How Does Human Resource Management Help In The Payroll Of Firms?
Human Resource Management (HRM) and payroll contribute to organisational prosperity. HRM plays a significant role in the management of employees. They manage employees to achieve organisational success. In short, they take care of employees relations. While payroll deals with the compensation of employees. Payroll is either finance or a human resource department function. For large organisations, payroll is the finance function. While for small organisations, it is the human resource department function. The human resource department can perform payroll functions.
Although, these two departments have distinct roles. But they share functions that are interdependent. Combining these two departments can serve many benefits for a firm. Their integration can reduce paperwork, cost, and time. But the question here is, how does Human Resource Management help in firms’ payroll? This article by expert HR specialists of Affordable Dissertation UK will explore the role of Human Resource Management in firms’ payrolls.
Understanding Human Resource Management Function
Employees are significant assets for an organisation. Organisations can achieve success from the best management of their employees. HRM plays an important role in this regard. It involves the management of employees and their related activities with best practices. They manage employees to achieve operational efficiency. By enhancing operational efficiency, they contribute to organisational prosperity. Human Resource Management can be in-house and out-house. In-house people are the full-time employees. Out-house people are freelancers or contractors. They perform several duties as mentioned below:
- They announce and publicise the available vacant position.
- They attract and gather a pool of candidates for the available vacant position.
- They hire the best one among many candidates.
- They ensure that this candidate is the best fit for the vacancy.
- They can hire and fire employees.
- They prepare job descriptions and the roles and responsibilities of employees.
- They motivate employees through monetary and non-monetary rewards.
- They develop the skills of employees through training and development programs.
- They ensure that employees are on track to achieve organisational goals.
- They ensure that employees are delivering what their job demands.
What Are The Underlying Functions That Human Resource Management Performs?
- Performance Management.
- Recruitment and Selection.
- Succession Planning.
- Learning and Development.
- Human Resource Information Systems.
- Compensation and Benefits.
- HR data and Analytics.
What are the benefits of Human Resource Management within an Organisation?
- They hire and secure top talent within an organisation.
- They improve employee’s satisfaction.
- They enhance the probability of employee retention.
- Employees have access to benefits with the help of HRM.
- There will be less compliance issues in the presence of HRM.
- It helps in saving time and energy for multi-task performer employees.
- Employees can access anytime to Human Resource Management in need.
What is a Payroll Function?
The payroll function entails providing salaries to employees. It involves the compensation of employees within a firm. It performs some functions as described below:
- They involve in balancing and reconciling the payroll data of employees.
- They provide salaries to employees and report taxes.
- They involve in conducting wage deductions of the employee.
- They maintain records of employees’ salaries.
- They inspect and verify the reliability of the payroll data.
- They maintain and ensure compliance with tax and legislation.
- They conduct paperwork for the new employee.
- They update and edit existing employee records.
- They deliver payroll checks.
- They involve in calculating reimbursement of employees.
- They assign bonuses and overtime for employees.
- They calculate the holiday pays of employees.
How Human Resource Management And Payroll Functions Are Interdependent?
The activities of payroll function are dependent on Human Resource Management. Both functions coordinate with each other on the activities as follows;
- HRM involves recruiting people. The payroll function provides salaries to these new employees.
- It conducts training and development of new and existing employees. In this regard, the payroll function provides a budget to the Human Resource Management.
- It provides a record for employees eligible for bonuses or deductions. The payroll department will review the information and assign or reassign funds.
- The payroll and Human Resource Management department have access to confidential employee data. The confidential information entails a home address. Also, it involves their financial information and social security benefits. They work together to ensure that information is not prey to illegal use.
- Human Resource Management is the champion of employee relations. In the absence of within time processing of paychecks of employees. They will involve in paychecks processing without payroll involvement.
How Does Human Resource Management Help In The Payroll Of Firms?
Human Resource Management can help in payroll by paying and dealing with employees themselves. For instance, in maternity pay of employees. It will state the employee’s right in receiving the compensation benefit. They will overview all the federal, state, and organisational laws in maternity leave. After a thorough review, they will grant compensation benefits to the employee. They will make the grant of compensation without payroll department involvement. Hence, Human Resource Management can compensate (payroll) and manage employees.
What Are The Benefits Of Incorporating The HRM And Payroll Functions?
The incorporation of the Human Resource Management and Payroll function has widespread benefits. These widespread benefits are as follows;
- It reduces extra paperwork with their integration.
- It provides room for automatic updates.
- It reduces errors and omissions in the preparation of reports.
- It eliminates the difficulty in the consolidation of reports.
- It reduces the time and cost of the organisation.
What Is A Prominent Divide Between Human Resource Department And The Payroll Function?
Payroll is such an activity that requires understanding of laws and taxation. It is a number-driven activity that requires knowledge of accounting. For this reason, it is known as a finance function. While Human Resource Management do not need to have a knowledge of any of these. So, knowledge of tax, laws, and accounting exhibits a divide between HRM and payroll.
Final Thoughts
It can be concluded that Human Resource Management can perform firms’ payroll by performing finance functions. They can assign compensation, salaries, and benefits to employees as by payroll.