Looking ahead

To get beyond the most basic of employee expectations (such as electronic funds transfer (EFT) payments and emailed paystubs) and instead meet and match future employee expectations by moving payroll forward and imagining not how payroll needs to be, at a bare minimum, but what it should be.

The future of payroll is definitely cloud-based. There is no longer any need for payroll to require in-house, desktop-based software. The payroll department should not be required to use a specific operating system and a specific (likely outdated) browser or utility, and it should not be required to download and install security certificates. It is possible to deposit a paycheque on a smartphone, but for some reason today’s industry standard seems to think the digital equivalent of Fort Knox is required to pay staff.

And that could not be further from where the industry is — and should be — headed. Advances in security technology have resulted in cloud-based systems often being more secure than desktop-based software. Of course, payroll fraud existed long before the advent of cloud-based payroll, but having a hosted solution means not only is it possible to digitally log more information than ever, but it is also easier to analyze the data.

When data is changed, it is possible to see who made the change, when they made it and from where. Automated security measures also mean suspicious activity is instantly shut out. On the flip-side, this allows for much more flexibility, allowing staff to work from home, from their phone, and even from the beach, all using secure and authenticated connections.

In 2015, paper does not make any sense. Cheques should be changed to EFTs immediately, and paper paystubs, T4s and ROEs should all be abandoned for superior digital formats.

Employees should not have to worry about losing a paystub, for instance, and employers should not worry about employees not getting their T4s. The future of payroll processing is cloud-based — everything employees need should be transmitted to them digitally and instantly.

This also extends to the software employees use. Current trends indicate payroll and HR are going to be tied in to the employee experience even more. Employees should be able, for instance, to log in and see what their pay is going to be and what accounts their money is being deposited into. Employees will be able to make changes as they need, and authentication tools will exist to make sure the changes employees are making are authorized and consistent with regulation.

Employee-facing human resource information system (HRIS) and payroll components would function alongside existing employee tools, meaning employees do not have a separate system to log into, but rather have a system that is integrated with their job.

One of the big issues payroll faces actually exists at a social level — a lot of people don’t know their payroll department exists to do anything but process their pay, when in reality many payroll departments, both large and small, have a multitude of responsibilities.

Future changes in payroll technology mean this wall between payroll and the rest of the company will fade away. Employees will be able to better interact with their payroll department and payroll will quickly become one of the most visible departments too, simply by engaging employees more.

Part of this engagement will come from better integration of employees’ specific jobs and responsibilities and their bearing on payroll. One example would be with employee education. Many forward-thinking companies offer reimbursements on education expenses, for instance. Often this is for education that improves an employee’s skill set within the company, but some organizations have a more carte blanche approach, figuring that any education an employee pursues betters him in some way.

Some companies have taken this a step further by offering online courses through their existing systems to employees. This allows supervisors and managers to see how employees progress and even offer additional training when they see an employee stumble or falter.

For instance, if an employee’s position requires a certain professional designation or certification, it would not be far-fetched for the employer to offer those courses in-house, lowering reimbursement costs and allowing the company to tailor training to its specific needs.

The clear next step, however, is integrating this directly with payroll and the HRIS. Imagine an employee completing a certification course — that information would already be in the company’s internal system and could be instantly transmitted to payroll and HR.

Automating this process means that when an employee completes a course that requires some form of reimbursement or even results in a pay raise, this information is automatically loaded into payroll. This forms a connection between the employee and payroll, helping to engage the employee.

The next big movement for payroll is definitely going to be in the social sphere, further embedding payroll as an important facet of the company and even better engaging employees. Water cooler chats, for instant, cease to exist with a mobile workforce (or any sizable workforce, for that matter).

In its place would be a suite of social apps that allow for a combination of work and play.

For instance, tools like Slack, which is an instant messaging app for teams, allow employees to chat with each other in real time. Integrations with Slack allow staff to get updates when third-party applications — say project or ticket management software — have updates. Support staff can receive instant notification on new tickets in the queue and managers can get updates when tickets reach a certain length and they need to get involved.

But there is also room for education in this. Staff can ask each other for help, jumping in on video conferences while more senior staff walk junior staff through problems. Employees can "pin" or "star" certain work-related items, making sure they are always visible and act as a resource. Staff can then "upvote" or "like" certain posts, making them more visible and highlighting what works and what doesn’t.

This turns all staff into educators — someone does not need the title of "training manager" to show staff how to do something they are experts at. Staff can be further incentivized to produce great help content. Using analytics, payroll could receive a report of who is the most helpful (and, conversely, who is least helpful.)

Companies could initiate programs whereby staff who produce exceptional content and make themselves indispensable to the company receive perks — it could be use of the company car (as a taxable benefit), a bonus or even a pay raise. Integrating the social side of things with payroll means staff know that everything they do has value and producing high-value work results in good things for them.

The future of payroll, more than anything else, is a more integrated platform. Manual changes — whether they are cheques, pay raises, certification upgrades, bonuses, allowances, taxable benefits or TD1 changes — are on their way out and automatic changes are on their way in.

Integrating systems, from project management to ticketing systems to social apps to payroll itself, is the future. Having not a one-size-fits-all model, but instead a modular system that fits in with the rest of the puzzle pieces is the way forward.

Piecing everything together and having every system — existing and new ones — work together in perfect harmony should be the direction of every company, and payroll needs to be a part of that.