PayFit: HR, it’s time to demystify pay as workers don’t understand their pay slips

“Payroll remains one of the major pain points in working people’s daily lives”, stated Firmin Zocchetto, PayFit’s Co-Founder and CEO.

One challenge is that many employees struggling to fully understand their pay slips (or pay stubs).

According to a survey of 1,950 workers by PayFit, just 54% of workers in Spain and 29% in France fully understand their pay.

This figure rises to 73% in UK – however, 24% of UK workers admitted they were confused by their tax deductions, 19% struggled to understand their pension situation and 18% didn’t think they would be able to spot underpayments from their employer.

“When workers don’t understand their pay slip, they’re left second-guessing whether they’ve been paid correctly, what’s gone into their pension, or how much tax they’re actually paying”, commented Zocchetto.

“This level of uncertainty can stall decisions – whether that’s applying for a mortgage, or simply figuring out if they can afford to book a holiday.”

It is also a distraction for employees, and HR leaders alike, because considerable time is spent figuring their pay, which “takes everyone away from more meaningful tasks”, stated Zocchetto.

Reinserting transparency and confidence around pay slips

Payfit’s data shows that 47% of UK workers turn to HR or payroll for clarification on their pay slips, rising to 75% in France and 64% in Spain.

So, what’s the solution for HR and employees alike to drive simplicity and confidence around pay slips?

While the pay slip’s original goal is to provide transparency, the outcome is often the opposite: a dense document that is difficult for most employees to read and understand”, Nicolas Kourilsky, CHRO at PayFit, exclusively tells UNLEASH.

It’s time for HR teams to step up to and “focus on demystifying complex terms but without oversimplifying”.

“This isn’t just about giving employees confidence that their pay slips are accurate, but about ensuring every employee feels confident and legitimate in understanding their own compensation so they can make better financial decisions,” adds Kourilsky.

PayFit’s data found that 94% in the UK, 88% in Spain and 81% in France have trust that their pay slip is correct, despite their struggles to fully understand their pay slip.

Some ideas to build up confidence around pay is to offer “offering e-learning platforms and knowledge checks, or Ask Me Anything sessions with their HR Business Partner, so that employees can discuss these topics directly in a 1:1 meeting”, notes Kourilsky.

One pagers within the pay slip can help, as can interactive options with “clickable definitions also lets employees get a better understanding of their payroll”.

Payroll may be complex, but “with the right tools, it is also one of the simplest to solve”, concluded Zocchetto.

HR, are you ready to step up? Not only will you empower your employees, but you’ll claw back time spent answering payroll questions, and be able to put that towards more fulfilling, meaningful work.