HR Manager (HRM) and Finance Manager (FM): Controversial issue on payroll management.

There has been recent controversial issue between HRM and FM on who to manage payroll process for a newly established organization. Below is the discussion among CEO, FM and HRM.

CEO: As we all aware that this is the first management meeting of this newly established company. Please HRM share update on staff matters with management team.

HRM: Thank you CEO. We have successfully recruited 15 staff and I am working on their payroll for this month. Immediately I'm done, I would bring it to your table for final approval before forwarding to Finance Manager for payment.

FM: Please HRM, we need to get it right from inception especially on payroll management. If I may ask, I have few questions on your submission.

HRM: Please go-ahead FM.

FM: Please are you aware about latest Finance Act, 2020 which gives ways to new computation of Personal Income Tax (PIT) popularly called PAYE? Also, are you the one to be responsible for annual returns and tax audit with IRS. Finally, other parameters of payroll such pension, NHF, ITF and NSITF should be adequately managed to avoid fine and penalty.

HRM: Kindly note that payroll has to do with staff matter and anything that falls within this category, it is solely handled by HR. Also, on all your questions, we would take cognizance of it and revert if there is any clarification.

FM: Alright but you also need to take note of staff IOUs and advances that might have been posted into various staff accounts on SAP.

HRM: If you want to handle that responsibility, I might shift it to you for proper management as you claimed.

CEO: No at this moment, I intentionally allowed you guys to justify your positions. However, kindly do more consultation with various professionals in different industries and revert in the next meeting.

Please share your view on who to manage payroll.

First, Why do both managers need to fight on who to manage Payroll when it is actually the responsibility of both parties to ensure that all staff salaries and allowances are paid accurately, and as and when due.

Payroll Management overlaps between HRM and FM, however, given that HRM is the People Business Partner, we can deduce that the primary responsibility of ensuring that all staff get what is due to them as compensation lies with the HRM.

For Preparation of the Payroll, it is better that the process is managed by the HRM given that it has all information regarding entry and exit of staff, as well as, who deserves to get what, from time to time.

The FM comes in when it comes to establishing the processes (building the Payroll Sheet or System) and advising on necessary developments as it relates to statutory compliance on a regular basis.

In practice, from both my local and international experience, I have seen that the HRM manages Payroll, while the FM reviews and disburse accordingly.

Given my above points and practical experience, I'd say the primary responsibility of Payroll Management falls on the lap of the HRM with the FM providing necessary and strategic reviews and input from time to time.

Let me sit and learn

educative................ My sis once worked in a place where she earn 130k gross but her net was 114 and some fractions and I told her they are cheating her. She said they pay pension, NHS and PAYE, even at that I still told her net should be around 121 and some fractions. This will ONLY happen in an organisation where the HR does not understand the finance act 2020

Reading...

Finance manager has perogative on payroll and not HR

I liken HR to PS in the ministry and FM to Chief accountant.

Just the way the REGISTRAR and BURSAR are, in the universities.

Finance manager should be incharge

Finance manager

Okay

This is dead simple. Your HRM should be concerned about the Nominal Roll while your FM should deal with the Payroll and keep the promotions in sync with the Nominal Roll.

They need to synergize just as in the picture attached.

No need to argue nau. It should be a joint efforts between HRM and FM. HR fills the part relating to amounts to be paid a staff after all internal deductions such as loans repayment, attendance, etc while Finance takes it over from statutory deductions. Once both are done,they move it to approvals.

Where I work, it is the HR Manager (HRM) that is the first point of contact when it comes to payroll management.

Both

Observing

The two departments have to work in conjunction with each other with finance/accounting taking the lead and HR offering a supporting role. If the company is new then textbook business management theory or rules do not apply. Even the CEO must sweep floors and do office cleaning and maintenance.

Tinubu the Jagabandit

9jayes:
This is where Peter Obi is needed as a finance minister under Asiwaju.


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you are very mad sir ... it’s not needed in a thread like this , you talking about a person that put a whole states fund in fixed deposit as intellectually smart . Let’s use our little sense please

9jayes:
This is where Peter Obi is needed as a finance minister under Asiwaju.


.

God forbid!!!!

Peter Obi does not have the prerequisite to hold any portfolio under BAT Presidency.

While i was working and slaving for a particular company, I think the HR Was in charge of the payroll, every organisation may have their own set rules and process,

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Pojomojo:
First, Why do both managers need to fight on who to manage Payroll when it is actually the responsibility of both parties to ensure that all staff salaries and allowances are paid accurately, and as and when due.

Payroll Management overlaps between HRM and FM, however, given that HRM is the People Business Partner, we can deduce that the primary responsibility of ensuring that all staff get what is due to them as compensation lies with the HRM.

For Preparation of the Payroll, it is better that the process is managed by the HRM given that it has all information regarding entry and exit of staff, as well as, who deserves to get what, from time to time.

The FM comes in when it comes to establishing the processes (building the Payroll Sheet or System) and advising on necessary developments as it relates to statutory compliance on a regular basis.

In practice, from both my local and international experience, I have seen that the HRM manages Payroll, while the FM reviews and disburse accordingly.

Given my above points and practical experience, I'd say the primary responsibility of Payroll Management falls on the lap of the HRM with the FM providing necessary and strategic reviews and input from time to time.

Oga, though part of work (secondary assignment) of HR is to oversee payroll, but the officer who is directly in charge of payroll management is "finance manager". Infact, the nomenclature of the two offices are self explanatory.

The HRM holds the responsibility of management of the payroll. However, this is subject to advice of the appropriate rates on NHF, PAYE and PENSION by the Finance department.

The duty of the finance department here is advisory and also ensure timely remitances and avoid regulatory contraventions as the case maybe.

HRM computes hours worked and other staff entitlements and communicates this to FM who will work on it to accommodate other statutory deductions before forwarding it to the CEO for final approvals.

So the process lies between the HRM and FM and also serves as checks and balance to avoid fraud

Stupid super story. HR handles recruitment and staff management. Finance manages inflows and outflows.

Rubyjade:
educative................ My sis once worked in a place where she earn 130k gross but her net was 114 and some fractions and I told her they are cheating her. She said they pay pension, NHS and PAYE, even at that I still told her net should be around 121 and some fractions. This will ONLY happen in an organisation where the HR does not understand the finance act 2020

tax of 9k on 130k. What are you smoking bro

Theoretically speaking it is the responsibility of HR to manage payroll but what obtains in reality in most instances is that payroll is managed by the Finance department in most organisations

This is a no brainer. It should start from hr and end with finance.

Rubyjade:
educative................ My sis once worked in a place where she earn 130k gross but her net was 114 and some fractions and I told her they are cheating her. She said they pay pension, NHS and PAYE, even at that I still told her net should be around 121 and some fractions. This will ONLY happen in an organisation where the HR does not understand the finance act 2020

Jesus! Let's assume that they are cheating her, and you believe her take home should be 121, then how much is paye and how much is pension?

Both have a role they both need to play. It actually starts from HR and ends with FM