Running payroll in 2021 is a complex and time-consuming process. Managing a multitude of different contracts and workers, along with dealing with the challenges presented by hybrid working, means payroll teams have never had it so tough.
Improvements in technology have gone some way to helping payroll departments keep on top of their increasing demand, but as the world gets back to normal post-pandemic, the pressure on payroll teams is only increasing.
That’s if your business even has a payroll team at all. Many SMBs employ either 1 payroll specialist or run their payroll without one, further adding to the stress and time it takes to complete payroll every month.
A recent study conducted by YouGov (download the whole white paper here), said over a quarter of businesses felt they were spending too much time and resources running payroll. This in turn has a knock on effect on the productivity of their entire business.
If you’re facing a situation like this, a good solution would be partially or fully outsourcing your payroll management. Fully outsourced payroll providers remove the administrative headache from your business and partially outsourced payroll teams give your internal staff a much needed breather. They can also handle the legislative changes payroll teams have to deal with and on a high level will save your business time and money.
Partially or fully outsourcing the payroll function in your business can help you get ahead of your payroll management and keep your staff happy.
But before you bring on board an external payroll bureau to help you sort your staff’s pay you should do a thorough research process to find the right third-party team for you. In this article, we’ll list the 5 things you should consider when researching outsourced payroll teams.
When it comes to finding a specialist outsourced payroll provider it’s a good idea to be specific. There’s no shortage of payroll providers out there and many of them focus on one industry or sector.
If you work in manufacturing, there’s no point hiring a third-party payroll provider that mainly has sales companies on their books.
It might not seem like a big thing at first, but finding an outsourced payroll provider that really understands your industry makes it easier to get them up to speed on the ins-and-outs of your business quickly. They’ll be better placed to offer you advice and guidance on your payroll management that’ll help save your company money.
Be wary of outsourcing your payroll management to an accountancy firm. They often aren’t experts in payroll management and will themselves outsource that role to another agency if you hire them to manage your finances and payroll.
The biggest headache for many payroll specialists is ensuring their payroll is compliant with current government guidance and regulations every month. These guidelines can change often and payroll experts must adhere to every change with no mistake or they could face fines from the government.
If a payroll expert finds this to be hard work, then it goes to show that if you’re not a specialist, the task can be absolutely daunting.
Making sure any outsourced payroll provider can competently handle this demand is an absolute must when searching for a third party company to work with.
Ask yourself; can they provide employees with detailed payslips, file and pay all taxes on time, pay deductions like pension payments to the right place and keep a clear list of records for a minimum of three years in case you need to see them?
This is a big task and one that can land your company in hot water if not done right. So take your time and check the outsourced payroll provider is competent in these areas and that they will help you make sense of them if you’re new to payroll management.
When deciding on an outsourced payroll provider, transparency should be a high criteria on your list. Whether you’re an individual payroll expert working within a company or a business owner who wants to learn more about the payroll process, a good outsourced payroll provider should be contactable and willing to share what they’re doing with your staffs’ wages.
Outsourcing isn’t a decision that should be taken lightly. After all, you are handing a very important business function over to a third party, so you should want to know what they plan to do when they run your payroll. Ask to see their end-to-end process and security credentials. A reputable payroll bureau should be happy to share these with you. If they are hesitant you might want to take that as a sign to keep looking.
Most outsourced payroll providers will charge a company a set amount for every employee they need to allocate to your payroll management. Some third party payroll bureaus, like Phase 3, also offer partially and fully outsourced payroll solutions that give your company more flexibility on price and control over your payroll process.
It’s also worth checking what other benefits are included in the cost of any outsourced payroll providers. Do they:
All of the above are valuable extra services and may be the difference between one outsourced payroll provider over another.
Also ask yourself, will your third party payroll bureau go the extra mile to improve your business? Or will they just fulfil the requirements you ask?
At Phase 3, we truly partner with our clients and provide proactive solutions to their payroll issues that go beyond just running their payroll. If we see something we can improve, you better believe we’ll tell you about it.
Peace of mind is arguably the most important outcome to working with an outsourced payroll provider. When all is said and done and you’ve completed your research, ask yourself this:
“Would partnering with this payroll bureau let me do my job more effectively and stop me worrying?”
If the answer is yes, then that’s a pretty good indication they’re the right outsourced payroll provider for you.
The ultimate goal of this exercise should be to remove stress and inefficiency away from your company and let you get back to undertaking value-added projects that’ll improve your business.
Phase 3 is a HRIS consultancy that works with businesses to improve their payroll, HR processes and technology. We partner with payroll departments and provide partially and fully outsourced payroll services for teams that need a helping hand or a business that needs their payroll taken care of.
If you like to find out how our outsourced payroll service could help your payroll department and business you can contact us here.