Every month, companies are accountable to their own employees. When the payslip lands in the employees’ digital mailbox and the money goes into their account, it’s time to do the accounts. Has the payroll administration worked as it should? Are the salary and payslip correct?
Often, the answer is no, because modern payroll administration is both complicated and resource-intensive and carries many risks of errors and inaccuracies if you do not have all the necessary skills in-house to run the payroll yourself.
That is why SAP house SOA People Denmark offers its customers the option of outsourcing their payroll function or parts thereof to the SOA People Denmark Service Centre. The collaboration can take many different forms depending on the size and needs of the companies, but there is one significant common feature: by outsourcing payroll administration to SOA People, companies get not just one or two consultants, but a whole team of specialists to help them.
The external colleague
“Due to our size, each consultant has a large support network to draw on, which often means that tasks and challenges are solved more quickly and efficiently. In addition, we take a lot of courses so that we are always up to date and can advise both our customers and each other with the latest knowledge. This is difficult in a company where there may only be one or two employees working with payroll and who also need to take holidays and maternity leave,” says Katrine Meier, Director of Service Centre of Excellence, SOA People Denmark.
In practice, the consultants at SOA People Denmark Service Centre function as external, trusted colleagues who are part of the company.
‘The best example is probably that some customers are completely unaware that they are communicating with an external payroll administrator. We feel just as responsible for their payroll function as they do. We are not just a robot they can reach out to, but a colleague who wants to serve them as much as we possibly can.’
Director of Service Centre of Excellence, SOA People Denmark
”Due to our size, each consultant has a large support network to draw on, which often means that tasks and challenges are solved more quickly and efficiently. In addition, we take a lot of courses so that we are always up to date and can advise both our customers and each other with the latest knowledge. This is difficult in a company where there may only be one or two employees working with payroll and who also need to take holidays and maternity leave.”
The human factor is important
Although the SOA People Denmark Service Centre utilises all the automation and efficiency opportunities offered by SAP’s intelligent ERP solutions, it is important to point out that payroll should not be automated without human control.
Some people think that payroll processing can be done at the touch of a button, but there are many things that need to be taken care of before a payroll run is perfect. We simulate the payroll on an ongoing basis to check that everything looks correct. If anything needs to be corrected or clarified, we reach out to the customer or our own experts. Payroll will never be more accurate than the input that is entered,” says Senior Consultant Marianne Rysbjerg.
There are many sources of error, and they can have a significant impact on salary. Has the correct number of kilometres been entered? Has the holiday been registered with or without pay?
‘An entry may appear correct at first glance when the company’s own system does not respond, but then a human eye at our company may notice that something is not right. It’s a bit like when spell check ensures that a word is spelt correctly but misses that the context is wrong.’
New legal requirements and agreements
Constant new legal requirements and agreements contribute to complicating payroll functions and HR work in companies, which therefore benefit from the knowledge sharing that constantly takes place in SOA People Denmark’s internal experience groups.
‘Even though the new holiday law has been around for a few years now, it still raises many questions and is being interpreted in new ways. New rules for maternity leave will also be introduced soon. We are constantly learning more and can advise customers on the latest rules and interpretations, which can be difficult to understand. New collective agreements are also constantly being introduced, and a company often has several different agreements to administer. In addition, there are all the local agreements, which mean that customers in the same industry and with the same agreement need different payroll solutions.’
Senior Consultant at SOA People Denmark
”Some people think that payroll processing can be done at the touch of a button, but there are many things that need to be taken care of before a payroll run is perfect. We simulate the payroll on an ongoing basis to check that everything looks correct. If anything needs to be corrected or clarified, we reach out to the customer or our own experts. Payroll will never be more accurate than the input that is entered.”
Statistics and salary reimbursement must not be forgotten
According to Senior Consultant Lene Schack Villumsen, SOA People also assists many companies with the statutory reporting of payroll and employees to Statistics Denmark.
‘This is often something that companies are unaware of until they receive a message in their e-Boks stating that there are now x number of days left until the reporting deadline. It is important that salary reports are submitted on time, and we help our customers with this.’
The same applies to the various forms of payroll reimbursement for young people and adult learners.
‘It’s surprising how many companies are either unaware of the opportunities or find it difficult to figure out what to do. Yes, it can be a big task, but there can also be a lot of money to be made. We have helped many companies obtain refunds that they would otherwise have missed out on.’
Several have individual salary agreements
In general, the fact that employment today is more individual-based than in the past increases the demand for efficient payroll administration, explains Katrine Meier, head of the Service Centre.
‘More and more individual contracts are being agreed on bonuses, holidays, maternity leave and benefits, which must be reflected in the final salary. It can be expensive to set up a system to meet the requirements of different individuals, and not everything can be automated; some things require individual treatment.’
It is also a widespread challenge for companies’ payroll administration that more foreign employees are being hired with special circumstances regarding tax, residence and work permits.
‘There are many types of special agreements and terms that a system may find difficult to handle without further ado, and we advise and assist companies so that they can accommodate their employees and provide them with a flexible solution that works in everyday life.’
Advantages of outsourcing:
➡ Less vulnerability when absent
➡ Broad expertise in the payroll team
➡ High-quality output
➡ Release of internal resources
Would you like to know more about payroll outsourcing?
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