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1 in 3 HR & Finance Professionals Don’t Think Payroll Can Respond to Changing Workforce

More than 1 in 5 state payroll still makes basic errors

Brussels, 25 March 2019: Decision makers outside of payroll are not confident in the payroll department’s ability to adapt to the changing needs and demands of the workforce. More worryingly, a significant number of payroll teams aren’t even meeting basic requirements such as making payments on time. Thirty-three percent of senior decision makers in HR and Finance don’t think that payroll is in a position to keep up with the changes driven by digital transformation and socioeconomic change.

Meanwhile on the more elementary level, 29 percent of respondents state that payroll often pays the wrong amount or the wrong employee. These findings come from a report conducted by SD Worx, a leading provider of global Payroll and HR services, assessing the views of 250 senior finance, HR and payroll professionals in the UK, regarding how the payroll function will evolve by 2025. 

For a substantial number of organisations, day to day performance has to improve. Twenty-two percent say that payroll errors at their organisation are either very regular or quite regular, while one in five (21 percent) say that payroll is often late. Poor performance in this respect can have a significant impact on the workforce, with 64 percent of payroll professionals saying it affects staff motivation. Fifty percent say that payroll performance also affects how attractive the company is to prospective employees.

Besides the priority to improve on performances, payroll departments should also take on a more strategic role in the business to meet the demands of employees around issues such as flexibility and work-life balance. Yet, 34 percent of organisations still only treat payroll as a low-ranking strategic priority. In a market where more than two-thirds (68 percent) expect to see an increase in flexible working hours, and 51 percent prioritise personalised reward packages, payroll has to be able to adapt. Investing in areas such as HR analytics will be pivotal to making this change a reality,  allowing the department to take full advantage of its status as the most reliable source of data in the company. Without the ability to analyse this data, teams will not be able to make correlations between issues such as absenteeism, engagement, reward and turnover, and develop policies and initiatives to make a real change in the business.   

    How are businesses reacting?

    To underpin this shift, technology will be critical. According to 88 percent of businesses, investment in payroll technology will rise by 2025, with 27 percent claiming there will be a significant increase in spending during this time frame. This is especially welcome seeing as 43 percent of payroll professionals cite not having the right technology available as a key challenge to being able to deliver tailored solutions to their staff. An area to consider when allocating this budget will be innovations such as RPA (robotic process automation), which can be used to automate repetitive, time consuming administration tasks. Such use of technology frees payroll teams to focus on delivering the more personalised, enhanced experience that employees expect.

    “As issues such as work-life balance become increasingly important to the workforce, people will expect the mindset of the organisations they work for to evolve and reflect that,” says Jean-Luc Barbier, Vice President  SD Worx and Managing Director SD Worx Global Solutions. “The fact that 83 percent of payroll professionals believe it is important for an employer to ensure financial wellbeing for its people underlines this. Management has to make sure that these expectations are met. If they are not, businesses will see employee engagement levels drop and prospective talent will look elsewhere. Payroll simply has to become more integrated with HR and aligned to other areas of the business if organisations are to stay on track for success.”

      Find out more

      Download the full report here to find out if your business is ready for the new world of work.

        About the report

        This report is based on a robust  survey of 250 business owners, CEOs, C-Suite Finance and HR professionals as well as senior payroll professionals in the UK. All respondents come from companies with more than 250 employees. Fieldwork was conducted during January 2019 by independent research, insight and consulting agency, Circle Research.

          For more information, please contact

          Katie Evans/Laura Lovejoy/Vicki Downie
          T: 020 7680 5500

            About SD Worx

            As the leading European player in payroll and HR, SD Worx provides worldwide services in the areas of payroll, HR, legal support, training, automation, consultancy and outsourcing. It focuses on customer centricity, fully embraces digitisation and is committed to international growth. More than 65,000 small and large organisations worldwide have currently placed their trust in SD Worx and its experience of more than 70 years. 
            The 4,150 employees at SD Worx operate in ten countries: Belgium (HQ), Germany, France, Ireland, Luxembourg, Mauritius, the Netherlands, Austria, the United Kingdom and Switzerland. SD Worx calculates the salaries of some 4.4 million employees and achieved a turnover of €443 million in 2017. SD Worx is co-founder of the Payroll Services Alliance, a global strategic network of leading payroll companies that together provide 32 million payroll calculations.
            More info on: www.sdworx.co.uk