Payroll Done Right: How to Best Manage Your Business Payroll
Payroll is a core function of any business, so getting it right is critical–but also challenging. In addition to administration and reporting, you also need to worry about compliance with federal, state and local laws.
Go it Alone?
Some companies, especially those with straightforward payroll, opt to handle the function themselves. That’s because managing business payroll essentially consists of a series of steps–collect information, decide on a schedule, calculate and run, and withhold and file taxes–that can be done in house.
But if you have a number of employees with varying hours, experience lots of turnover, or are paying taxes in multiple states, payroll can get complicated quickly. To reduce risk, save time and streamline operations, many companies choose to outsource their payroll and related tax duties.
Top Reasons to Outsource Business Payroll
Every company is different. But one of the biggest reasons organizations utilize a third party for business payroll is because they lack the internal expertise or resources to run payroll, handing it off to someone in HR or accounting who has another primary job function. By outsourcing, you’ll alleviate the burden on your organization and free up your employees to focus on your core business.
Outsourcing payroll offers numerous other benefits as well:
- Fewer mistakes mean you’ll be compliant with regulations—and pay less in penalties
- You’ll save time–and money–by turning intensive payroll processing tasks over to a team of professionals
- A company can avoid delays and disruptions caused by more complicated situations like administering a bonus or preparing severance that can upend regular processes
- Your business can reduce the risk of compromised sensitive employee information by administering payroll externally
That’s not all. Depending on the provider and their technology, you could gain access to even greater advantages and efficiencies for a happier, more productive team.
How to Choose a Payroll Vendor
When you decide you’re ready to shift to outsourced payroll, there are many options to choose from. To find a qualified third party that’s best suited for your business, consider the following factors:
- Cost: The cost for a payroll service can vary depending on whether a vendor just handles paycheck processing or you utilize them for other services as well. Be sure to identify exactly what you need, then compare the total costs for one year between vendors. And double-check whether you’ll be charged by the pay period or month.
- Reputation: Ask for referrals from colleagues, peers or others you trust. Once you narrow down a list, ask the companies for references and follow up with them to gauge their satisfaction. It’s also wise to check online reviews.
- Capabilities: Depending on your growth strategy, you may want a company that can handle additional needs as you evolve, such as operating in different states, offering 401(k)s, and hiring part-time workers. But if you don’t foresee needing add-ons, be wary of companies who want to bundle all their services for a higher price.
- Technology: To enhance ease of use and efficiencies, you’ll want to look for a vendor that offers advanced technology to make your experience better. Ask for a demo of the software so you can see it in action. And check that it’s secure and mobile-friendly for accessing on the road.
- Accuracy: Mistakes can happen so you’ll want to ask how the payroll companies handle them, how long it takes to correct a mistake and who’s liable. And make sure the company you select is bonded and insured.
- Service: Ask about how your account will be serviced and whether you’ll have a local contact for personalized attention or need to dial a call center for any issues. You’ll also want to check the customer service hours and other support, like how often you’ll receive reports or other communication from them.
Interested in learning more about how to make payroll work for your business? Click below or contact Complete Payroll Solutions at 866.658.8800.