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JGA Recap: The past 5 months in the world of payroll (July – November 2022)

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Here are our top pics for the past 5 months of payroll news, podcast episodes, JGA announcements, and more!

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Payroll as the Composer, Encore, Encore!

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My second article in our “payroll as” series, aligns payroll to the composer of an orchestra, a comparison I believe is particularly relevant in our new world of work.

 

Read the first article here: Why Payroll plays the role of the cycling domestique

 

PAYROLL OF THE PAST

It could be argued that before automation infiltrated the payroll process, the art of payroll processing used to be a straightforward monthly cycle focused on transactional activities intermixed with legislation and manual payment calculations.

 

In payroll years gone by, payroll managers, in orchestral terms, were effectively required to conduct small payroll Chamber Orchestras to ensure everything ran smoothly. Payroll was a process of coordinating a tune at an andantino, melodic pace, composing of perhaps a couple of violins (Legislation), a cello (manual payments), a double bass (Manual calculation payments), several woodwind instruments (process and data flows) and maybe a small brass section (Inland Revenue Submissions and audits).  These would be harmonised perfectly to create a beautiful sinfonietta symphony, or in payroll terms, an accurate, efficient payroll process.

 

Of course, sometimes extra rehearsals were needed, especially when payroll deadlines and complexities requested more attention, such as at year-end when P11Ds had to be processed; however, for ten months of the year, the payroll manager could focus on conducting a small band to deliver a competent tune.  Payroll was only about paying employees on time.  If payroll wasn’t heard, it was considered a success.  However, times have moved on.

 

Two decades ago, when I first entered the payroll profession as a payroll recruiter, the issue was that although payroll departments conducted their small bands perfectly, the tunes they played were rarely listened to (or acknowledged) by their HR or Finance counterparts. If they were heard, they were undervalued or “Poco, un poco”, which resulted in payroll professionals failing to gain the traction that would allow them to rise in strategic prominence.

 

Beethoven created his most famous overtures after he began to lose his hearing.  The deafer he became, the harder he worked to be heard.  He already knew how instruments and voices sounded and how they worked together, so he focused on ensuring that his greatest work, his Ninth Symphony, was his most masterful.  It was longer and more complex than any symphony he had previously created, and so it required a larger orchestra.

 

Fast forward to the present day and, finally, Payroll is beginning to be heard too.  Post-pandemic, we have seen payroll operations thrust into the limelight and, as a result, payroll composers are now leading much larger orchestras than ever before.

 

PAYROLL HAS EVOLVED

Today, the small payroll chamber ensembles of the past have evolved and developed into full philharmonic orchestras delivering full-scale symphonic payroll repertoires.  Much broader components now make up the total composition of a payroll operation, with complexities manifold and integral, rather than stand-out and rare.

 

Old monthly and weekly pay cycles are becoming outdated. Payroll professionals now handle multiple, concurrent flexible pay cycles. The rhythm and tempo of payroll is also changing.  Figures from research undertaken by the TUC highlight that the gig economy nearly tripled in the five years to the end of 2021 in England and Wales. Payroll tax arrangements differ for those working within the gig economy compared with employees. Additionally, some contractors may now fall under the IR35 rules in the UK, further enhancing the complexity of the payroll process.  And let’s not even mention words such as furlough, mini-budget, Chancellor, cost-of-living, real-living wage or NMW!

 

Putting this into perspective, according to recent research by SD Worx published in 2022, “nearly 1 in 4 HR Directors believe their company’s lack of capability makes payroll processing more difficult.” Why? Because payroll is no longer transactional. Payroll managers now compose many complex moving parts. Strategic trend analysis, interpreting complex legislation, implementing automation, supporting employee engagement, enhancing wellbeing with reward and benefit initiatives, managing global cross-border payments, introducing pay-on-demand services and leading remote teams all form part of the modern payroll professional’s remit. Payroll may be more complex than ever to manage, however, the results are symphonic when these components are harmonised to play a tune.   Better profits, improved employee retention, enhanced employee engagement and wellbeing.  The positive effects are endless.  There is no denying that playing a payroll tune is more challenging than it has ever been before, however; finally, the payroll composers, found at the heart of these orchestras, are starting to be heard.

