+44 1276 587675

As the CIPP’s annual survey of payroll practitioners releases its report for 2023, we look at some of the key takeaways. 

The CIPP has just published its Payslip Statistics Report, a flagship survey which explores trends impacting payroll processes, payslips and compliance. You can find the full report here (and it’s well worth a read), but here are some of the findings that struck a chord with us.  

1. More than 1 in 10 businesses have changed pay frequency 

It’s not hard to see the cost-of-living crisis influencing issues surrounding pay frequency. Although 13% of companies have made changes to their pay frequency in the past year, almost 1 in 5 (18%) have been asked to make changes by staff, and it’s notable that, within those companies making changes this year, supporting employee wellbeing has been the driving force for change in 19% of cases. 

Rising prices and the general financial squeeze are even more apparent in the first and second most popular reasons for changing payment dates: improving efficiency and cashflow. 

2. 4 in 5 businesses offer cost of living support 

Lots of businesses are doing more to support staff during the crisis, although it’s interesting that, as we’ve explored on these pages previously, that help isn’t always financial. While 18% of employers have given above inflation pay rises and almost 1 in 3 have supported workers with one-off bonuses, by far the biggest single support measure has been the offer of more hybrid/remote working.  

It’s also notable that while almost 1 in 5 employers have offered inflation-busting rises, just as many have done nothing. 

3. Over half of payroll depts are miscalculating holiday pay 

According to the CIPP’s survey, just 47.84% of respondents are calculating holiday pay in a compliant way. In addition, a lack of transparency over what holiday pay includes is increasing employee queries, while elements that should be included in holiday pay calculations (regular overtime, shift allowances, shift premiums etc) are not. 

4. Payslips offer missed opportunities for communication 

Most staff take time to look through their payslip, so it can be a valuable way of passing on information. 79% of payroll departments used the payslip to show HMRC’s health and social care levy messaging. Yet just 44% use payslip messaging to help employees understand their pay, and only a quarter of businesses use the payslip for any other form of messaging during the year.  

Since direct communication with payroll is by far the most common form of communication for employees wanting to understand their pay, there would seem to be a clear opportunity to reduce the burden on payroll departments by increasing the use of the payslip as a communication tool.  

5. Top three payroll queries are… 

  • Tax code queries (36%) 
  • Underpayment due to late payroll data (23%) 
  • Inability to access online portal (23%) 

Just to further underpin the point made at 5, while no amount of payslip messaging could solve technical portal access issues, there’s clear potential to head off queries about late payment and tax codes with a payslip note. 

6. The payroll outsourcing opportunity 

The CIPP survey doesn’t ask whether respondents run their own in-house payroll or whether they outsource payroll. We can, however, gain an indication of the state of payroll outsourcing by looking at the numbers of payrolls processed – something the survey does cover. 

33% of those surveyed process one payroll. It seems reasonable to assume these are all in house payroll departments. 31% process 2-5 payrolls. Again, it seems reasonable to assume these are predominantly payrolls for distinct companies within the same group, handled by a single department.  

This suggests around a third of respondents to the CIPP survey are payroll companies handling the outsourced payrolls of numerous client businesses (and in 3% of cases, more than 1,000 payrolls). 

Yet that means two thirds of respondents (probably) are not outsourcing. Given the challenges of running an in-house payroll – from the wealth of other duties to the staying abreast of legislative change – it’s perhaps not surprising that the report identifies issues in payroll management, from maximising communication to compliance.  

That’s where we can help. Whether your payroll challenge is getting it all done, managing change, ensuring accuracy or reducing queries, outsourcing your payroll can make a world of difference. Talk to us about outsourcing your payroll now.