A Guide To Effective Payroll Calculation In The Hybrid Working Era
June 25, 2022
Along with the change in working environments, geographical locations, roles, and priorities of employees after the pandemic, the payroll system needs to be modified to better adapt to the new period.
The Covid-19 outbreak has brought upon unprecedented change, significantly impacting the economy and the working environment of many employees. As the pandemic has posed great difficulties for in-office workers, remote working or hybrid working is rising as the future of the workplace. In Vietnam, corporations, and organizations are adopting new working models to bring the best benefits and work experience to their employees.
Challenges in payroll for hybrid workers
Covid-19 has forced many companies to embrace work from home and remote working models, but little did businesses know that workers absolutely adore these work models, even when the pandemic began to ease off. According to the UK’s Office for National Statistics, the number of hybrid workers has increased by 11%, from 13% to 24% between February and May 2022. IWG research also showed that 72% of employees are willing to give up 10% of their salaries in exchange for long-term flexibility, whether hybrid work model or full-time remote work. In addition, remote working has introduced various new group of workers to the labour market such as gig workers or workationers (those that work remotely while on vacation). Though creating certain flexibility for workers, the new work model, on the other hand, presents a lot of practical and legal challenges for payroll specialists.
It is worth noting that tech giants such as Google, Facebook, and Twitter are planning a pay cut for remote employees as well as establishing a new payroll model for this group. In fact, businesses have already had a lot on their plate, from processing payroll for a wide range of employees with different titles, identifying and paying for those with different type of employment arrangement such as full-time, part-time, temporary employment, and permanent employment, contractors, and freelancers… Now, their work is even more complex as they have to plan and calculate payroll for new groups of workers, such as remote workers and workationers that work from other countries, with new payroll policies and legal challenges. Additionally, employees are more requiring a much more transparent payroll process, with built-in accessibility namely employee self-service platform rather than the traditional way of contacting the HR department. For this reason, the business’s payroll model needs to be more flexible, up-to-date and connected to employees.
However, according to a survey by Kronos & the American Payroll Association, nearly a third of 1,000 experts said that they were using the payroll system dated more than 10 years ago. This number implied the fact that the payroll system in many businesses is obsolete and difficult to catch up with changes of the time. Therefore, it is also difficult for businesses to apply compensation and benefits strategies in the new normal to retain talents.
Optimize the salary system, improve the employee experience
Certainly, building an up-to-date payroll will help companies to quickly catch up with the flexible labour market as well as enhance employees’ experience in the digital age. As the leading HR consulting firm that offer various payroll services from payroll system, diversified payroll packages, and other administrative tasks for businesses, Talentnet summarizes the must-have features of a comprehensive payroll system as follow:
+ Seamless integration with other HR platforms: The new generation of payroll system should be integrated with other HR platforms such as timesheets, vacation days, overtime, and invoice records of what employees used for work in the month. These records will be automated to ensure accuracy and reduce the workload for the HR department.
+ Salary structure divided into different groups according to job type, department, and level of work: A well-designed salary structure will help the HR department easily identify the benefits and pay range for a group of employees at the same level or within a department. Therefore, HR staff can precisely calculate an employee’s performance. They can simultaneously control the overall basic salary by determining the pay range for specific jobs or positions.
+ Automation integrated with mobile version: In the digital age, automation has played a prerequisite role to help companies operate smoothly and effectively. In addition, once the payroll system is integrated into mobile phone applications, employees can easily update their workday to inform whether they are working from home or taking a day off. This can be done anytime and anywhere, thus the system will automatically record the information to make fast and precise payroll.
Besides, companies may consider using outsourcing services provided by HR outsourcing companies like Talentnet for holistic automated payroll solutions following international standards and support from experienced specialists with profound market knowledge.