‘Don’t stand on the sidelines’

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AI is coming for payroll – here’s why HR needs to get involved rather than watching from the sidelines

WITH AI coming for all arms of HR, it’s no surprise that payroll teams are eyeing up the new technology with a blend of cautiousness and curiosity. As one of the more detailed, data-driven segments of a business, payroll hinges on accuracy and efficiency, but what can AI automate, and what should it never be used for? Speaking to HRD, Kylie Baullo, managing director Australia and New Zealand at ADP, says it’s important to embrace the benefits of AI while simultaneously ensuring there is human oversight. “If you ask any payroll practitioner why they can’t take off Mondays or Tuesdays, they’ll tell you that they’re chained to their desk with 20 browser windows open, trying to juggle multiple different data sources, making sure all the data is clean and correct, catching errors before they cause problems, calculating payroll and running audits. They’ll tell you that there are so many moving parts and it needs to be 100% correct,” Baullo says.

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“Nobody wants their bank account to have a 96% accuracy for their transactions and 4% not”

Kylie Baullo, ADP

With AI, organisations have this incredible opportunity to make life simpler – payroll errors create more work for payroll professionals and HR leaders. What’s needed is guidance within the workflow to remedy issues such as missing clock-in-and-off data before it becomes a problem. “Nobody wants their bank account to have a 96% accuracy for their transactions and 4% not,” quips Baullo. “For payroll, the stakes are equally high. However, AI does have the ability to both inspect, evaluate and surface patterns within that data, allowing payroll professionals and HR leaders to proactively act on errors. It’s the ability to drive a higher level of accuracy and to eliminate the stress of getting payrolls done that’s one of the great advantages AI brings to the table. “Data privacy, security and ensuring that we have a transparent model where people have a right to know what is happening – that’s paramount. Since 2019, we’ve had an AI & Data Ethics Council that works to introduce policies and frameworks around how AI is used, both in our full product life cycle and within our organisation. This forms part of our compliance-by-design process, which incorporates transparency, bias mitigation and accuracy into our generative AI tools.”

Because AI still holds an element of the unknown for many employees, some worry about how it accesses and stores their personal data – not to mention their fears of losing their jobs. The ADP Research 2025 People at Work report found that 9% of workers in Australia fear that AI will replace their jobs, while 10% are uncertain how the new technology will shape their work in the future. “There is significant concern in the market regarding the impact of these new tools and the level of automation of people’s roles and the work they do,” says Baullo. “[This is] particularly true in the HR and payroll space. People want technology to be able to help them, but they’re also really worried about how it’s used and what it will do to their day-to-day work.”

An adage that’s gained a lot of traction in the digital age is ‘AI won’t take your job, but someone who understands AI might’. “Employees across all organisations should be getting involved with AI and be part of this next phase rather than standing on the sidelines and waiting for somebody else who has those skills to jump in and take their role,” Baullo tells HRD.

When an organisation has an AI-adoption-first approach, fear surrounding its introduction across areas such as HR and payroll wanes. Ironically, having people who fear it only hinders the change process, resulting in fewer people being willing to invest in it the first time around. “There’s a really important intersection of how the technology works and how the people work with that technology,” adds Baullo. “It’s that ability to be able to figure out what guardrails organisations have implemented to protect access to data, data privacy, and how the data is being used. How to take that data and use it in such a way that it’s helping and assisting you in the process, with human oversight, interrogating what is being produced.” ADP’s teams are looking at AI through two distinct lenses, Baullo explains: building AI and buying AI.

“Employees across all organisations should be getting involved with AI and be part of this next phase rather than standing on the sidelines and waiting for somebody else who has those skills to jump in and take their role”

“In our Lyric HCM solution, we’ve used AI to develop a search-based platform as well as pre-emptive menus versus the old-style drop-down menu-driven systems,” she says. “We’re also ensuring that we have the ability to create thresholds, blockers and warnings that surface information in real time within the applications to support HR with real-time decision-making.” For employees looking to leverage AI, Baullo highlights the many resources available in the marketplace that they can explore. From Salesforce to LinkedIn, Gong to Grammarly, the options are endless. She says it’s about helping employees select what works for them and implementing that as part of your organisational strategy. Employees are using AI in their personal lives, Baullo points out; we are all using Google Maps, embracing the real-time data that helps us get to our destination faster. Now is the time to bring that into the workplace.

What does this mean for HR leaders? In a 2025 ADP pulse survey of over 1,500 business leaders and HR decision-makers, almost two-thirds (63%) of large organisations (1,000-plus employees) and 44% of midsized companies (50–999 employees) reported they had implemented or were piloting the use of generative AI. Baullo reflects on the “exciting times ahead for HR, including efficiency gains through resume screening, interview scheduling and [identifying] payroll anomalies, through to data-driven insights to predict skills gaps and guide succession planning. For larger organisations, the scalability to manage employees across different geographies presents opportunities to remove repetitive work.”

The importance of accuracy in payroll

Helping employees embrace AI

Published 16 Jun 2025

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The skills gap facing Australian workers

Just 19% of Australian workers believe they possess the skills needed to advance in their careers over the next three years

24% of the global workforce are confident they have the skills needed to advance to the next job level in the near future

14% of Australians feel that their employers invest in their skills development

Only 6% of those over 55 believe their employers are investing in the skills necessary for their career progression

Source: ADP

Intersection between technology and the people who work with it

Kylie Baullo, ADP

‘The future of AI is going to be far more automated’

Baullo looks to the future of AI in payroll with optimism. She says success will hinge on a system to support compliance in the sector, ensuring an effective end-to-end process that’s always governed by human oversight. “I think the future of AI is going to be far more automated; it needs to be part of the workflow no matter the domain, be it time capture, benefits, policy or payroll. It should join systems and make the user’s experience seamless, all while accessing deep and essential data that provides better, faster and more straightforward solutions.”

Source: ADP

Friend or foe? AI’s impact on Australian mindset

1 in 10

Australians have no idea how AI will affect their roles

of Australians are worried AI might replace their roles

of Australian workers are positive about AI’s impact on their roles

18%

of knowledge workers see the positive impacts of AI

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