 

THE PANDEMIC MOVED THE COMPOSERS NEEDLE

Meanwhile, the recent pandemic forced almost all business-critical operations (including payroll) to function from remote environments. Remote working opened a pandora’s box of opportunities for companies keen to broaden talent pools, while simultaneously improving working conditions for those eager to secure a better work/life balance. Companies are now setting up global offices to overcome staffing challenges, requiring payroll departments to evolve from UK-only operations to globally compliant functions. Within the next five to ten years, the location of talent is likely to change further. Recent research evidence suggested that 54% of the world’s college graduates are from the major emerging markets: China, Brazil, India, Russia, Turkey, Mexico, and Indonesia. Payroll is already adapting, and as globalisation trends continue, the demands on payroll professionals to be conversant in global legislation and cross-border currency payment management will only increase.

 

Innovation is also infiltrating the payroll process more than ever before.  The payroll technology market is estimated to be valued at £27 Billion in Europe alone; hence it is not surprising to see an influx of new payroll opportunities come to the fore. Pay-on-Demand, interactive payslips, cryptocurrency payments, blockchain ledgers, cloud-based solutions, and more add layer upon layer of complexity to the process.  The payroll composer now needs to understand, manage, and immerse significantly more instruments into its orchestra.

 

Research published in 2021 shows that many Millennials and Generation Z want to be paid in Crypto wallets, and conversations surrounding the dissolution of the traditional payroll cycle continue to increase in volume. Meanwhile, employee-led labour markets are demanding more from their reward and total compensation packages, forcing payroll operations to change to ensure high employee satisfaction rates.  Subsequently, payroll operations are now directly impacting employee attraction and retention success, heightening its importance as a strategic operation.

 

The smallest orchestra is the chamber orchestra.  I believe payroll took 15 years to evolve form chamber orchestra to the next size up, which is the sinfonietta.  Pre-pandemic, the payroll industry was getting noticed, it achieved chartered status and relationships with HR and Finance had improved considerably.  However, Post-Pandemic, payroll has rapidly advanced the composer’s needle.  Payroll leaders are now managing full, philharmonic sized orchestras with a responsibility for providing a far greater impact on overall organisational performance than ever before.

 

PAYROLL DIRECTLY IMPACTS ORGANISATIONAL PERFOMANCE

Now considered the most valuable commodity in the world, data is handled in increasing volumes by eager payroll composers keen to identify trends and analytics that can impact broader organisational objectives. Payroll data can identify trends in absence management, regional pay gaps and benefit utilisation that impact organisational performance. Notably, understanding how payroll can influence employee wellness has become integral in contemporary payroll operations. Payroll is no longer transactional; the automotive robots can handle this aspect of the process. Instead, payroll is becoming far more strategic, providing value across the employee cycle, and improving business performance in the process.

 

Recent evidence suggests that more than one in four large companies struggle with the complexities of payroll legislation. More than a third of large companies report that workforce composition makes payroll processing more complex. The rhythm and tempo of payroll have changed, and payroll professionals have adapted to deliver more complex melodies and harmonies than ever before. Given the extent of the changes presented, it is not difficult to understand why.  Simply put, listening to a philharmonic orchestra can be a powerful and engaging experience. Payroll composers are orchestrating influential operations that help sustain the composition of a business by ensuring employees are engaged and retained.  When employees are happy, operations are empowered and can work in harmony to reach new levels of performance.

 

WILL PAYROLL START TO PLAY OUT OF TUNE?

The question is: How many more sections can payroll composers manage before the orchestra starts to play out of tune?

 

Payroll professionals are required to perform a cadenza (improvise) more and more as the layers of complexity continue to permeate the payroll process.  That is why I believe it is time for organisations to invest in payroll operations to ensure that its composers have the support they need to deliver strategic success. I hope the “finale” will be board level stakeholders appreciating the value and harmony payroll composers bring to the table in supporting broader organisational objectives.

 

My wish is to see payroll managers recognised and promoted to become strategic payroll people directors.  I want to see organisations provide training to improve strategic leadership skills.

 

Whatever happens, one thing I know for sure is that payroll professionals are composing overtures that are finally being heard, and it is about time too!

 

Encore, encore!

