Technology

Inefficient HR Processes Come With a Hefty Price Tag, and We’ll Calculate Yours

By

Rod Lott

| Jan 30, 2019

More than a quarter of a million dollars – $261,792.68, to be exact. That’s what it costs an employer of 500 people, per year, to not equip employees with HR technology.

How do we know? Because Ernst & Young recently conducted comprehensive research to determine that cost, and we built an online calculator based on those findings to show employers how big a hit the bottom line takes when manual processes remain in play.

In its November 2018 study, Ernst & Young examined 41 common HR tasks. After numbers were crunched, three areas exhibited the most potential for saving money:

Get aboard savings

Perhaps not coincidentally, all three areas include tasks employees can perform on their own through self-service, single-database software. And when such software isn’t in place or in use, employers pay for it through lost time and duplicated labor.

For example, consider onboarding. In the survey, respondents reported that an average of 12% of Forms I-9, required for employment in the United States, contained errors. Manually recording that data and fixing its errors costs $7.85 per form; when nonlabor costs are factored in, such as printing and copying, that total rises to $8.32.

Assuming that 12% error rate, a company of 500 employees would be looking at $499.20 to fix 60 incorrect or incomplete I-9s. That’s a move that should be done, considering the federal government can assess penalties between $220 and $2,191 per wrong form.

Better yet, self-service HR technology would all but eradicate the cost of error-ridden forms, and diminish total costs of entering Form I-9 data.

It’s not just your Forms I-9 that cost you. With five numbers you provide, our usage calculator will tell you instantly how much you are spending – that you could be saving – in several functional areas. You even can download your results to a PDF containing a full cost breakdown.

About the Author

Rod Lott

As Paycom’s Editorial Manager, Rod Lott brings more than 25 years of experience in marketing, advertising, branding and journalism. A published author and a graduate of the University of Oklahoma, he has worked with such brands as Blue Cross Blue Shield, Sonic Drive-In and OU.

See more posts by Rod Lott