Payroll Challenges for SMBs:
The COVID-19 pandemic has dramatically changed the dynamics of business with major implications for payroll. Millions of professionals were forced to work remotely, switch jobs, or adjust according to the shifting business models of the employers.
Although these shifts and adjustments are widespread, they are not affecting every business in the same way. And as the market awaits its entry into a post-COVID-19 world, small and medium-sized businesses will face even greater complexities in their payroll and HR needs. The apprehensions of these increasing complexities are staring SMBs in the face and compelling them to rethink how HRM and payroll software could be used to increase efficiency.
For SMBs, The Pressure is Building to Adopt Payroll Flexibility
Impact of Social Distancing on HR and Payroll Management and the Benefits of Online Payroll Software
With the onset of the global pandemic of COVID-19, there popped-up a pressing need to avoid physical interactions. This presented the employers all over the globe with challenges in meeting the needs of their workforce because of the minimized interactions during the payroll process. These processes included traditional attendance registering which usually includes touch-based biometric devices and direct human interaction for various purposes. This has affected the payroll systems big time, and companies-specifically SMBs-have been compelled to consider a fully digital route.
SMBs with cloud-based integrated payroll solutions including HR systems and payroll services had an advantage when the pandemic struck and employees were told to work from home. But the story for organizations with on-premise systems to manage payroll is completely different. Members of the HR and payroll teams that needed to work from home to access payroll systems through their laptops/desktops struggled, and consequently, their payroll operations were significantly disrupted.
This established the need for SMBs to upgrade the archaic payroll and HR systems to a cloud-based payroll solution.
Remunerating work from home while keeping track of absences
COVID-19 has blurred the lines between the work and home environment, making it difficult for employers to adapt to remuneration, leave, and overtime policies amongst other things to accommodate workforce requirements and the changing world of work.
We are aware of the influx of different types of absences (from confirmed COVID-19 cases to furloughed workers) during the pandemic. This increased the pressure on the HR team caused by inaccurate employee pay and incorrect reporting.
Here also, organizations using online payroll software that seamlessly integrated the HR systems with the payroll services were better off. Their recorded absences were automatically sent to payroll, helping them process employee wages accurately and on time.
Changing legal frameworks and understanding new legislation
In the context of the pandemic, governments around the world announced measures to keep businesses afloat and help employees. In the absence of in-depth legislative knowledge, many SMBs found it difficult to process employees’ pay correctly, and were constantly running the risk of breaching employment laws.
Today we find that the Labor Law and Taxes are constantly on the move. Governmental response to the situation in the form of tax reliefs and emergency stipends requires organizations to integrate these into their payroll system.
Adopting flexible and efficient payroll solution
The incessantly changing work environment makes the digitization of payroll and workflow processes imperative. The leveraging of online payroll software offers various short and long-term advantages to SMBs.
Integrated online HRIS systems and payroll services offer accessibility, automation, and insights without health risks to parties involved. Cloud-based payroll software enables companies to decentralize payroll flows whilst empowering employees to take charge of their experience. Employees can book leave, view paystubs, and manage their records remotely. The curation of this data in turn facilitates strategic decision-making.
The reshaping to the workings of payroll by COVID-19 will have long-standing effects on organizations, especially the SMBs. It now depends on companies to adapt and re-imagine HR and payroll processes to keep their systems afloat.