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2019 APA State of Payroll Study – How Perceptions are Changing from Tactical to Strategic I Apex HCM


Payroll historically has been viewed as a tactical function – one that’s calculated, expedient and heavy on procedure aimed at a precise outcome. But perceptions in and of the industry are changing, according to a recent study by the American Payroll Association. Results of APA’s survey of 651 payroll professionals throughout North America reveal that as more organizations are investing in efforts to track key performance indicators (KPIs) and measure the business impact of internal processes, payroll increasingly is being seen as delivering strategic value.

Researchers began with a poll of payroll professionals and their colleagues to find out just who views payroll as a strategic function. The results:


  • Payroll professionals: 03%
  • Their supervisors: 53%
  • Their functional department leaders: 57%
  • Other functional departments: 66%
  • C-level executives: 12%
  • Fellow employees: 29%


But as the adoption of modern payroll technology accelerates, payroll teams have new opportunities to prove themselves strategic contributors to their companies’ success. That starts with tracking certain KPIs. Among the savviest of those surveyed – fewer than half, surprisingly – 37 percent track the number of manual, voided and stop payments; 24 percent track payment errors as a percentage of total payroll; and 20 percent track total processing time per cycle.

Top performers also keep an eye on the speed at which professionals close out and reconcile payroll – a key marker of the administrative impact of payroll processes. Of those polled, 28 percent reported successful close-out and reconciliation in just one day, while half take up to two days and 22 percent take three or more days. That’s critical because research shows a definite correlation between faster close out/reconciliation rates and lower payroll error rates.

The APA’s study also revealed a prime opportunity for payroll software and services providers. Nearly a third – 27 percent – of organizations polled are using payroll systems that are more than a decade old; 45 percent are operating with systems six to nine years old. These outdated platforms invariably mean inaccurate and inefficient payroll; little to no insight into workforce data; and poor employee experience.

By comparison, the best modern, cloud-based payroll technology systems offer these five top elements aimed at improving efficiency, compliance and the employee experience:


  • User role-based security access
  • On-demand reporting
  • Frequent compliance and regulation updates
  • Real-time reporting and analytics
  • Employee self-service functions


Further, more than 60 percent of survey respondents say a payroll software platform that seamlessly integrates with time and labor management is crucial. Nearly as many require the same of payroll and HR systems.

Meanwhile, significant changes to state labor regulations like minimum wage increases and mandatory family and medical leave, along with federal proposals to change the Fair Labor Standards Act (FLSA) overtime threshold and the new W-4 format to be implemented in 2020 are putting payroll at the forefront of an organization’s compliance strategy.

Keeping tabs on key performance indicators and using the latest cloud-based, employee-centric payroll and HCM platforms can make a significant difference in a payroll department’s time- and cost-efficiency, compliance rates and worker satisfaction. That’s why it’s critical that you choose the right software technologies for your payroll service business. And that’s where Apex HCM comes in. Designed by a team of both payroll industry veterans and some of the brightest new IT minds, our suite of payroll, human resources and time and attendance solutions can be customized to meet virtually any prospective client’s needs. Call 878-645-3150 or contact Apex HCM online to learn how.