Many people lump human resources, payroll and benefits administration together. These are distinct functions with their own concerns, which often puts them at odds with each other. Getting the people in these roles to work together and get along can be an uphill battle. How can you increase collaboration and get everyone on the same page?
Although human resources, benefits and payroll are all different functions, there are places where they intersect, such as when an employee is hired or let go, someone gets a pay raise or requests time off. While the HR department needs to stay current on all federal, state and local regulations, there are laws that are applicable to payroll as well, such as taxes. Many companies roll benefits administration into the payroll department, but this process isn't without complications. Benefits have changed a great deal with the Affordable Care Act. Plus, many companies have started to offer more to employees to establish a more competitive position in the recruitment market.
In addition, there isn't a singular reporting structure for payroll across different companies. Payroll is typically housed within HR or the finance department. Even if payroll is handled within the HR function, there is still involvement from finance to make sure everything adds up. Some of the problems can start because of the uncertainty of how payroll should be handled. It has a clear bearing on HR issues, especially as they relate to benefits, but payroll is based on numbers of accounting.
Some people may be unclear where human resources stops and payroll starts. This can be a source of contention within your organization, and it's crucial to get these teams to work together.
Where Does the Trouble Start?
There is a clear need for human resources and payroll to collaborate. If you're recruiting for new positions, what salary should you offer? How much vacation time can you offer? In addition, security is a more substantial issue than it was before the Internet. Both of these departments have access to confidential employee data, such as banking numbers, Social Security numbers and home addresses. Bringing these teams together creates a stronger defense against hacks.
What happens when a situation intersects? For example, maternity leave and pay is a joint issue. HR needs to advocate for the employee and ensure the company is upholding anti-discrimination laws. Difficulties can arise because these two separate departments may have different ideas on how ideas like this should be handled.
How Can You Bring HR and Payroll Closer Together?
Ultimately, some of the difference between HR and payroll are here to stay. Both departments need to maintain compliance with their specific regulations. HR will continue to be responsible for recruitment, hiring, onboarding, employee development and mitigating internal issues, and payroll needs to ensure paychecks are issued on time and benefits are handled. Despite this, there doesn't need to be a huge disconnect between payroll and human resources, especially because there is so much overlap between the two departments.
Platforms that can be used across multiple departments have a number of benefits for businesses. You can reduce costs by eliminating other applications, and different teams have access to the same data, which improves collaboration. Many software platforms allow you to tailor the program for individual departments so they get what they need while maintaining a higher degree of consistency across the organization, according to Tech Radar. It's much easier for everyone to reach the same conclusion when they're working with a shared set of data. Working with the same platform also makes it easier for different departments to collaborate when their responsibilities intersect.
Many HR and payroll departments depend on multiple software platforms or vendors to manage all their tasks, and it can create a great deal of inefficiency. If you truly want to bring these two teams together, a shared platform may be a good approach. It can help break down some of the barriers between different teams, as well as increase collaboration with the finance team. Shared metrics can establish HR as a more equal partner in business decisions.
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