Human resource functions and payroll functions have always been related, but often handled separately. While HR was usually responsible for onboarding employees and getting all the correct paperwork filled out, it was then usually handed over to accounting or the finance team to handle the actual paycheck process. This was because accounting and finance were already handling budgetary matters and had access to financial accounts.
Businesses these days are streamlining almost all of their business processes, and payroll is no exception. Using integrated payroll systems – which are linked to HR databases and functionality – is becoming a more sought-after solution for HR departments and businesses of all sizes.
What are integrated payroll software systems?
According to PayDay Workforce Solutions, “An integrated payroll system is one that allows both human resources and payroll staff to access the same information without duplicate paperwork or files, creating efficiencies that save time and money and reduce liability.”
Overall, integrated payroll software can help reduce the headache and hassle of pulling information across business units who have disparate systems.
What are the main business benefits of using integrated payroll systems?
Businesses continue to optimize their performance and processes by using software that connects different business functions. The benefits of connecting the HR and payroll process systems can help businesses in several important ways.
- Less administrative work: Integrated payroll systems can improve HR productivity and allow the staff to reduce the focus on onboarding and paperwork. This is great for smaller businesses with smaller HR or accounting teams. Having all the employee data in one place can help streamline operations and save time for every department. Having one place for payroll, tax forms, benefits data, and staff reviews enables departments to work better together and creates a better experience for accounting, HR, and even employees.
- Better accessibility: With an integrated payroll system, not only do relevant departments have access to the employee information they need whenever they need it, but it also often allows employees to access their own information. This means that employees can use a self-service portal to download paystubs, update addresses or other personal information, digitally request time off and sick time, check current tax deductions, access benefit information and more. This makes the information update and search capabilities easier for employers and employees alike. Instead of employees having to go through HR or finance to find out information – like available PTO or tax deduction rates – employees can get the information themselves. This is particularly useful in a small business where people resources might be fewer. It also gives employees more information to make better decisions, saving individual employees and teams time.
- Improved data security and better data accuracy: With a streamlined payroll solution, there’s less of a change of mistakes on data entry because it’s only one program. Plus, with an integrated interface, employees can often enter the information directly into the system themselves during onboarding, further reducing errors between an employee’s physical paperwork and HR entering it into the digital database. HR platforms are also a secure way to store highly sensitive and confidential information, from the social security numbers that HR has to the pay rate that finance uses to run a paycheck and the bank account information used for direct deposit. Housing this data in a secure digital platform not only allows better accessibility by those who need access but offers better protection against access by those who shouldn’t have it.
- Automatic updates: Changes like tax code regulation updates and health care laws can make an impact on payroll deductions and employee information. Other changes, including new hires, raises and bonuses, terminations, and benefits will affect company paycheck policies and amounts. Having access to accurate records that can automatically be updated should a raise go through or a tax law change means reduced error and reduced work.
What are the best examples of integrated payroll systems?
Businesses have a lot of options when it comes to finding the integrated payroll system that works for their needs, size, and budget.
Here are a few places to try.
- Gusto: Gusto’s motto is “Payroll and more.” This means that they can easily handle all the steps involved with the payroll process and much more. Their software model includes benefits administration, PTO requests, time tracking, offer letter templates, and more to make it a comprehensive HR software solution. It also easily integrates with accounting and finance programs like QuickBooks and FreshBooks for easy, seamless budgeting and reporting.
- BambooHR: BambooHR helps employers handle a whole suite of HR functionality, including hiring, onboarding, time tracking, performance management, payroll, and more. This gives businesses a holistic view and handles their whole HR and employee process.
Businesses are increasingly looking for that competitive edge to help them stay ahead of others in the industry, and streamlining operations like HR and payroll tasks are helping many businesses save time and money and gather better insight into their people and their processes.