 

Of course, a symphony is only as good as the musicians that make up the orchestra. The same is true of payroll departments! JGA Recruitment is an award-winning payroll recruitment firm that can ensure that every payroll professional in your ensemble is skilled and qualified to deliver a perfect tune, so you never miss a beat! If you need support recruiting in your payroll department, contact us today.

 

CONTACT JGA RECRUITMENT GROUP

Contact JGA Recruitment to find out more and discover how in partnership, we can locate the top talent for your business and take positive steps to create a sustainable, brighter future for all: [email protected].

 

JGA Recruitment also publishes two leading business podcasts: The Payroll Podcast and The HR L&D Podcast 

 

Written by Nick Day, Managing Director at JGA Recruitment Group – the UK’s leading Payroll & HR Recruitment Consultancy and Executive Search Firm.

JGA Recruitment Group| Payroll & HR Recruitment

E-Mail: [email protected] | Tel: 01727 800 377

Copyright©: JGA Recruitment Group 2022

 

Sources:

SD Worx (2022) SD Worx Europe Wide 2022 Report, Antwerp: SD Worx

https://www.tuc.org.uk/news/gig-economy-workforce-england-and-wales-has-almost-tripled-last-five-years-new-tuc-research

https://blogs.lse.ac.uk/netuf/2018/10/25/wages-in-the-gig-economy-and-beyond/

https://www.gov.uk/guidance/understanding-off-payroll-working-ir35

https://blog.iese.edu/expatriatus/2012/10/19/transforming-hr-strategies-for-the-future-implications-from-the-global-talent-2021-report/

https://tax.thomsonreuters.com/blog/can-employers-pay-wages-in-cryptocurrency/

Future of Payroll Report 2022

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Managing global workforce issues such as the great resignation, regulatory changes, and technology advancements whilst adapting to future work demands remain top priorities for organisations.

 

As a result, the future of payroll, at least in the short term, seems to be hellbent on transformation!

 

From systems to processes and from flexible working to borderless workforces, the changes predicted to impact the future of payroll by 2025 have accelerated and are affecting everyone right now.

 

Payroll professionals during the pandemic helped shift the value perception needle as they successfully navigated the complexities of COVID-19. Payroll professionals ensured employees were paid accurately at a time when employee and employer tensions have never been higher. Millions of employees were put on furlough or isolated from the world. They were left suffering from financial or mental health anxieties, which placed payroll at the heart of the conversation. In response, strategic discussions emerged concerning pay-on-demand opportunities, flexible payment solutions, global payroll models and disruptive technologies that could improve processes and workplace wellbeing.

 

Anyone reading this will already know and appreciate that payroll plays an integral role in all organisations. However, broader business leaders have also now begun to recognise its importance. Businesses began to realise the impact payroll can play in achieving organisational objectives, particularly enhancing the employee experience.

 

Meanwhile, the great resignation (or, as I prefer to call it, the ‘great awakening’) has resulted in vast volumes of people changing employers and highlighted how employees now value work-life balance and wellbeing over financial rewards. This power shift has had a phenomenal impact on the world of work and has resulted in companies making wholesale changes to how they treat, attract, retain, and reward their employees. Add other disruptions such as regulatory and technological changes and globalisation into the mix, and it is easy to see why organisations are reviewing their payroll strategies to keep pace with this sea change.

 

In response, the world of payroll technology began to adapt and evolve to meet employees’ and employers’ ever-changing demands and needs. Likewise, as requirements filter down, payroll responsibilities have started to change and evolve in response. Here at JGA Recruitment, in collaboration with the CIPP, we undertook a payroll research project that identified several new payrolls career pathways now available to payroll professionals (over 60) in 2022. A significant increase in the traditional path from payroll clerk to payroll manager, which existed only a few years ago.

 

Meanwhile, the great awakening forced employers to recalculate how they invest in improving the overall employee experience. Ensuring employees are paid accurately, on-time and intuitively has become an essential ingredient in this equation. As a result, the payroll process has become more than a function focused purely on the process because payroll can help make the employee experience a positive one. Hence, expect the future of payroll to focus on solutions that improve employee engagement and wellbeing. Expect to see increased importance and investment allocated to implementing employee self-service, interactive payslips, and on-demand pay-based solutions.

