Stuart Gentle Publisher at Onrec

Payroll innovation should be capitalised on to improve employee retention

The role of payroll in talent strategies is often overlooked, but with innovation growing in the function, businesses could be missing a critical component to create more competitive employee packages. That’s according to a new report by CloudPay.

The specialist global payroll provider’s Payroll Efficiency Index (PEI) Report revealed evidence of increasing technological innovation in payroll, but the expert has warned that keeping the function siloed could be detrimental to employee engagement overall.

According to the PEI report, while the UK has the lowest First-Time Approval (FTA) rate in pay (52.42%), when this is coupled with falls in both Data Input Issues (DII), and Issues Per 1000 Payslips (I/1000), it reflects an increased adoption of technology and innovation in payroll.

As Grant Tasker, Senior Director of Global Payroll at CloudPay, explained, while this is positive news for core HR systems, the opportunity it presents to increase employee engagement and retention could be overlooked, without greater collaboration:

“Payroll has often been seen as a purely functional and transactional element of a business, but in reality, it is so much more. Yes, people need to be paid, but there’s more to the function than just this. We’ve seen huge technological innovation in recent years, with the ability to offer mobile payments and pay-on-demand (or Earned Wage Access) emerging to meet the growing needs of the workforce.”

“This innovation has a crucial role to play in employee benefits packages, but far too often payroll works in silo. It’s crucial that the function is given the weight it deserves in strategic HR discussions. Without this collaboration, progress could slow which, for any employer, could be detrimental to talent strategies now and in the future.”