Bells and whistles

No matter what type of business you're running, payroll is an essential monthly activity involving complexities related to calculations, deductions and statutory regulations. Yes, buying good payroll software to manage this in-house saves a lot of money. However, even more important is the legislative knowledge a small business will receive from a reputable payroll provider.

SMEs need to realise that size is irrelevant when it comes to legislative penalties. This makes them more vulnerable, and if they are taken to the CCMA, for example, there is every chance that the fine would be the same for a five-person company as it would for a large organisation with hundreds of employees.

For less than R3 500, SMEs can have access to a comprehensive payroll system that will make month-end calculations and statutory compliance a stress-free experience. However, before leaping ahead and simply buying a payroll solution off the shelf, companies need to be mindful of what training and support the software vendor will provide. They should, at a minimal, provide assistance via telephone, e-mail or fax for all queries, from the simplest to those more complex.

Choose a company that is reputable and experienced. Don't end up being a guinea pig for someone new in the market. An experienced company, with good references and case studies to its name, will be able to provide fast support at any time should it be needed.

I have often seen that SMEs already have software they could use, but because the implementation was not done correctly and no training was provided, they simply choose to replace rather than use what is already there. This can be an unnecessarily large expense.

The software must be able to handle all aspects of payroll reporting. The objective of the software is to simplify the payroll process and make the operation more efficient. Therefore, the chosen solution must be able to handle all the aspects of payroll reporting. Importantly, the software must be able to integrate into the company's accounting system. The accounting system should work hand-in-hand with the payroll software. So make sure to check with the supplier on this.

My initial advice is to look for a payroll product that will provide longevity. The upfront investment will be worth it in the long run. It will not only give the employer peace of mind as the payroll process will be set up correctly, but, most importantly, the company will also be fully compliant.

By investing in software that will last the business a long time, companies will not only make sure the return on investment is great, but payroll administrators will feel they are equipped to do their jobs if they have attended training. Being paid correctly and timeously also fosters stability and trust among employees.

By investing in software that will last the business a long time, companies will not only make sure the return on investment is great, but payroll administrators will feel they are equipped to do their jobs if they have attended training.

Sandra Swanepoel is sales director at Softline VIP Payroll.

Interestingly, until a few years ago, formal payroll qualifications were lacking in South Africa, and I believe that 'old school' work processes had a lot to do with this. Payroll administration was always seen as a back office job, which required little expertise - an 'add-on' to someone else's job, if you like, where the tricks of the trade were learnt through trial and error. However, over the past 10 years, changes in legislation affecting payroll have greatly affected the way the job is done today and, more importantly, by whom it is done.

The new legislation introduced skills levies and brought significant changes to tax and labour laws, as well as UIF reporting. Companies were suddenly faced with the realisation that in order to avoid penalties for non-compliance, they had to bring payroll administration out of the attic and into the boardroom. Payroll was now a priority business process in which no risks could be taken.

Payroll administration is much more than just knowing the software product. In any industry, experts in their field are hired to lessen the risk of non-compliance to the business and the same should apply in the payroll industry. Employ a payroll administrator who knows the legislation, who knows what payroll best practice is and who is able to apply this to the company's specific payroll requirements.

Choosing the right payroll solution doesn't have to be a daunting task. What is important is to match the product's functionality with the business needs, and this means looking beyond all the bells and whistles vendors often put on the table.

* Sandra Swanepoel is sales director at Softline VIP Payroll.