How the magic payroll button really works
It’s time for a little trumpet blowing and foot stomping by payroll professionals. Alarmingly, there are still so many managers and business leaders who think we have a magic payroll button that takes little to no skill to press. For some, the belief is that anyone with half an ounce upstairs could run a payroll! When something goes wrong, the question is raised “Why is it so hard!?”
Sadly, it’s often the managers of the payroll team with this flawed perception. They might serve their team and themselves well to spend a little time getting a new perspective on what I honestly believe is one of the most committed work groups in a company. What other department stays as long as it takes through hell and high water to process an EFT file, again and again, without thanks.
Let’s take a look at the diversity of knowledge a payroll professional is actually required to have… and how we get that seemingly magic button to work…
We are expected to be consummate customer service representatives, with superior conflict management skills; responding to technical questions on the spot; remaining calm in the face of irate employees, who sometimes hit you with a tirade of swearing. We must be mind readers; hide our anger as we are treated as lower class citizens by people who think that God created us unequal; hide our laughter at the ridiculous requests; and empathise with the employee who needs their money yesterday because they can’t feed their kids or put petrol in the car to get to work. We solve problems day in and out and its’ when we can’t, or don’t, that others in the organisation begin to hear about it.
Payroll professionals liaise with employees, managers, the finance team, the human resources team, solicitors, workers compensation insurers, auditors, the Child Support Agency, medical funds, unions, employer associations, banks and finance companies, social security, superannuation funds and the taxation office. These people and organisations make demands upon us and expect the same service excellence that our employees expect from us. It doesn’t matter if we have a Service Level Agreement stating when we will respond to requests, because most of these relationships are bound by law and so are the timeframes in which we have to jump.
Payroll professionals actually performing the payroll process are under constant stress during the time between the receipt of the input data, to the time the funds are transferred to the bank. If we are lucky enough to have all the data provided correctly and on time, its a fairly calm payroll day, but that is not a standard practice in the world of payroll. There’s usually a pretty tight timeframe, a whole list of queries awaiting resolution by people who won’t return phone calls and emails. Achieving a zero error rate demands a great deal of validation and questions.
Policies & Procedures
Apart from having to know the company policies & procedures intimately, there is usually a fair amount of time spent by pro-active Payroll Managers referencing policies or documenting and updating payroll procedures as innovations are implemented and best practices are discovered.
We have to be constantly mindful of the consequences of our actions on employee relations and foresee human resource management issues that may emerge, or are already in effect. Every interaction with an employee and every payslip is a potential ER/IR disaster if not managed well. This is a top of mind issue for all payroll professionals.
In order for payroll professionals to competently process payrolls, we must understand accounting principles to effect many of the transactions we do in our standard day. Debits and Credits run deep in the simplest of payroll general ledgers, multiplied by the complexity of organisations with numerous companies and differing cost account structures.
At any time, there will be multiple payroll projects in the pipeline. System upgrades, new EBAs, legislative changes to address and more. Payroll Managers and their staff are juggling diverse management needs, moving target dates, sometimes a lack of resourcing, shifting management priorities and insufficient hours in the day to keep their projects from falling over.
Legislative & Industrial Framework
We are expected to have in-depth working knowledge of the endless legislation that affects the organisation: Fair Work Act and its’ predecessors, Workers Compensation by state, OH&S, Payroll Slips Regulations, Annual Leave, Long Service Leave and Public Holidays by state, Superannuation Guarantee Acts … phew!