History of Payroll.
Simply put, payroll is a list of employees to be paid, with the amount due to each of them. The word came into use around the 1750’s as a combination of the words Pay (a verb) and Roll (a noun) referring to a list of periodic payments made to employees as salary.
Payroll was handled by a paymaster, a person whose job it was to pay wages or salaries in certain organizations, government, and military. A profession which can be traced back to the mid-16th century in Europe, nowadays the word payroll executive or payroll manager is used in denoting a person or team which forms the company’s department that calculates and pays all the employees.
The format of wage or pay has changed over time, starting from food, grain, clothes and even beer in ancient Egyptian times to salt and land grants in Roman times.
BBC says some of the earliest writing in the world, called ‘cuneiform,’ meaning wedge-shaped, was used to record rations, A cuneiform-inscribed clay tablet dated about 3100 BCE provides a record of the daily beer rations for workers in Mesopotamia, could this have been the world’s first payroll journal? Depicting what rations were bartered for labour provided by individuals?
As the world moved through various economic phases, from the commercial revolution which began in the 11th century and lasted until it was succeeded by the Industrial Revolution in the mid-18th century, so did the mode of payment change from food, clothing, shelter to a monetary based system allowing people to buy goods and services they desire in lieu of work or services rendered.
19th & 20th century saw developments in retail or consumer banking, which allowed people to save, spend and manage their money with ease, as commercial banking started and access to banking opened up with the introduction of retail banking services, people were able to manage their salaries easily and salary payments moved from being cash in hand to bank transfers or account credits.
In the 20th & 21st century, the rise of the service economy made salaried employment even more common in developed countries, where the relative share of industrial production jobs declined, and the share of the executive, administrative, computer, marketing, and creative jobs—all of which tended to be salaried, increased.
The concept of taxing income is a modern innovation and presupposes several things: a money economy, reasonably accurate accounts, a common understanding of receipts, expenses, and profits, and an orderly society with reliable records, so payroll had to evolve and incorporate the complex taxation structures of the local governments.
This is how payroll evolved from being entries in clay tablets, copper plates to paper parchments, paper scrolls, and ledgers to automated Payroll Software, which can update payroll data and payment receipts in real time!
Most payroll software providers are the digital disruptor’s in an ancient domain, helping companies calculate their payroll accurately, helping HMRC to ensure correct tax revenues are generated from the companies, instructing banks to accurately credit salaries into accounts and ensure compliance on all legislative requirements of taxation.
That was the history of payroll, in brief, we wonder what the future will look like? with Cryptocurrencies and constant change in legislation, we are sure it will be anything but boring.