The growth of remote working is giving shape to new trends in the human resources world in many ways. Not too long ago, the emergence of the work-from-home policy was being welcomed by a good number of businesses in India as the beginning of a new era in employment.
The thrill of not being confined to a nine-to-five job, working at one’s comfort and pace were some of the many advantages of working remotely.
At the same time, one cannot overlook the fact that HR professionals dealt with several challenges amid this new transformation. One such challenge was managing and processing payrolls correctly. Needless to say, errors in COVID times can cost a considerable amount of money to a business.
No matter how small or big the mistake is, it can impact an organization both financially and legally. That being said, it is a crucial but difficult task for HR managers to ensure accuracy, especially when they are working from home.
In this blog, we will tell you about three payroll errors that should be avoided by every company during this difficult time. Also, we will give you a solution to avoid such mistakes as well. So, without any further ado, let’s dive in!
Data Entry Errors
Let’s face it, HR managers carry out a lot of routine operations. Due to this, they often end up making unintended and costly mistakes. Since humans are prone to making mistakes, we cannot blame them every time. Every individual makes typos, and any person can unintentionally enter 10 hours rather than 1. But this small typo can be acutely costly for the entire business.
Now, to avoid such mistakes, many companies go for payroll outsourcing. However, giving sensitive information of employees to a third party is always risky. Besides, outsourcing payroll cannot eliminate 100% of data entry errors as well.
For those of you who don’t know, buddy punching is when employees cover for one another and clock in for each other to steal time.
For the longest time, this has been one of the most common payroll problems. According to a study, 19% of employees have engaged in some kind of time theft that may cost organizations a minimum of 7% of their gross annual payroll. Furthermore, the average weekly “theft” of time is 4 hours and 5 minutes per person per pay period. In essence, preventing buddy punching is certainly challenging for HR managers.
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Incorrect Tax Rates
We all know that tax slabs change every year. Now, when tax rates are changed, whatever a company used to pay its employees may not be applicable after that. And, if a company fails to comply with such changes, it will ultimately lead to hefty fines, penalties, and severe legal consequences.
Hence, it is an important duty of an HR manager to keep checking employee tax rates regularly and update them promptly; however, it is not as easy as it sounds to be. Fortunately, we have a solution to simplify this task. Keep reading to know about the same!
So, you have got a clear understanding of the aforementioned payroll errors. By now, you may have also understood that traditional tools and manual methods are the biggest contributors to such payroll mistakes.
It’s no news that automated software is taking over the corporate world like never before. Need to mention, more and more companies are shifting towards automation in this crisis time. If payroll errors are considered, the best way to cut them down is by implementing payroll management software.
Payroll software allows a company to automate and streamline the payroll management process. Simply put, the software takes care of the whole process with a bare minimum of human involvement. From payroll calculation to transferring payrolls, payroll software does everything automatically.
Here are some features of such systems that make payroll management error-free:
Employee Self-Service- Employees can edit their personal & financial details on their own, thereby avoiding any chances of mistakes
Automated alerts- The software sends timely notifications to the company whenever a tax slab is changed
Cloud-based Interface- Data will be stored in the cloud, thereby eliminating payroll mistakes due to paperwork
And much more…
We hope this blog helped you to understand what is payroll errors as well as payroll management software.
Manual methods cannot change, so technology has to. Having said that, it is the responsibility of employers to switch to one of the top-notch payroll management software and decrease the possibility of mistakes, save money, and improve productivity in their businesses.
A digital switch can be a little tough but if considering its advantages, it is, undoubtedly, worth the effort.
So, what are you waiting for? Take a step ahead and find out an efficient payroll system as soon as possible!