Few business owners or managers will cite payroll management as one of their favorite tasks. But, when does it make sense to outsource payroll operations? Here’s a quick look at the top reasons that businesses turn to payroll-services providers.
For small businesses, however, an in-house payroll service is a money burner. There’s a very good chance you can save money by outsourcing your payroll operations.
While processing your payroll, your employees are not contributing to the overall health or bottom line of your company. With this burden removed, your employees can focus on doing more productive things that generate or help generate revenue.
Not only did you pay your employee to process your payroll, but you also have to pay them again to fix it. Considering most mistakes involve a governmental agency, you’ll also have to pay that employee to resolve the issue with the IRS or state and there will probably be some penalties and interest involved. A good payroll-services provider is far less likely to make a serious error than your in-house staff and if they do, the error and its consequences are there’s to deal with, not yours.
A good payroll service will have multiple redundancies in place, output speed and quality won’t vary when personal emergencies, vacations or illnesses arise.
Your employees could try to achieve the same level of understanding, but it would take a considerable investment in time, money and effort at your cost.
Firing, hiring and training an in-house payroll staff in anything less than several weeks is virtually impossible.
Your staff, when freed of rote payroll responsibilities, will be free to focus on other, more creative work that can add to your bottom line.
Most payroll service bureaus have technologies that can spot and alert clients to various types of payroll fraud, such as salary manipulation and “ghost employees.”