The HR and payroll teams face a lot of challenges when managing a workforce in the logistics sector. Business owners have to manage a mobile workforce that keeps changing all the time. Demands for services fluctuate, and so does the number of employees. Amidst this chaos, you need HR processes that allow you to manage all this movement of employees and still give you time to work on the tasks that require actual attention. You also need a payroll team that can cope with the changes and make sure that everybody gets paid accurately and on time. In this article, we will learn about payroll and HR challenges in the logistics business and how integrated services can help combat these challenges effectively.
Challenges in Logistics Workforce Management
Here are some challenges you might encounter when managing a logistics workforce:
1. Complex Pay Structures
In the logistics industry, employee salaries can vary depending on overtime, sick days, and a number of other factors. It makes payroll calculations complicated. You have to accommodate the salary for overtime and different shifts and factor in taxes and bonuses, which makes the calculations very complicated and prone to errors. A single spreadsheet cannot handle this process. Many logistics companies use efficient payroll software to handle all these payroll complications in an easy way.
2. Regulatory Compliance
Another challenge that a logistics company can encounter is complying with laws and regulations. In recent years, it has become quite difficult to stay compliant with laws and regulations. The compliance activities include deducting the right amount of taxes from employee paychecks and maintaining documentation of payroll expenditures. Increased compliance helps prevent unnecessary penalties. HR compliance services can assist you in staying updated on regulatory changes and taking preemptive measures to ward off compliance issues.
3. Seasonal Workforce Fluctuations
Some months in logistics services are insanely busy, while others are quiet. These fluctuations can cause your workforce to grow or shrink. There will be temporary staff, self-employed individuals, and contractors during peak seasons. Since you have to pay the workers only when you need them, it can be laborious for your payroll team.
4. Integrating New Technology
Ever since the pandemic, the logistics industry has changed radically. Global e-commerce sales have increased, and varying demands for goods have led businesses to develop new strategies for streamlining business processes, including HR and payroll management. Technology can play an invaluable role in managing integrated HR and payroll services. Using new technology for managing these processes can be a challenge as you have to train your workforce on how to use the latest software.
5. High Staff Turnover
Companies that offer 3PL services usually have a high staff turnover rate. Warehousing can be a tough career with inflexible working patterns, making it difficult for employees to achieve a good work-life balance. You need to onboard new employees quickly and remove old employees from your payroll. This can be a challenge for your HR and payroll staff.
Ways Integrated Payroll and HR Services Can Help Manage a Logistics Workforce
Here is how integrating payroll and HR services can help overcome the challenges encountered in managing a logistics workforce.
- Maintaining One System
Using one system for both HR and payroll services helps save time since the IT specialists only need to make changes and implement new features to one system. For instance, if a logistics company starts a new department, the IT company needs to make updates only once. They do not need to take extra time to upgrade both systems simultaneously.
- Avoiding Duplicate Entries
Many payroll teams re-enter data after the HR team has already entered it. Doing this is not only laborious but also takes a lot of time and can lead to data entry errors. Using two systems also requires your employees to track and cross-check the changes made in one system with another. The best way to avoid this inconvenience is to employ one system that caters to both HR and payroll data.
- Saving Employees’ Time
Employees and managers can save a lot of time by only having to use one integrated system. If the company uses one system for HR and payroll, employees can update personal data, complete vacation requests, and check pay and tax information in one place. Syncing data while using more than one system also requires a lot of time and resources. For example, HR needs a new hire for an upcoming project, but new employees may not appear in the payroll system right away. As a result, you might experience a delay in paying your new employee. Integrated payroll and HR systems save your employees time and help avoid such delays by making changes to payroll and HR simultaneously.
- Staying Compliant
Auditing employee data and tracking employee changes is indispensable to assure company compliance. When there is only one integrated system, auditors only have to check one system and its related processes. Moreover, using one system for confidential employee data reduces the risk of compliance issues and saves employees time.
- Eliminating Communication Gaps
Using separate systems for managing HR and payroll data might lead to a communication gap between both teams. However, an integrated system improves communication between the two teams because they need to work closely together, define processes, and make sure that the system is aligned in a way that suits both teams.
A closer interaction between HR and the payroll department also allows them to discuss potential problems openly.
- Reducing Subscription Costs
A logistics company's annual subscription for HR and payroll software is usually expensive. Since an HR and a payroll system carry much of the same employee data and have similar roles, combining these two can considerably reduce subscription costs as the company only has to pay annual costs to one vendor for an integrated system.
Leverage Payroll and HR Software to Streamline Workforce Management in 3PL
The HR and payroll departments of logistics companies face numerous challenges. Combating these challenges, which include complicated pay structures, staying compliant, seasonal workforce fluctuations, and getting familiar with new technology, can be quite difficult for a 3PL company. However, integrating their payroll and HR systems can help them save a lot of time and money and reduce the risk of errors. If you are having difficulty managing both teams side by side, consider integrating your payroll and HR software!
