Monday, August 09, 2021 / 01:37
PM / by Advans / Header Image Credit: hrmexam
How you compensate your staff goes a long way
at determining their motivational level, which in turn affects your business' productivity. When you pay your workers on time, they are inspired to do more.
Human resource in this era is the most
valuable asset an organization can have. "Low job satisfaction can result in
costly turnover, absenteeism, tardiness, and even poor mental health".
(Hellriegel and Slocum, 2007).
Without sustained motivation and morale of
the employees, organizations risk losing invaluable employees which is a disadvantage
to the business' growth and profitability (Dessler, 2003).
Despite this common notion, a lot of small
businesses still fall short at paying their staff on time due to several
reasons. For this article, we will be focusing on one independent factor which
is the lack of efficiency in organizations' payroll
Based on a survey carried out by Advans Nigeria, 5 out of 10 MSMEs still pay their staff
salaries by hand while the rest use direct transfers. If Nigeria must continue
to develop as a nation, it starts with the organizational microcosms.
Inefficient staff payment systems are
inimical to the growth of businesses, as they could lead to pilfering and high
employee turnover. Factors that constitute to these inefficiencies include:
- Manual Procedures: Manually computing your staff salaries,
benefits, deductions, and bonuses can be highly tedious. This can be
time-wasting and prone to errors. These
can lead to over or underpayment of staff which in turn leads to unnecessary
- Not staying abreast of changes in labor laws: In most small businesses,
practically all administrative functions are carried out by one or a few
individuals, in order to save cost. As a result, staying updated with
information on taxes, tax relief benefits and other vital information could
constitute an extra burden and as we all know, ignorance of the law is not an
excuse. Many organizations have folded up due to non-compliance of labor laws.
- Improper record-keeping: When an organized remuneration
system is not in place, this error is bound to occur. Record keeping and reporting
of employee remuneration is a legal obligation in Nigeria today especially for
tax purposes. Asides from this, it is also important in staff planning,
monitoring and comparison of employee productivity levels. Having this in place
also provides a form of evidence to the contractual agreement that exists
between an employer and an employee.
In the light of this information, it is quite
certain that these lapses in payroll management practices should not be trivialized.
How then can we mitigate these inefficiencies and bring about a healthy and
more favorable method of staff payments?
One way will be to onboard an efficient
payroll management system, such as the Advans Payroll System which provides an
ample solution to these setbacks. With this Payroll management system, employers
do not have to worry as it creates a fast and seamless way to paying workers
without being involved in the actual process. Benefits of this system include:
- Effective and efficient staff remuneration
with no recurrent transfer fees.
- The system is less prone to errors, therefore
reducing issues of over or underpayment.
- Provides easy access to loan facilities for
both the employer and employee, at very low-interest rates thereby easing financial
timely payment to sustain employee productivity levels.
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