What is Payroll?

The term 'payroll' encompasses every employee of a company who receives a regular wage or other compensation. Some employees may be paid a steady salary while others are paid for hours worked or the number of items produced. All of these different payment methods are calculated by a payroll specialist and the appropriate paychecks are issued. Companies often use objective measuring tools such as timecards or timesheets completed by supervisors to determine the total amount of payroll due each pay period.

After a payroll accountant multiplies an employee's hours by his or her pay rate, the gross income amount is entered into a calculator or computer program. Regular deductions such as tax withholdings, FICA payments (social security), medical insurance, union dues, charitable contributions and so on are then categorized and subtracted. The remaining balance is then converted to a check and becomes the employee's net pay for that time period. Payroll departments also identify the employer and employees by a federal code and keep a running tally on total income and deductions for the fiscal year.

For small business owners, keeping enough cash in a payroll account is often one of their highest priorities. Even if the business itself hasn't become profitable, employees must still be compensated for their services. This is why many smaller companies prefer to keep their payroll obligations as low as possible until they've reached a certain level of profitability. It's not unusual for small business owners to forego their own salaries in order to meet their payroll obligations.

Setting up an effective payroll system is not especially difficult for trained accountants, but it can be very time consuming. Some smaller businesses rely on user-friendly computer software to set up a simple payroll system complete with check printers and file storage.

Larger companies may assign trained accountants to handle payroll issues as part of their overall duties. But many businesses without the means to maintain their own payroll systems choose to farm out this task to outside specialists.Since payroll records are based on objective criteria such as timecards and federal tax forms, outside accountants can perform all of the calculations, store all of the year-to-date data and issue paychecks in a timely fashion. Employers simply need to update these payroll companies with changes in employee pay rates or deductions.

This payroll system is managed to the company's Employee salary

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Human Resource Managemnet

A Human Resource Management System (HRMS, EHRMS), Human Resource Information System (HRIS), HR Technology or also called HR modules, or simply "Payroll", refers to the systems and processes at the intersection between human resource management (HRM) and information technology. It merges HRM as a discipline and in particular its basic HR activities and processes with the information technology field, whereas the programming of data processing systems evolved into standardized routines and packages of enterprise resource planning (ERP) software. On the whole, these ERP systems have their origin on software that integrates information from different applications into one universal database. The linkage of its financial and human resource modules through one database is the most important distinction to the individually and proprietary developed predecessors, which makes this software application both rigid and flexible.
Purpose
The function of Human Resources departments is generally administrative and not common to all organizations. Organizations may have formalized selection, evaluation, and payroll processes. Efficient and effective management of "Human Capital" has progressed to an increasingly imperative and complex process. The HR function consists of tracking existing employee data which traditionally includes personal histories, skills, capabilities, accomplishments and salary. To reduce the manual workload of these administrative activities, organizations began to electronically automate many of these processes by introducing specialized Human Resource Management Systems. HR executives rely on internal or external IT professionals to develop and maintain an integrated HRMS. Before the "client-server" architecture evolved in the late 1980s, many HR automation processes were relegated to mainframe computers that could handle large amounts of data transactions. In consequence of the low capital investment necessary to buy or program proprietary software, these internally-developed HRMS were unlimited to organizations that possessed a large amount of capital. The advent of client-server, Application Service Provider, and Software as a Service. Human Resource Management Systems enabled increasingly higher administrative control of such systems. Currently Human Resource Management Systems encompass:
1. Payroll
2. Work Time
3. Benefits Administration
4. HR management Information system
5. Recruiting
6. Training/Learning Management System
7. Performance Record
8. Employee Self-Service
The payroll module automates the pay process by gathering data on employee time and attendance, calculating various deductions and taxes, and generating periodic pay cheques and employee tax reports. Data is generally fed from the human resources and time keeping modules to calculate automatic deposit and manual cheque writing capabilities. This module can encompass all employee-related transactions as well as integrate with existing financial management systems.
The work time gathers standardized time and work related efforts. The most advanced modules provide broad flexibility in data collection methods, labor distribution capabilities and data analysis features was outdated. Cost analysis and efficiency metrics are the primary functions.
The benefits administration module provides a system for organizations to administer and track employee participation in benefits programs. These typically encompass insurance, compensation, profit sharing and retirement.
The HR management module is a component covering many other HR aspects from application to retirement. The system records basic demographic and address data, selection, training and development, capabilities and skills management, compensation planning records and other related activities. Leading edge systems provide the ability to "read" applications and enter relevant data to applicable database fields, notify employers and provide position management and position control not in use. Human resource management function involves the recruitment, placement, evaluation, compensation and development of the employees of an organization. Initially, businesses used computer based information systems to:
• produce pay checks and payroll reports;
• maintain personnel records;
• pursue Talent Management.
Online recruiting has become one of the primary methods employed by HR departments to garner potential candidates for available positions within an organization. Talent Management systems typically encompass:
• analyzing personnel usage within an organization;
• identifying potential applicants;
• recruiting through company-facing listings;
• recruiting through online recruiting sites or publications that market to both recruiters and applicants.
The significant cost incurred in maintaining an organized recruitment effort, cross-posting within and across general or industry-specific job boards and maintaining a competitive exposure of availabilities has given rise to the development of a dedicated Applicant Tracking System, or 'ATS', module.
The training module provides a system for organizations to administer and track employee training and development efforts. The system, normally called a Learning Management System if a stand alone product, allows HR to track education, qualifications and skills of the employees, as well as outlining what training courses, books, CDs, web based learning or materials are available to develop which skills. Courses can then be offered in date specific sessions, with delegates and training resources being mapped and managed within the same system. Sophisticated LMS allow managers to approve training, budgets and calendars alongside performance management and appraisal metrics.
The Employee Self-Service module allows employees to query HR related data and perform some HR transactions over the system. Employees may query their attendance record from the system without asking the information from HR personnel. The module also lets supervisors approve O.T. requests from their subordinates through the system without overloading the task on HR department.
Many organizations have gone beyond the traditional functions and developed human resource management information systems, which support recruitment, selection, hiring, job placement, performance appraisals, employee benefit analysis, health, safety and security, while others integrate an outsourced Applicant Tracking System that encompasses a subset of the above.
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