Dealing with Employee Records in Payroll Management

Every company needs to record information on its employees. This information needs to be relevant, of course. Any company that goes beyond collecting simple identifying information such as name, address, contact details, date of birth, and nationality may be accused of harvesting irrelevant information. The importance of keeping full, relevant information on employees is essential for any company, as company leaders will need to have an awareness and understanding of their workforce to correctly and efficiently administer their business.

First, contact details are needed for each employee. The reasons for this are obvious and numerous. For a start, many companies send pay stubs through the mail. Quite apart from the fact that these pay stubs contain no small amount of personal information, it is essential that they be sent to the correct address. It is also important to keep address details needed to send letters for any one of a wide range of reasons.

Keeping an employee's telephone number is also important. If an employee has failed to turn up for work, for example, the company may need to call if the person failed to call in sick. As well, a manager may need to call a staff member who is not working on a given day when that person's expertise in needed to deal with a work issue. Finally, a telephone number and address for the employee's next of kin is required.

The very mention of the words "next of kin" may cause many people to think of the worst; next of kin are, after all, the people who are contacted in case of a fatal accident at work. However, the requirement to contact an employee's next of kin does not always mean that the employee has died. Generally, it will be in the case of an accident at work, but this may just be to warn the next of kin that a relative is safe and needs to be picked up from the hospital or workplace.

Details of a customer's date of birth and nationality also are important. This is demographically relevant in terms of equal opportunities legislation. Among other details, companies need to keep these records so they can prove their employment policy does not discriminate against a section of the community. Some demographic information will be collected anonymously. For example, date of birth will be kept tied to the employee and will not be anonymous, but details of race, marital status, and sexual orientation will be. These are kept purely for statistical reasons so that companies can prove they have not favored or disfavored a section of the public in their recruitment policy.

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Other information kept may pertain to particular skills that a member of the workforce may have. This will concern skills that may not be immediately relevant to the job performed but can become relevant in specific circumstances. For example, if a company provides special days out, organizing the perfect day for their customers, the primary skills required for the job will be organizational and communication skills.

If, however, a customer comes to the company with a particular request, the company can check to see if any of its employees is specifically equipped to provide the best service. This may be, for example, a special occasion for a customer who speaks only French. If someone within the workforce has a degree in French, the company can tailor its service to the customer by providing an intermediary who can communicate at the optimum level with the customer.

A company also will need to have details on any of its workforce who have special needs. Special needs, whatever the image it may conjure up to some, do not necessarily apply to customers with impaired mobility, although this is a major part of the requirement for any company. Mobility impairment is an obvious case of special needs, and companies who employ mobility-impaired people should certainly already have the correct provisions in place. Other examples of special needs include employees with food allergies. They may be lactose-intolerant or suffer from Celiac disease. Should the company lay out a buffet for its workers, it is important that it provide gluten-free and non-dairy alternatives.

The above are just a few examples of information a company might hold on its employees. Others include details of an employee's qualifications and disciplinary records. All companies should keep these in light of the numerous cases of appeal for unfair dismissal. When all of this is considered, it shows that the work of a payroll department is far from simply issuing pay stubs and cutting checks for the company's employees. In a great many cases, an inquiry by or about an employee will either start or end in the payroll department. The dedicated record-keeping for which this department is responsible is utterly indispensable for a company.

Therefore, the chances are that if you give information in a job interview or during an assessment after taking a job, it will be kept on your personal records in the payroll department within your place of work. You can request that some of this be destroyed, but the overall pay details are kept for a prolonged period for tax purposes. This is a legal requirement.

Ask a hundred different workers exactly why they do their jobs and the likelihood is that at least 80 of them will mention the salary as part of, if not the whole reason, they do it. Some of us are lucky enough to do something we really love for a living, something that we would do even if there were no payment at all. But the simple, undeniable truth is that bills have to be paid and groceries have to be bought; and if we are doing well enough, we like to have a bit of cash left over for the purpose of enjoying ourselves. Therefore, a payroll department is important for any company with lots of employees. If the employees did not get paid, they would stop turning up extremely quickly.

Paying employees has become a far more streamlined process in recent years, with the option for companies to transfer payments electronically to their workforce by means of automated payments. This process in any given month for a big company will amount to thousands or even millions of dollars, so there is a very large onus on the company's payroll department to get it right. A couple of wrong details and the company could be looking at a very costly process to put it right. Therefore, a company needs to have its payment policy and procedures nailed down from the get-go if it wants to avoid an expensive headache.

The details that a company needs to address in terms of salary payments differ little between organizations. There are variations, some quite profound and some very slight, but the general principle of paying a salary to one's employees is a global one. First, there is the frequency of payments. This is one factor that varies between companies and jobs. Typically, a temporary, part-time job will pay by the week. This is for a number of reasons: These roles tend to have a high staff turnover; there is an attitude that temporary, part-time workers are of a "here today, gone tomorrow" nature. In addition, there is less regularity of shifts. From one week to the next, these workers might log 12 hours or 20.

Full-time, permanent workers, by contrast, will have a regular shift pattern and be in the job for months at a time. Typically, this style of employment is referred to as "nine-to-five" work, as a shift will often start at 9 a.m. and end at 5 p.m. Although this has become a lot more flexible in recent years, the basic principle of working Monday through Friday with eight-hour days broken up by scheduled breaks is a firm favorite with employers. Whatever the exact pattern, it is the regularity that is the issue. Because of this regularity and the stability of the role, employees are often paid by the month

Then there is the rate of pay. Generally, on applying for a job, one will see the salary quoted as an annual amount, but companies often have an hourly rate for all levels on the pay scale. The average job will have an hourly dollar rate, expressed, for example, as 10.16 per hour. Therefore, if an employee in that role works 140 hours in a month, the month's gross pay for that employee will be $1,422.40. A part-time temporary worker, who may well receive a lower rate of pay, say $6.87, and works 16 hours in a week, will earn $109.92 for that week.

Note that the earnings mentioned above are referred to as gross earnings. This is not the amount that goes into a worker's account on payday. The amount the employee actually receives is arrived at via a number of deductions. We will deal with these deductions later, but for the moment, the amount paid to employees after deductions is their net pay. Often you will find that an employer advertises for a vacancy and lists the pay as a gross amount, for the simple reason that this is a larger and naturally more eye-catching figure.

Once these amounts have been calculated, they will be paid to an employee on a given day, the much anticipated payday. Celebrated up and down the land to the extent that it might as well be a national holiday, payday is when the employee's salary lands in her or his account. Often in order to ensure that this arrives on time, an employer needs to transfer the money a few days before the payday stipulated in a contract. The promptness of this transfer is of huge importance and will be the busiest day in any payroll department, as figures are calculated, checked, and double checked, then payments are transferred and checked again so any errors can be dealt with as soon as possible. With the calculations done, the employees' pay stubs will then be issued, informing them that a transfer has been sent to their account for a certain amount, and detailing how this amount was arrived at. This whole process is repeated weekly or monthly depending on the job and the employer. Though the payment of a salary may be taken for granted, it is hoped that the above explanation illustrates just how much work goes into it.