HR and payroll changes
HR and payroll in 2014 – changing profession
Jonathan White, Head of Sales for HR and Payroll at Sage, discusses how the landscape is changing and how professionals should look to respond
T
he role of the human resources (HR) professional is changing, and adaption must be quick as they respond to a variety of challenges that have made their mark in 2013. For many, the key legislative changes real time information (RTI) and automatic enrolment (AE) have been a significant focus this year, as many prepared for their staging date and began to report payroll to HM Revenue & Customs (HMRC) in real time. These compulsory legislative changes have put a serious burden on the many HR and payroll departments, as they ensured their organisation was ready for the regulation. RTI came into effect for the majority
of UK businesses in April 2013 and represented the biggest shake up to the payroll system since 1944. By increasing the regularity of reporting, it enables HMRC to respond more efficiently to errors that lead to the under- or over-payment of tax and should ultimately serve to minimise the administrative burden of payroll year- end for many organisations. Additionally, many of the large and medium sized business now have staged, or imminently will be staging, for AE. The onus is on the employer to communicate the changes to their staff and begin paying the correct pensions contributions – which equates to a significant administrative burden which naturally falls to the HR and payroll team to implement. Communications can be a significant burden on teams that now find themselves in charge of not only processing the payroll and HR needs of the company, but having to communicate a vast legislative change that will affect employees’ pay packets, and is likely to prompt urgent questions which the company needs to clarify correctly. This is causing issues and worry
for businesses. Recent Sage customer research found that one in five businesses surveyed declared that AE was their biggest challenge over the past year, and two out of five businesses found the main challenge associated with AE to be that of affordability. HR and payroll teams can cut down the time they spend implementing the legislation with appropriately chosen software solutions: 40% of the businesses surveyed believe that their software is either only partially or not compatible with AE. Businesses can save money and time completing administrative tasks and ensuring legal compliance by using software, so utilising all the features correctly is important. Ask your vendor for training if you have new staff to bring up to speed.
It is important for companies to save money this year. Despite legislative changes, more than 50% of companies expect to see budget reductions within the year and therefore it is now more important than ever that HR departments focus on their key roles and ensure they remain relevant and a beacon of best practice in the fluctuating business landscape.
More and more legislative compliance is riding on the HR and payroll team’s ability to move with agility and ensure changes
...COLLECTING AND ANALYSING BUSINESS DATA TO INFORM BUSINESSES PROCESSES...
are made correctly first time. There is certainly a new role for professionals to carve out for themselves. Last year saw a 20% rise in HR departments naming building businesses data analytics and business partnering capabilities as a huge priority. Providing the analytics businesses need to calculate performance is necessary as budgets are being squeezed across departments and time intensive research that keeps staff away from day-to-day priorities is no longer a viable method. This may be where HR professionals need to begin to focus their attention and find what it is that their role supports in a world of new business functions. 37% think that the HR function is poorly defined and data resourcing is an area of paramount importance for businesses that HR is in a position to own. It is not only legislative change that is making the roles of HR and payroll professionals more complex; so, too, is the importance of data for businesses. Numerical value is being applied to everything in businesses as they continue to feel the stretch of resources. By collecting and analysing business data to inform businesses processes, HR and payroll professionals can ensure they hold a necessary and effective strategic position within the company. To ensure they are ready for the year
ahead, HR and payroll departments need to look not only at their immediate responsibilities but how they can maintain the position as a data driven and business critical department. Tools are out there to make this easier, and businesses need to ensure they have the right software and are using it correctly. By doing so, 2014 will start looking like a great year rather than one fraught with challenges and difficulties.
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