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By Andrew Baines
Having worked in payroll for 15 years, I have developed a firm understanding of how emerging technologies and changes in legislation have called for payroll professionals to continuously cultivate and develop new skills in order to stand out from the competition. Read on to find out what trends will continue to impact the industry!
Payroll processes have certainly evolved with the tide of ever-changing business trends, and will continue to do so. I believe there are two major constants that will continue to develop and have an impact on consumer behaviour and how employers run their businesses as a result. Those who embrace innovation will ultimately set themselves apart from competitors. But in order to adapt, employers will need to actively pursue individuals who are proactive enough to flow with the wave of transformation.
Digitalisation is sweeping through the industry, increasing efficiency and productivity as a result. Given the wide range of digital finance management solutions on the market - such as Sage, SAP and Workday - many employers are looking for tech-savvy individuals who are either willing to learn or are already proficient in using existing and emerging accounting software and functions.
Because the areas of finance and HR are so heavily intertwined and central to a company’s agility, they are the logical first step toward unifying all back-office functions. For this reason, more employers are converging finance and HR automation, processes and data.
A recent study by Oracle has identified 34 critical touchpoints between enterprise resource planning (ERP) and human capital management (HCM) cloud systems in which a tight integration can speed operations and eliminate manual tasks across the departments. One example is how organisational changes such as increasing the size of the salesforce require companies to create new departments and budgets, while expanding into new locations necessitates staffing up and acquiring office space and equipment as well as assessing local tax implications.
While there may be some resistance to change, it is crucial that employers maintain a focus on the end game of digital transformation as roles change due to automation and the need for data mastery. According to the survey, 30% of respondents said the cloud frees them from low-value work to focus on strategic priorities.
While larger organisations may call on a third party bureau to review updates in legislation, it is advantageous for payroll professionals to also keep themselves clued up, as this will enable them to be proactive business advisors within their organisations.
Below are two of the biggest legislation changes that were announced this year, and how they will impact payroll:
Apprenticeship Levy: This year, the Apprenticeship Levy was introduced to help young people get into apprenticeship schemes. The money will go towards funding the education within apprenticeships in the UK. The new tax will only apply to companies that have a pay bill over 3 million per annum. The tax will be based on 0.5% of an employer’s pay bill. However, there will be an allowance of £15,000 for all employers.
Gender pay gap reporting: Kicking off on the 5th of April in 2017, this piece of legislation requires private and voluntary sector organisations (employing 250 or more people) to publish the details of their gender pay gap by the 4th of April in 2018. Employers will need to use data from 2016/17 for the first reports which will require median and mean information relating to employee pay and bonus pay to be published; together with details of the number of men and women in each quartile of the organisation’s pay distribution.
In conclusion, change will continue to impact finance functions across the board, and payroll professionals will need to continuously adapt and evolve in order to be highly sought after by employers.
Andrew Baines is a data-driven payroll specialist with over fifteen years in the industry, where he has obtained extensive knowledge of UK PAYE payroll specialisms including tax, National Insurance, statutory payments, HMRC guidelines, legislation and returns. He is currently temping as a Payroll Advisor. Andrew believes that his communication and interpersonal skills are essential for building relationships – both within a payroll team and other departments within the organisation, as well as with external parties and clients.
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