What Does a Payroll Specialist Do? (And How Much They Earn)
Updated July 8, 2023
If you're interested in an entry-level position in finance, you may consider becoming a payroll specialist. Individuals in this role handle a variety of tasks related to employee payment and payroll documentation. Understanding their primary responsibilities and how to pursue this position can help you determine if it's the right career for you.
In this article, we learn the answer to 'What does a payroll specialist do?', the requirements and skills needed for a payroll specialist job, how much they earn and give an example of a job description for this role.
What does a payroll specialist do?
Payroll specialists oversee all aspects of timesheet and payroll processing to ensure payroll processing remains compliant, accurate and on time. Specific responsibilities may vary based on the size of the company the payroll specialist works for and the industry of the company. Typically, responsibilities include preparing and submitting paper payroll checks for employees who don't have direct deposit, collecting banking information for direct deposit setup and processing deposits on paydays.
They may also conduct semi-annual audits of all payroll records, document and maintain all payroll records and reconcile the general ledger regarding payroll transactions. It's important for candidates interested in pursuing this role to familiarize themselves and stay up-to-date with policies relating to the taxation of salaries, benefits and other payroll factors. This can help them prepare to respond to employee inquiries regarding payroll issues or concerns.
Payroll specialist requirements
Securing a position as a payroll specialist may involve certain requirements depending on the industry and size of the company, including:
Payroll specialists need a minimum of a high school diploma or General Education Development (GED) certificate. Many employers prefer candidates who also have a Bachelor's Degree in Accounting or another related field. Relevant coursework includes computer payroll time reporting and processing, bookkeeping, computer accounting and benefits deduction.
Payroll specialists often earn their roles through promotions from the position of a payroll clerk or as an entry-level position after completing a bachelor's degree program. For example, many payroll specialists earn their positions through promotions from a role as a payroll clerk or human resources assistant. Many employers prefer payroll specialist candidates who have at least five years of experience working in a position related to payroll.
Payroll specialists may also receive additional on-the-job training specific to their role and the company. This additional training is usually part of the onboarding process for their new role. On-the-job training can last for a period of a few days up to a few months depending on the company and the role.
Related: Learn About Being a Payroll Clerk
Certifications relevant to the position and industry of a payroll specialist are important in helping you advance in your career. Popular certifications include the Fundamental Payroll Certification, the Certified Payroll Professional and Certified Bookkeeper certifications.
Certifications help you prove your skills and qualifications and help you distinguish yourself as the right candidate. Payroll specialists can also earn certifications to gain additional knowledge about their responsibilities and further their career advancement opportunities. Popular certifications for payroll specialists include:
Fundamental Payroll Certification
The American Payroll Association (APA) offers the Fundamental Payroll Certification (FPC) so entry-level payroll specialist candidates can prove their knowledge and proficiency relating to payroll fundamentals.
Certified Payroll Professional
The APA also offers the Certified Payroll Professional (CPP) certification to payroll specialists who have at least 18 months of experience working in a payroll position and who have completed several payroll practices and concepts courses.
The American Institute of Bookkeepers offers the Certified Bookkeeper designation to individuals who have at least two years of professional experience in accounting, bookkeeping, accounts payable or a related field.
Microsoft Office certifications
Microsoft Office offers several certifications that verify an individual's level of proficiency in using one or more of the five main Office apps – Word, Excel, PowerPoint, Access and Outlook.
Please note that none of the companies, institutions or organizations mentioned in this article are affiliated with Indeed.
Skills needed to become a payroll specialist
Payroll specialists need a combination of several hard and soft skills to succeed in their role. Some of the most common skills required for a role as a payroll specialist include:
Communication skills involve the ability to communicate both verbally and non-verbally with active listening, observing, speaking and empathizing. Payroll specialists have excellent verbal and written communication skills so they can communicate internally with employees to discuss and resolve payroll issues and concerns and can communicate with the rest of the payroll department. Communication skills are also essential since payroll specialists frequently speak with CPAs or legal professionals if complicated issues arise.
Data entry skills
Data entry skills involve a combination of technical computer skills with strong attention to detail and accuracy. It's important for payroll specialists to be accurate in the data they're entering regarding employee time worked and compensation owed to ensure employees receive the correct amount of pay at the right time and to maintain accurate payroll records.
Time management skills
Time-management skills involve the ability to balance and prioritize responsibilities in a manner that helps you complete your work on time while also maintaining a work-life balance. It's helpful for payroll specialists to have excellent time management skills as their responsibilities require them to spend their day multi-tasking and to ensure they process payroll in a timely manner so employees receive their pay on time.
Computer skills include a combination of typing, system and software knowledge. Payroll specialists need strong computer skills as their job responsibilities include typing and using programs such as Microsoft Office, QuickBooks, enterprise resource planning and automated payment processing systems such as ADP.
How much do payroll specialists earn?
The national average salary for payroll specialists is $38,153 per year. Payroll specialists are typically full-time employees, but may also be part-time or seasonal employees. Salaries for payroll specialists vary depending on their level of education, relevant work experience, the geographic location of the job, the size of the company and the industry of the company.
Salary figures reflect data listed on Indeed Salaries at time of writing. Salaries may vary depending on the hiring organization and a candidate’s experience, academic background and location.
Payroll specialist work environment
Payroll specialists typically work full-time within an office environment. Some payroll specialists may work part-time or seasonally. Payroll specialists typically work standard business hours on a Monday-Friday shift. They may spend most of their day working independently, but may also work with a team of payroll clerks, human resources and internally across departments. If they work for a mid-size or smaller business, they may be doing payroll duties and other things such as human resources, invoicing, or bookkeeping.
Payroll specialist job description example
Here's an example of a job description an employer may write when looking for a payroll specialist:
Our customer service call center is seeking an experienced Payroll Specialist who oversees payroll processing and ensures all of our staff receive timely paychecks and have a thorough understanding of their salaries. We recognize how hard our employees work to serve our clients and help our business grow. We rely on our payroll specialist to audit and verify all time-keeping records of employees' hours worked and any deductions or withholdings required to comply with state and federal law.
The successful candidate has at least five years of payroll experience, is a Certified Payroll Professional and works with the rest of our team of payroll clerks, accounting and human resources to ensure the entire business runs as smoothly as possible.
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