Taking the pain out of payroll

With a number of celebrities and large corporates coming under fire in the past 12 months for underpaying their workforce (and consequently having to pay significant penalties!) there’s no question it’s imperative to get payroll right. If you’re not an expert in payroll (and let’s face it, most of us aren’t!) it’s really easy to make simple errors that can cost you dearly. To some extent STP has made it easier to report tax and superannuation but leave entitlements, commissions, changes in working hours etc often require quite a detailed knowledge of the programmes and awards.

Teresa Bu, CPA and Accounting Team Leader, is one of Viridity’s payroll experts. She takes pride in being a subject matter expert and managing the payroll for a number of clients. In this interview we do a bit a deep dive into payroll with her and how she and the Viridity team get the job done.

What are the common challenges or mistakes you’ve seen in businesses regarding payroll? 

Overpayments and underpayments to employees are the most common problems in business. The majority of SME’s don’t have an HR and/or payroll expert in house. This can cause some challenges in communicating payroll/HR issues. For example, some business owners are time poor and want to spend as little time on payroll as possible, so when they are questioned by an employee, they don’t really know how to answer technical or legislative queries with confidence, which leads to frustration. Conversely, employees don’t always like to ask questions of their boss which can result in long term problems – especially when employees leave the company.

Do you have to have an HR degree to do payroll?

Payroll is quite separate from HR. As registered BAS agents, we specialise in payroll-related issues and calculations which are handled in accounting software systems, meaning no HR degree is required.  My team are all well versed in payroll essentials for most accounting platforms. I’m currently studying a Payroll Administration course to add to my credentials, largely because payroll is a special interest of mine.

Tell me what you enjoy most about working with clients on their payroll? 

Being able to provide clients with correct pay information and calculations gives me a great deal of satisfaction. Payroll can be complicated, and we work across many different industries which means different awards. So, staying informed is a key part of the role, which we do through education, memberships and knowledge sharing. Changes in payroll happen just about each and every year, which for me, makes it more challenging (and interesting) We consider our client’s employees as part of our extended family, we really do. That makes me feel like I’ve got a vested interest in getting it right.

Payroll is obviously important in any workplace, so how do you manage working with clients when you’re not physically in their office?

Most payroll related issues are sensitive and confidential. As an outsourced payroll specialist, it helps protect both clients and their employee’s privacy to some extent.  We manage client’s payroll in cloud solutions so the communication between clients and us is efficient and safe.

If there was one piece of advice, you’d offer to business owners getting frustrated with the complexity of payroll and doing it themselves, what would it be? 

First and foremost – come to us…Lol. But seriously, why wouldn’t you outsource something that’s frustrating you? Some would cost, but I challenge that and ask, can you afford not to? Especially if it’s a task you find frustrating or onerous.

An example from just a few years ago a client’s MD ran payroll himself in Excel.  The first time we ran it in Xero he ran a parallel in Excel to check we’d get it right. He challenged us on almost every individual pay. The problem was his spreadsheet contained errors (which can easily happen over time), or mistakes in his understanding of payroll that meant he had been paying almost every employee incorrectly for the past 2 years, some too much/some too little.  It ended up costing him and these days, you can’t afford to get it wrong.

How have you been supporting your clients throughout Covid-19 payroll management?

In addition to the usual processing we do for our ongoing clients we have also been managing their JobKeeper reporting requirements, at no extra cost. The whole team have become knowledge specialists on JobKeeper because we believe in (and get satisfaction from!) supporting our clients through thick and thin.

Payroll isn’t something to take lightly. There are so many nuances to the process. Please get in touch with us if you need help with or  thinking about outsourcing your payroll, you won’t look back.



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