 

In 2022, businesses are demanding more data and insights from payroll departments than ever to help them make more informed decisions about their workforces. The level of detail found within payroll data has allowed payroll leaders to provide strategic insights that have helped business leaders to navigate, understand and address workplace or workforce challenges more effectively. For example, if we consider the great resignation as an example, payroll data has helped to identify trends in employee behaviours, helping employers understand what is important so they can make changes that improve satisfaction scores, increase productivity and support talent acquisition and retention challenges.

 

The overwhelming drive for businesses to transform payroll has also resulted in a significant increase in the adoption of cloud technology, AI, and automation, especially as employers seek to engage with their workforces. Technology advancements have reduced human errors and repetitive tasks, enhanced cyber security, reduced fraud detection, and improved employee access and transparency. Automation and AI have also provided payroll leaders with more time to focus on delivering value-added payroll strategic insights.

 

One significant post-pandemic change has been the realisation that payroll professionals can remotely process an accurate and efficient payroll operation. The pandemic successfully highlighted that all functions could operate successfully remotely. The result is an awareness that talent pools now exist across all global areas. Recruiting remote workforces across global borders has resulted in many payroll departments evolving from UK-only operations to multi-regional, international functions overnight. If this has not happened to your payroll operation yet, it is only a matter of time before it does as the war for talent intensifies.

 

In response, payroll leaders have had to learn how to design and implement new global payroll operating models to accommodate new multi-regional recruited workforces. Payroll leaders have discovered how to manage unknown global compliance risks and still deliver a seamless payroll experience. Subsequently, organisations are turning to technology to help them provide a seamless international payroll service because they recognise that if executed poorly, it can lead to costly compliance failures and impact that significant “employee experience.”

 

One thing we all know is the payroll landscape has accelerated rapidly. Changes predicted in 2020 that many thought would begin to impact the payroll industry in the next 5-10 years have affected us in just 24 months. Predicted workforce changes that may have involved remote working or faster payments have accelerated due to employee demands and technological disruptions. Employees are asking for pay in real time; they demand transparency; they want payments made in different currencies or through new platforms. Meanwhile, pay transparency has become a top priority for business leaders keen to improve or showcase pay equity across gender, disability and diversity pay gaps. All the above is causing organisations to invest heavily in payroll technologies and tools that can help them to attract, engage and retain top talent.

 

Disruption in payroll is here to stay, at least in the immediate future, as companies continue to invest in technology that improves that critical employee experience. It is good news for payroll leaders keen to develop strategic expertise and value within an organisation. These disruptive payroll technologies provide payroll leaders with more access to consolidated, real-time payroll data, which are helping organisations to make better strategic decisions.

 

The profile of payroll has never been higher.

 

WHO ARE JGA RECRUITMENT GROUP?

JGA Recruitment Group specialises in attracting its clients’ top 15% of Payroll and HR talent. Founded in 2008, the business has become an award-winning company renowned for continually innovating and pioneering new approaches to the candidate search and selection process.

JGA Recruitment Group has experienced significant growth across all market sectors, from executive to contingency search. Committed to its mission of growing the right way, they provide hyper-focused, bespoke recruitment services to locate top talent that inspires and enables employers to achieve significant success through its people.

Contact JGA Recruitment to find out more and discover how in partnership, we can locate the top talent for your business and take positive steps to create a sustainable, brighter future for all: [email protected].

JGA Recruitment also publishes two leading business podcasts: The Payroll Podcast and The HR L&D Podcast

Written by Nick Day, Managing Director at JGA Recruitment Group – the UK’s leading Payroll & HR Recruitment Consultancy and Executive Search Firm.

JGA Recruitment Group| Payroll & HR Recruitment

E-Mail: [email protected] | Tel: 01727 800 377

Copyright©: JGA Recruitment Group 2022

Why Payroll plays the role of the cycling domestique

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Following the recent completion of the Tour De France and Tour De France Femmes, we have seen incredible cyclists winning new records and accolades for themselves and their countries. Yet, as much as we enjoy celebrating the winners’ achievements, not many realise that those who finish with the coveted yellow jersey can only do so thanks to their trusted ‘domestiques’.

 

But what is a domestique?

