Five payroll tips for the newly minted HR

Payroll tips for HR professionals should focus on accurate employee data, clear arrears and deduction processes, timely salary-revision inputs, payroll review controls, and suitable payroll software. HR and payroll teams work best when employee changes and payroll inputs are communicated before the payroll cut-off and checked before salaries are finalised.

Quick Summary

• Verify joiners, leavers, employee IDs, and other payroll inputs before processing.
• Define how arrears are identified, approved, recorded, and paid.
• Communicate deductions and recoveries accurately and follow applicable local rules.
• Finalise salary revisions before your organisation's payroll input cut-off.
• Choose payroll software that supports the workflows, controls, employee self-service, and reporting you need.

"In 2006, Snowdrop carried out a survey on the relationship between HR and payroll after it witnessed first-hand some of the difficulties that can arise if the two don't work together. It revealed that information delivery is often at the heart of the problem: more than 60% of payroll professionals believe HR doesn't give them accurate information, while 54% think HR doesn't keep them up to date. That said, the survey found both sides willing to work more closely together (96% in payroll and 85% in HR)." (Source: PersonnelToday.com)

The following tips should help you achieve two goals: segregate the role of HR and payroll in the various areas mentioned as well as ensure that best practices are being followed by you, the HR, when collaborating with the payroll team.

1. How Can HR Verify the Employee List Before Payroll?

Before each payroll run, HR should verify that eligible employees, joiners, leavers, employee IDs, and approved employee changes are reflected in the payroll input. A simple review control can help catch omissions and mismatches before salaries are finalised.

You need to be aware of whether all relevant employees are in fact on the payroll of your organization and that the payout has been made to all of them. Along with the question "Have I paid everyone?", another that needs to be asked is, "If not, why was an employee missed out/paid inadvertently?". A common reason for rolling out an erroneous payroll is that the resignations for the month have not been considered and the payout has been made here accidentally.

Before payroll is processed, verify that all eligible employees are included and that joiners, leavers, and other status changes are reflected correctly. If an employee is missing or included unexpectedly, identify the cause before payroll is finalised. A common issue is an employee-status change not being reflected in the month's payroll input.

Another common scenario is HR having passed on the wrong employee ID to payroll. In such cases, the employee in question may get removed from the list and not receive a payout.

A practical control is to separate data entry from review, so one person prepares the payroll inputs and another checks them before processing. The exact control can vary by organisation, but documented review helps reduce avoidable data-entry and hand-off errors between HR and payroll.

2. How Should HR Manage Payroll Arrears?

Define how arrears are identified, approved, recorded, and paid, including what happens when a change misses the payroll cut-off. The process should reflect company policy, payroll configuration, and applicable local requirements.

Technically, arrears refers to "money that is owed and should have been paid earlier."

Arrears are amounts owed for an earlier pay period that are processed later.

Say a new employee joins towards the end of a month. Let's assume his/her joining date to be the 29th and salary payout date to be 31st. Here, a decision is required to be taken by the HR as to whether this employee will be paid for the 3 days worked in the current month at the end of the current month or the next month, along with the salary for the next month.

For example, if a new employee joins late in the month or after the payroll input cut-off, the employer may need to determine, subject to applicable local requirements and company policy, whether the amount for that period is processed in the current payroll or as arrears in the next cycle.

If the decision is in favor of the latter, then care has to be taken to put in place a notification to alert you, the HR, about this payment when the payroll for the next month is being processed. In case you go with the former option, then arrangements have to be made to add the new employee to the current month's payroll without fail.

Whichever approach applies, record the employee, effective date, approved amount, and processing cycle so the payment is not missed. Payroll reminders or workflow controls can help ensure the arrear is included in the correct cycle.

This decision then needs to be included in the policy and a process created around it to execute it smoothly.

3. How Can HR Prevent Errors in Payroll Deductions and Recoveries?

HR and payroll should process only authorised deductions and recoveries, using the correct amount, schedule, effective date, and supporting approvals. The treatment of deductions can vary by jurisdiction, so payroll teams should follow applicable local law and company policy rather than applying blanket rules.

If an employee takes a loan or salary advance from the company or has a recovery due for a damaged asset, the responsibility for collecting the amount rests on the concerned HR. Commonly seen are scenarios where it slips the HR's mind to do this. The result is that the payroll team may decide to deduct the entire amount due from a single month's salary. This affects the employee due to the possibly heavy impact on his/her net salary. The HR is required to provide the necessary details, including the recovery period, to the payroll team.

If a loan, salary advance, authorised recovery, or other deduction is to be processed through payroll, HR and payroll should provide or verify the required details, including the amount, recovery schedule, approvals, and effective dates. Deductions and recoveries should follow company policy, employee authorisation where applicable, and relevant local law; they should not be applied ad hoc.

Also to be borne in mind while making recoveries is that statutory deductions have to be made even if the employer is able to make only partial recoveries in a given month. In other words, recoveries cannot affect statutory deductions/contributions.

Statutory deductions and contributions must be handled according to applicable local requirements. The treatment and priority of non-statutory recoveries can vary by jurisdiction and payroll policy, so HR should not assume that every recovery can be taken in full or in a particular order.

