Though I agree with Aussiejohn on the risks involved in using Excel for managing large payrolls and the need for a proper payroll system, I must also play the devils advocate here.
My organisation eats, sleeps, dreams EXCEL... just about everything we do, we do in EXCEL; including payroll.
Our payroll strength has gone up to as big as 800 (daily wagers) at one point in time; and we used excel sheets without any issues. We have a seperate excel for PMT Staff & Workers
The keys for using excel are
a) design the workbook and sheets as per your requirement.
b) minimise data entry requirements (believe me, it can be done)
c) design input sheets also to match your main data sheets and use excel functions to copy data from input sheet to main sheet
d) use formulae, conditional formatting, plethora of excel built-in functions etc to maintain data integrity, non-duplication, data validation etc
e) Use lock / unlock cells to restrict editing rights to selected cells / rows / columns to only those areas where data entry is required.
f) protect the sheet with passwords
g) maintain a change log and strictly control the mods to the sheet.
h) maintain the sheets.
My payroll EXCEL has
a) a master sheet capturing all data of employee
b) a salary calculation sheet
c) PF ECR Sheet
d) ESI Upload Sheet
e) Payslip
f) Bank upload Sheet
g) Forms B, C & D
h) A macro to bulk print Pay slips (2 payslips per A4 sheet for daily wagers)
i) In case of PMT Salary Sheet, there is a macro to print payslip to PDF and generate an email to his given email ID.
Excel is extremely powerful, all you need is some knowledge and lots of curiosity, know what you need, design it well as per your requirement, minimise data entry / typing requirement, restrict mods and access (our payroll excel is accessed by just 4 people in the organisation), teach them how to use it and one can live comfortably with excel.
Necessity, they say, is the mother of invention, so we have learnt to tap deep into excel and exploit it well; but as aussiejohn said, a proper payroll / HRMS is probably a better solution.
Thanks and Regards
Arun