Quite literally, the French word “domestique” means “servant”. Within the realm of cycling, a domestique is a title given to a cyclist who holds the critical role of providing support to the top team principal members or the team lead rider, known as the ‘Captain’. The domestique has several essential responsibilities, including being a pacemaker for the Captain or riding out in front so that the lead cyclists can ride in their slipstream, saving them precious energy for when the lead riders push for the finish at the end of the race. The domestique’s critical role focuses on ensuring that they make the position of the competitive cyclist as easy as possible so that they can win races and stay ahead of the competition!

The domestique’s role doesn’t stop at just being the windshield for the race team leaders. They are also often required to carry food and water for the team Captain. In addition, when the Captain faces a technical difficulty with their bicycle, the domestique may be required to offer up their bike to help them succeed so they can continue the race at their own expense. It is a selfless role that involves hard work and considerable suffering, all for someone else to take the glory!  It got me thinking as I can think of no other sport in which such a role exists, however, it did suddenly become apparent that the profile of the domestique can be easily aligned with the role payroll plays within business.

The bottom line is that the domestique is the embodiment of the ultimate team player, without which the Captain or lead rider would struggle to compete. A domestique gives the Captain a better chance of winning the race and gaining glory.

 

How does the role of the domestique in cycling align with role payroll plays in business?

At first, this alignment may seem somewhat abstract, however, I believe the payroll professional plays a similar role within business to that of a domestique in cycling. Payroll operations help businesses to succeed. Without good payroll operations in place, organisations are likely to flounder. A lead cyclist would fall behind without the support of their domestique, similarly, companies without solid payroll operations are likely to drift behind their competitors. Inefficient or inaccurate payroll operations typically result in high staff attrition and low morale, and the fiscal penalties for errors can be severe. Getting payroll wrong and failing to comply with complex regulations can not only lead to increased costs and fines, but it has a knock-on impact on employee wellness, attrition, and engagement if they are continuously paid incorrectly.

The modern payroll profession is, in my opinion, the backbone that supports and enables companies to function effectively, allowing stakeholders and business leaders to concentrate on what they know best: running the business and delivering strategic initiatives that provide a competitive advantage.  Payroll operations support businesses to allow them to operate efficiently, effectively, and competitively.

Payroll departments are now leveraging big data to drive and support strategic decision making, identify insights and improve workforce efficiency. From understanding regional pay gaps and reward scheme adoption rates to helping HR with absenteeism trends and pay review statistics, payroll plays a fundamental role in supporting business leaders with information that enables them to compete more effectively.

 

Why is the role of the payroll domestique so important?

Slick payroll operations also help support the employee experience, driving employee engagement upward. However, when employees experience payroll mistakes and poor processes, this can be extremely disengaging, leading to critical workforce issues such as high attrition and challenges attracting new employees into the business. Recently in the news, several stories have appeared highlighting payroll errors within major employers that have resulted in employees needing to secure loans from payday lenders or even cutting back on meals to make ends meet. Such situations create tremendous financial stress and anxiety for employees that profoundly impact motivation, productivity, retention, absenteeism, and attraction. With the UK facing an unprecedented cost of living crisis, the ability of a company to process accurate payroll operations has never been more critical.

 

The silent sound of success!      

Like a domestique, it is rare for a payroll professional to receive praise for their work, which often goes unnoticed.   Payroll professionals recognise that their role is to support a broader strategic objective. Similarly, to domestiques, payroll professionals are happy to silently contribute to the ultimate success for which business leaders take the public plaudits.   And yet, if things go wrong, (as recent headlines have shown), it is the payroll professional that is often left as the first line of defence to take the blame if organisational performance drops or errors occur.

That is precisely why I am aligning an effective payroll team with the cycling domestique. Payroll operations focus on avoiding and identifying issues before they occur. When a rare error does arise, they take responsibility for addressing it effectively and quickly to minimise performance disruption and safeguard the leaders they support. In payroll, the power of silence is the only award that is craved as silence acknowledges a job well done. No noise means no complaints and can therefore be considered to be the silent sound of success! The same is true for the cycling domestique.

 

The best domestiques become eventual winners.

Integral to the success of any organisation is the payroll department. Crucial to the success of any lead rider in the Tour De France is the domestique. Recruiting the right staff and investing in top talent are essential in both instances.

