The benefits of an automated payroll system

Employers are required to manage and process their employees’ salaries, leave days, taxes, and other employment-based information relating to remuneration. Processing this information manually (on a spreadsheet, for instance) is a lot more time-consuming and predisposed to human error than using an automated payroll system. However, there are a number of other benefits to installing or implementing an automated payroll system.

1. Efficiency

We’ve already mentioned the fact that payroll automation reduces the time spent on processing employee information, salaries, taxes, and other information. However, there are a vast number of additional efficiencies offered by a payroll system that extend far beyond simply the amount of time saved. A payroll system can be integrated into a company’s other systems such as their time-keeping system (i.e. tracking employees clocking in and out of work, via a carded or biometric system), performance reporting systems, and other HR systems that track employees’ development, reports, and remuneration. The efficiency of this integration is realised when information on salaries and/or performance is sought, and needn’t be found manually in a separate or paper-based system.

2. Easy integration with SARS requirements

The South African Revenue Service (SARS) requires that employers export their employee and tax information in CSV format from their payroll systems and import the CSV file into their e@syFile system. From there, the employer’s remuneration and tax information is uploaded via SARS eFiling. Without an automated system, the declaration and submission process to SARS would not be as simple as a quick export and import of the CSV file, and would make life considerably more difficult for your business accountant.

 3. Safety of your employee records

Most (if not all) payroll software systems encourage employers to back up their information. Automated payroll solutions offer the ability to keep your employee records safe, either with an off-site back-up solution or with a cloud-based back-up that comes standard with employers’ software agreement. Employers with a manually run payroll system would be hard-pressed to come up with a better reason for not going the automated payroll system route, than for the safekeeping of their personnel records. Imagine losing your business’s and employees’ financial, payroll, and tax information…

4. Data security

 Keeping your employees’ personal and financial information away from prying eyes is also a big responsibility employers must take upon themselves. With the introduction of the POPI Act there is a major emphasis placed on securing sensitive information and not allowing unauthorised persons access to data that includes individual’s ID numbers and banking details. Payroll software solutions offer a password protected environment where personal and financial data related to your employees can be stored at low risk of being accessed by the wrong persons. Of course it is important to secure the computers and devices where the data is stored against hacking attempts and virus attacks by reviewing your network security setup and updating firewall and antivirus software regularly.

5. Standardisation

As the world becomes increasingly automated, digitised and efficient, many once-manual systems and processes are falling away. When was the last time you bought a CD from a physical retailer, went to a travel agent’s office to book a flight, or used the post office to post a letter to a friend? eCommerce, online flight booking, and email are three very simple examples of the convenience of digitisation that has resulted in the standardisation of adopting automation as the simplest solution. Automated payroll systems are fast becoming the norm over manual payroll processes because of the efficiency argument. Employers who have not yet adopted automation in their payroll processes may very quickly get left behind.

6. No need for the experts (yet)

Small businesses especially can benefit from automating their payroll system. While we don’t recommend trying to run a business without a financial person (bookkeeper, accountant, financial manager, and/or tax consultant); a small business starting out with a few key personnel to grow the company means that funds will be limited. In the interim period between starting up and the subsequent rapid growth, entrepreneurs may find themselves forced to do their own books and salaries – this is where an automated payroll system will save many hours of work, which could be better spent on business development and growth… which will bring in the capital required to employ an accounting professional to manage the system for them.

Don’t delay on automating your payroll system, and avoid the potential for errors and the hours lost to manual processes. Do business efficiently and easily, and leave the complexity to the software.

3 Comments

Filed under General, Industry Information, Partner Payroll

3 responses to “The benefits of an automated payroll system

  1. Nontobeko

    Hi i want to know what happens to employers when they are threathen by employees for practicing they’re rights like joining a union and the employee telling them he will deal with them n already started firing staff unfair

  2. Nontobeko

    At pick n pay whiterver they don’t follow the rules no one is getting that amount intead we are having what they call short hours

  3. Nontobeko

    Please cn you do an investigation at pick n pay whiteriver please we are tired of been robbed

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