Payroll and compensation functions of a small business are two of its most important features. While neither department generates revenue, they provide the primary reason for every employee to show up for work and perform at their best each day. There are individuals at each professional level who perform a variety of tasks aimed at ensuring that each of these duties is administered in an efficient and effective fashion.
A payroll manager oversees and directs each of the day-to-day activities of a company’s payroll department. Depending upon the size of an organization, he may work as an independent contributor or manage a team of junior payroll professionals. This individual typically does not actually run payroll. In most environments, he maintains all payroll records, hires and trains payroll staff members, and coordinates any audits to which the department is subjected. He may also work with senior management to procure payroll administration software.
Working under the direction of a payroll manager, a payroll clerk carries out each of the day-to-day transactional duties required of the department. She compiles all necessary payroll data, such as time sheets, and enters it into the firm’s time-keeping system. She calculates each employee’s respective pay, computing deductions, such as tax withholdings, union dues, insurance premiums and Social Security. In addition, she pays each employee through either an electronic bank transfer or by cutting them a physical check.
A compensation manager is a senior level employee who oversees the long- and short-term strategies surrounding his firm’s compensation and benefits planning and administration policies. In most environments, he manages a team, including a compensation analyst and a benefits administrator. Working with other organizational leaders, he ensures that each job description is aligned with the appropriate salary range. He also directs his staff in administration salary surveys to ensure that his employer’s compensation packages remain competitive with others in the industry. Regarding benefits, he procures and selects insurance providers, and secures coverage plans that meet the needs of his employee population while remaining within the company’s budget.
A compensation analyst performs administrative tasks to support of the initiatives implemented by a compensation manager. Compiling and analyzing internal and industry-wide salary data, she determines the appropriate pay grades for each position within her organization. She also conducts detailed salary surveys researching and auditing the compensation practices of competitive firms.
Reporting to the compensation manager, a benefits administrator performs all tasks needed to implement and maintain his employer’s benefits programs. Serving as the conduit between insurance providers and the employee population, he informs staff of their benefits eligibility and enrolls them in the proper plan. In addition, he also maintains all benefits-related records.