Payroll Outsourcing

Every employee in the organization is liable for remuneration, benefits and incentives based on the work done by them. Organizations are shifting towards outsourcing important tasks or menial tasks based on the necessities of the organization. This allows organizations to quit worrying about these tasks because outsourcing companies take care of them.

Record of financial transactions regarding the salaries, bonuses, tax deductions etc., come under payroll of companies. Outsourcing is adopted by organizations to cut costs that might otherwise be incurred in the whole procedure.

Payroll Outsourcing provides various services like filing taxes, keeping records of salaries, providing pays to the employees, deducting money for employee welfare schemes, keeping a record of all the payments and many others. It is time consuming process which requires qualified manpower as a result organization find it easy to outsource the process to make things easy.

Benefits of Payroll Outsourcing

1) It helps to save time

2) Work handled by a professional team

3) Keeps official information safe and secure

4) Host organizations can save the cost of infrastructure set up

5) Eliminates paperwork

6) Equipped with the best HRM

7) No risks related to losing employees

8) No additional cost incurred to train employees

9) Taxes and salaries get paid at the right time

10) Focus on core tasks

Types of Payroll Outsourcing

· Full time payroll service providers take care of the whole process from beginning to the end, all they require is proper data.

· In another scenario, the service providers might handle the core tasks and give the basic tasks to the organizations.

There are service providers who focus on specific tasks based on the requirements of the organizations. In these cases, they only need help with tasks like attendance records, tax deductions or providing pay checks.

· Attendance records- Here the service providers keep a record of the number of working days, sick days, holidays etc., of the employees and provide pay checks after calculation.

· Tax deductions- Employees are liable for taxes, hence the service providers calculate the necessary deductions before providing pay checks.

· Providing pay checks- Here the service providers provide remuneration to the employees in cash, cheque or bank transfer for the work they do.

How to decide which Payroll Outsourcing Service is the best?

1) Research about service providers and find out if they offer what the organization needs at a considerable range.

2) Check if the service providers have automation facilities for simple tasks or else it will lead to more spending on menial tasks.

3) Make sure that they make necessary updates with regards to changes in employee details.

4) Ensure that the data collected about your employees and organization are in safe hands.

5) Make more services automatic and take help when necessary.

6) Approach only those agencies who are trustworthy, reliable and honest.

Disadvantages of Payroll Outsourcing

1) Unable to access payroll whenever necessary

2) Cannot make any changes or corrections

3) Chances of information leakage

4) Risk of misunderstanding or miscommunication

5) May not make timely payments or provide reports

6) Lack of quality services

7) May lead to problems and penalties for the organization

8) May lead to extra charges

9) Service providers might go out of business

10) Ill reputed agencies might cause more trouble than help