Top domestiques have often gone on to become Grand Tour De France winners. For example, Chris Froome became Tour De France Champion in 2013 after riding for Sir Bradley Wiggins in 2012. More recently, Geraint Thomas became a Tour De France winner in 2018 after initially being the lead domestique to Chris Froome in his previous 2016 and 2017 Tour De France victories. So, who was Geraint Thomas’ domestique in his maiden 2018 victory? Chris Froome!  Chris Froome recognised that Thomas “was stronger from the outset this year.” From 2012 to 2018, all the above riders were part of Team Sky, which invested more than £150m into its team to become the most successful cycling team winning the Tour 6 out of 7 times during this period. Investing in top talent and recruiting the best domestiques available was a critical factor in this success.

In the world of payroll, we are seeing more businesses than ever committing investment into the recruitment process to ensure they can secure the best payroll talent available. Meanwhile, payroll professionals continue to rise in profile as business leaders begin to understand the contributions effective payroll operations can have on achieving organisational success.

For the first time, top accountancy firms are now promoting payroll professionals to Partnership level roles.  In addition, award-winning payroll recruitment firm, JGA Recruitment Group recently reported that they have secured a record number of payroll director-level requisitions as major FTSE and Fortune 500 companies begin to hire executive level payroll talent.

 

Effective payroll operations are now synonymous with business success.

Effective payroll operations are also becoming synonymous with increases in employee retention, attraction, wellness, and engagement metrics. JGA Recruitment Group founder Nick Day expects this association to continue:

“Payroll is notoriously complex; however, many businesses have been slow to recognise the complex regulatory landscape and compliance obligations payroll departments are required to navigate. Hence, it has been exciting to see organisations contact us to help them recruit new payroll directors as they begin to recognise the powerful role payroll efficiency can play in achieving broader organisational objectives. I believe this process starts with recruiting the right payroll talent from the top down because top-performing payroll operations have demonstrated time and again that they can improve performance, deliver insights, increase employee engagement, and save organisations both time and money.”

If you want to ensure your business stays ahead of the curve, then get in touch today to find out how  JGA Recruitment Group can help transform your payroll operation into top-performing domestiques that can support your organisational or strategic endeavours. Phone: +44 (0)1727 800377, Email: [email protected]

 

WHO ARE JGA RECRUITMENT GROUP?

JGA Recruitment Group specialises in attracting its clients’ top 15% of Payroll and HR talent. Founded in 2008, the business has become an award-winning company renowned for continually innovating and pioneering new approaches to the candidate search and selection process.

JGA Recruitment Group has experienced significant growth across all market sectors, from executive to contingency search. Committed to its mission of growing the right way, they provide hyper-focused, bespoke recruitment services to locate top talent that inspires and enables employers to achieve significant success through its people.

Contact JGA Recruitment to find out more and discover how in partnership, we can locate the top talent for your business and take positive steps to create a sustainable, brighter future for all: [email protected].

JGA Recruitment also publishes two leading business podcasts: The Payroll Podcast and the The HR L&D Podcast

Written by Nick Day, Managing Director at JGA Recruitment Group – the UK’s leading Payroll & HR Recruitment Consultancy and Executive Search Firm.

JGA Recruitment Group| Payroll & HR Recruitment

E-Mail: [email protected] | Tel: 01727 800 377

Copyright©: JGA Recruitment Group 2022

Sources:

https://hrindependents.co.uk/what-happens-when-payroll-goes-wrong/

https://www.theguardian.com/business/2022/jul/15/asda-employees-skipping-meals-monthly-payroll-errors

https://www.theguardian.com/business/2022/jul/17/next-apologises-to-staff-after-it-problems-cause-months-of-underpaying

https://solutions.zellis.com/financial-wellbeing-report-2022

https://en.wikipedia.org/wiki/Geraint_Thomas

https://en.wikipedia.org/wiki/Domestique#:~:text=Greg%20LeMond%20won%20the%201986,for%20Bradley%20Wiggins%20in%202012

https://www.skysports.com/more-sports/cycling/news/21684/11453702/chris-froome-happy-to-play-domestique-in-geraint-thomas-tour-de-france-victory