Employee trust matters in an organisation. But it takes time to earn it and effort to keep it. It can be lost all too easily and that can be damaging both in the short term but also longer term too. The psychology of trust is complex of course: a lot of factors influence it.
Some of those relate to the more strategic aspects like culture and leadership. But trust also builds at the more routine level too, through day to day activity and the experiences employees have in the course of their work.
That’s where HR and payroll processes fit in. When they’re going well, they might not be something you’d think about in terms of trust. But if things don’t go so smoothly, there’s potential for problems.
Why does trust matter?
There’s plenty of research highlighting just how important trust is in an organisation, and how damaging it can be when that trust is lost. The UK’s Engage for Success movement refers to trust’s fundamental role in high performance and engagement. PWC research talks about it being essential for business growth and coping in crisis situations, as well as affecting recruitment and retention.
So how can good payroll and HR systems make their contribution to both earning and keeping employee trust? Here are some of the ways they can help.
Five ways effective payroll and HR systems increase trust levels in organisations
1. They minimise the risk of payroll errors
Payroll reliability is essential for trust – so it follows it can be damaged if there’s a pay error. Employees should feel confident that they can rely on the fact they will be paid what they are owed on time.
They shouldn’t have to feel that they must constantly check that it’s been done correctly. And if a payroll error’s been made, it’s frustrating for them to have to flag it up, as well as potentially then spend time dealing with the repercussions of getting it sorted out. This can start to sour a relationship and if it keeps happening, a business could even find itself starting to lose people.
2. They reduce the problem caused by underpayments
The knock-on impact of a payroll error can be felt particularly acutely if there’s been an underpayment that creates some kind of financial difficulty for an employee.
It could lead to them being unable to make essential scheduled payments, then having to deal with all the associated implications of that. It might be as fundamental as not having enough in the bank to afford to pay for the absolute basics like the food shop. It can cause an awful lot of hassle and upset which inevitably will hit trust levels.
3. Overpayments are less likely to occur
While arguably less upsetting than an underpayment, an overpayment can cause problems too.
Even if it’s a small payroll error, it can still take up the employee’s time getting it sorted out. Depending on the size of it, or the variability of payments an employee usually receives, they might not even realise they’ve been overpaid. That could mean it’s spent before the payroll error’s been identified.
In some cases, the error might not be noticed for a long time, creating a serious problem and jeopardising trust levels as a result. While HR and payroll software cannot completely eliminate the risk of clerical mistakes, the inbuilt checks and balances within the system along with the reduction in a number of inputs helps lessen the chances of payroll errors happening. And if they do occur, it makes it more likely they’ll be identified quickly.
4. Employees can easily access their own information
Payroll and HR software helps create a greater sense of empowerment which is a vital component for building and maintaining trust. It gives employees more control over their information by being able to access it and, in some cases, being able to update it too. Transparency of communication is essential for trust as well. HR and payroll software helps achieve that by providing far greater visibility and clarity.
If there was a query, access to their own data means employees can quickly look into it themselves and access information straight away rather than wasting time and energy trying to find out answers from other people.
5. Confidence in the appropriate use of data
The requirements around collecting, storing and using data are quite rightly very demanding. Employees must be confident their information is being managed in a responsible way that’s fully compliant with legislative requirements.
Good HR and payroll software is set up to ensure full compliance with all such requirements. It offers a highly secure way for data to be collected and used. That gives reassurance to employees that their data is being looked after properly.
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