- By: shrmpro
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Payroll management is the crucial aspect of an HRMS software system. The reason is, employees of an organization will not be managed well till their salary is secure under a managed system. This is what a payroll management system does by streamlining all the records related to employees pay.
Security is the best part while establishing payroll management software in any company. This is due to the feature which allows assigning access to only the designated person within the organization. Passwords are provided for the particular level of the hierarchy that allows them to perform only permitted work.
In the era of technological advancement, automation of HR practices becomes dominant which has moved spreadsheets to cloud-based payroll solutions. It gives tons of advantages including major ones like the ease of use, anytime-anywhere access, employee collaboration and quick retrieval of records.
A Payroll system is an important part of HRMS software with a structure that is split into different set procedures to deliver desired results.
Below they are-
- Data input and validation
Payroll inputs are forwarded to the concerned department for further processing including the details of every aspect ranging from new joiners, exit employees, one- time payment or any salary addition or revision. All these inputs are validated in terms of company policies and government regulations.
After all the inputs are submitted, they are processed in the system for salary computation. The payroll system will generate the gross and net salary of each person with relevant deductions and taxes applied.
- Verification check
After complete processing, the next step is to verify the accuracy of the pay results. This requires a salary register with the detailed statement of all the pay elements and deductions an employee is liable for. Every variance is checked at this stage before moving further.
- Report generation
It is an important part of post-payroll activities where a bank file is created containing the net statement pay plus personal bank details. This total of the bank file must match with the net pay total in the pay register.
- Statutory compliance
The system must be linked to the government portals to allow online payment and receipt generation along with electronic submission of the returns. After the final process, the payroll of the particular month is locked to prevent any input or further changes.
Taking this discussion further, the point of discussion migrates towards picking the right payroll management system.
There are several factors to consider such as:
- Core functionalities such as auto-generated payslips and bank statements leave and attendance tracking and flexible policies
- Employee self-service to get access to the details like payslips, number of leaves
- Services for support and training
- The technology involves features like cloud storage, mobile app, and integration with third-party applications
- Statutory compliance with alerts for filing and support for ESI, TDS, and PF.