Sue Grundy, Service Delivery Manager

1. Maximising the value of your Payroll Department Sue Grundy, Service Delivery Manager

2. Significant Value Businesses can realise significant value through their payroll department, from greater accuracy through to highly valuable Management Information

3. Developing Efficiency Overview of how organisations can develop the efficiency of their payroll department

4. Key Performance Indicators How much the payroll department costs to run How much each payroll within the department costs to run How those costs are made up

5. Costs evaluated by remit and by payee Cost per remit (payslip produced) Cost per employee (payee)

6. The Reasons why to do this: Illustrate areas of excessive expenditure Manager can make informed decisions Compare year on year costs Assist with change management by comparisons between before and after period of change

7. Information Required Payrolls Number of Employees (Payees) Payslips (Remittances) Payment Methods Payroll Staff Payroll System Stationery Work area Any other payroll associated operational costs e.g. Postage, Administration

8. Example of Payroll Statistics Weekly payroll 100 hourly-paid employees Due to high turnover, generates 110 remittances per week, all paid by cash 4-weekly payroll 800 hourly paid employees 10% paid by cheque, remainder by BACS Monthly payroll 50 salaried employees, all paid by BACS

9. Costs incurred by the payroll department Staff Payroll Manager £30,000 + 15% on-costs Supervisor £20,000 + 12% on-costs 3 Assistants £15,000 + 10% on-costs each The supervisor works on two payrolls. Three fifths of his time is on the 4-weekly payroll, the remainder is on the weekly payroll. Assistant 1 works only on the 4-weekly payroll. Assistant 2 works only on the weekly payroll. Assistant 3 spends 3 days a week on the 4-weekly payroll and the remainder filing for everyone.

10. Associated Costs Associated payroll departmental costs • Computer system • Computer maintenance (software and hardware) costs £24,000per annum • Stationery • Payslips cost £60 for 1000 (so 6p each) • Computer paper costs £5540 per annum • Accommodation and overheads • The Finance Department has provided you a figure of £1350 per member of staff to cover the department’s share of the rent and other head office overheads

11. Pay Method Costs Payment Method • Cash • Various charges associated with paying cash total £9,200 per annum. • Cheques • Bank charges of £1 for each transaction • BACS • Costs amount to £715 per annum

12. Analysis of Payroll staff costs

13. Analysis of Associated Payroll Departmental costs

14. Analysis of Payment method

15. Effectiveness What is the most cost effective payment method? Which of the payrolls are costing the least amount to produce? Could I reduce the weekly postage costs over the next year? How can I reduce the stationery costs of the payroll operation? If the pay frequency changed how would this impact on staffing costs? How much could be saved by providing on-line payslips?

16. Questions & Answers Please ask Questions

17. Thank you and please enjoy the rest of your sessions