Payroll's overdue AI evolution is finally happening, don't miss the boat

Payroll professionals have perhaps been the most anxious of all those in the HR profession about adopting AI across their work.

It’s understandable. Although its buzzword status is firmly cemented, AI use is still not without its issues including hallucinations and privacy concerns, and mistakes in payroll can be extraordinarily costly.

However, despite this AI anxiety, payroll is also perhaps the profession with HR where there is the most opportunity for – arguably long overdue – automation and digital transformation. Whether it is real-time analytical insight on payroll data, automated processing, or even AI chatbots that save an employee from having to respond to the ‘How do I get paid?’ question for the umpteenth time that month, the upside is huge.

Thankfully, it seems that payroll professionals are finally taking the leap. As Daniel Greaves, Global Head of Payroll and Benefits, Klarna, states: “We use it [AI] in everything we do, in everyday life… so why wouldn’t we use it in our pay, something that impacts every single one of us?”

Automation, analysis, access… the list of AI applications goes on

Payroll leaders are predicting greater AI adoption and digital transformation for their profession in 2024. According to a 2024 CloudPay survey, 64% of payroll professionals predict a rise in AI and advanced technology use within the next year. ADP’s ‘The Potential of Payroll in 2024’ report includes a similar finding that professionals place digitalisation as the joint top key business driver for payroll over the next two to three years.

The applications are widespread. With payroll leaders hoping to see improvements to the employee experience; to the integration, monitoring, and reporting of payroll data; and to the reliability and security of technology, AI is a consistently viable answer.