How streamlining payroll and HR data supports diversity and inclusionby
From pay disparities to flexible working and parental leave, streamlining your payroll data can have a huge impact on tackling some of the biggest diversity and inclusion issues within organisations today.
Imagine a magic solution that helps companies save time, avoid human error and reduce the likelihood of data silos. A magic wand that improves diversity and inclusion efforts, closes the gender pay gap, improves work-life balance and implements more flexible working plans for parents with children below school age. Yes, that's all possible! And the solution is far from a futuristic fantasy – in fact, it's something any organisation can do today.
How can streamlining HR and payroll help with data reporting?
While payroll and HR teams’ day-to-day tasks and responsibilities may differ, both departments often require access to the same sensitive employee data. However, as many payroll and HR professionals will testify, accessing and sharing this data is often much easier said than done.
Reporting requirements often differ, so it can be tricky to find a format that suits both parties. Furthermore, undefined reporting responsibilities can cause confusion and leave people trying to determine who to ask for which reports.
Collecting data can be a very time-consuming task as there are GDPR considerations and restrictions and questions on how to obtain the required data; who owns the necessary data?
For example, when HR teams collect personal data from a new starter, they must pass the relevant information to their payroll team. That can cause compliance issues with GDPR if the information is shared in a non-secure platform such as email. Not only does it make the process longer, it also involves more people, so there’s an increased risk of human error.
Consequently, having this data accessible in one platform would help save time and ensure that it is stored securely.
Whatever the size of your business, HR plays a vital role in improving the fulfilment of your employees and ensuring that your company or organisation complies with the relevant legislation.
Why is D&I reporting important?
While streamlined payroll and HR processes can help teams from a data perspective, it can also help organisations tackle other important issues - e.g. diversity and inclusion and gender pay inequality. Having all the data needed to tackle those issues in one place will help organisations understand where they stand in terms of diversity and inclusion.
An initiative brought in by the government, also known as the Equality Act 2010, came into force in the UK in April 2017, requiring organisations that have at least 250 employees to release their gender pay gap figures. Accessing employees’ data can help businesses have a clear insight into any gender pay disparities. At the same time, streamlining HR and payroll also enables them to look further into ethnicity pay reporting.
In recent years, there has been an increased focus on ethnic pay disparities. While there is no current legislation in place requiring organisations to document this, there is talk of it being implemented in the not too distant future. Parliament will debate this subject on 20th September 2021, following consultation between October 2018 and January 2019. Having accessible ethnicity data from HR shared through to payroll makes identifying ethnicity based inequality much easier so employees can address it.
A 2020 study shows that companies that effectively address the challenges identified by reporting the gap see higher staff retention and avoid gender and ethnicity pay disparities. For organisations whose payroll and HR departments work independently of each other, it can be difficult to realise there's a problem until it's already too late.
How can streamlining HR and payroll data help with flexible working and parental leave?
To improve D&I, employers will also need to look at other factors, such as flexible working and parental leave.
Having employee data easily accessible for both HR and payroll teams when employees work flexible hours or take leave will help with operational efficiency when running payroll.
More and more companies are offering their employees flexible work and introducing more work from home policies; it has become even more common as companies have had to adapt during the pandemic. Research shows that many companies will keep this option available for their employees in a post-pandemic world as they are beginning to understand the value it can bring.
Employees with families can take shared parental leave and enhanced paternity leave. It could encourage male employees to bond with their children longer, and it would also be less detrimental to mothers as they are less likely to be seen as a ‘risk’ when being hired. With more men taking time off the career ladder, it can help level the gap between men and women when it comes to promotions and career progression. Having employee data easily accessible for both HR and payroll teams when employees work flexible hours or take leave will help with operational efficiency when running payroll.
How does HR and payroll data benefit organisations?
Whatever the size of your business, HR plays a vital role in improving the fulfilment of your employees and ensuring that your company or organisation complies with the relevant legislation. One of the essential areas in which HR and payroll overlap is the organisations’ legal obligations, D&I reporting, and ensuring that pay and benefits are correct.
As we mentioned at the start of this article, this solution is not a futuristic fantasy; it’s something that any organisation can have today. Not only would it help with time-consuming reporting tasks and operational efficiency, where it can perhaps make the most significant impact is by supporting companies as they look to improve diversity and inclusion.