HR.com has published its "Future of Payroll 2026" report, offering insights into how organisations are evolving their payroll functions through technology, automation, and new operating models. The report, based on feedback from 186 payroll and HR professionals worldwide, examines how payroll teams are responding to rising compliance requirements, data demands, and digital transformation.
The findings show that payroll technology continues to advance, but organisational capability, skills, and process maturity remain key challenges for many payroll functions.
The report indicates ongoing investment in payroll technology, automation, and integration. Organisations are increasingly adopting digital payroll platforms, automation tools, and analytics solutions to enhance efficiency and accuracy.
However, technology alone does not solve payroll issues. Many organisations still rely on manual processes, disconnected systems, and limited integration between HR, time, and payroll systems. This causes ongoing data quality problems, reconciliation challenges, and compliance risks. It is one of the main obstacles to unlocking the potential of artificial intelligence (AI) and the strategic value of payroll data.
The gap between organisations with integrated payroll systems and those still using fragmented processes remains significant.
Despite investments in technology, compliance and data management still pose significant challenges for payroll teams. Keeping up with evolving legislation, maintaining data accuracy, and ensuring proper reporting remain challenging, time-consuming, and high-risk tasks. The report highlights that payroll transformation involves more than just technology; it also includes governance, procedures, and skill development.
The new pay transparency and pay equality directives are singled out as a change opportunity, rather than just a compliance requirement. It's also an opportunity for payroll to showcase the power of its data and cross-functional impact.
As payroll becomes more digital, data-driven, and strategic, the skill set required for payroll professionals is also evolving. This emphasises the importance of upskilling, training, and professional development to enable payroll teams to effectively handle new systems, data, and compliance demands.
As the global payroll profession continues to develop, structured education and professional development programmes play a crucial role in helping payroll professionals cultivate the compliance, analytical, and technical skills necessary for modern payroll functions. PayrollOrg’s education, global training programmes, and certification are designed to support this skill development and help payroll professionals prepare for the future of payroll.
The report emphasises a consistent message seen across recent industry research. Payroll is becoming more complex, digital, and increasingly visible within organisations, yet many payroll functions still operate with limited resources, manual processes, and skills shortages.
For global payroll leaders, the focus should not only be on system integrations but also on establishing a robust payroll operating model supported by clear governance, skilled teams, and standardised processes. Technology enables payroll transformation, but people, processes, and governance determine its success.
The report also emphasises that payroll skills and capability development remain a major priority and opportunity for payroll functions, underlining the importance of structured education and professional development as the payroll profession continues to evolve.
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Max van der Klis-Busink, MCIPP, RPP, is the Owner of Passion For Payroll and Vice President of Global Strategy on PayrollOrg’s Board of Directors.