Lost time | Archaic payroll technology is crippling the HR function

Archaic payroll technology is crippling the HR function

HR leaders in the UK are grappling with stress, burnout, and hindered strategic work due to outdated payroll technology and inefficient processes, according to a recent study conducted by Rippling.

The research, based on a OnePoll survey of 250 UK-based payroll managers across businesses of varying sizes, sheds light on the challenges faced by HR professionals tasked with managing payroll.

Notably, around 32% of payroll managers invest over seven days per month into the payroll process, a task that often detracts from their ability to engage in more strategic responsibilities.

Medium to large businesses, employing 500 to 999 people, appear to be disproportionately impacted by antiquated payroll practices.

A staggering 90% of payroll managers in this segment report manually inputting data into spreadsheets on a monthly basis to ensure timely employee payments.

Consequently, a significant majority, 77%, of respondents from medium to large businesses feel that payroll management contributes to stress and burnout.
Moreover, 78% of those surveyed express frustration at being impeded from focusing on strategic initiatives due to the inefficiencies within their organisation's payroll processes.

A further 71% acknowledge the need for a change in their payroll provider, while 78% express a desire to overhaul their payroll system, albeit with apprehensions about the arduousness and duration of the process.

The study also delves into the practice of outsourcing payroll operations. Approximately 24% of businesses across all sizes resort to outsourcing, incurring an average monthly cost of £3.69 per employee.

For a company employing 2,000 individuals, this translates to nearly £90,000 annually.

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This financial burden, coupled with the considerable internal resources required to navigate the intricate process, underscores the financial and operational toll of inefficient payroll management.

The importance of deploying modern technology to alleviate the administrative burdens associated with payroll management cannot be overstated.

By integrating technology that connects applications, systems, and databases, HR teams can free themselves from repetitive tasks, enabling them to contribute more strategically to their organisations' growth and success.

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