Addressing the seasonal hiring conundrum

The surge in seasonal hiring, aimed at meeting the spike in consumer demand, frequently leads to operational headaches and stretched resources. Why, despite advances in workforce planning, does seasonal hiring continue to present significant hurdles for payroll departments? And, more importantly, how can businesses better manage the increased workload and ensure a seamless payment process for temporary staff?

The lead-up to the holiday season impacts entire sectors—especially retail, hospitality, and logistics—where heightened demand drives workloads sky-high. Yet, few feel this pressure more acutely than payroll teams, who grapple with unique challenges that can push resources to their limits and strain overall performance. Our recent research reveals the scale of this burden: 61% of payroll specialists report a significant increase in workload during seasonal hiring, while 32% indicate a rise in process errors. These findings underscore the critical need for strategies that help payroll teams manage holiday-related complexities efficiently and accurately.

Seasonal hiring creates payroll challenges for employers and payroll teams in three specific ways. Firstly, more workers on temporary contracts means additional pay runs, more deductions that need to be made, an increased chance of supplemental runs and greater risks overall. Put simply, the extra volume of work introduces multiple new potential points of error and raises the likelihood that mistakes will be made.

Secondly, seasonal hiring increases the compliance burden faced by pay teams. Workers may operate under different employment terms or contracts to the rest of the workforce which naturally increases the complexity of tax and regulatory requirements and the potential for errors.

Finally, onboarding is arguably more complex due to the time constraints. When employing a full-time or permanent worker the process is often easier to plan for as the lead time to onboard them is longer. However, when hiring seasonal employees, the window in which HR and pay teams are given to introduce new starters to existing platforms is often much smaller, which then reduces the time to ensure that data has been obtained and inputted accurately.

Almost every employer that hires seasonal workers, whether that’s a restaurant, shop or hotel, will have faced issues with pay efficiency and accuracy that’s linked to their temporary workforces. But what can these organisations do to mitigate the risk, and ensure processes continue to run smoothly?

The key to overcoming these seasonal payroll challenges lies in technology. According to our latest Payroll Efficiency Index (PEI), payroll teams are reaping the benefits of advanced tech solutions that streamline processes and reduce errors. Just as digital platforms have transformed other sectors, payroll is evolving too. Our data shows that modern, tech-driven solutions—powered by automation, machine learning, and artificial intelligence—not only minimise errors but also detect them early in the validation stages, limiting their impact on both employers and employees. As a result, payroll teams can handle seasonal peaks more efficiently, ensuring smoother operations for all.

Unified, tech-backed platforms automate many of the manual processes that create risk, and potential points of error – such as tax deductions - gifting specialists time to focus on more strategic tasks. They integrate with human capital management (HCM) platforms and offer streamlined pay cycles with in-built error detection capabilities. They can provide more advanced analytics which gives employers the ability to better forecast future workloads, and means teams aren’t battling at the last minute to ensure is everyone is paid correctly, and on time.

When implemented effectively, technology can absorb the added workload that seasonal hiring brings, creating a valuable opportunity for organisations to streamline payroll processes year-round. This includes integrating pay-on-demand or earned wage access (EWA) models, which allow workers to access their earned wages as needed, rather than waiting for traditional pay cycles. By shifting away from rigid weekly or monthly pay structures, these systems make it easier to add and remove seasonal hires, adjust payment dates, and provide permanent employees with greater flexibility around how and when they’re paid.

Traditional payroll processes often mean seasonal workers—who typically take on extra jobs to supplement their income ahead of the holidays—aren’t paid until weeks after starting. Employers who offer more flexible payment options gain a competitive edge in attracting these workers, supporting both employee satisfaction and recruitment efforts during peak periods.

Of course, we can’t overlook the fact that adopting modern platforms can also reduce workload and demand for payroll specialists’ time in other ways. By granting more control to employees over their pay and financial information through self-service platforms, employers will reduce the number of inbound enquiries teams need to handle. Every pay specialist will recognise that their services are always in heightened demand ahead of busy holidays, but by giving employees access to everything they need, this time is freed up and can be better spent on more valuable tasks.

Ultimately, while seasonal hiring has long posed significant challenges for payroll teams, it doesn’t have to in the future. By embracing technology and modernising payroll processes, organisations can transform seasonal peaks from a burden into an opportunity. Those that adopt flexible, tech-driven payroll solutions stand to benefit not only during high-demand periods but throughout the year—gaining efficiency, attracting talent, and setting a new standard for payroll excellence.