Human resource professionals fail to focus on more productive functions, as majority of their productive man hours are invested into managing payroll, accounts, taxes and routine administrative work that results in brain drain towards the end of the day.
Outsourcing payroll and administrative functions to external agencies helps companies strategise their efforts and bring out synergies in workings of a team to achieve long-term business objectives within less time. Some of the reasons why companies today increasingly feel the need to outsource payroll are as follows:
- Complexity in rules and regulations
With laws that govern provident fund to calculation of taxes, employee benefit programs and incentives provided to staffers, it becomes challenging for organisations to process the exact reimbursements and salary for each employee.
Also human resource personnel is answerable to employees’ queries about salary considerations, wage increase, payroll processes and tax deductions clearly and confidently to deliver convincing answers. Hence matters such as these which consume a lot of productive man hours of HR personnel is entrusted to payroll service providers externally.
- In-depth reports provided by payroll companies
Payroll companies work towards delivering in-depth well researched reports and specific information with a cost-competitive advantage.
- Access to payroll experts for more information
Employees can directly contact the payroll experts employed by these outsourced payroll solution providers to answer employees’ queries either on call or by email. They further act as a single point of contact for your internal and external employees.
See: 2015 sees sharp declines in outsourcing payroll functions
Specialised training programs are provided by payroll outsourcing companies to staffers, in case of change in payment processes, taxation rules, employee benefit programs or CPF rules.
- Professional Payroll Computing Services
Professional payroll outsourcing companies provide basic to comprehensive and complex payroll administration for companies. They also help maintain and manage records of individual payroll files, while calculating pay structure, salary and reimbursements on time.
Printed or electronic pay advices are delivered to employees via email and there’s an ease in functioning to calculate annual reimbursements, taxes, bonus, increments etc. on time.
Also the annual income statements to be issued for tax purposes are taken care of by payroll outsourcing companies, wherein each employee salary structure and benefits, perks, bonus, increments and tax issues are dealt with complete confidentiality. Such enhanced service offerings provided by payroll outsourcing companies help HR professionals to focus on real work such as staff training and development programmes, compensation planning initiatives, rewarding and recognising top performers, succession strategy and lot more.
Payroll processing when outsourced to external service agencies help in enhancing cost savings. However, not many companies are aware of the fact that by actually outsourcing payroll functions they are not just saving on time and hassles of calculating payroll, while being responsible to answer every employee in case of any discrepancies; they eventually end up saving significant costs towards the end of the year.
Furthermore, payroll outsourcing can help companies deal effectively with challenges put forth by laws governing salary for employees, the tax rules, and get direct access to comprehensive reports by payroll experts, thus saving on money and time. Such vast array of benefits provided by payroll outsourcing companies has made businesses opt for payroll software solutions to manage calculation of pay easily.
Also read: Knowing When to Outsource Your Small Business’s HR
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