What Are the Benefits of Integrating Human Resource Management & Payroll Databases?

Payroll databases integrate elements of HR and accounting.

The term payroll refers to the financial records of payments to employees, as well as any deductions from the pay for taxes or other purposes. Payroll management is one function of human resource management. HR managers work with company accountants to ensure accurate and timely employee pay. Payroll database integration automates many of the functions of payroll, saving time and ensuring correct accounting.

HR and Accounting

HR staff keeps records on how much each employee gets paid, either in hourly wages or salaries. HR managers must also track any pay raises, promotions and bonuses. Accountants keep track of payroll deductions such as taxes and garnishments. When it’s time to pay the employees, accountants use HR records in conjunction with hours worked, sales, bonuses and deductions to determine how much to pay each employee. Payroll databases sped up the process for both accountants and HR staff by easing access to payroll information.

Payroll Databases

Databases by nature combine previously separated but related information into a common pool of data. Payroll databases combine human resource management data, such as wages, salaries, benefits and bonuses, with accounting data such as hours worked, tax status, deductions and actual pay. This integration means that HR staff can communicate seamlessly with the accounting department when it’s time to create and manage the company payroll.

Payroll Data

A number of factors go into determining employee pay, so payroll databases may contain a vast amount of information easily managed by technology. This data is input from a number of sources, including human resource mangers, accountants, employee supervisors and executives. Typical information includes previously mentioned data from HR and accounting staff. Some companies pay on commission, meaning that some or all of the employees' pay is based on sales made or accounts signed. For companies using commission pay, sales information will need to be input into the payroll database.

Payroll Management

Without payroll databases HR personnel must sort through, track and classify payroll data and share their information with the accountants who are ultimately responsible for payroll calculation and paying employee wages using company funds. Payroll management can be confusing and time consuming. Paper payroll records can take up a lot of physical space. Payroll databases manage much of the information for the HR staff, giving the staff more time for employee development and other important HR functions.

References

• Bureau of Labor Statistics: Human Resources Assistants
• Human Resource Management, Seventh Edition; Lloyd L. Byars and Leslie W. Rue
• Management Information Systems, Sixth Edition; James A. O’Brien

Resources

• University of Hawaii: Payroll Data Records