HR Payroll Software VS Traditional Manual Payroll Processing: How Are They Different?

May 6, 2020

Payroll processing is, quite literally, an employer’s allocation in compensation to his workers. Payroll is the largest expense for most companies. Consequently, it is also, by far, the most critical function of human resource management.

Payroll management is an essential part of running a business — but with plenty of room for error, it can be an overwhelming task.

Many companies reported failures and losses in the course of payroll calculations and management related to simple accounting errors. Although these professionals have invested a great deal of time and energy in keeping track of taxes, sick leaves, hourly remuneration, monthly wages, and employee data, many errors could still be observed.

Businesses can choose to manually do payroll, or they can use different types of commercial payroll software packages. They may choose to outsource all this financial work to a manual payroll service as well.

Manual payroll means you employ a team of professionals who will manually perform all accounting and payroll tasks. On the other hand, computerized payroll software will automatically operate to keep track of performance management, attendance, and bonus data.

We will compare the advantages and disadvantages of computerized payroll over manual processing in this article to help you decide which method is best suited to your business.

Manual Payroll Process

A manual payroll method doesn’t require any tools to manage the entire payroll process. It is entirely dependent on human effort. The whole process is handled by hand. Even monitoring of attendance data and calculating statutory deductions would be included.

Third-party companies are willing to take over all aspects of payroll processing for companies that want their hands off the payroll transactions. This includes managing either employees or contractors and ensuring that all the finances of the workforce are in perfect order.

One of the biggest benefits of using a professional payroll service is that there is simply no need for managers and leaders to worry about the details. This allows them to focus more on fundamental activities and business growth. It can be a very efficient way to delegate time-consuming tasks and outsource work from expert and reliable individuals.

Professional services also provide more resources than a software package would provide. Tax filing is one of the best examples.

The annual corporate tax return is a complex thing — it’s not easy to do on paper alone. It is very analogous and can require a great deal of decision-making.

With this in mind, professional services can offer more guidance than software packages that require a lot of customer business strategy and strategic use.

One of the biggest downsides, though, is the cost of employing a manual payroll service. Companies that can get by with an HR payroll software in UAE and in-house operations can save a great deal of money.

Automated Payroll Process Using an HR Payroll Software

An HR Payroll software in the UAE can automate virtually all of the payroll process steps and requires minimal human intervention. Companies can use time-keeping systems to control attendance and overtime.

The software can be linked to the payroll system that can also track requests for leave. At most, new hire details and employee departure dates may need to be inserted into the process.

Usually, automated payroll software will take over the rest. This could include even the estimation of tax and legal deductions.

Managers and management teams have immediate access to payroll processes and can customize the program accordingly. If anything needs to be modified, authorized users can open the payroll system instantly and make the necessary changes without entry barriers.

With these tools, it is possible for internal people who need access to payroll information to get it wherever they are.

Payroll software packages also have their own advantages and disadvantages. While there are some systems that manage these types of software well, the use of a payroll software package to handle payroll operations also has some disadvantages.

To internal staff members, many of these HR payroll software packages can require quite a bit of training. Employees in your human resources department may need time to figure out how to perform different payroll tasks to become completely effective.

Final Thoughts

Making the choice between implementing HR payroll software in the UAE or employing the assistance of payroll services depends on the needs of your business, as well as your existing processes.

Organizations should look at the charges for payroll software products and services to ensure that they are not unreasonable in terms of the actual benefit the company gets out of the process.

Ambitions for the near and distant future also need to be considered. HR Payroll software and payroll services in the UAE are very different in their approach to these aspects, so having a strong understanding of your current business situation simplifies your choice.