The functioning of HR and payroll department vary in organizations across the globe; HR focusing on the full spectrum of employee-related processes and payroll centering upon finance tasks. But, there is always been some alignment between the services of both departments provide during the life-cycle of an employee within an organization. HR and payroll departments need to prove the strategic contribution that they can bring to today’s business environments. They need to work together to develop smarter management and business processes.
Why is Integration Needed?
The data collected by HR department regarding employees is much of the same information required by the payroll department. Therefore, there is a lot of data entry work. HR and payroll integration allows both departments to access all of the same information by using the same database. An integrated HR management system allows both HR and payroll teams to retain ownership and control of their data so there is no threat of a loss of identity and no risk of incorrect data manipulation.
The integration of HR and payroll data can offer numerous benefits, a few are listed below:
- Data is entered into one comprehensive solution, reduces the likelihood of errors, improves information validity and helps ensure stronger audit performance
- Reduces administrative burden on HR professionals which in turn saves time, money and increases efficiency, ultimately a great return on investment for companies
- Payroll and HR contain highly sensitive data, from salary information to social security numbers. By integrating HR and payroll systems into a highly secure HR platform, data breaches can be reduced
- Knowledge transfer can be achieved, integration not only encourages a greater understanding and appreciation for one another’s role but also enhances the development of new skills
- The unified function (HR and Payroll departments) will have a great impact on employee benefits and the policy of the business, which in turn will improve the profile of both teams within the organization
- A more effective recruitment, training, performance and reward strategy can be established when employee data is stored, accessed and analyzed in one integrated system
- Consolidated reports regarding employees’ information and their packages can be generated. These reports also provide employees’ benefits data as well
- When the data is available together through a single interface, employees are able to log into the HR management system and quickly access information about payroll, available time off, current tax deductions, and benefits.
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