Join Gabriella Parente-Neubert for an in-depth discussion in this video The purpose of payroll and HR's role, part of Human Resources: Payroll.
- Imagine this, a 24 year old woman eager to tackle the world of HR after successfully completing her graduate studies starts her first position as a senior human resources generalist at a leading aerospace company. While sitting in her new office feeling confident in the expertise that she can offer, in walks a man with a question that she would least expect. He hands her a document and says, "My paycheck is wrong, I need you to fix it." Bewildered, she looks at the document and wonders why he came to her when there's a payroll department right down the hall.
But then again, the door clearly says human resources. Thinking through her bag of HR tricks, she realizes that payroll was not one of them, but should it be? Of course you're wondering if this young woman was me, and indeed it was. My example illustrates the importance of payroll in an organization, and especially within the HR function. Payroll is fundamental in why we come to work each day. It's why we pick an organization to dedicate a good majority of our time to. It's why we kiss our spouses and children goodbye in the morning and return to them late at night.
Our pay is as crucial to our lives as payroll is to the HR function in an organization. If a company can't pay its employees accurately, lawfully, or fairly, how can we expect any other human resource initiative such as training, performance management, or leadership development to work? In Maslow's hierarchy of needs, the most fundamental and basic four layers of the pyramid are physical needs, love, friendship, and esteem. These contain what Maslow calls deficiency needs or D needs.
If these deficiency needs are not met, the individual will feel anxious and tense. Maslow's theory suggests that the most basic level of needs must be met before the individual will strongly desire or focus motivation upon the secondary or higher level needs. A person's pay fuels those very basic physical needs, water and food. Once that is met, safety needs can be met such as personal and financial security. As you can see, a person's pay is at the very bottom of the list, and without it they cannot move up the hierarchy to self-actualization, or if at work, their greatest potential.
As my example suggests, payroll serves an important purpose within any organization. How we pay our workers is crucial to the employees trusting the organization so that they may feel safe and free to explore their natural talents and abilities and have outstanding performance within the company.
- Classifying workers
- Garnishing and taxing wages
- Picking a payroll system
- Paying sick, vacation, and holiday time
- Understanding benefits