Guide

How to Manage Payroll Risk | 30 Questions to Help you Avoid Underpayments

Check out our latest article: How to Manage Payroll Risk. It includes a free PDF with questions to ask your team, payroll risks to look out for & mitigation strategies.

For a lot of Australian organisations, the payroll function is under-invested and under-resourced, with potential dangers lurking below the surface.

A recent AFR interview with Tracy Angwin, CEO at Australian Payroll Association, reinforced some hard hitting issues that surround payroll:

"Perhaps the most alarming thing we see is the trend of senior management not understanding the payroll structure required to ensure a well-governed, compliant and efficient payroll. The number of senior company executives quietly admitting to us that they have no idea what is going on in their company's payroll function is astounding."

Tracy Angwin · CEO, Australian Payroll Association

We saw similar concerns in the Fair Work Annual Report FY22:

Payroll risk — Fair Work Ombudsman statistics

So what are the big payroll risks and how do we mitigate them?

Payroll risks you should be across

Operational risk

The 4 key areas to review in operations are:

Record keeping
Processes
Transparency & oversight
Controls & segregation

People risk

The most common issues relating to your people include:

Risk of staff burnout
Key person dependency
Failure to plan for 'if things go wrong'
Lack of training & development

Compliance risk

What is important to payroll in terms of compliance?

Identifying & understanding the relevant legislation
Keeping up with changes
Compliance & audit tracking

Want help to determine if your organisation is at risk for any of these 3 areas?

Download our free PDF whitepaper. We've outlined a list of questions to help you surface any issues that might be present.

Managing payroll risk whitepaper cover
Free download
Managing Payroll Risk whitepaper
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How to mitigate payroll risk

What should you be doing?

Here's 3 tips to ensure your payroll team is set up for success:

1
Formalise governance structures
To improve compliance & accountability — this includes centralising payroll operations management, plus conducting regular audits and reviews.
2
Invest in your people
Strong governance & operations structures help reduce employee burnout and demonstrate workload requirements. Focus on hiring the right people and continually developing the staff you have.
3
Invest in payroll operations technology
This is important — payroll systems can't do everything. They are not designed to manage payroll governance or your day-to-day operations. Payroll governance tech lets you centralise payroll operations, better manage knowledge and provides a formal audit trail of all operations and record keeping.

For more information, download our free whitepaper: Managing payroll risk [PDF].

Steps to get started

If your payroll operations and knowledge are scattered across spreadsheets, email, personal calendars and documents — that's not good governance.

Paytools, Australia's leading payroll operations software, can help.

It will reduce payroll risk in your organisation by creating consistent and accountable payroll operations. Get in touch to see how you can build an air-tight and fully auditable payroll governance program in days, not weeks.

Ready to take control?

Create calm, compliant payroll.

See how a purpose-built payroll operations platform brings your operational and compliance management into one place.

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