If your payroll team can't take holiday, you have a resilience problem

This dependency is often well understood but harder to resolve. An organisation might run payroll successfully every month while remaining heavily reliant on a small number of highly skilled individuals.

Building additional cover can mean duplicating specialist skills at a high cost, leaving teams to weigh that investment against the operational risk of maintaining the status quo.

Payroll professionals’ ability to take planned time away should then be viewed as one of the simplest tests of operational resilience. A payroll function that can continue operating smoothly during planned absences is usually one built on strong processes, documentation and shared knowledge. So, what can organisations do to get there?

The payroll profession is changing

Historically, payroll was often viewed as an administrative function focused primarily on ensuring employees were paid accurately and on time. But this description is well outdated.

Payroll is increasingly seen as a strategic function within the business, and a great payroll professional is hugely impactful within an organisation, playing a critical role in navigating ever-changing legislation, tax requirements, pension regulations and compliance obligations. At the same time, they are being asked to develop entirely new technical skills as payroll technology becomes more sophisticated.

These technological changes mean the skills required by a payroll professional have evolved. Payroll professionals are managing integrations between systems, validating data flows, supporting automation initiatives and working with increasingly complex reporting requirements.

In many organisations, payroll professionals are now expected to understand data management, technology platforms and system functionality and formats alongside their traditional legislative and employee payment responsibilities.

That highly specialised combined skillset is like gold. It’s becoming increasingly difficult to find, and without enough talent available, it leaves an operational hole that can be hard to fill – meaning operational resilience is more important than ever.

Mitigating organisational dependency

With a small number of skilled professionals in payroll teams, knowledge naturally becomes concentrated among a select number of individuals.

Over time, certain employees become the only ones who know how to manage complex calculations, resolve unusual compliance issues or work around limitations within the company’s payroll systems. They understand the spreadsheets nobody else understands and the processes that have evolved over many years, often without written guidelines.

These team members become indispensable, making it especially tricky for organisations if and when they take an extended leave or move on from their roles.

To address this challenge, payroll teams need to have processes in place that are built on sustainable systems, documentation and knowledge sharing, rather than solely relying on the individuals who hold the key to the most valuable information.

If employees do leave their roles, succession plans and training opportunities for other employees need to be in place to ensure a smooth transition, and that any critical information is shared and tasks are handed over before the individual exits the business.

Building resilience for the future

The notion that payroll professionals cannot take their holiday is directly linked to these dependencies, but more than just knowledge sharing needs to be done to mitigate this challenge going forward.

One key initiative to help address this is recruiting and retaining talent. For most young people considering their future career, payroll isn’t even on their radar. When looking at similar career paths, most people understand what an accountant does, and most have some understanding of human resources, but very few think of payroll as being more than one or two people within an accounting or HR department that make sure people get paid on time.

And if the narrative that payroll professionals can’t take holidays runs deep enough to reach these audiences, it acts as an additional disincentive for joining the industry.

The reality of the profession is very different. Payroll is an exciting and ever-changing industry. With a mix of technology and advisory responsibilities, payroll professionals are highly skilled individuals focused on understanding and managing complexity, rather than on admin tasks.

We need to be thinking of how, as a profession, we can attract the next generation of talent into the industry, showcasing how payroll can be a career in its own right and how fulfilling a career in this industry can be. Payroll is more than just numbers – it’s a career path where people who thrive on problem solving and attention to detail will really make an impact.

At the end of the day, if payroll can’t function when someone goes on holiday, the problem isn’t the holiday. It’s that the organisation has allowed critical knowledge and responsibility to become concentrated in too few hands. This doesn’t just impact the payroll team, but the entire organisation. The risks are too big to ignore.

It’s time to squash the myth that people who work in payroll can’t take their holidays. With a focus on recruiting and retaining talent, as well as knowledge sharing and training within organisations, we can build payroll teams that work effectively, collaboratively and have the necessary operational resilience to support the needs of their organisation at any time.

How ZEDRA can help

ZEDRA supports businesses expanding internationally, from organisations entering new markets for the first time to established multinationals with employees across multiple jurisdictions.

As organisations establish and grow international operations, payroll, employment and compliance requirements often become more complex.

Our team combines central coordination with local expertise to help clients manage payroll processing, statutory obligations, reporting and payment arrangements across more than 150 countries.

We can also support related HR requirements, including employee onboarding and offboarding, employment contracts and handbooks, employee relations, salary benchmarking and wider compliance management.

To discuss your international expansion, payroll or compliance needs, contact Allan Harness.