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Things You Need to Know Before Outsourcing Your Payroll Services

Saturday, January 22nd, 2011

During the life of a small business certain decisions present daunting challenges because of the limited time and monetary resources available. Every business owner is asked, at some point, if time has come to find a company that provides payroll services for small business. Finding a reputable provider of payroll services is not the most difficult decision. Certain internal areas of the business must be considered, including: existing time records, privacy and accuracy, business growth rate, existing employees, and the cost benefits.

Accurate time keeping is required for exempt employees, and when your company would have to adopt a completely new practice to track work time, these costs must be factored in to the decision. The payroll-services company will require approved documentation for each employee to pay each person correctly.

One catalyst to outsourcing your payroll services is consistent concerns over employee privacy and accuracy of the paychecks and taxes paid. If payday is fraught with correcting issues and addressing employee concerns, evaluate the reasons and determine if outsourcing would solve these problems. Reassigning the work to another employee may be the answer instead. External companies provide increased privacy because no one within your company has a need to know employee salaries.

Growing businesses struggle to find enough time in the work day to squeeze payroll activities in to the average busy work week. If your administrative costs are consistently high and your business is growing, the time might have arrived to outsource payroll and give other responsibilities to the current administrative staff. One indication that an adjustment is required would be when no one has time to handle questions about business processes and daily activities.

One reason to outsource payroll is because the current payroll administrator is retiring or resigning. With enough notice this could be the perfect time to find a company that provides payroll services for small business. The service costs would be covered by not replacing that employee. Document the changes that will be implemented to include every task that will be shuffled to another person and show the employees how much easier off-loading payroll could be instead of hiring and training a new person.

Every business decision requires evaluation of the real costs associated with making the change. If the business employs more than twenty people, the cost of outsourcing payroll is normally offset by the administrative time currently spent to produce the paychecks and file the tax forms. Idling an employee by making this change will frustrate your current staff and cost more money than it will save..

Choosing a Payroll Outsourcing Company

Thursday, January 14th, 2010

Many companies now outsource some of their administrative functions because of the many benefits and advantages it offers. One of the common tasks that is being outsourced now is HR functions particularly payroll processing. Processing payroll within your company is sometimes not practical since this can cost you more than seeking the services of payroll professionals. This is the reason why more and more companies are restructuring their organisations and instead seeking the services of a payroll outsourcing company to do the job for them.

When choosing a payroll professional to help your business. The ideal payroll outsourcing company for your business is the one that has previous experience working with businesses with the same size as that of your organisation. Making sure that you choose a payroll outsourcing company that can provide you excellent customer support that are especially designed and scaled for the needs of your business. If you wish to seek the services of a professional payroll company, you need to be specific in terms of the level of involvement you want them to have, whether you want them to be in-charge of the whole process or just focus on one element.

The company you choose must have a good reputation and proven excellence in the field of payroll processing to ensure that you get the best of the best. Ensure that you carefully explain the whole process with the payroll company such as the deductions, adding employee if your company expands, and the frequency of payslips so that they understand the needs of your business. Once you have chosen a payroll outsourcing company, you need to carefully analyse the contract and ensure that you will be able to monitor their level of service and required actions are properly carried out.

Payroll outsourcing has more to offer other than a simple cost efficient benefit. Other than the obvious margin between in-house and outsourcing, it has been proven more efficient and allows your internal HR professionals to focus on managing human capital and improving the company’s “human assets”..