Critical attributes of payroll system any business needs

Being an employer, you need to manage and run multiple departments of the business concurrently. Finance and accounts require more consideration in comparison with other sections of management. In addition, human resource system and payroll system should also be intermingled to handle data synchronously and calculate payroll accurately. The function of payroll is estimation of employee salaries by deducting all the leaves while including reimbursement and benefits. Any payroll system you use, must fulfill all the basic to advanced features that are crucial for the smooth processing of payroll management. Automated payroll systems give you the opportunity to customize them according to the explicit necessities of the organization. If you are planning to purchase or exploit outsource payroll system, you must demand for following critical elements that will assist you in optimizing business management.

Employee information

Along with basic information about employee designation title, personal data, probationary time-frame and the holiday entitlement, payroll system should also be able to hold extensive human resource system details dynamically. Confirmation of personal details and identity card should also be accommodated by the payroll system, whereas training, courses and career information of employee must also be maintained in split sections. Reporting of leaves, long vacations and multi-pension modules must also be a part of fully functional payroll system facility.

Payroll leaves

The section of payroll system that hold the absence records, reasoning, history and analysis reporting should also be provided separately in order to categorize and filter the leaves on an hourly basis along with the duration and nature of the leaves. Employee working profiles, performance details and certifications should be maintained by recording and reporting modules. It will boost payroll along with procedures of human resource system in profound environment.

Attendance monitoring

The module that contains the attendance records of each employee for creating time-sheet is another core element of payroll system of any business. Keeping daily attendance record, data of overtime along with the details of the work and its priority level, Instructions and details of work attached to each task assigned to worker in given time, calculations and deductions of basic salary counting on the work hour record, all important tasks should be carried out with precision.

Payroll Run and Update

The section of run and update payroll system manages payroll acquisition based on departments, divisions, payment levels and frequencies including extra benefits agreed upon by the employer. It also facilitates you with employee pay assessments and reporting to keep the system up to date. Payslip generation with diverse settings and designs can also be availed through this section.

Payroll history maintenance

With all the extensive processes and complex data-calculations, its eminent to maintain all the logs, records and history of work done till the date. This part of payroll system should provide options in selecting which the features that you want to keep in history for viewing and reporting. Effective record reporting with filtration facility, analysis and formatting should also be an essential part of the system.

Issues in Human Resource System & Payroll System Integration

To manage a progressing business human resource and financial setup, it takes professionally well equipped human resource system in accordance with the payroll system. There is a lot of information that both systems need to share with each other to keep the data concurrent along with payment calculations and other relevant financial requirements. But the problem occurs when there are multiple entries against single employee record and it create confusions that leads to inconsistent database. Data should be entered and saved once to build a reliable database which can return optimized results. In general, human resource system and payroll system share data about employee name, employment number, employment date, date of birth, date of leaving job, employee department and designation, holiday, sickness or long term vacation data, benefits/allowances and the list goes on. It shows the need of integration between two systems to manage the business smoothly. But it takes extensive efforts and also needs you to pay some serious returns.

Diverse kind of Database

If you are using two separate database systems to manage HR and payroll and both belong to different vendors, it would be quite complex to integrate them for centralizing the whole setup. For example a SQL server database for HR and Oracle for payroll will not give you facility of accurate reporting due to diverse interfaces and privileges. Even if you transfer your data on a single source, e.g. ODBC it will also make duplicate entries because usage of two separate interfaces for entries and updates.

Security clashes

There are many expected security issues that will arise when you will try to integrate two existing systems. If you transfer files between systems, there will be no security protocol that will transfer the file with full security. In the same way you will face protection issues while delivering or receiving confidential files to outer source. That’s why maintaining two systems within a company together will result in data duplication.

Data manipulation and conversion

Combining stand alone payroll and HR solutions will also irritate while making data conversions and integrating existing records. Both systems hold distinct format of storing and displaying data, which will never allow them to merge the employee records appropriately. Payment estimations will also be devastating when extracting data from two different systems as it needs another interface solution.

Access privileges

As multiple staff members will use the two integrated systems simultaneously, it will require extra privilege control and monitoring of data. With the merger of the two systems it will require more interfaces to access, enter and update records that will need training of all the relevant employees. It will cost high amounts to the business, but gives no surety of accuracy of system flow.