Every employee hates to see discrepancies in the take-home pay. So, it is the role of the HR to ensure that all employees in the organization receive the right/sufficient take-home pay even after making all the necessary deductions.

Before payroll is finalised, review the effect of authorised deductions on net pay and confirm that the payroll treatment is consistent with applicable requirements and the employee's approved recovery schedule.

4. When Should HR Finalise Salary Revisions for Payroll?

Finalise approved salary revisions before your organisation's payroll input cut-off, allowing enough time for approvals, arrears, deductions, and payroll review. The exact lead time depends on the organisation's payroll calendar and approval workflow.

Different companies may opt for different salary revision cycles. Sometimes this coincides with the work anniversary of the employee, at other times it may follow the financial year or vary based on the level or grade of the employee in question. Whatever the case, you need to plan to complete the process of arriving at the revisions, for eligible employees, around 10 days before the due date.

Salary revision cycles vary by organisation. They may follow an employee anniversary, an annual review cycle, a business-specific schedule, or another approved trigger. Whatever the cycle, complete approved revisions before the payroll input cut-off rather than relying on a fixed number of days.

This time will be utilized to get budget sanctions, the necessary approvals from the employees' business managers, and then to work with the payroll team to compute arrears, the impact on taxation and statutory contributions, recoveries, etc. The effective dates are also to be accounted for here if arrears are present.

After approval, translate the revised pay into the employee's salary structure, confirm the effective date, and update the payroll system in time for review. The required lead time should be defined in the organisation's payroll calendar and approval process.

Apart from annual salary revisions, salaries may change in another scenario - with the confirmation of an employee. You need to be cognizant of this change and track it proactively with the help of the employee's business manager. The effective date of salary change here may be the exact joining date of the employee. This information is to be collected by you and the necessary advice passed on to the payroll team.

Apart from annual revisions, salary changes may also follow confirmation, promotion, transfer, or other approved employee events. Track the approved effective date and pass the required information to payroll before the relevant cut-off.

5. What Should HR Look for in Payroll Software?

Prioritise software that supports the payroll and HR workflows your organisation actually needs, including employee data, payroll inputs, leave and attendance integration, employee self-service, reporting, access controls, and mobile access where relevant. Evaluate configuration and reporting requirements before selecting a platform.

Every organisation has core HR functions in some form or another. But the fact remains that there are tasks that are repetitive and time-consuming. The challenge of every HR is to infuse simplicity, speed and efficiency into their operations wherever possible.

A cloud-based HRMS or payroll software can help centralise recurring HR tasks and reduce manual coordination. Depending on your needs, evaluate capabilities such as onboarding, payroll, leave and attendance, employee communication, reminders, alerts, and integrations between HR and payroll data.

An employee self-service (ESS) portal can let employees perform configured routine tasks themselves, such as viewing or downloading published payslips, applying for leave, updating permitted information, or marking attendance where supported. A mobile app can extend access to supported ESS workflows without implying that every feature is available in every configuration.

The software should also support the operational and statutory reports your organisation is required to generate, along with the access controls and reporting needed by HR and leadership.

For a broader overview of payroll software features and use cases, see greytHR's current guide.

About greytHR

greytHR is a full-suite HRMS trusted by 34,000+ businesses and 3.5 million users across 30+ countries. A cloud-based solution with an Arabic mobile app, greytHR enables businesses to manage the complete "hire-to-retire" employee lifecycle in a single, unified system, covering recruitment, onboarding, core HR, leave and attendance, timesheets, payroll and statutory compliance, performance and expense management, and exit. Its AI-powered capabilities bring AI into HRMS workflows, helping modern HR teams automate year-round administrative tasks and free up time for strategic work. greytHR is especially strong in Middle East compliance, with deep WPS, DEWS, and GOSI coverage.

Frequently Asked Questions

What information should HR send to payroll each month?

HR should provide or confirm approved payroll inputs such as joiners, leavers, employee master-data changes, attendance or leave inputs where relevant, salary revisions, arrears, deductions, recoveries, and effective dates before the payroll cut-off.

What are payroll arrears?

Payroll arrears are amounts owed for an earlier pay period but processed in a later payroll cycle. The treatment depends on the reason for the delay, company policy, payroll configuration, and applicable local requirements.

How can HR reduce payroll errors before salary processing?

Use a documented payroll calendar, validate employee and change data, reconcile approved inputs, and add a review step before payroll is finalised. Clear ownership between HR and payroll also reduces missed or duplicate inputs.

When should salary revisions be submitted to payroll?

Submit approved revisions before the organisation's payroll input cut-off, with enough time for approvals, arrears, deductions, and review. There is no universal number of days; the lead time depends on the payroll calendar and workflow.

What should HR look for when choosing payroll software?

Look for capabilities that match the organisation's payroll and HR processes, including configurable salary structures, payroll inputs, deductions and arrears, employee self-service, reporting, access controls, and integrations with relevant HR data. Requirements should be evaluated for the organisation's market and operating model.