No matter what type of business you’re running, payroll is an essential monthly activity involving complexities related to calculations, deductions and statutory regulations.

Sandra Swanepoel, sales director at Softline VIP, says that while buying good payroll software to manage this in-house saves a lot of money, even more important is the legislative knowledge a small business will receive from a reputable payroll provider.
“Payroll administration is much more than just knowing your software product. In any industry, experts in their field are hired to lessen the risk of non-compliance to the business and the same should apply in the payroll industry. Employ a payroll administrator who knows the legislation, who knows what payroll best practice is and who is able to apply this to the company’s specific payroll requirements,” she says.
She adds that the solution a company chooses must be able to handle all the aspects of payroll reporting. The software must be able to integrate into the accounting system, and it is important to look for a payroll product that will provide longevity.  Choosing the right payroll solution doesn’t have to be a daunting task, Swanepoel says. What is important is to match the product’s functionality with business needs, and this means looking beyond all the bells and whistles vendors often put on the table.
To operate effectively and get the most from software products, companies should not only invest in the best software solution but also implement best practice procedures as part of the solution. Often companies do not utilise software to its full capacity, resulting in a poor return on their investment.
“In my experience, training employees to use your payroll and HR software is one of the most cost-effective decisions you can make. If everyone knows how to optimally use these solutions you can save time and money while increasing skills. By investing in software that will last the company a long time you not only make sure that the return on your investment is great, but payroll administrators will feel that they are equipped to do their jobs if they have attended training. The flipside of having your payroll expertly administered is that it builds trust amongst employees – everyone appreciates being paid correctly and timeously!” she says.
Interestingly, until a few years ago, formal payroll qualifications were lacking in South Africa, something Swanepoel believes “old school” work processes had a lot to do with. Payroll administration was always seen as a back office job which required little expertise – an “add-on” to someone else’s job, where the tricks of the trade were learnt through trial and error. However, over the past ten years changes in payroll legislation have greatly affected the way the job is done today and, more importantly, by whom it is done.
“The new legislation introduced skills levies and brought significant changes to tax and labour laws, as well as UIF reporting. Companies were suddenly faced with the realisation that in order to avoid penalties for non-compliance, they had to bring payroll administration out of the attic and into the boardroom. Payroll is now a priority business process in which no risks could be taken.”