What drives payroll proficiency?
Whether your payroll runs smooth or not depends on different aspects. How complex is the legislation in the country you’re operating in, which types of remuneration do you offer, and what does your workforce look like? Then there’s also the question of available payroll tech, in-house expertise and payroll partners. Discover how big an impact these 6 factors have on payroll proficiency.
Payroll partners & technology have most positive impact
According to the 4,503 HR professionals and entrepreneurs who participated in the 2023 Payroll Proficiency Index (PPI), payroll partners tend to make their life (much) easier. Mainly Belgian, Norwegian and Spanish companies claim their payroll proficiency benefits a lot from external assistance.
Unsurprisingly, the legislative landscape is found at the other end of the spectrum. This driver is making payroll handling (much) more difficult for more than 1 in 4 European companies. In Belgium and France, two infamously complex countries for payroll, HR teams experience the most negative impact of legislation on payroll handling.
Other striking results include that technological solutions have the most positive impact in Spain, that Danish companies aren’t too satisfied about their own payroll capabilities and that the composition of reward systems play a minor role in payroll proficiency.
Looking into 6 drivers for payroll proficiency
Looking into 6 drivers for payroll proficiency
Legislation
The last couple of years have been a real rollercoaster for payroll officers. One legislative change after the other made an already labour-intensive responsibility even more complicated. The bottom line: payroll has become a job for seasoned legal experts. That’s not news, but what you probably don’t know is which EU countries have the most or least complex legislative landscape and which particular legal issues deserve the most attention when handling payroll.
Reward
The goal of effective payroll management is quite obvious: paying your employees correctly and on time. But not every European employee gets paid in the same way, as reward systems and benefits differ across countries: some employees receive payments more frequently, some can compose their own salary package, some receive multiple perks, etc. The way this is arranged either complicates or facilitates payroll handling in different countries. Get the ins and outs.
Workforce
This not only concerns the number of employees you need to pay, but also the composition of your workforce. For example, team A might employ 10 communication experts with the same contract type, while team B has a large mix of permanent employees, part-time workers, freelancers and students, with a high degree of internal mobility. Payroll for both teams will be very different. Let’s dive into the complexities propelled by different workforces.
Technology
Automating and integrating the various payroll processes that comprise the pre-calculation, calculation and post-calculation of salaries can lead to significant efficiency gains. Which countries are the most tech-savvy when it comes to payroll software, which subprocesses benefit most from technological solutions, and where are cloud-based systems most common? Our 2023 Payroll Proficiency Index sheds light on these and other questions on technology.
Capability
You’ve probably read it about a hundred times in the last few months alone: payroll is C-O-M-P-L-E-X. That doesn’t make it less true. Having the right expertise, skills and knowledge at hand is no longer a given in every company – big or small. And finding new payroll wizards in an increasingly tight labour market is just as hard. Find out which countries are most satisfied about their own capabilities and payroll professionals and what is driving their experiences.
Partner
Many artists have sung the lyrics ‘One is the loneliest number’. And although they probably weren’t singing it with payroll in mind, it aptly summarises one of the key issues: alone, you can only do and know this much. That’s why many companies turn to payroll partners for help. Check which European countries are most willing to take on a sidekick to boost payroll proficiency, which tasks are best suited for outsourcing and how different countries feel about outsourcing payroll completely.