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Payroll systems compliance: An engagement opportunity for HR Leaders

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Most businesses care about their employees and legal obligations, and are not intentionally non-compliant when it comes to paying what they owe. The threat of fines, the risk of reputation damage and the resulting impact on your bottom line are all significant and realistic consequences of non-compliance. But what about the impact of day-to-day errors and oversights, or legacy payroll systems that aren’t as efficient as they could be? What are they costing you?

Payroll non-compliance impacts your employee’s commitment

More than ever before, the world of talent management is focused on how to foster an enthusiastic, motivated workforce—because the evidence shows that engaged employees are more purposeful and productive. But the attention paid to how to achieve happier workers is underpinned by a critical assumption: that organisations have the basics covered. Because while it’s understood that remuneration is not the main motivation for employees, it is essential to maintaining a feeling of trust and a sense of security throughout workforces.

In a Forbes article, thought leader in human capital and business strategy Glenn Llopis, discusses seven key reasons employees lose trust in employers. The majority of these reasons relate to a feeling of disconnect when it comes to relying on leadership to deliver consistency between their words and their actions:

Employees don’t ever want to feel taken advantage of – especially during a time when everyone is being asked to do more with less.

Non-compliance hurts your relationship with your workforce, because even when it’s the result of an honest mistake, an employee with a payroll query is rarely a happy one. Implementing a contemporary and seamless approach should be one of the core initiatives for HR professionals wanting to build and maintain a committed workforce.

When money is an issue, your business goals suffer

People won’t be satisfied by interesting tasks or flexible work options if they feel they aren’t being paid fairly. They will very quickly lose goodwill towards your organisation if they sense they are being short-changed of their correct entitlements, or that you can’t be trusted to manage payroll consistently and reliably.

Only when the money is safely ‘in the bank’ are people able to focus all of their energy on contributing towards your business objectives. It makes perfect sense given the variety of monetary pressures people face. For example, the level of household debt in Australia is only getting higher, and the cost of entering the housing market means many are committed to significant monthly mortgage payments. There’s been an increase in people’s reliance on pay-day loans, even by full-time workers from higher income groups. Workers are also concerned about not having enough to put away to retire comfortably. It’s because of this that employers should commit to a seamless payroll experience for their staff, and maintain a sense of security in their lives.

The technology driven workforce: Employees want access and control

ANZ’s survey of financial literacy among Australian adults released in 2015 found fewer people reported feeling in control of their finances. Yet in today’s technologically empowered society, employees expect greater transparency and control than ever before.

People have whole-heartedly embraced advances such as online banking. Consider also the changing demographic of your workforce. Younger generations are more likely to be digital natives and they expect to be able to access information online, anytime, as well as use digital tools in a self-service way.

In the face of increased employee expectations, organisations should leverage the existing opportunity to create a strong, committed and secure workforce through the implementation of seamless and compliant payroll processes.

The fact is, successful organisations will be those that embrace tools that ensure compliance as an essential facet of their engagement, talent management and retention strategies.

Often this means upgrading technology, staying on top of legislation, understanding and managing their workforce intelligently, and giving employees timely and immediate access to information through user-friendly interfaces.


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