Information on the HRIS Payroll System
The HRIS Payroll System is an option businesses may consider as they determine how to most effectively manage payroll and employee sensitive tax data. The HRIS Payroll system can be part of a larger Human Resource management or a stand alone system. Companies may choose to consider integration options, functionality and employee population size before determining the best way to manage payroll for their organization.
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What is HRIS?
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The Society for Human Resource Management defines Human Resource Information System or HRIS as a computer database used to gather, store, maintain, and retrieve relevant employee and HR-related information. HRIS products can be stand alone software components or elements with a greater network of solutions called the Human Resource Management System or HRMS. Tools that fall under these titles usually include recruiting, benefits administration, payroll and other functions of the Human Resource Department.
Payroll System Function
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Payroll is the process used to administer the financial record of an employees' salary, wages, bonuses, net pay and any related deductions. Payroll is usually updated and delivered weekly, bi-weekly or monthly, and is managed by a Human Resource representative for the company. The payroll system is the application that HR Representative will access to store, update and manage all tax information for every employee. All tax detail must be stored for up to four years by any employer regardless of company size, making payroll systems a critical tool in business operation management.
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Process of HRIS Payroll System
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According to "Essentials of Payroll," by Steven M. Bragg, the HRIS payroll system should include these processes to ensure the ability to report and track employee salary and tax information in any company: New employee record creation including tax and medical insurance forms, timecard information, wage summary and deductions, wage register for the production of tax reports, wage and tax verification, and the ability to print checks and record any manual payments outside of the regular payroll cycle.
HRIS Payroll System Integration
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Some companies may opt not to integrate a payroll system into the HRIS product. In an article on HR.com, George Eckhert explains that the HRIS Payroll system's primary advantage is the accessibility to other data used in the human resource process, including hiring, benefits administration and training. In an integrated system, the margin for error is decreased as commonly needed employee information like name, date of hire, Social Security number and address can be found in one centralized location. The two types of integration are local and physical. Local integration means the human resource systems use the same codes, numbers and fields to capture information. Physical integration means all of the human resource systems are contained on the same server network within the suite of products.
Outsourced Payroll Processing
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For companies that prefer to avoid the time and cost of selecting an HRIS Payroll System there is an additional option. Some small and mid-sized companies opt to outsource payroll and other human resource processes. Bypassing the process of software selection, cost and integration these companies select a service provider to manage the data for their employee population. In a PricewaterhouseCoopers study performed in 2004, half the companies surveyed chose to outsource the payroll process. The remaining half chose to implement an internal software solution. Companies with less than 500 employees show a slight increase in selecting outsourcing over an HRIS payroll system.
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