The 2016 Employee Outlook Research paper from the CIPD has found that 36% of the UK employees surveyed are dissatisfied with their current pay level and more worryingly that 25% of employees plan to leave their current company in the near future.
Additionally, a survey conducted in 2015 by FMP found that payslip queries still make up a large amount of the contact employees have with their company’s HR team as it made up 43 percent of all queries from the employees surveyed. Further, FMP found that 50% of all employees surveyed had errors or mistakes with their payslips or pay at least once in the last 3 years.
However, what is most enlightening and arguably most startling is the effect that payroll related errors and mistakes have on employee’s morale and satisfaction levels. Later research by FMP suggested that the time and stress it takes to resolve payroll issues is one of the most demotivating and unfavourable things for an employee. So much so in fact that a third of the employees surveyed would strongly consider looking for a new job if their current company paid them incorrectly even once, 44 percent would be demotivated if it happened, and 51 percent would lose significant trust in their employer.
It paints quite a bleak picture. But how could this new research potentially put a heavier burden on payroll departments going forward? Well we hypothesise two ways;
The first relates to the statistic quoted in the first paragraph of this article. As mentioned, the CIPD research found that 25% of UK employees strongly plan on leaving their current employer in the near future. This higher employee turnover will understandably create markedly more paperwork and larger administrative duties for the payroll department as the rate at which people leaving the company and thus new employees entering the company will be higher.
The second relates to the statistics quoted in the last part of the third paragraph of this article. As mentioned, even a single payroll related mistake would cause a third of employees to consider leaving their current company, 44% to feel demotivated and 51 percent to lose trust in the company. As more heads of companies become aware of this research and the seemingly large negative impact an arguably small payroll slip up or mistake can make on an employee then they will likely put more pressure on payroll departments and place a heavier burden on them to maintain higher accuracy and efficiency.
It is crucial to note however that our above conclusions are based primarily on just two research papers that are largely limited by the sample size of the employees they surveyed. Results may vary significantly depending on geographic area, industry or even employee age and/or gender so it is worth taking that into account.
Further, the additional burden we predict will be placed on payroll departments as a result of everything mentioned in this article can be mitigated by a company’s management deciding to hire more payroll staff to spread the additional workload or to outsource a small or large portion of payroll activities to a third party company.