<i>Dear Workforce</i> How Many Payroll People Do I Need

October 8, 2000

Dear Workforce:

I am seeking statistics regarding payroll staffing averages (i.e. what is theaverage size payroll department for an organization of "X"employees?). In our case we’re 2,000 employees. Can you help? Thanks.

-- Joanne, in Texas

A Dear Joanne:

Unfortunately there are no exact statistics for payroll staffing averages.Reason being, the payroll function can lie under the Human Resources or Financedepartment depending on the organization. However, the current ratio for HRpractitioners per employee for the year 2000 is 1 per 100.

In determining the number of individuals needed for your organization,consider the following factors to guide you.


  • How much can your organization afford and leverage technology?
  • Is your organization technology equipped, perhaps enough to utilize aWeb-based or networked system to forward and process information?

Type of organization/workforce:

  • Is your organization all exempt employees, where little to no input isneeded to process payroll, or is it a manufacturing environment with alarge contingent of non-exempt employees punching time cards?
  • Is your organization’s HR function static or are there constantpromotions, transfers and salary changes to be made?


  • Are all of the employees in one location, or do you have facilities indifferent states? Is it necessary to have one person at each facilityprocess payroll individually or have them forward it to corporateheadquarters?
  • Do you have a sales staff spread out across the U.S. that you need tocoordinate with and process payroll in accordance with their respectivestate regulations?


  • How is the payroll processing handled? Does your organization utilize apayroll service or is it processed in house? If you utilize a service, doesyour HRIS system integrate with the payroll program allowing the HR staff toinput changes into the system for payroll, or are all changes input bypayroll?

Without knowing the specifics of your organization it is difficult to come upwith an exact ratio to apply. However, with 2,000 employees there is aconsiderable amount of information to process and distribute. I would suggest aminimum of two employees to manage the payroll process in order to ensure timelyresponses to the employees’ requests and questions, and processing of alllegal and tax filings.


SOURCE: Senior Human Resources Consultant BillMcGuire, the benefits and compensation expert for Benchmark HR Solutions Inc., aSalem, N.H.-based recruitment and employee retention services provider forhigh-growth, start-up technology companies.

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