Statutory Compliance in HR & payroll System for Bangladesh
Being compliant with the statutory compliance, organizations need to be well-versed with the various labor regulations of Bangladesh. In this article, a checklist would be laid down to explain how a payroll software can be used to maintain the regulations curated by the government.
Adherence to minimum wage policy:
Monthly wage policies are fixed by the Government body which is then maintained by all the employers. It is crucial for organizations to clear the wages of employees every month and have a clear report of that payment in their system. Each department has different wage packages which can be maintained easily with a Payroll software. Auditors can easily track the monthly wage payment report from the system if a payroll software is at work. On the other hand, if such processing is done by hand, chances are there will be numerous mistakes, missing employees, missing monthly payments, if reports are done manually. Thus, adhering to wage policy would be complicated and, in many cases, employers might find themselves paying fines and under court cases.
Provident Fund Processing:
The Provident fund act. Of Bangladesh includes couple of significant clauses like, ‘compulsory deposit’, ‘contribution’, ‘dependent’, ‘Government Provident Fund’. Apart from these, the act. Also includes policies of compulsory deposits, various provisions regarding repayments, rights of nominees etc. All this important information should be collected and with the agreement of the employee must be recorded in the HR system at the very beginning of the recruitment. The provident fund of the employee must collect the deposits each month according to the agreement provided by the organization in conjecture with the Government law. The HR software automatically performs all these tasks as the administration sets the rule of the collection procedure. Thus, the system only needs to be set one time to perform the same task on each collection period. The laws might go through amendments at any given time, for which the administrator has to configure such changes in the system to produce results according to the amendment.
Income tax Proceedings:
Among direct taxes, income tax is the most significant source of revenue. Bangladesh’s tax system is a progressive one which is imposed on it’s nationals based on their ability to pay. The rule more or less dictates that the more a taxpayer earns the more he should pay. Income tax law in Bangladesh aims to ensure equal social justice. Organizations has to be well acquainted with the latest income tax rules laid by the National Board of Revenue.
Every employee after a certain pay range has to pay the income tax. Organizations have to set or change configurations of their HR system based on the pay range of each employee or department. There are certain investment types for the tax rebate which could be managed by the Payroll system. The HR & Payroll system records the income tax reports for later review. In many cases, organizations complete all the tax proceedings for an employee with just one click.
Without the HR & Payroll system the income tax procedure of an organization becomes hectic to maintain. The amount of paperwork to process such governmental procedures are huge, which could be easily avoided using a software system. Furthermore, using a HR & payroll software would minimize the need of hiring more HR professionals.
Conditions of Employment:
In every commercial establishment, employees are recruited under certain conditions or provisions. On the other hand, many employees are recruited either as permanent employee or under probational arrangement. Both criteria serve the employees different facilities and procedure of workflow. The employees are mostly recruited after signing a contract which is signed and acknowledged by both parties and when the employment period starts the employees follow those certain rules on which they agreed to work for the organization.
A HR & payroll software records the information of the recruited employee under a category; in which the employee falls and the HR administrator tags the employee file with the assigned tasks along with all the policies and compliance covering that employee profile description.
The HR professional never has to worry about any mistake occurring by the software in the cases of adhering to the compliance. Once the configurations were made they would produce the same results until the settings are changed by the administration.
Installing a HR software would deliver clear reports including each and every employee detail, detailed time period of employment, agreements and policy binding the employee and so on. At the time of audit such reports are significant to show the organization’s structural and adherence to employment policy maintenance.
Statutory compliance of HR is quite complex intertwined by a number of laws which needs to be complied at a timely manner. A HR department has to be pay attention regarding all the laws, for instance, depositing deducted amounts in the bank and filing accurate returns on time. If an organization does not carry these procedures properly while delaying payments and such, organizations could face legal actions and penalties from the authority which often becomes an overspread burden on the business.
Many laws and terms are complicated and are often open to interpretation. Even HR professionals often find themselves at a loss and not be fully conversant with the laws. This is why, a HR solution to handle the complex procedure is always recommended. The automation provided by the HR solution reduces workload while ensuring timely coverage of all the duties included in the laws and regulations.
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