Blog: Payroll processing in India and the trends to watch out in 2019

Payroll & Benefits Administration

Payroll processing in India and the trends to watch out in 2019

From data cleansing to automated technologies, these are the top trends that will define payroll processing.
Payroll processing in India and the trends to watch out in 2019

2018 carried a number of complexities for payroll process vendors. New forms of employment such as, mobile workforce, contractual engagement, and the impact of new regulations on contracting were some of them. So given the emerging requirements of various key industries, the main objective for HR in 2019 is to become as directed, prescient (of what is to come), nimble, objective and responsive as any other department (such as Finance or Operations), in order to earn its place in the boardroom. A variety of SAAS systems, technologies such as RPA and BOTs, mobility, and analytics will help businesses speak a common language and achieve those goals, ensuring objectivity in what they do.

Anticipating the business and law driven changes and surges, if direction, prescience, and objectivity are the virtues of HR as a department, they are virtues that technologies can deliver upon. 

Technology tools that will evolve and reach maturity in 2019:

  1. ChatBOT technologies for instantaneous turn around in employee Q & A to enhance employee engagement – Interacting with BOTs will help companies fetch straight, unbiased answers and cut turnaround time. Help desks and call centres continue to be replaced by BOTs and AI-based digital assistants that fetch answers by querying databases or even “talking” across platforms to complete the requested service.
  2. Robotic Process Automation (RPA): Today RPA is moving towards ‘cognitive’ RPA and organisations are harnessing ‘cognitive’ RPA (RPA with AI) to automate processes and tasks in ways that are outside human design in order to eliminate bias. With this kind of ‘cognitive’ automation, organisations will experience the benefit in the form of accuracy and reduced latency. 
  3. Mobility apps for “anytime-anywhere” access to services: Mobility will drive enhanced employee experience. With latest functions in the mobility apps, apart from typical engagement functions that allowed employees to manage their time / time-off; apps will help employees plan their business travel and report expenses. These new mobility functions will gather increased momentum during the year.  In business to employee scenarios, given the globally mobile workforce; employees will be able to avail HR services from anywhere and from any device of their choice.
  4. Analytical Reporting will go mainstream in the years to come and will drive major HR decisions making it a prescient and directed function. Analytical reporting has always been in demand and organisations find that their need for analytics (used to make HR Decisions) is always increasing. Predictive analytics will help organizations address problems such as talent retention with better hiring metrics, predicting early customer churn, employee costs, movements etc. pivoting on a number of factors such as grade, location and even recruiting source. 
  5. Focus on providing tailored user experience (rendered using technologies such as HTML 5, Angular JS etc) and enhancing employee productivity with data from IOT devices and machine learning will continue to see increased traction in the year ahead. 
  6. Automated statutory reporting: Digital India has given the necessary impetus for technology adoption in the country at various levels. Thanks to the Government of India for its digitization efforts to ensure easy compliance and transparency for companies to comply with. Outsourced statutory compliance in India today is still predominantly manual across the entire gamut of activities, namely generation of UAN numbers, TIC numbers, and preparation of challans, filing of challans, maintaining registers, returns and making remittances. These activities call for trained manpower and the primary tool for preparation and filing are Excel files and manual liaising activities sometimes leading to inadvertent human errors. End-to-end automation in statutory reporting to stay ahead of changing requirements (PF Report and Challan generation) will be something to look forward to. The market would certainly appreciate digitization for the reason that it improves turn-around times, security and transparency. 
  7. Interfacing core Human Capital Management (HCM) or talent management systems and Finance with HRO through secure FTP or web services will streamline redundant processes and eliminate the need for manual interaction without disturbing the IT architecture.
  8. Input Data Cleansing: Most businesses have implemented multiple ERP, legacy and software applications. Data on people, including time sheeting, days off, LOP, performance, grades etc. used in the Payroll process as inputs, can come from multiple sources, locations and un-integrated systems. Clients may not be able gather, clean and consolidate data in vendor defined formats without substantial effort. HRO vendors must take this responsibility and demonstrate complete ownership. Accuracy input data is the most important consideration in delivering an accurate output – processed payroll and payslips.  

What HR vendors must keep in mind for the year ahead?

While 2018 saw a rise in companies embracing technologies to cater to HR specific concerns, vendors too seized the opportunity to focus more on HR automations for their respective clients. Intelligent Character Recognition (ICR) and Optical Character Recognition (OCR) technology vendors have so far only employed character recognition paradigm. But, vendors of today employ pattern recognition as the way forward. This presents an opportunity to increase automation. For instance, document scanning can be programmed to handle many formats, prints, and fonts. HRO vendors are experimenting with such technologies to automate income tax proof submitted by employees, travel bills etc. 

Similarly, business changes that clients are going through can also be monitored regularly. In the context of HRO services, clients could be proliferating employment contracts, hiring rapidly or increasing employee mobility to enable agile HR. So, given the high-pressure economy prevalent today, they may on-board employees for their availability rather than job skill leading to major changes in compensation patterns. Thus, the vendor must be ready for systemic or simple changes in services.

For 2019, HRO Services are expected to adopt more technology and automation. The technology path is laid to eliminate human error, kill latency and redundancy. Predominantly, services tailored for increasing employee engagement on the operations front will be most sought after from vendors, which will include a combination of digital and personalized elements. 

(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of People Matters.)

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Topics: Payroll & Benefits Administration

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