1st May 2018
Why business continuity should include the option for a third-party to manage your payroll
A part of every organisation's business continuity should include a plan B for running payroll in an emergency.
Payroll is without doubt a business-critical activity - unpaid or incorrectly paid employees and legislative non-compliance are not something most organisation's would want to contemplate. Processing payroll in-house using payroll software offers a great deal of flexibility, but it does rely on the availability of skilled people to do it. The reality is that a combination of holidays and unplanned absence or unexpected events, could leave you unable to pay your employees. So it's important you consider what you would do in the event of an emergency.
A contingency plan should cover the following aspects:
1) Collation and entry of payroll data
Someone will need to be familiar with how to collate the required information and then, if you process payroll in-house, how to enter it into your payroll software. If you use a payroll bureau then someone should be aware of how to enter it into their systems or spreadsheet templates. The information required will include:
- Payments and deductions
- Pension contributions (in line with auto-enrolment legislation)
- Holiday pay
- Sick pay
- Maternity pay etc.
2) Processing the payroll accurately and in line with legislation
Payroll legislation is a complex and constantly changing arena and non-compliance can be a costly affair.
If you use a managed payroll service then this will not be such a major concern. However, you will need someone available who can approve checks ahead of the payroll being run.
If you process payroll in-house then this can be a real problem. Even if you have someone available who knows how to use your payroll software - if they don't regularly work in payroll it is easy to lose that knowledge. Some payroll software providers, like Civica, may be able to provide an emergency service to assist you, with experienced payrollers who understand the system and the law.
3) Arranging payments to staff and third parties
Ensure you include provision for payment of staff by BACS, or whatever method your organisation commonly uses, in your plans.
4) Supplying payslips
Legislation dictates that employees require a written record of their pay. Your plan should include where to acquire payroll stationery, how to print payslips and how to distribute them. Using e-payslips where possible will make this process a lot simpler.
5) Meeting HMRC RTI requirements
Payroll information must now be submitted in "real-time" to HMRC. You won't be able to wait until your payroller is back on board to deal with this. Ensure your plan includes knowledge of how to make the required submissions using your payroll software. Your payroll service provider will take care of this for you if your payroll is managed.
Developing a plan
- Streamline and simplify your payroll processes as much as possible
- Check if your payroll software provider could provide an emergency assistance contract
- Use an external payroll service so the risk is managed elsewhere.
Civica Payroll Services can manage as much of your payroll processing as you need, so you still keep control.