Human Resources / Payroll Information (2024)

FAQs

Does HR handle payroll questions? ›

Payroll processing is one of many responsibilities your HR department may take on. Many business owners and HR leaders choose this option because HR does have expertise in handling employees with a very people-first mindset. This can lead to better employee experiences than finance's financial data handling expertise.

Payroll is an employee facing function and therefore belongs under human resources. Questions, queries and complaints from staff will arise, and it will be HR that will be tasked with responding. As the human resources department will ultimately field such concerns, it makes no sense to keep payroll at arm's length.

HR helps to set compensation and benefits policies, such as the company's payroll, salary increases, incentives, bonus payments and employee benefits packages. Payroll uses this information to process the payroll by accurately calculating paychecks, deductions and benefits contributions.

While HR is frequently in charge of managing employee relations, payroll is in order of controlling employee salaries. Yet, the two responsibilities frequently overlap and are carried out by the same person, particularly in small businesses.

When you are applying for a job in California, employers cannot ask you about your salary history or the value of your benefits (such as health insurance policy limits). Nor can employers try to track down this information personally or through an agent or recruiter.

Ensuring information confidentiality: Payroll information is confidential. This is why it's best handled by the HR department.

Only designated people should have access to your business's payroll information. If you have an employee in charge of running payroll, let only that employee have access to payroll information. If you run payroll yourself, do not let any employees have access.

None is the right or wrong way to organize your business, but payroll and HR are technically two separate functions. Human resources professionals are all about the people. It's their job to bridge the gap between human needs and organizational needs.

The HR department is responsible for managing employee data and retention, while the payroll department is responsible for managing employee compensation and payroll processing. In order for both departments to do their job properly, they need to have access to each other's data.

How do you manage HR payroll? ›

Payroll Calculation Formulas

Net pay is the final payout that is disbursed to an employee after all the necessary deductions made. Gross pay = Basic salary + HRA + DA + Allowances + One-time payment/incentive (Reimbursements, Arrears, Bonus, etc.)

As we've seen, payroll is something that can be difficult and challenging for beginners, but it's not something that necessarily has to be like this. If you want to stick to manual methods, you'll want to first break down each aspect of payroll into its necessary parts, and make your way through one at a time.

Calculating salaries is simple. Most employers set an annual rate (because the numbers are bigger and, therefore, more attractive when trying to recruit) and then divide it by the number of pay periods (either monthly, weekly, or biweekly) in a contract of employment.

Among the responsibilities assigned to HR, payroll is one of the most impactful to company culture and organizational success.

The HR department is responsible for managing employee data and retention, while the payroll department is responsible for managing employee compensation and payroll processing. In order for both departments to do their job properly, they need to have access to each other's data.

If you have a question about compensation and employee benefits. Knowing that the hr department manages these plans, they are a great resource if you have questions about pay stubs or health insurance, for example.

HR typically handles employee information and timekeeping, while Accounting manages the financial aspects, like processing payments and withholding taxes. In larger organizations, there might be a dedicated payroll department that works closely with both HR and Accounting.

Human resources is an employee-facing role but finance handles cash flow, so which one is responsible for payroll? The short answer is both. Here I explain how it's best divided between the two. Payroll responsibilities intersect with human resources and finance departments.