SAP Payroll


What Is SAP Payroll?

Payroll is such a vital component to employee satisfaction that many companies are hesitant to make any changes — even if there are potential benefits to updating processes or technologies. This is reflected in SAP Payroll offerings — the traditional on-premise SAP Payroll and the cloud-based SAP SuccessFactors Employee Central Payroll. The cloud offering is essentially identical to the on-premise offering, except for where the servers are hosted.

SAP has hinted at plans to build a next-generation payroll solution, but that often takes a backseat to investments in other areas of its human resources (HR) technology suite.

Making an error on an employee’s paycheck is one of the fastest ways to receive a notice of resignation, so the reticence to change payroll at many companies, and the motivation for SAP to build a new payroll system, is explainable.

What Is SAP Payroll?

Payroll is such a vital component to employee satisfaction that many companies are hesitant to make any changes — even if there are potential benefits to updating processes or technologies. This is reflected in SAP Payroll offerings — the traditional on-premise SAP Payroll and the cloud-based SAP SuccessFactors Employee Central Payroll. The cloud offering is essentially identical to the on-premise offering, except for where the servers are hosted.

SAP has hinted at plans to build a next-generation payroll solution, but that often takes a backseat to investments in other areas of its human resources (HR) technology suite.

Making an error on an employee’s paycheck is one of the fastest ways to receive a notice of resignation, so the reticence to change payroll at many companies, and the motivation for SAP to build a new payroll system, is explainable.

Vendors such as Deloitte offer SAP Payroll and SAP SuccessFactors Employee Central Payroll implementation and consulting services. There are companies, such as Alight, that also administer payroll services for an organization partially or completely with the option to use technologies like SAP Employee Central Payroll.

Many SAP customers also use non-SAP payroll systems that integrate with SAP systems such as ADP or Paychex.

Key SAP Payroll Considerations for SAPinsiders

  • Mainstream maintenance for on-premise SAP Payroll is scheduled to end in 2027. Current SAP Payroll customers will have to consider the option of moving to SAP SuccessFactors Employee Central Payroll in the cloud, which currently has no end-of-maintenance date, or a non-SAP payroll product. Staying with on-premise SAP Payroll beyond 2027 will require extra maintenance fees or third-party maintenance services.
  • Payroll has slower cloud adoption than other HR technologies. In our recent HR Technology State of the Market report, among surveyed respondents that indicated they were using payroll technology, 18% indicated that the system was currently deployed in the cloud, the lowest cloud adoption rate of any technology mentioned. Cloud payroll adoption is rising, with another 19% currently implementing a cloud payroll solution. However, nearly 11% of respondents indicated having no plans for payroll in the cloud, more than double the proportion of any other technology.
  • Payroll accuracy is a top HR objective. In the same HR Technology State of the Market report mentioned above, reducing errors in time and payroll was the top HR technology strategy objective among respondents, which were predominantly HR professionals. Getting payroll right isn’t just a concern for the finance and compliance departments. Those in HR know the importance it holds to their ability to retain talent.

40 results

  1. Case Study: Automating financial processes for weekly payroll uploads

    Reading time: 1 min

    Learn how utilizing an Excel-based solution for payroll uploads delivered great time savings and eliminated errors at Fender. Find other insightful content from Magnitude on their Vendor Showcase.
  2. Q&A: Payroll and Its Impact on Cloud HR

    Reading time: 4 mins

    AJ Whalen, Senior Research Analyst, HR, SAPinsider spoke with Imran Sajid, Director HXM Solution Marketing, SAP during an SAPinsider webinar on Thursday, May 7, 2020 to review the findings of a recent SAPinsider benchmark study that looked at customer payroll strategies and practices – including the solution landscape and technologies they use – to understand…
  3. State of the Market: Payroll and Its Impact on Cloud HR

    Reading time: 1 mins

    This SAPinsider benchmark study looks at customer payroll strategies and practices – including the solution landscapes and technologies they use – to understand the top issues facing payroll organizations and executives. The report also examines where customers are seeing business value in their payroll processes and the ways in which payroll technology may be impacting…...…
  4. To Outsource or Not to Outsource: The Role Payroll Can Play in Cloud HCM Adoption

    Reading time: 7 mins

    SAPinsider recently spoke with Mike Ellis, President, Rizing HCM APAC, to discuss the state of SAP SuccessFactors market today, global trends he is hearing from clients, and options for SAP customers in the area of outsourcing payroll specifically. Ellis, who has nearly 30 years of experience in HR transformations, cloud implementations, and payroll outsourcing, was…
  5. Integrating SAP Payroll with Accounting (FI/CO) and Benefits

    Reading time: 9 mins

    Thank you for registering for this live Q&A on automating and integrating SAP Payroll with finance (FI/CO) and benefits. Please find the transcript below. Sue Dainis: Hello and welcome to today’s live Q&A, “Integrating SAP Payroll with Accounting (FI/CO) and Benefits.” We’re looking forward to a lively discussion. Thanks to everyone who has submitted their…...…
  6. Take Advantage of Underutilized Functionality to Streamline Payroll Processes

    Reading time: 9 mins

    Panelist: Mike Timm, Integrated Consulting Group Date: Tuesday, July 24 For companies, payroll is a necessary task that needs to be done accurately, yet efficiently, so it doesn’t add unnecessary costs and lower ROI. It’s important to ensure that your payroll integration and configuration processes take full advantage of the payroll functionality available at your fingertips. Read…...…
  7. Understand Leading Practices for Defining Your Payroll Systems of Record Using a Hybrid Solution

    Reading time: 6 mins

    Learn how to define the systems of record for all data components involved in SAP payroll processes, the designation of where they exist, and where they are maintained: SAP payroll on-premise, SAP SuccessFactors Employee Central, and SAP SuccessFactors Employee Central Payroll. This content is for SAPinsider Monthly Subscription, SAPinsider Annual Subscription, and SAPinsider Premium Annual…
  8. Quick Tip: What Are the 4 Options for Existing SAP Payroll Customers?

    Reading time: 3 mins

    Understand your four choices if you use on-premise SAP Payroll. Key Concept SAP has approximately 9,000 active on-premise Payroll customers today. In 2012, it was announced that support for on-premise SAP HCM would be guaranteed through calendar year end 2025. The goal of SAP SuccessFactors is to transform its on-premise SAP HCM and Payroll customers…...…
  9. What Are the Key Considerations Behind the Use of the Employee Central Payroll Global Template?

    Reading time: 13 mins

    Review these considerations for using a global template for implementing Employee Central Payroll. Various decisions may positively or negatively affect your payroll implementation. This content is for SAPinsider Monthly Subscription, SAPinsider Annual Subscription, and SAPinsider Premium Annual Subscription members only.Log In Join Now
  10. 5 Steps to Set Up SAP HCM Configuration for Imputed Income Calculation

    Reading time: 11 mins

    Understand how standard SAP configuration can be implemented and tested for imputed income calculation. This guide explains the key configuration steps required to set up the imputed income calculation related to configuration and validation in the payroll results table. Key Concept Section 79 of the US Internal Revenue Code (IRC) requires employers to calculate taxable…...…