Business Resources

7 Practices For A Productive Payroll Process

The one day that all employees look forward to every month is undoubtedly pay day. On the other hand, if you are responsible for the payroll process, pay day is no doubt the day that you dread the most.

There are many processes to keep track of while running payroll for the entire company every month. From tracking employees’ attendance and overtime hours to calculation of commissions, allowances and taxes, this can result in numerous payroll mistakes if there are no proper and clear payroll processes in place.

To minimize costs, time and efforts incurred due to payroll errors, here are some payroll “habits” to bear in mind for a productive payroll process.


Using excel spreadsheets to manually calculate the company’s monthly payroll is likely to result in a higher change of miscalculation. Reduce the amount of paperwork and human errors by automating your payroll process. There are numerous payroll software providers in the market that can help with calculating the company’s payroll, taking into account other salary payments such as bonuses and allowances.

Take Inventory

It is imperative to conduct regular reviews of payroll processes and identify areas that can be improved or removed. By identifying specific areas that require troubleshooting, this can help to increase productivity in the long run.

Be Transparent

Keeping your employees informed about payroll policies and procedures is a sure way to keep employees engaged. Moreover, it is important to communicate any changes in policies and procedures to employees in a clear manner such as conducting a town hall or sending email blasts. This is also to avoid any misunderstanding or uncertainty within the workplace.

Direct Deposits

With direct deposits, this benefits both the payroll department as well as accounting department. No more having to print cheques and delivering them manually to employees. At the same time, it is a secure and quicker way to disburse salary to employees.

Pen Down Key Dates

Draw up a payroll timeline for the entire year and mark down important dates such as tax filing deadlines. This is particularly important if there are various groups of employees with different pay periods. It is also important to ensure that everyone who is involved in the payroll process is aware of the payroll timelines, so that these key deadlines can be met on time.

Audit Regularly

Regular audits are crucial to ensure that payroll accounts are balanced and also to unravel any potential instances of fraudulent activity. At the same time, it is a good time for the payroll department to reaffirm that existing payroll processes are in line with compliance polices and statutory laws.

Invest in HRMS

Payroll should not be the only HR process to be automated. In fact, using a Human Resource Management System (HRMS) can help the HR department to better manage HR processes – such as tracking of employees’ overtime hours, vacation leave and compliance tracking. Additionally, HRMS allows HR professionals to manage all HR processes within one platform instead of juggling the various HR processes across multiple platforms.

The first step to increasing payroll productivity is to start incorporating these payroll “habits” in your company’s payroll department. These little changes will ultimately reap its benefits in the long run.

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