant number of businesses still use manual payroll management or outdated HRM software to handle their HR solutions. The older software is mostly non-integrated and not compatible with each other. 

Technology is improving yet often payroll vendors with an installed base cannot move with the times. With obsolete technology, customers are forced to upgrade often at an exorbitant and unexpected cost. It is often at this point that payroll administrators look for better options. 

SmartPay is web-based, designed on a Microsoft SQL database to provide flexible, rules-based pay calculations, unlimited history, and multiple payrolls on a single instance. SmartPay offers innovative solutions such as part payments to Bitcoin wallets or salary advances applied for through WhatsApp.

5. Timely Payroll Processing

Timely payroll processing is a responsibility that is commonly taken for granted, especially in larger businesses. We all know the feeling of counting down to our next pay date. When it comes to remunerating employees, some have trouble punctually processing and releasing payslips. Largely, it is because payroll management is rather intricate and complicated should not be prioritised until the ending hour.

This is an unwanted situation that creates many potential problems for businesses, legally and in terms of disgruntled workers. Up to 70% of operational costs in your business are spent on salaries and wages. Using SmartPay ensures that you are making sure that time is accurately and fairly measured, reported, and analysed to ensure optimum efficiency.

How to overcome these common pain points

If you are still managing your payroll manually, we encourage you to schedule a demonstration of SmartPay to see just how comprehensive and user-friendly our system is and how much time you will save by automating your processes.

If you are already using a system, but feel that it is not delivering as you had hoped, let us show you just how easy it is to switch. We take the pain out of the transfer and will even give you a license fee holiday if you’re still having to pay fees on your existing software.  We’ll provide the much-needed support all the way through your transition to make the process a smooth one.

It’s important to consider who owns your payroll software. Many large corporates grow to a size where there is a focus on shareholder returns rather than customer service. Alternatively, they are sold to investment companies because of the attractive recurring license revenue. In these cases, service levels drop to maximise short-term returns.

Being privately owned and in control of our intellectual property, we can focus on customer service and long-term value. 

Call us today or book a demo

Learn why the SmartHR Solution or SmartPay Solution makes sense in your business.