In a pre-pandemic world, the workforce was in dramatic flux. From the rise of the gig economy and lower barriers to becoming an independent contractor or a solo-preneur, to the accelerated development of real-time payments capabilities all had major implications for payroll.
The pandemic further accelerated that disruption as millions of professionals were forced to work from home, change jobs, or navigate the shifting business models of their employers. Again, this all occurs with potentially significant effects on how payroll and the human resource team overall operate.
While these shifts are widespread, they don’t affect every business in the same way. And as the market awaits its entry into a post-pandemic world, small and medium-sized businesses will face even greater complexities in their payroll and HR needs.
In the midst of these changes, HR technology startup Rippling announced a $145 million Series B funding round. Founded by the former CEO of HR and benefits firm Zenefits, Rippling is taking a different approach to the industry with a focus on value-added features like employee device management, as well as employee data management, to support a digital HR strategy.
In a recent conversation with PYMNTS, Rippling’s Chief Financial Officer Adil Syed discussed some of the potential consequences the pandemic could have on the payroll landscape, as well as the shifting burdens of human resources teams overall.
Playing The Support Role
Whether helping businesses navigate the process of managing a newly-remote workforce, or aggregating data to understand Paycheck Protection Program loan qualifications, what small- and medium-sized businesses had in common in the throws of the pandemic disruption was a need for support.
For HR technology providers, that meant the accelerated development of solutions to automate PPP loan applications, payroll or employee onboarding.
But now that the immediate impact of the pandemic has subsided and the markets are looking out toward the future, Syed said that the need to continue the role of SMB supporter will continue as businesses grapple with the long-term, potentially permanent consequences of today’s disruptions.
The pre-pandemic emergence of a global workforce is expected to proliferate even further as more employees choose to remain at home even in the wake of lifting restrictions or a vaccine, for example.
“I think it’s important for our clients to take a step back and reimagine a world where there might be a big percentage of the workforce that wants to always work remote, and that isn’t coming back into the office,” noted Syed. “Employers that are flexible and adapting are going to benefit from these changes in future trends and be a more attractive employer.”
For human resources teams, there will be converging disruptions, from the growing burden of managing employee health data and potential vaccine documentation to understanding how to calculate payroll tax on employees that may not only be in a different state or country, but that — as a result of long-term remote working — may be changing locations fairly often.
Syed noted that one of the biggest challenges of the pandemic is a lack of certainty. Not only is it impossible to identify exactly what will happen in a post-pandemic market, but it’s also impossible to know when these shifts will occur.
Nonetheless, exploring some of the trends that arose even before coronavirus swept the globe can offer a relatively stable guide to what employers and HR teams may come to expect, particularly when it comes to payroll.
The emergence of on-demand or early access to earned wages, for instance, reflects a shift in the payroll space away from the weekly or bi-weekly paradigm. The growing development and adoption of real-time payments capabilities will further drive that evolution, noted Syed.
“The fluidity of when payroll needs to be run by any company is going to morph and change as employees’ needs for cash and payment for their services evolve,” he said.
Automation is critical for any effective Software-as-a-Service solution available to businesses today. When it comes to HR, the ability to automate what had previously been manual and mundane tasks, like running payroll, will not only enable HR professionals to have more time for value-added operations, but will also ease the friction of paradigm shifts like the move away from a bi-weekly structure.
Also vital is the ability to offer solutions remotely, and to provide flexibility in services offered depending on a small business’s unique, and often changing, needs. For Rippling, that means a focus on third-party partnerships and integrated solutions like retirement planning, enabling employers and HR teams to connect their staff to such benefits without having to wait for Rippling itself to develop them.
There’s no certainty as to what lies ahead, but having that flexibility to support automation, remote services and way to customize the employer and employee experience will be critical moving forward.
“This is a trend you see across the industry and one we’re taking very seriously,” said Syed. “The needs of customers vary dramatically, especially in the SMB market, when you’re dealing with so many industries.”
Selected by Fintech Tube