Understanding Time and Attendance and Payroll Integration

Understanding Time and Attendance and Payroll Integration

Time and attendance and payroll integration is a concept discussed during every time and attendance consultation session. Whether your company
implementing a new system or looking to upgrade an existing one, your integration with a payroll system plays a pivotal role in your decision of selecting
both a time and attendance and a payroll system. There are however various points to consider when analyzing integration between time and
attendance and payroll system.

Time and Attendance vs Payroll System Responsibilities

Many clients believe that time and attendance and payroll functionality should be provided by the same company. While there are a few systems that
provide you with both modules, it is important to understand why you will see so many separate time and attendance and payroll companies. Before
discussing integration in further detail, let’s first investigate as to why the two services are often provided by separate companies.

  • Most countries (especially in Africa) have complex tax and labour laws. Both systems must comply with these laws and any amendments made over time.
  • Time and attendance rules and calculations can get convoluted. Rules such as splits into Saturdays, Sundays, 24–96-hour shifts, shift weights or
    paid public holidays can get complex, and the development of such a system is costly and time consuming.
  • The efficacy of your time and attendance system determines the time and workload required to successfully complete your payroll in your payroll
    system. As such, an e ective time and attendance system must be robust in its performance and calculations.

It is therefore crucial to implement a time and attendance system that caters for the depth of your labor laws and payroll rules. Your company is legally
required to implement and maintain certain rules. Failure to select the correct system will result in numerous manual data modi cations being required
and a resulting loss in time that could be spent elsewhere. It is therefore important that when you identi ed the time and attendance system that caters
for your rule requirements, you also must identify whether it ful ls your payroll integration needs. Don’t miss out on all the features BioSyn has to offer,
find out more here.

What is payroll integration?

Before we start to discuss payroll integration, it is crucial to understand what integration truly means. We often have a potential client enquiring as to
whether we can integrate with a payroll system, such as Sage, PSIber, PaySpace, SimplePay, and many more. When we ask a client, what do you mean (or
understand) by “integration”, 90% of the time the answer is: “Can you export to a specific payroll system?”.

BioSyn also owns the web application development company that develops our time and attendance system. So for our developers, “integration” can be
interpreted in multiple ways. There can be either (and/or) indirect or direct integration.

Indirect Payroll Integration refers to the process of exporting an XLS, CSV or TXT le from your time and attendance solution and importing it into your
payroll solution. Generally, the format of exports has been standardized by time and attendance and payroll solutions. In certain cases, a more unique or
customized export le must be provided by the time and attendance provider.

Direct Payroll Integration refers to the process of building direct one- or two-way communication between the time and attendance and payroll
systems. This is usually done by utilizing APIs (what is an API?). This means that if you perform an action in one system, the data is automatically “pushed”
or “pulled” from one system to the other without requiring any manual intervention by the user. This eliminates numerous pitfalls not covered by manual
integration.

Advantages and disadvantages of Time and Attendance and Payroll Integration

Advantages

Indirect Integration
  1. A manual export and import action must be performed by a user to complete the export.
    This creates a strong expectation on the user surrounding accountability and therefore to verify their data before importing.
  2. Most export/import formats have been standardised across time and attendance and payroll solutions.
  3. Eliminates the need for paper.
  4. Reduces the time it takes to complete your payroll versus traditional paper-based options.
Direct Integration
  1. Only enter data (e.g., employees, leave or employment histories) once, and the integration will synchronize the data between the two systems.
  2. It eliminates any possibilities for manual data manipulation mistakes. Greatly improving reliability of payroll data.
  3. Drastically reduces the amount of time it takes to administrate and export payroll data, often an improvement by as much as a 1000%.

Disadvantages

  1. Leaves room for manipulation of data in-between exporting and importing.
  2. Often requires data to be entered in duplicate, e.g., adding employees, leave or employment histories in both your time and attendance system as well as your payroll system.
  3. Often requires payroll administrators to perform additional actions by hand.
  4. Manual actions can leave room for mistakes and incorrect salary payments.
  5. Can be time consuming with a large number of payroll batches that require exporting.
  1. Integration is greatly dependant on the integration capabilities of both the time and attendance and payroll solution.
  2. Implementing integration between two systems can be costly if it is not already done.
  3. Integration could possibly be one-way only, forcing you to utilize one system as your base, and the other as a secondary source. This could require you to switch primary data systems when implementing a new system.

Choosing between direct and indirect integration

In comparison, it is clear that considering indirect vs direct integration should not even be on the table with the aforementioned advantages of direct
integration. While indirect integration has a few advantages above a paper-based solution, it cannot compare to the powerful bene ts of direct payroll
integration. Direct integration eliminates human error as well as a tremendous reduction in the possibility of fraud. The duplicate entry of data into two
separate systems can also increase the number of hours required for payroll personnel to insert and maintain data.

The more employees a company has, the higher their requirement for standard data administration becomes, direct integration therefore also aims to
reduce the hours spent on standard data administration. We’ve seen a reduction in payroll administration hours of 8+ hours down to a single hour or
two for a small company, and a tremendous 900+ hour reduction in payroll administration for 7000+ employee clients. Not only does direct integration
make your payroll run go more smoothly and accurately, but it also frees up the hands of your HR and payroll administrators.

Custom Payroll Integration

One step beyond direct integration is custom integration between your time and attendance and payroll solutions. While custom integration is generally
not required, there might be instances where your needs di er from that of most companies. This could include customizations such as unique shift or
labour rules speci c to your company, custom escalation procedures or advanced modules such as job costing, bonus, or night out hours. When
considering custom integration solutions, it is important to identify the current resource load the requirement has on your company and its employees,
and what your potential return on investment would be on the integration and whether the cost would be worth it. Generally speaking, a well-priced, well
integrated system, would save you a tremendous amount of time making the initial payment worth it.

In Summary

Integration, whether direct or indirect, is the ultimate goal of any time and attendance system. Your measurement on whether it is worth the price,
should be based on the ability of the system to reduce manual modi cations, and increase the accuracy of your payroll data. The future of time and
attendance systems lie in their capability to integrate directly with payroll solutions, and you should keep this in mind as one of your deciding factors
when selecting an appropriate time and attendance solution. The depth of the integration (e.g., employees vs leave and payslip data) should also bear
weight in your decision.

Our Recommendation

We would recommend that you request a demonstration of the integration capabilities of the system under your consideration. The goal should be to
ensure that the system has the necessary capabilities to suit your needs. If the time and attendance system that you are considering does not have direct
integration capabilities, we would recommend that you request the supplier to consider integration with your payroll solution and what the associated
costs and timeline of such integration would be. You should also be sure to understand exactly what the extent of your payroll integration would be and
what changes would need to occur with how your sta manage these on your current time and attendance and payroll systems, so that you are aware
and prepared for when you intend to implement an integrated solution.

The larger the scale of your company, the greater the impact of direct integration will be and the e ciency it contributes to your HR and payroll teams
Beyond the fact that the time and attendance system improve the accuracy and consistency of your payroll data, it also allows your sta more time to
focus on their primary responsibilities rather than the mundane daily data administration tasks and the frustrations that go along with them.

Feel free to contact us if you need some advice on how to select the right time and attendance solution and integration partner

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