Challenges of a Payroll Software Provider

Payroll Software being sold as a part of ERP suite, or standalone is becoming the need of the hour. With the rising of global mobility and multinationals, the software is in great demand. The major players in the market are SAP, ADP, Oracle, Cornerstone, Workday and Ramco Systems.

Payroll Software offloads the work of Finance or Separate Payroll Department to a great extent. Gone are the days when payroll officers used to calculate payrolls on excel worksheet. With this there are many challenges which the payroll software providers face. Below we have discussed major challenges with solutions available.

Let’s start…

Compliance

As there are many regulations which a payroll must be compliant with, the payroll software may not be compliant with it or may request manual inputs which adds to the burden on staff.

There may also be a difference between the legislation announced by the government and actual working style in the region.

The Changing Environment

As compared to other legislations, the payroll law, i.e. tax and social security changes are uncertain. The department may announce a legislation change today, which is applied after one month. The patch should be released before the effective date of the change. Non Compliance of which leads to hefty fines and penalties for the employer.

Tracking

Tracking the changes is another difficulty. The task becomes laborious when you are a global payroll provider. Some companies have outsourced this task to external consultants and others have their internal teams to serve the purpose.

Electronic Filings

With the introduction of e-filing across developed nations like the United Kingdom, New Zealand and Australia payroll vendors have to integrate their systems with government systems. With each payroll process, payroll software sends a file upload automatically to the government system. This practice ensures proper accountability and also helps the government with research and analytics.

Language

Making applications available in local language. The labor staff may not be English speaking. So, to enable them to read pay slips, apply leave, enter expense requests, filling time sheets, the software should be available in local language.

Industries

The payroll calculation, i.e. (tax and social security rules) differs across industries, i.e. the social security rates may be higher in high-risk industries like construction and mining. Your payroll offering should be flexible to handle changes across industries.

There may be challenges like data security, the time to process and many others. As per survey conducted by some big organizations, the clients are not satisfied with their existing payroll software and want to make a shift to other providers in the market. There is a great opportunity for small and medium enterprises to really make use of this time. But, this needs a huge investment in above challenges to make the product likable by employers and organizations.