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Getting payroll management right is essential, not only because employees depend on being paid correctly, but also because mistakes can be costly. According to the Australian Fair Work Ombudsman (FWO), there was a significant increase in underpayments by leading corporations over the past four years. In fiscal year 2021-22 alone, more than half of the recovered $532 million in back pay was due to these underpayments. To avoid falling into common payroll pitfalls, it’s time for businesses to move away from spreadsheets and consider transitioning to a more automated payroll process.

The dilemma of manual payroll

Traditionally, payroll calculations have been done manually, with payroll managers handling everything from computing employee salaries to tracking their attendance and leave. This method, however, involves dealing with multiple factors and variables, and going through extensive data stored in numerous files and folders. Unfortunately, even after investing all that time, the possibility of errors remains high.

Some of the top challenges associated with manual calculations include:

  • They’re time-consuming: Payroll calculations require significant time — even in small companies. For larger corporations, the process becomes exponentially more time-consuming, impacting efficiency.
  • They’re resource-hungry: The multi-step nature of payroll means it can’t be managed effectively by just one person. This resource intensity can lead to additional hiring, adding to operational expenses.
  • Data management can be difficult: Manually maintaining, organising, and securing payroll data can be a daunting task. It also opens the door to potential data theft, misplacement, and misappropriation.
  • Data security is put at risk: Payroll data is sensitive and requires robust security wrapped around it. Manual systems heighten the risk of data breaches, leading to potentially significant financial and reputational consequences.
  • Achieving compliance is tricky: Laws and regulations relating to payroll are always changing. Keeping up with these changes while manually calculating payroll can lead to non-compliance, resulting in penalties or legal repercussions.

Automating the payroll process

Manual payroll administration is a time-intensive process that often leads to inaccuracies, and spreadsheets cannot cope with complex calculations. Payroll automation on the other hand, simplifies and streamlines the process, reducing the time previously invested and ensuring precise employee compensation every time.

There are six key benefits to automating payroll with right software solution:

  1. Reduces errors

Payroll automation software can quickly and accurately calculate deductions, overtime, commissions, and other factors influencing an employee’s pay, eliminating data-entry errors.

  1. Saves time

Automating repetitive payroll tasks can save a lot of time. Payroll automation performs a variety of calculations in the background, letting payroll managers focus on higher-priority, value-added business activities.

  1. Enhances security

Spreadsheets don’t offer a secure environment for sensitive data. Payroll automation software encrypts and password-protects sensitive data, ensuring it can only be accessed by those managing the payroll. Digital document storage also reduces the required physical space and minimises the risk of record misplacement or damage.

  1. Provides inclusive reporting

When formulating strategic decisions based on anticipated labour costs, payroll automation proves invaluable. Payroll automation systems offer the ability to generate customised, downloadable reports, helping companies with strategic planning.

  1. Simplifies tax

Managing taxation can be complicated and time-consuming, and errors can lead to fines. It’s essential to meet deadlines and calculate employee taxes accurately. Automation can help relieve this burden, ensuring your taxes are filed correctly and on time.

  1. Allows for accurate record-keeping

Australian and New Zealand businesses must retain several years’ worth of pay records, including total hours worked, payment rates, payroll dates, and more. Automated payroll software can organise your data and ensure easy compliance and audit readiness. A payroll automation process is also beneficial when it comes to maintaining accurate data on new hires and departures.

A better way to payroll

Payroll management is not just about paying your employees. It’s about creating a system that benefits everyone involved, from the payroll professionals who run it to the employees who depend on it, and the organisations that need it to be efficient and compliant.

If you’re looking to retain control over your payroll operation while benefiting from additional support, our supported payroll solution might be just what you need.

As technology becomes more people-centric, the right partner to support your payroll team is essential. To explore how Affinity Payroll’s supported payroll service can fit your business model, contact us today at




For over thirty years, Affinity has been a trusted partner for mid-market and enterprise businesses in Australia and New Zealand, empowering them to transform their payroll operations. With a focus on turning payroll from a cost into an asset, we have established ourselves as industry leaders in delivering innovative cloud-based payroll software and exceptional payroll services.