Turn Payroll Into a Strategic Function
Estimated reading time: 5 minutes
(Editor’s note: Today’s post is brought to you by our friends at Paycom, a leading provider of cloud-based human capital management software. They recently presented $20,000 to two LGBTQ+ nonprofit organizations as part of a Pride giving initiative. Enjoy the article!)
I’ve mentioned before that I’ve been responsible for payroll a couple times during my HR career. It can make a lot of sense. HR and payroll work very closely together. And when employees have an issue with their paycheck, they often go to HR. That’s why I want to talk about payroll today and what we can do about reducing paycheck mistakes. Because no one wants to have an issue with their pay.
Employees rely on it. According to data from The Washington Post, somewhere between 50% and 78% of employees live paycheck to paycheck. One little mistake can be a big deal. When employees spend time worrying about paying bills, this isn’t good for their wellbeing and work performance.
In addition, manual checks are costly. NACHA, a trade association of electronic payment vendors, indicated that it costs a business up to $2 to cut and process a hard-copy check. Now, I’ll admit the $2 number is a bit dated (2011), but I’m hoping we can agree that this cost has only increased over time. And while $2 might seem insignificant, we also know those costs can quickly add up. Bottom line: Everyone wants the same thing, and that’s for payroll to be right every time.
Introducing a New Path Toward Perfect Payroll
The person who should know how much they’re supposed to be paid is the employee. They know how many hours they worked. They know if they’ve taken time off. They know how much their deductions should be. And they’re in the best position to let the organization know if corrections should be made. So why not give employees the tools to do their payroll before it runs?
Our friends at Paycom have reimagined payroll with a new solution called Beti™. Chad Richison, Paycom’s founder and CEO, explains the value proposition. “With Beti, employees do their own payroll. It should have always been this way, but the tech didn’t exist. Today it does, and employers and employees will win with it.”
Now before I get into some of the details about how Beti works, please know that employees can’t change their pay. Nor can they add hours they didn’t work. That’s not what we’re talking about. Beti allows employees to complete payroll-related tasks, including viewing their preliminary paycheck details, acting on any payroll related tasks, asking any relevant questions and approving their paychecks before payroll runs. Bringing employees into the payroll process means questions can be resolved early, so fewer mistakes are made, and fewer manual checks are cut.
Here’s how Beti works: Before payroll is processed, employees will receive a real-time push notification to view, act on, and then approve their paycheck details via a mobile app. The check detail points out when there are changes — like a first-time benefits change. A perfect example would be during annual enrollment. Let’s say an employee signs up for a new healthcare plan. Beti would remind the employee when that change is going to show up on their paycheck. The check detail also provides a status on pending expense reimbursements and bonuses.
If an employee has a question, they can reach out to the appropriate person for clarification. Paycom’s Ask Here technology allows employees to initiate questions directly from their Employee Self-Service®. Managers receive notifications from employees in the form of a daily digest. I like to think of it as their payroll to-do list.
I believe sending managers payroll inquiries in this manner could be very helpful. I can’t tell you how many times an employee’s pay has been incorrect because a manger unintentionally lost track of their question or request. Managers deal with a lot of email. Stuff gets lost. But the communication breakdown still happened. Now, with Beti, managers know what they’ve sent to payroll is accurate because it was double-checked by the people who would know best: the employees.
Strategic Payroll is the Future
Business and HR leaders have been talking for quite some time about digital transformation and how employees play a key role in owning their data. For example, having employees enter their own address changes reduces data entry mistakes and can save the company money (an average of $4.51 per data entry). It also frees the HR department’s time so they can do more strategic things.
What I like about Beti is that it brings payroll into the digital transformation conversation. Our payroll departments have an opportunity to focus their energy on things other than data entry. “Payroll is often one of an organization’s largest expenses, if not its largest expense,” said Jennifer Kraszewski, vice president of HR at Paycom. “Payroll needs to be accurate, but the process doesn’t have to be a burden on HR professionals. With Beti, HR professionals can oversee the payroll process while empowering employees, who know their data best, to do their own payroll.”
As more organizations are thinking about their future, now is the time to start thinking about transforming payroll into a more strategic function. As Paycom’s CEO Chad Richison mentioned, it’s a win for everyone.
P.S. If you want to learn more about moving your payroll function into a more strategic direction, join me and the Paycom team on September 16, 2021, at 2p Central for the webinar, “The Future of HR? It’s Employees Doing Their Own Payroll” hosted by HR Daily Advisor. We’re going to be talking about Beti and how including employees in the payroll process is good for everyone. The event is approved for recertification credits from both the Society for Human Resource Management (SHRM) and the HR Certification Institute (HRCI). If have a scheduling conflict already, register anyway and listen to the recording. Hope to see you there!
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