Managing payroll is not simple. Especially if you don’t have the right system in place.
Making payroll payments, keeping deadlines, ensuring data security, staying on top of employment law: many things can go wrong.
But the truth is that managing payroll doesn’t have to be complicated. In fact, payroll processes can run smoothly in the background of your daily operations. This way you can focus on what really matters: your employees and business growth.
In this article you’ll learn about:
- The top challenges of payroll processing
- Managing payroll in the gig economy
- How to improve payroll processes and employee retention
- Manual vs. automated payroll management
Ready to take your payroll to the next level? Download our FREE guide to avoid costly payroll mistakes, assess your payroll, and identify areas for improvement!
The top challenges of payroll processing
When employees on permanent contracts receive the same salary every month, payroll processes and calculations are relatively straightforward.
However, in today’s business world, we’re dealing with payroll transfers that are more complicated than making regular monthly transfers.
For example, consider calculating pay for:
- Employees on hourly wages
- Frontline employees who earn different amounts at different times
- Employees on civil contracts, which requires more information to calculate the net pay accurately and correctly (we need to know whether employees have other sources of income, whether they pay health insurance and so on)
Sometimes there’s also the extra complexity of “flexible pay” when employees are entitled to have access to their earnings whenever they need it.
As a result, the complex payroll calculations of today involve many different variables. Still, your payroll processes should work smoothly and fit your current business situation. This is essential if you want to grow quickly and stay ahead of your competitors.
There are further challenges. Dealing with hundreds of files, hard copies, and spreadsheets saved in multiple places: this is the world of payroll in a large number of organizations.
Luckily, payroll doesn’t have to be complicated. Quite the contrary, payroll can be automated. It may seem that investing in a solution that can automate your payroll processes is another cost for your company. But this is not how it works.
The truth is:
Manual work wastes a lot of your time and resources. For this reason, automated payroll is a money-saver that helps you reduce your existing cost: the high cost of running payroll.
Ready to take your HR to the next level? Plan 2023 with this HR Calendar and improve employee retention!
The biggest payroll challenges for Symmetrical’s clients
Our clients are mainly organizations that employ hundreds or even thousands of people domestically or globally. Saving time and money is essential for all of our customers.
An interesting case is the gig economy sector (a.k.a. digital platform work). Gig platforms matching workers to jobs (or users/customers to service providers) offer a wide array of different services. They range from driving and delivery services to online teaching.
Gig platforms earn on a commission basis. It’s rare that rates are predetermined; they usually depend on particular assignments. Thus, if a platform wants to grow quickly, it will need a larger number of employers and users: the more, the better.
As a consequence, scaling processes and operations is extremely important, especially when complicated calculations significantly increase the cost of payroll processing. Furthermore, optimizing business processes is necessary to gain a competitive advantage in a very competitive environment.
Additionally, one of the biggest challenges in the gig sector is employee retention. Often gig employees are predominantly motivated by earning money, not necessarily by working for a specific company or a platform. If they can get better salaries or have better working conditions elsewhere, they will change their jobs.
Thus, companies need reliable HR and payroll tools that won’t give their employees reasons to change their employers.
Payroll challenges: how can automated payroll address the needs of the gig sector?
Think about companies such as Uber. Imagine this: in some city areas there may be a much higher demand for taxi drivers. This will have an impact on the bonus system and ultimately the payroll, especially since bonuses are taxed differently.
If you try to deal with such cases manually, get ready to deal with hundreds of files. You may get lost in a sea of data dispersed in many different places!
Alternatively, consider an automated solution that addresses such complexities and can process the rapidly changing payroll data. This should also be a flexible system capable of handling multiple variables.
Improving payroll processes and employee retention in the gig sector (Symmetrical’s solution)
Gig companies should do their best to make their employees want to stay. The effectiveness of payroll processes can have an enormous impact on that.
For many gig workers it’s a deal breaker if they don’t get paid smoothly and on time.
This is where the gig sector can benefit from Symmetrical’s payroll solution. First, our tool can significantly reduce waiting time for pay, even from 9 to 3 days. This will improve employee satisfaction as financial liquidity is important for all employees.
Second, Symmetrical will automate your payroll processes. At the same time it will help you reduce payroll mistakes and the number of payroll-related questions from your employees. If your employee has doubts about the amount of money they received, the Symmetrical solution will allow you to answer such questions very quickly.
Third, our solution offers your employees fully transparent payslips. They can see exactly what determines their salaries, e.g. the number of orders, the amount of commission, salary deductions, and so on. We make sure employees understand exactly how their salaries are calculated.
Not only will it be appreciated by your employees, but it will also improve work performance at your company.
Payroll challenges: why do companies at a growth stage fear automation?
Unless we deal with stable organizations, time pressure and the fear of competition can make young companies avoid making crucial changes, such as automating their processes.
However, manual processes are not business drivers. In the long run they simply cost organizations too much and slow them down.
Consider managing payroll:
- You need to use your human resources for both operational and strategic purposes.
- You need a supervisor of the whole process.
Additionally, we’re talking about very complicated calculations and thus a high risk of errors. Files and data will be passed from employee to employee. Employees will need extra meetings and managers will need plenty of time and energy to supervise the whole process.
Manual work doesn’t really save the cost of managing payroll.
Now let’s consider payroll errors. Workers can claim that they didn’t receive enough money. Maybe you made a payroll mistake or maybe .. you didn’t (maybe your employee is wrong). Either way, you still need to check your calculations, which can be costly and time-consuming. Bank transfers can be pretty problematic, too.
All this generates more work for your staff. Can you really afford it?
The benefits of automated payroll software
An efficient and effective automated payroll solution is NOT another cost for your company. In fact, in the long run it will save you plenty of money.
Thus, it’s worth taking the time to implement the right automatic payroll solution. Treat it as an investment that will yield cost savings. In other words:
Short-term pain, long-term pain.
Automated solutions are also a good idea if you don’t have efficient customer acquisition. If that’s the case, focus on improving the efficiency of your growth, for example by automating your payroll process, which will save your employees from getting lost in spreadsheets and documents.
That’s why Symmetrical makes the most of technology to help your employees work smart and avoid tasks that can be done by tools. Still, we believe that people are the biggest asset at EVERY company and our approach is people-first.
The Symmetrical solution will help you streamline your processes so you can focus on building a people-focused culture and developing your business.
Symmetrical is the first payroll solution you won’t hate. We enable fast-paced companies to onboard at scale and run their payroll invisibly. To run your payroll hassle-free, contact our experts to learn more!