Stepwise Payroll Management

When Accounts and Human Resource Departments are involved in Payroll management, its very necessary to define the responsibilities clearly. You can make changes in this process suiting to your organization requirements.

Step 1:

Collecting time sheets with attendance sheets

If the on line system is maintained, then it will ensure automatic checking with the attendance register and time sheets. Otherwise the attendance sheets and the time sheets are to be compared manually.

 Timeline: Maximum by 1st working day of next Month

 Involved: HR Department

Step 2:

Receiving salary details

Ø  Terms of appointment

Ø  Entering details of salary structure

Ø  Entering details of Promotion, Increment and Confirmation.


Changes of Grade, Salary Structure, Department etc.

Ø  Details of disciplinary action taken

Every disciplinary action is based on certain terms and conditions.

That terms and conditions, if it has any effect on salary, the same to be incorporated in the system.

Ø  Receiving details of Resignation


The final settlement is to be disbursed, based on the notice period.

Timeline : Maximum by 2nd working day of next Month

Involved: HR Department

Step 3:

Receiving the details of Employee Advance, deductions & reimbursement

 All details pertaining to employees, their deductions (Other than phone bills), advances & reimbursement details are to be settled by Accounts department & send it to HR department for further action.

Timeline: Maximum by 3rd working day of next Month

Involved: Accounts Department

Step 4:

Phone Bill Deduction

As phone bill generation takes three days’ time, entries regarding phone bill has to be done accordingly. Phone usage limit is decided at the time of joining/ increment. Any excess amount will be deducted (excluding service Tax)

Timeline: Maximum by 4nd working day of next Month

Involved: HR Department

Step 5:

Final sheet preparation

Once all the entries are done, final sheet shall be sent to Director for necessary approvals.

Timeline: Maximum by 5th working day of next Month

Involved: HR Department

Step 6:

Disbursement of Salary

Once final payroll sheet is prepared, it will be sent to Director for final approvals. Once it’s done from Management’s end, mail from Management shall be marked to accounts & HR department. Salary will be disbursed either online, cash or by cheque by accounts department.

Timeline: Maximum by 6th working day of next Month

Involved: Accounts Department & Management

Step 7:

Other formalities

Once salary is disbursed: ESIC, EPF & Phone bill details will be sent to Accounts department

Timeline: Maximum by 7th working day of next Month

Involved: HR Department


Step 8:


After getting the details of Phone Bills, ESI and EPF, accounts department will make payments according to the time frame.

Timeline ESIC: Maximum by 14th of next Month

Timeline Phone Bills: Maximum by 16th of next Month

Timeline EPF: Maximum by 18th of next Month

Involved: Accounts Department


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