1. Cost. In-house payroll can be a money burner. There’s a very good chance that you can save money by outsourcing your payroll operations. Calculate your costs. Determine how many hours your employees are devoting to payroll-related activities, calculate how much you’re spending and compare the amount to a plan offered by a payroll-service provider. Also, factor in the money your business spends on tasks like accounting support and printing and distributing checks.
2. Reliability. In-house payroll activities function as reliably as the people doing the work. With a payroll service, output speed and quality won’t vary in accordance with vacations and illnesses. You also won’t have to spend time helping new hires understand your business’s payroll system.
3. Accountability. If paychecks are delayed or paperwork is mishandled, it’s the payroll-service provider’s responsibility to fix things. If the provider can’t (or won’t) remedy the situation to your satisfaction, you can switch to another service provider in a snap. Try firing, hiring and training an in-house payroll staff in anything less than several weeks.
4. Productivity. Payroll management is a time-consuming activity. With this burden removed, your employees can focus on doing more productive things while you focus on managing your business. You may even be able to trim your staff’s size.
5. Accuracy. Payroll mistakes can be painful, angering employees and the local tax collectors. A good payroll-service provider is far less likely to make a serious error than your in-house staff. Furthermore, if a big mistake is made, you can seek financial restitution from the provider which you can’t do with your own employees.
6. Speed. Payroll-service providers are specialists with processes and technologies in place that can allow you to process even the most complex payrolls quickly. Unlike most employers, they can also accommodate a temporary influx of seasonal workers without acquiring new systems.
7. Expertise. A good payroll-service provider will know all the ins and outs of payroll-related tax laws and regulatory mandates. Your employees could try to achieve the same level of understanding, but it would take a considerable investment in time and effort.
8. Security. Do you have the time and energy to closely supervise your business’s payroll for time and rate abuses and other shady activities? Most payroll service firms have technologies that can spot and alert clients to various types of payroll fraud, such as payment manipulation and “phantom workers.”
9. Worry.There’s a lot to be said for the peace of mind that outsourcing payroll services can bring to a business owner or manager. No headaches, no hassles: You’re left to focus on running a profitable business.