Electronic payroll: functions and benefits
María José Solano [Vauxoo]
14 July 2021
Throughout this blog post we will tell you about what electronic payroll is, what functions and benefits it has for the company and the employee, in addition, we will share some advantages of implementing a software that helps you automate this process.
Regardless of the size of a company, one of the main obligations it has to fulfill is the payment to its employees in a timely manner for the services provided for a specified period of time.
It is common for small companies to calculate their payroll on spreadsheets, which is easier and more practical when there are very few staff in the company. However, when the company begins to grow it is more convenient to use software that facilitates it, as well as the calculation and administration of payroll, which will help minimize time and effort in your company.
Electronic payroll is a digital document that is the equivalent of traditional employee payroll. The objectives of electronic payroll are basically the same as those of paper payroll and contains the same mandatory payroll concepts, therefore, its function is the same as that of paper.
The payroll receipt is the proof of the services that an employee provided to a company, this file shows that the company complied with the payment of said services, in addition to it the benefits, bonuses, punctuality awards, overtime and the deductions that are made by law (isr, insurance, etc.) are broken down.
This receipt is of vital importance, since it contains a part of the capital flow of the companies, so it is necessary to register it for legal, labor and tax purposes as well as to carry out internal control, in addition, it helps companies to report more accurately the contributions that have been made to the different institutions, as well as the fees and taxes withheld.
Payroll receipt functions.
Check monthly income. The payroll receipt is usually one of the most common ways to verify income being the collaborator of a company. In addition, if you need it, it is a necessary document when applying for a loan, a credit card or a mortgage, it is an easy way to verify your payment capacity, as well as your solvency and liquidity.
Check the employment relationship of the employee with the company. In case a collaborator needs to demonstrate her relationship with the company, a payroll receipt can be of great help.
Avoid misunderstandings. With the payroll receipt, the collaborators in the companies can clarify any doubts that exist with their payment, it can avoid misunderstandings, and it helps to have a clear explanation within the deductions.
Benefits of automating the process
The payroll process can take up to a week to prepare in many cases and can involve some human errors that can backfire on businesses as they can be reflected in payroll and breach of payroll tax laws.
Having a payroll software is of vital importance for companies today, since it allows to standardize the calculation process according to practices already certified in the market and leaves room for staff to audit and control the payroll management itself.
Here, we share some advantages of implementing a software that helps automate the payroll process:
Time. El uso de un software ayuda a automatizar el proceso de cálculo, evitando que se haga de forma manual, ayudando al colaborador a centrarse en la auditoria, corrección y elaboración de reportes de gestión de todo el proceso
Accesibilidad y protección de la data. The use of software helps to automate the calculation process, avoiding the manual work, helping the employee to focus on the audit, correction and preparation of management reports of the entire process.
Scalability. By having a commercial payroll system, we allow the updates that are made at the level of laws and regulations to be certified in their operation, leaving aside manual calculations and therefore there are differences in interpretations between the personnel who make the adjustments. If we talk about a payroll system made internally in the company, the advantage is that the control of changes according to the law is tracked and verified with more consistency compared to changing formulas in cells of a spreadsheet.
Electronic payroll module in Odoo
The Odoo payroll module is integrated with the employee module, which is an important advantage for companies, since it is where each employee is configured with their respective contract and specifications. It is also integrated into the attendance and absences module, which help to have a more fluid and transparent operation, in this module the incidents of each collaborator are loaded such as vacations, leave, maternity leave, absences, the hours worked overtime, etc.
Additionally, in the case of Mexico, Odoo can certify the digital seal that must be printed on each payroll receipt that is generated, as well as the generation of the XML file that contains the encrypted digital seal, required by the Administration System Tax (SAT).
Payroll is essential for any company, no matter its size. One of your greatest responsibilities is to ensure that your employees receive their salary in a timely manner, the use of software will be of great help to execute the payroll in the shortest possible time, avoiding human errors and avoiding fines or delays in payments.
Then we leave you the following webinar, where we did a demonstration of payroll management for Mexico in Odoo, we talked about how to configure it, the fundamentals, calculations, reports, complementary functionalities and an introduction of the steps to implement it.
Are you ready to automate your processes? Try Odoo now!