- New survey of payroll providers finds data errors, double-handling, and poor software is pushing out the time each pay run takes into days.
- 76% of payroll providers need 1-5 days to complete a pay run.
- Just 2% of UK payroll providers can complete a pay run in less than two hours, compared to 71% of providers in Australia and New Zealand.
- Automation is widely-seen as the solution but some distrust of it remains.
New research from people management platform Employment Hero shows UK payroll providers are struggling for days to deliver each pay run, as messy data and inefficient processes slow them down.
76% of the 444 payroll providers surveyed said the average pay run took one day or more to complete, with “two days” being the most common time for completion.
A recent survey of Australian and New Zealand providers, also conducted by Employment Hero, found a far speedier typical pay run – with 71% saying a pay run took less than two hours, compared to just 2% of UK providers.
British payroll providers cited an array of challenges largely relating to data errors and complex legislation.
Over a third (34%) said “double handling of data” was one of their top payroll challenges, with a similar proportion citing “chasing clients for payroll data” (33%), troubleshooting payroll errors” (33%) and “complex legislation” (31%).
Asked directly what the top reason was for “mistakes” in the pay run process, respondents cited:
- Timesheet and/or leave data inaccuracies: 41%
- Employee data misclassification: 39%
- Poor record keeping: 39%
- Mistakes interpreting/updating pay compliance (i.e. minimum/overtime rates or industry awards): 37%
- Legislation changes: 33%
Kevin Fitzgerald, UK MD of Employment Hero, commented:
“In the UK, the time it currently takes to complete pay runs is unnecessarily long. While precision is crucial, leveraging modern software could transform this vital operation from a days-long ordeal into just a few hours. Accepting the status quo is no longer an option when we have the technology to do better.
“The future is unmistakably headed towards automation, a change eagerly anticipated by roughly a third of those we’ve spoken to, who are ready to embrace it fully or partially in the payroll process. Yet, there’s a palpable reluctance among some payroll providers to let go of traditional, manual methods. They fear that without the ‘human touch,’ their role loses its essence, compromising their effectiveness as financial professionals.
“The reality couldn’t be more different. Embracing automation for the more tedious tasks does not detract from their role, rather it enhances it. It frees up precious time, allowing them to engage more deeply with clients, providing the personalised, nuanced advice that only a human touch can deliver. Technology and personal service are not at odds but are complementary forces.”
Employment Hero has a suite of cloud products that are always up-to-date with new payroll legislation, and integrate payroll with other functions seamlessly. This can reduce the double-handling of data, minimise the need to check different applications to ensure they’re ‘talking to one another’, and ensure businesses are complying with the latest rules and regulations.
