There is some distinctiveness between HR and payroll functionality. Payroll controls all the payment-related issues in the organization, and HR handles all the HR issues within the organization. There are times when these two roles overlap.
Both functions use separate software modules to perform the specific job. In the small business environment, both functions are also performed by the same person.
This article talks about the key difference between HR & payroll software. Why should you consider investing in integrated HR & Payroll software in Bangladesh? So, let’s begin.
What is HR Software?
HR software is designed to assist your organization in managing employees. It helps simplify all HR management work, better manage employee talent, and thus drives productivity in the organization.
What is Payroll Software?
Payroll software is associated with compensation-related work. It assists in calculating employee payroll by considering all the accounting elements and reduces the risk of human errors.
What Are the Key Differences Between HR and Payroll Software?
Both functions are essential to play within the organization. The differences between the two functions are apart follows:
Sharing a different skillset
HR software is people management-centric, whereas payroll software deals with finance-related work.
Payroll software has to adhere to all the tax law regulations and has to keep a thorough understanding of the accounting process.
However, HR software helps streamline management-related work, such as attendance and performance tracking. This, in turn, enhances the organization’s overall productivity.
Responsibility varies depending on the size of the Organization
Small organizations can handle payroll management systems and employee management. The number of employees is smaller here, so both tasks can be easily done.
However, the case is different for big organizations. They have a vast workforce. To have a steady workflow, they need to deploy an HR software system and a payroll system.
Both solutions communicate different functionality
Payroll Software helps mitigate payroll errors and reduce the time and effort invested. This solution is so easy to manage that a non-financial person can easily do it.
Conversely, HR software focuses on the bigger picture. Implementing HR software is essential to maintaining a steady workforce. It helps track employee performance and reduces manual work pressure.
Both solutions foster different communication model
HR software fosters faster communication between different departments. Employees can easily manage their portal and update it according to management needs, facilitating collaboration between management and employees.
Payroll software facilitates financial stability that can be easily shared with the finance and accounting departments. It works as a bridge for accurate financial decisions.
Differences in Concerns
HR software concerns hiring the right person for the right role, and payroll software concerns paying employees for their work.
One solution is to be concerned about when a new employee starts working together or leaves, and when others need to take care of the raise at the time of promotion.
How the HR and Payroll System Aligns Together
There are some connecting points between these two systems. Both systems share standard functions such as recruitment, salary, bonus, payment, leaves, benefits, etc.
For instance, when the HR department hires a new employee, the payroll system must be informed. Payroll must ensure that all critical aspects are taken care of.
When introducing a new salary scheme, HR must be integrated with the payroll system. Similarly, when employee performance needs to be updated, HR and payroll systems must be worked on accordingly.
If the payslip isn’t processed promptly, the HR department will face an issue. A delay in paychecks can negatively impact other departments. That’s why the HR department needs to provide timely input to generate timely paychecks.
When an employee goes on sick leave, HR and payroll are responsible for ensuring smooth transitions and on-time payment.
Error-free communication and confidential data handling can not be done smoothly if HR & Payroll don’t merge. It is essential and must be done seamlessly.
How Does the HR & Payroll Software Integration Happen
With so many overlapping activities, integrating both solutions is becoming more necessary. Many companies are keen to take more strategic solutions using their HR software. HR practitioners now handle payroll-related activity for a hassle-free workflow.
Using one solution can make every time-consuming process easier. So much software is out there providing HR & payroll software solutions together. One of them is the Jibika plexus.
It is designed to provide integrated HR and payroll solutions that work seamlessly. It also helps save a great deal of time. Such software can be used as a backbone for each department. Such an integrated solution is much needed to ensure a highly efficient and effective workflow.
The integrated solution would enable quick, error-free reporting for your HR and payroll departments. Although both activities have differences, they all end with the same objectives.
FAQs
Q) What is the primary function of HR software?
Answer: Human resource software mainly involves working with employee data, hiring, performance reviews, and general employee work.
Q) What does payroll software specifically handle?
Answer: Payroll requires software to track employee pay, tax withholdings, and to pay employees.
Q) Can HR and payroll software be used together?
Answer: Yes, many organizations deploy HR and payroll software in tandem to ensure seamless information flow regarding employees and salary information.
Q) What are the key features of HR software?
Answer: HR software typically has key features such as applicant tracking, employee onboarding, performance management, and benefits administration.
Q) Is it necessary for a business to invest in both HR and payroll software?
Answer: Using both is not a requirement, but both software programs improve operational efficiency since each performs different yet complementary functions.
Conclusion
Combining HR Management and Payroll Services is often bewildering for businesses; hence, knowing the difference between HR and Payroll software becomes paramount. Whereas HR software is about engaging employees and managing data, payroll software is focused on payroll and compliance.
Both tools can help organizations optimize their processes, increase accuracy, and drive operational efficiency in managing their workforce. In conclusion, the right mix of software solutions to meet your business needs can help create a happy team that functions at a high level.
