Paymaster Magazine

6 trends affecting payroll and HR in South Africa

South African companies face a number of human resources (HR) and payroll related challenges today, and there is no sign that the pressure will be let up in 2015 or 2106. Volatility in the workplace and workforce, skills development, and  tax regulations and labour laws that never cease to change are perhaps the most challenging issues that businesses need to face.

Thankfully there are many technologies, such as paymaster, and business models that assist organisations in South Africa in achieving greater control an improved management of HR with their business needs and of course take the pain out of payroll management. Here are some key Trends affecting Payroll and HR for next year or so are as follows:

  1. Compliance Compliance Compliance

It is expected that the regulatory and tax environment will continue to become more complicated, as proven by trends in the last decade or so. Implementation of pension fund reform has been delayed, however it is still very likely to happen, for example. And the environment changes every tax year.

  1. Increase in payroll fraud

Payroll fraud has seen reported incidences increase at an alarming rate especially among SMEs in South Africa. The growing number of companies asking payroll firms to assist with forensic investigations after falling prey to payroll fraud and this indicates that the crime is on the rise.

The three components of the classic fraud triangle – Motivation, opportunity and rationalisation  – form a perfect storm in payroll and this creates enormous risks for businesses. An automated payroll solution, such as Paymaster, well planned and implemented processes and strict governance are essential to containing the risks.

  1. Cloud Technology

A growing number of entrepreneurs now use cloud applications to get up and running quickly with essential business applications such as payroll and HR, this use of cloud technology is expected to grow.
Many existing businesses are expected consider the cloud as a method of optimising operational and capital costs in their IT environments, this will include Payroll. Furthermore it is expected that many companies that have not yet done so will implement online employee self-service solutions and this automate time consuming processes like expense claims and leave approvals.

The reason that the cloud plays such a large part of future operations is due to the fact that it empowers people to be productive while they’re mobile. The recent Sage Business Index survey for 2014 showed 59% of South African businesses believe the mobile infrastructure in South Africa makes it possible to work effectively on mobile devices. And more than 40% believe that, in the future, tablets and smartphones will be of most use for accounting and/or payroll.

  1. Strategic investment in HR

Business has recognised that an engaged and empowered workforce with the right skills and levels of competency will deliver a superior return on investment. A workforce that is engaged, happy and satisfied is proven to be vastly more productive and delivers the greater levels of innovation and customer service demanded to compete in today’s environment.

Because of this, many companies are automating or outsourcing their routine HR processes so that HR managers can focus on performance management, training, skills development, alignment of the workforce with the business strategy, and other key strategic initiatives.

  1. Outsourcing

A growing number of  companies are outsourcing routine payroll tasks such as processing the monthly payroll and printing and distributing payslips, allows them to concentrate on core business and entrust an efficient, specialist provider such as Paymaster with staying ahead of compliance requirements, technology, and other complexities of running a modern payroll.

  1. Online tools for smoother recruitment

Recent surveys have shown that up to 75% of organisations are adding online recruitment to their traditional recruitment methods and using social media in this respect. It is expected that more companies to use tools such as online applicant tracking, talent communities, and internal career portals in conjunction with their traditional recruitment processes as the cost for these is reducing and the process is not only faster but produces a more quality in the candidates.

In time, business will be able to export job specifications from their HR systems to online recruitment platforms or import a successful job applicant’s details directly into their payroll and HR software. This will bring new levels of efficiency to the admin processes that surround recruitment.

 

Adrian Baillie-Stewart

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