CloudPay claims traditional pay cycles may be a thing of the past. It says monthly and weekly cycles are becoming less relevant, as technology, including AI, automation, and APIs continue to reshape payroll processes.
According to its Payroll Efficiency Index, data indicates a move away from standard fixed pay cycles. Instead, businesses are adopting payroll systems that are more flexible, so payments can be made at different times to meet employee demands. The company says that greater autonomy is now being prioritised, and businesses need access to more frequent, flexible employment contracts.
The PEI paper shows variations from region to region, but the number of days taken to complete payroll cycles increased by 12% to 8.28 days year-on-year globally. This highlights a need for a rise in flexible payment schedules, the company says, and more on-demand pay models are being adopted by businesses. There has also been a 1.43% rise in additional payroll runs compared to the previous year.
CloudPay’s research reflects a changing payroll landscape, one that relies on more subtle models where timing is dictated by business needs and/or events, as well as employee priorities.
According to the company’s CEO, Carlos Morato, the increase in more versatile pay cycles is largely down to technological evolution. “The move to more flexible pay cycles is being supported by the rise of the three A’s: AI, automation and APIs, which are offering far greater potential for organisations.”
Morato says automation “is picking up a significant proportion of the […] tasks that professionals had previously been focused on,” letting employers be “more strategic and adaptive in their actions.”
Traditional cycles could soon become obsolete, the company says, but Morato believes businesses have to evolve and adapt. “Those firms and payroll teams that do adopt more modern, innovative pay models can use this agility to their advantage by incorporating it into their recruitment and retention efforts. The types of changes mean that the future is looking increasingly bright for global payroll, and the shift away from fixed pay cycles can offer a huge number of benefits to adopting organisations and their employees.”
(Image source: “Money!” by Sklathill is licensed under CC BY-SA 2.0.)
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