Payroll functions essentially are centred on employee compensation taken care of by the Accounts Department.
HR Department, in contrast, ensures that employee relations are maintained in conformance to prevailing norms for industries as have been federally stipulated.
Convergence of HR and Account departments for sharing payroll functions can spell remarkable success for your organization. Bridging the functionality rift between HR and accounts departments can result in motivated employees with favorable productivity curve and steering clear of statutory impediments.
Why Payroll Functions must be Coordinated by HR and Accounts?
The reason for coordination can be understood from a simple example. On January 19th, 2017, the Indian Government’s Labor Division made it mandatory for all private organizations to implement the wage revision recommendations of 7th Pay Commission. Any violation ran the risk of cancellation of labour license.
The notification for the same was sent to respective HR departments of every organization as they handle the labour welfare related issues. It was the responsibility of HR to apprise Accounts about the changes in Basic, DA, and other emoluments for various labour classes i.e. skilled, semi-skilled, unskilled.
Further, remunerations of tenured employees had to be adjusted accordingly. Only when HR would provide a comprehensive report to Accounts about the changes, the Accounts team could meticulously implement the same without delay.
Any delay would have invited legal hassles.
Those organizations where interaction between HR and Accounts have been seamless could streamline this tedious process. Others had to bear the wrath of the Labor Division of government.
How HR and Accounts Handshake can be Facilitated for Optimization of Human Capital Management
Cross-domain cooperation between the discrete departments has become possible due to the following reasons.
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Cloud-based systems which ensure optimum collaboration and information sharing on the go and from multiple platforms
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Cross-functional databases of employee-related information which allow for the implementation of norms uniformly across various locations
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Instant intelligence exchanges that allow accommodation of contemporary changes in compensation procedures
Your organization can exhibit strict compliance with statutory, recruitment and compensatory matters with real-time cooperation between Accounts and HR.
Importance of Policy-Oriented Interactions
A symbiotic relationship between HR and Accounts is the catalyst for ensuring talent retention, reducing attrition, and boosting employee satisfaction index.
When employees are compensated at par with government stipulated rates, they feel subliminally motivated to contribute their might to forward organizational interests optimally.
Timely implementation of changes and reflection of the same in employees’ payslips would result in the contented workforce.
Proper minimum wages, overtime rates and adherence to regulations governing engagement of employees beyond normal working hours can spark a wave of heightened productivity across processes.
Further, extending benefits related to employee insurance rates, leave, maternity advantages and other remunerative benefits within a realistic time-frame can promote employee loyalty and reduce attrition.
Competitive Compensation and Talent Retention with Optimum Coordination
Talented employees would intuitively feel disinclined to leave your organization in search of better opportunities if remunerative expectations are fully met. Your company would not lose the value for money and time it had invested in cultivating advanced employee skills. Strategic harmonization of HR and Accounts functions’ on the matter on payroll thus can offer your organization a definitive edge in a stiffy competitive corporate landscape.
Conclusion
The confluence of HR and Accounts would evolve from a change in mindset. The organization would be the ultimate beneficiary as efficient Payroll ERP Software makes its impact felt on the profitability quotient of your company.