Let’s talk about Payroll and HR
Payroll and HR are often considered two separate functions. On the whole, they are; however, there is also a grey area of overlap in their functionality.
The purpose of this blog is to provide you with information on the differences between your Payroll and your HR function. We will define the roles, consider any overlaps, and let you know what we offer and where to turn for help if you need it.
What is the difference between Payroll and HR?
Payroll is a finance function that refers to the process of paying your employees or subcontractors.
This service encompasses several duties, including:
- Processing and issuing payslips and relevant documentation to your employees.
- Ensuring all necessary statutory deductions are calculated and deducted correctly.
- Calculating statutory pay including sick, maternity, paternity etc.
- Processing and paying pension contributions to your delegated pension provider ensuring that you always remain compliant with The Pension Regulator.
- Processing and, if requested, tracking holiday pay.
- Processing leavers and issuing P45’s and P60’s.
- At EOG we also ensure that you receive several reports each pay run so you remain informed and in control of your payroll function.
Why not take a look at our EOG Payroll Process to get a clear picture of how we process Payroll here at EOG.
Human Resources (HR) is all about how you manage the people that work for your business.
HR handles the hiring and firing and monitors your staff’s personal development and training.
HR also ensures that you uphold your employment law responsibilities, communicate company policies, and handle disciplinary scenarios correctly.
Does the HR function process payroll?
This is largely a no.
However, you may find that in many small to medium-size businesses, the same individual handles Payroll and HR.
The overlap
HR may, however, during the hiring process, gather the starter checklist information from new employees, which is then passed onto the Payroll function to add to the payroll system.
Or for instance, if an employee was to go on maternity leave, this is an area where both HR and Payroll’s responsibilities merge to ensure that the employee’s transition onto maternity pay is handled effectively. This can also be the case with other statutory pay, such as long-term sick leave or gardening leave due to a disciplinary investigation.
Another overlap we often encounter is if the Payroll department is tracking Holiday hours, then the terms used to track the holidays must be clearly reflected in the employee’s contract, which will have been created and maintained by the HR department.
Do I need a HR function within my business?
This is a function of the business that many owners of growing businesses have overlooked. From the get-go, you will have a finance function in place to ensure you get paid on time. You will have had a delivery function in place to ensure that you deliver goods or services promptly… but as you’ve grown and started to employ, the cost of HR won’t have appeared to be a priority; as initially, your priority is to make sure that you have enough money to pay your staff each payday!
However, getting your HR right can be invaluable to you and your business; having a happy, productive team around you will help your business move forward.
Just think about the positive effect on your business of having a system in place that attracts and employs the best in your industry.
And, get HR wrong, and it can be very costly! The cost of unfair dismissal, well!
Obviously, as the owner-manager of a Small/Medium-sized business that employs people, you will be in charge of making a lot of the HR decisions; however, it’s best to leave the legal bits to the experts!
What services does EOG offer?
Here at EOG Accounting, we offer Payroll as one of our core finance services.
We clearly define how the service works on our EOG Payroll Process.
We love to work with growing businesses, ensuring that their staff get paid on time, every time and are on hand to assist employers with payroll queries, support and guidance when needed; however, we are not HR experts.
You may not consider yourself big enough to have an in-house HR team, but where can you get HR support?
Having worked alongside many Small/Medium-sized businesses, we often see employers without any HR systems in place. We wanted to make it easy and affordable for Small/Medium-sized employers to have a complete Payroll and HR function, so we have decided to team up with Croner-i.
Croner-i’s “Navigate-HR” is an outstanding product designed to help Small/Medium-size businesses remain compliant and fulfil their HR obligations.
Easy to use
Croner-i is packed with easy-to-use functionality that makes finding, using and saving the HR information you need intuitive and simple. Guidance is easy to digest, navigation is intuitive and everything you need sits together in one place.
Up-to-date
Every single guide, tool and resource in Navigate-HR is regularly updated, so you can be sure that the information you’re reading is correct and relevant. Plus, daily news and weekly eAlerts keep you in the loop with ever-changing rules and regulations.
Extra support
This isn’t just an online service – a subscription to Navigate-HR also provides access to their helpline for more advice. Experienced advisors are on hand 9am-5pm to help answer more complex queries.
Contact marcia@edwardsofgwynedd.com today if you’d like to learn more about Navigate HR.
This information is subject to change and is not professional advice. Refer to our disclaimer for more details.
