The payroll department, much like the HR function, is often critically viewed by employees. If you do not pay someone properly (or worse – not at all), you’ll definitely hear about it! If you do not have HRMS payroll software, not only are you missing an opportunity to improve your payroll operations, but your payroll department is setting itself up for failure. Here are some situations which demonstrate the importance of HRMS to the payroll department.

Why you should use an HRMS for your payroll department

HRMS = A Centralized Database

Payroll_DeptMost of the time, components that are associated with pay are found in other systems. While some of these, such as time & attendance, integrate with payroll, other systems probably don’t. For example, if an employee passes a training assessment, there can be an additional bonus or pay increase. If you do not have learning management tasks integrated with HRMS payroll, there’s a big risk that the pay increase or bonus will be missed by your payroll department.

HRMS Gives Managers Access to the Data They Need

HRMS systems gives managers access to employee job details they need, such as employee job details and organizational charts. Stand-alone payroll systems often do not have this level of transparency as their focus is purely to calculate and generate pay. HRMS payroll helps you to avoid a variety of errors by giving managers access to the data which will help to improve accuracy of payroll processes.

Data for Reporting and Audits Will Go Missing Without an HRMS

The payroll department often has their own policies and procedures in place to pay an employee; however, a payroll system doesn’t always have the additional data elements found in an HRMS which can prove helpful in an audit situation. Additional payroll data is also crucial when sending reports from payroll to another system, such as financial systems.

International Growth Will Meet Resistance

Few payroll systems are completely global in nature. Historically, certain products have succeeded in other countries due to a variety of reasons such as tax complexity and local use. What if you want an overall headcount? Without HRMS payroll your only chance is to contact multiple payroll systems and hope that it can be delivered in a standard format that will be suitable. Long term, it’s not an operational model that can thrive for the future due to the effort and time required to complete basic tasks.

Payroll systems and HRMS payroll both have their strong points and there can be a need for them to co-exist. If you only have the payroll piece of the puzzle, you’re missing out on an opportunity to do more and to better support your payroll operations.