Payroll's progress
Technology having massive impact on industry

By EILEEN MOZINSKI SCHMIDT - Special to The Freeman

January 20, 2018

     

Camille Pierce, payroll specialist at IPS; Sarah Lutz, benefits specialist; and Pete Feaman, vice president, at the IPS offices in Delafield.

Submitted photo

DELAFIELD — The technological revolution has resulted in a makeover for the payroll industry.

“The days of employees wanting to get their check stub on a Friday and take it to the bank have kind of gone away,” said John Feaman, president at Integrated Payroll Services, or IPS, a payroll and human capital management services business headquartered in Delafield.

Payroll systems have been changing rapidly in the wake of a technological push toward a more mobile and data-driven society, along with a shifting legal and political landscape, according to Feaman. He said both employees and employers are now often looking for more advanced, streamlined, and comprehensive ways to work with payroll and other related systems.

“Instead of traditional payroll, we’re also handling benefits administration, electronic on-boarding” and more, said Feaman, who noted workers are more accustomed to conducting their lives electronically and administrators prefer not to monitor and work with different systems for various areas of employee management.

“H.R. professionals are liking it and employees are definitely demanding it,” he said.

Feaman’s father, Larry Feaman, had a background in the payroll industry. He started IPS in 2010 with John Feaman and his brother, Pete, who are both certified practicing accountants, along with their sister Leslie. Another sister, Sarah, joined the firm last fall.

In recent years, Feaman said the company has added a series of human capital management services to the business suite, and is structuring systems in the cloud to allow access from all locations.

John Feaman, president of IPS.

Market on the rise

The global cloud-based payroll market is expected to increase at a rate of 6 percent in coming years to reach $9.9 billion by 2023, according to a Research and Markets analysis released late last year.

Cloud-based humans capital management systems are key for companies with employees traveling and for those with employees working remotely, which has also been increasing. Over 40 percent of workers worked remotely at least some of the time during 2016, according to Gallup News.

In addition to technology, developments in the legal and political landscapes have influenced payroll and human capital system operations.

“The Affordable Care Act has definitely affected my industry,” said Feaman,

who said payroll has been the main industry responsible for handling reporting requirements in the law, also known as Obamacare. He said that overall his clients have grown adept at handling those changes in the years since the law was implemented.

As to the new federal tax plan passed last year, Feaman said IPS software is designed to automatically accommodate any changes in rates.

Feaman offered these tips to businesses on handling payroll in the new year:

User-friendly software

Feaman said businesses handling their own payrolls should invest in software they are comfortable operating.

“I’ve seen employers handling payroll themselves that have gotten into trouble. They might not be up to date on compliance,” he said, adding that consulting with a payroll provider can help with this software selection and setup.

Classify correctly Make sure employees are appropriately designated in all systems as employees or contractors.

As contract work is increasing and tax laws are changing, the Internal Revenue Service is looking into this aspect of reporting by companies more carefully, according to Feaman.

Ask for more

For businesses working with a payroll provider, Feaman encourages asking what suite of services and streamlining options they offer.

“They might not know that the technology is available to them,” he said. “Especially for companies that have employees that maybe aren’t centric, they are throughout the nation.

“You can use systems to communicate with them.”