Digitalization in payroll services refers to the process of transitioning from traditional methods of payroll processing and human resource management to the use of digital technology and software solutions to optimize these functions. Popular topics in this area in recent months have been electronic employment records as well as the transition to an electronic payroll. Therefore, we invited Miroslava Misheva, Deputy Team Leader - Payroll from our team, to comment on whether a "digitalization" mission is possible in the reality of the Bulgarian labor market.
1. One of the keywords of our time is digitalization. In which directions can we work on digitalization in Payroll processes?
Mira: First of all, we should note that such a transformation involves several different aspects, the main ones being:
When taking steps toward digitizing some or all of these processes, an important prerequisite is the creation and maintenance of electronic employment records for all employees. It is these that form the basis of digitizing the overall payroll processes and allow employment contracts to be signed, supplemental agreements to existing employment contracts, termination orders, and leave applications and orders to be made digitally.
2. Are there administrative or regulatory obstacles to this?
Mira: The obstacles so far have been tied to regulations that require some documents to be paper-only, such as employment records. On 26.09.2023 were voted the changes related to the electronic employment book and the electronic employment record, which built on the existing law on electronic documents and electronic certification services.
Digitalization of food vouchers is also being undertaken from 01.01.24. In the next calendar year, they will be on an electronic medium - a plastic or virtual card, and paper vouchers will cease to be used from 30.06.2024.
These are just some of the positive changes that are phasing out administrative and regulatory hurdles in digitalization processes and bringing us closer to the desired level of digitalization.
3. What are the advantages of using electronic employment records?
Mira: Electronic employment records are not a new issue. Already in 2016, it was foreseen that some of the documents in the employment record would be stored in electronic format. The regulation on the type and requirements for the creation and storage of electronic documents in the employee's employment record, adopted in 2018, created a legal possibility to digitalize part of the employment record.
The results or pros of digitalization in the administration of employment records as well as HR processes are:
4. Why is there so much talk about an electronic workbook format?
It will be part of an electronic register maintained by the NRA and is intended to facilitate and speed up processes related to employment and improve access to information on the length of service, positions held, professional qualifications, etc. It has been the subject of intense interest and discussion due to several important factors and advantages it brings with it:
1. Digitalization of information:
2. Advantages of the introduction and use of an electronic employment record:
The electronic format also solves another practical problem related to the retention of the employment record by the employer upon termination of employment. The Labour Code stipulates that it must be processed and returned to the employee immediately. Interpretative Decision of the SCC No. 1 of 2019 interprets the word "immediately" as the day on which the employee presents the employment book to the employer - on the same day it must be cleared, certified, and returned to the employee.
All this sounds really encouraging and we, for our part, look forward to 01.06.2024, when the Ordinance under Article 62(5) of the Labour Code should be adopted and these theoretical benefits should become practice in our daily lives.