If you want to optimize your business outcomes, from legal compliance to employee satisfaction, it’s important to pay your workers accurately and on time. And thanks to payroll automation software, doing so has never been easier.
Despite the availability of payroll software, 25% of small businesses still rely on pen and paper to track their finances. Not only does manual payroll take more time, but it’s also more prone to errors. To overcome these issues once and for all, all your business needs to do is embrace a payroll software solution.
To help you choose the right payroll management software for your company, we discuss 14 of the most important payroll features below.
#1 Automation
One of the most beneficial payroll software features to help streamline your HR is automation. Automation can make the following payroll tasks more efficient:
- Data input
- Time tracking
- Wage and tax calculations
- Tax reporting
- Legal compliance
- Paycheck distributions
With global payroll automation streamlining your HR department’s workload, your team can turn their attention to managing employee relationships, planning professional development programs, and cultivating a positive company culture.
Automated payroll processing can also improve the accuracy of daily tasks done by HR professionals by taking the potential for human error out of the equation.
#2 Time-Tracking Capabilities
Workforces are often split between full-time employees on a salary and part-time workers making an hourly wage. While salaries are typically straightforward, hourly wages involve more complex calculations—you must track your employees’ time and account for any overtime regulations in their jurisdiction.
Luckily, payroll software that includes time-tracking can simplify hourly wage calculations. These tools for HR professionals record your hourly workers’ time, whether they’re clocking in from the office or from home. Your payroll platform can use this data to calculate their wages, automatically raising their rate for any overtime hours they work.
In some EU countries, even if the employee is paid monthly, you’re legally obligated to track employees’ time. This is to ensure compliance with overtime laws, and that all overtime payments are duly paid.
Some payroll processing systems include time-tracking capabilities, while others integrate with third-party time-tracking applications. In either case, this feature is essential to ensuring accurate, legally compliant payroll.
#3 Compensation Management
Once you’ve made sure that your employees are being paid accurately, you can turn your attention to your compensation management. Are your salaries competitive? Should you redesign your bonus structures? Do your foreign employees need a raise to account for inflation?
While these compensation management questions can be complex, you can uncover data-backed answers with ease by using the right payroll software solution. You just need to select a payroll software that allows you to:
- Compare how your salaries stack up to industry competitors
- Analyze whether or not you’re paying employees fairly and equitably
- Optimize your bonus structures and schedules
- Calculate cost of living increases for employees who move to new locations
#4 Direct Deposits
Electronic bank transfers, also known as direct deposits, are a popular payment method. Employees appreciate them for their convenience.
Direct deposits are also more efficient for employers since they enable HR departments to skip the hassle of the process of printing and mailing paychecks and pay stubs. What’s more, direct deposits are more secure and eco-friendly than physical paychecks.
Since direct deposits benefit everyone involved, looking for a payroll platform that facilitates electronic bank transfers automatically is a good idea.
#5 Self-Service
Another payroll software feature that employees will appreciate is self-service. Self-service allows workers to access their employer’s payroll software and review the following data:
- Remaining paid time off
- Pay stubs
- Tax forms
When your employees can check this information on their own, they won’t need to reach out to your HR department as frequently. In turn, your HR department can attend to other tasks.
Better yet, self-service enables your employees to update their payment details, such as their bank account numbers and home addresses, at their convenience.
Not only does self-service improve your business’s operational efficiency, the added autonomy it provides employees will improve morale.
#6 Expense Management
Depending on your business model, you may need to reimburse your employees for certain expenses—transportation, meals, travel, lodging, and client entertainment are just a few examples. If you run a remote company, you may also want to reimburse your employees for their home office equipment. In some countries, this is a legal requirement. You can provide home office equipment in the form of a one-off allowance.
You can manage these expenses with ease by selecting HR software with expense management capabilities. Not only can this payroll processing software generate detailed expense reports, but it can also automate payments, ensuring timely reimbursements.
#7 Global Payroll
Thanks to the rise of remote work, companies can hire skilled workers from around the world. Expanding your job search globally can help you snag top talent, improve your team’s diversity, and conquer new markets.
If you run a global company, you need payroll management software that’s up for the job. Payroll software with global support features can help you:
- Convert payments into foreign currencies
- Account for time zone variations
- Track and manage different countries’ compliance requirements
While some payroll management software systems provide these features, you may want more hands-on support. In this case, working with a global Employer of Record (EOR) can make all the difference. In addition to setting you up on an HR payroll platform, an EOR service can help ensure your workers are paid accurately, compliantly, and on time.
#8 Tax Filing
Did you know that 40% of small business owners say taxes are the toughest part of owning a business? They attribute their distaste for tax filing to the headaches involved in keeping up with complex and ever-changing regulations and associated administrative burdens.
While taxes aren’t going anywhere, they don’t need to be difficult. A payroll solution with tax features can make this process a lot easier by automating the following tasks:
- Monitoring local tax rates and regulations.
- Determining the right tax rates and filing dates for each employee’s location.
- Calculating tax deductions and withholding them from employees’ paychecks.
- Generating annual tax forms and sharing them with employees.
- Submitting mandatory reports to various tax authorities.
Not only can payroll software take these tasks off your to-do list, but it can also prevent you from making expensive mistakes.
#9 Compliance Management
Taxes are just one component of legal compliance. You must also ensure the following employment elements satisfy all relevant laws and regulations:
- Labor contracts
- Onboarding procedures
- Minimum wages
- Overtime pay
- Payroll frequency
- Mandated benefits
- Breaks and meals
- Termination protocols
As with taxes, these factors can become more complex if you hire employees in multiple locations. Luckily, payroll software with a detailed compliance dashboard can help you keep track of your legal adherence as you expand your workforce worldwide.
#10 Wage Garnishment
Wage garnishment occurs when a court orders an employer to withhold an employee’s earnings to satisfy an unpaid debt, such as child support, tax levies, or loan payments. To fulfill a wage garnishment order, you must deduct the ordered amount from your employee’s paycheck.
Complying with wage garnishment orders is simple when you have the right HR payroll solution. Just look for a payroll system that includes a built-in wage garnishment feature.
#11 Personalized Payroll Reporting
Maintaining detailed reports of your payroll data is vital for various reasons. These reports can help you:
- Prove your adherence to regulatory requirements
- Plan your budget
- Analyze and optimize your payroll practices
Some payroll software even allows you to customize your payroll reports, enabling you to see the most pertinent information and insights for your goals.
#12 Integration Capabilities
Payroll software is just one valuable tech tool you can use to optimize your company’s operations. You may also rely on the following types of applications:
- Accounting software
- HRIS systems
- Tax Software
- Learning management software
- Benefits administration software
When your payroll software can integrate with these types of applications, you can funnel all of your HR data into one place and enjoy a more seamless user experience.
#13 Robust Security Measures
When comparing payroll software options, don’t forget to evaluate their data security measures. Since you’ll be storing your employees’ private financial data, you must keep it safe. Payroll management software with robust security features like encryption, automatic backups, and user access controls can do just that.
#14 User-Friendly Interface
Lastly, you want to ensure your chosen payroll software is easy to use. Otherwise, you may have difficulty taking full advantage of the features listed above.
Some payroll features that contribute to a user-friendly interface are as follows:
- Customizable dashboards
- Intuitive navigation
- Drag-and-drop capabilities
- Real-time notifications
- Mobile app accessibility
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