New Research Explores How Payroll Leaders Can Overcome the Complexity Crisis

Payroll has always been complex, but some distinct challenges have converged in today’s business environment, creating a complexity crisis for payroll teams.

They’re facing multiple jurisdictions to process, constantly evolving payroll regulations, siloed systems, and legacy technologies. As organizations face greater pressure to control costs, manage risk, and ensure efficient operations, the payroll function may not be properly equipped to support these efforts.

How is this payroll complexity crisis impacting today’s payroll professionals? As a leading payroll technology provider, we at Dayforce, in partnership with PayrollOrg, conducted the “Payroll Complexity Survey” to find out.

We surveyed 497 payroll professionals and found that many respondents reported being saddled with the same complex challenges as when we studied a similar group two years ago. Compliance challenges (45%), managing the complexities of multi-jurisdictional payroll (33%), and inefficient processes (25%) still top the list.

In some cases, difficulties have increased, with 58% of respondents reporting that it has become more challenging to be a payroll professional in the past two years. They also said filling new or vacant payroll positions is a challenge, with 41% saying it is somewhat or very difficult in their organization.

What is causing these challenges to linger and payroll jobs to become more difficult to work and to fill, and how can organizations overcome the complexity crisis in the face of these problems? Here are three things payroll leaders need to know:

1. Payroll technology needs an upgrade. Just over half of survey respondents said their organization uses cloud-based payroll technology. These technologies are now best-in-breed. Without them, payroll teams can’t provide their full value to the organization. But it’s important to be selective in payroll vendor selection beyond whether they offer cloud-based solutions. We see that only 11% of payroll pros don’t have any issues with their pay technology.
2. Payroll data isn’t actionable. In many organizations, the challenge isn’t a lack of data, it’s doing something worthwhile with it. Payroll is no exception, with 74% of respondents saying they have issues with their payroll data. The top challenges were not having the right tools to analyze data (26%), data not providing a complete picture (23%), and siloed data in disparate systems (20%). Here at Dayforce, we know the key is for payroll leaders to ensure data isn’t just accessible, it’s also actionable.
3. Payroll complexity impacts automation. Despite the benefits of automated payroll, it’s still met with obstacles. According to the survey respondents, 76% said they have barriers to adopting payroll automation. Concern that their business scenarios are too complex for automation was the top barrier, at 39%. But investing in the upgraded technology we referred to in our first point means payroll teams can more easily, flexibly, and reliably automate.

Download your copy of the “Payroll Complexity Survey” report for more findings and tips for how payroll leaders can overcome today’s complexity crisis.