Payroll services for academies: The strategic value of getting it right

Payroll is like a contract between employer and employee, building trust and assuring employees they are valued, appreciated and respected.

The importance of financial security should never be underestimated — 59% of employees said current financial worries prevent them performing their best. Effective payroll is one simple way employers can uphold their part of the contract and contribute towards better financial wellbeing for employees.

By seeing payroll as more than a back-office function, academies can shift the perception and make it a strategic enabler that can help alleviate frustrations, boost morale, shape culture and retain staff long term.

Running payroll has many nuances in the education sector, and becomes especially complex in multi-academy trusts (MATs). This can make it more challenging for finance departments and managers to complete timely, accurate payroll from month to month. Key complexities that need to be addressed include:

• Multiple pay scales and contract types. Teachers and school staff can be on a number of different contract types, which may require term-time only calculations. Teacher pay scales mean that salaries change year over year, and new pay awards need to be factored in and often backdated. Any staff on leave such as parental leave also need to be accounted for in payroll calculations. In addition, supply teachers and temporary staff need to be paid, though this will often be done through an agency.
• MAT teams and structures. Almost 80% of the trusts included in the 2025 Kreston UK Academies Benchmark Report now consider their operations to be fully centralised. This can help streamline processes, but it also puts pressure on central teams, and may raise further complexities when accounting for the needs of individual schools. When MATs experience growth, this can lead to further complexities as teams grapple with change while trying to keep up with payroll requirements.
• Limited resources. In the education sector, staff may feel they are continually asked to do more, with either less or the same. Limited resources make education payroll management more challenging, with finance, payroll and HR teams often fulfilling diverse roles and following complex manual processes. This can impact timelines and make errors more likely.
• Pension schemes. Navigating the Teachers' Pension Scheme (TPS) and the Local Government Pension Scheme (LGPS) for other school staff can be complex and time consuming. When completing payroll, academies will need to factor in deductions from salaries as well as employer contributions. They will also need to complete the End of Year Certificate (EOYC) annually by the specified date.
• Statutory reporting requirements. HMRC submissions and payroll reporting requirements must be accounted for monthly and annually. Academies will also need to disclose information about teacher pay, and provide public reports (published on their website) detailing employees with a salary above £100,000.  

Payroll services for academies are a widely-adopted solution — payroll can be outsourced to an external provider that is then responsible for delivering it accurately and on time. Choosing to work with a third-party provider makes sense for busy academies and MATs, helping to make some of the common complexities more manageable. 

Payroll services can relieve internal pressure and help contribute to strategic aims. Finding the right provider is crucial though, and a service that can’t adequately meet the needs of academies is only going to cause further problems. Outsourcing payroll is a big decision and the chosen provider needs to have a proven track record of working with academies, as well as the capacity to deliver payroll as required, month in, month out.

Underinvesting in payroll with a substandard provider carries risks, including:

• Non-compliance with GDPR. When outsourcing payroll, the payroll bureau will be the processor but the academy will remain the data controller, making them liable for compliance with GDPR. Academy payroll compliance is too important to take risks with, as non-compliance can lead to fines and financial penalties as well as possible legal action.
• Further administrative burdens. Using a substandard provider can end up increasing work for staff when they have to help troubleshoot, review for errors, fix mistakes and chase progress. Outsourcing payroll should improve workload and lift morale for current staff, not exacerbate issues. When staff stress is increased and they feel less in control of their work, this can lead to dissatisfaction and pose retention risks.
• Payroll errors. Accuracy is essential in an area as important as payroll. Providers with a poor track record that don’t demonstrate enough attention to detail increase the risk of errors.
• Reputational risk. With errors comes reputational risk. Teachers and school staff talk to each other, and academies can all too easily become known as undesirable employers when they fail to pay their people correctly.
• No room for growth. Academies change, grow and merge. The right payroll service provider should support academies through these periods of change, rather than holding them back. 

Payroll services for academies: Achieving a strategic advantage 

Quality payroll services are worth the investment and can help academies achieve a strategic advantage as employers. When narrowing down payroll solutions for schools, assess:

1. Automation and accuracy. The Payroll Assurance Scheme (PAS) from the Chartered Institute of Payroll Professionals (CIPP) can help identify services that are robust, reliable and committed to compliance.
2. Integration with HR and finance. Integration is essential, ensuring there are no data “black holes,” and reporting is accurate. Work with providers to understand how they can fit into existing processes and make use of in-house systems. Payroll software is an important consideration as it can help enable seamless integration. MAT payroll software designed specifically for schools is most likely to meet all requirements. It may also be an option to outsource parts of payroll processing while keeping data management in house, depending on what makes the most strategic sense.
3. Futureproofing. Don’t select a service for now, select one for the future. This is very important strategically, making sure changes to structure, operating models and more can be accommodated and academies can scale with confidence.
4. Decision-making potential. Academies should ensure they can work in partnership with the provider to use data to its full potential. Data and metrics should underpin any important decision-making regarding people and HR processes. Only work with payroll providers who can contribute to actionable data processing, and preferably provide their own insights and contributions.  

Choosing the right payroll service for your academy

Choosing a provider with the right credentials and an in-depth knowledge of education payroll improves the likelihood of finding the right one first time. Access Education’s managed payroll service can save academies time and money while increasing accuracy, for as little as £3.50 per payslip.

The service is designed to manage everything needed to run payroll successfully month over month, from making BACS payments, to managing pension processing, to producing reporting.

Access Education offers:

•  25 years’ payroll processing experience
• 99.9% accuracy rating
• 100% pass mark with the CIPP’s PAS

Dedicated support is available directly from the payroll team, a service that clients really appreciate. "The onboarding experience has been great, and the team is making sure everything runs smoothly. We do feel really looked after," said Jane McCumiskey, Chief Operating Officer at Fylde Coast Academy Trust, which uses Access Education’s Thriving People bundle.

Fylde Coast Academy Trust chose to use a comprehensive solution for payroll, HR and staff management. Payroll was the initial priority — while staff were paid on time with their previous system, there were frequent errors that needed to be manually corrected. "We want to be confident that payroll just works, without having to go back and fix things," said Jane. The trust is now on track for fewer payroll errors, a smoother, more efficient process and better data accuracy.

Payroll software is another important consideration, helping to facilitate payroll processes and support information transfer if outsourcing. Holte School is successfully integrating HR, payroll, finance and budget management into one platform, reducing errors and admin.

“The level of insight and control this system provides is something we simply don't have now. We’re looking forward to a much more streamlined, efficient approach to HR, payroll, finance and budgeting,” Melissa Bowen, Schools Strategic Business Manager for Holte School. 

Payroll services for academies: Invest in long-term success

The right payroll service will help academies focus on delivering a quality education, reducing admin and promoting a culture that supports staff retention. Access Education can partner with academies to introduce a more strategic approach to payroll.