Address: 8 Houlton Drive, Palm Beach, 4275, KwaZulu-Natal, South Africa | Tel: 031 702 0449 | Fax: 086 605 2670

Why Payroll is Important!

It is paramount for business owners of companies, both big and small, to understand the importance of payroll.  Understanding the function of payroll is vital and helps a company to align itself with compliance with labour legislation and tax laws. The well-established and functioning payroll reflects a company’s level of compliance, establishing and demonstrating a company’s integrity and dedication to its employees.

ayroll

Payroll is a key function for two important reasons. Firstly, when employees are paid incorrectly or late, they are likely to become demotivated and are more likely to believe that their contribution to the workplace is not appreciated or that the company does not have what it takes to get the basic structures in place. Imagine being on the receiving end of incorrect remuneration and benefit payments. There is no reason for sloppy payroll functionality and processing. Employers who are not familiar with the correct way in which to run their payroll can reach out to an outsourced payroll company to assist them with refining their processes and ensuring employee and employer taxation compliance. 

Secondly, ineffectual payroll is not the employee’s responsibility to address. Missing information at the onset of an employee’s employment is commonly due to gaps in the onboarding information-gathering phase and reflects poorly on the employer. Payroll mistakes open a company up to recurring and escalating month-on-month issues which creates confusion and dissatisfaction amongst the staff. A payroll expert has many benefits which counteract the additional expense of outsourcing the task, the least of which is ensuring that both employee and employer do not land themselves under inspection from SARS.

A payroll expert has many benefits which counteract the additional expense of outsourcing the task, the least of which is ensuring that both employee and employer do not land themselves under inspection from SARS. Having a payroll service provider will help with managing all aspects of the remuneration process including bonuses, overtime, leave and claims which can be difficult to pay correctly if not done properly. This will also work hand in hand with the running of the HR department which is often heavily reliant on payroll to facilitate analysis and reporting functions.

Payrolls with an additional HR module allow a company to keep all their records in one place which can be easily maintained and accessed. Time and attendance, performance and employee relations can be difficult to manage without a structured system to support the effective implementation thereof.

A payroll service provider will also ensure that weekly and monthly pay dates are met and annual tax deadlines are not overlooked or missed. Additional functions include management of statutory deductions such as UIF, COIDA, pension and medical aid contributions, and other fees such as Union membership and levies stipulated by Main Agreements are paid correctly and proportionately.

Additional benefits of a highly functioning payroll is that employees are able to access their company, payment, leave and benefits information via the Employee Self Service functionality. Allowing employees to access their own information will give them greater control over their information should they require it thereby alleviating the pressure on the payroll and HR departments, to provide such information.