Take a moment to think about what kind of business you are in. If it is anything other than payroll, then you should be outsourcing payroll. Does that sound confusing? It’s actually quite a simple concept. Any task performed by your employees that has nothing to do with the business you are in should be outsourced.
There are actually many reasons for this, but the main one is that it makes your business more streamlined and efficient. It’s less wasteful and more reliable. Why is processing payroll internally wasteful and unreliable? Well, it’s because you’re not in the business of payroll processing, but you still have to pay for people to be trained in it, kept up to date on all the legal requirements and so on, and then they actually have to do the processing. The smaller your business is and the fewer employees you have, the more harmful it is not to outsource the task.
This is because if you have few employees, it probably means that your payroll processing is the responsibility of just one or two individuals, rather than a dedicated team of payroll professionals. Now what happens if one of those responsible for the task becomes seriously ill or is otherwise unable to do the job?
Sure, you could appoint somebody else to temporarily cover for them, but here’s the thing: payroll is a task that needs to be done strictly to regulation. Any mistake could make you liable to fines, legal action, and in cases of extreme violations you could even go to prison.
If this task is outsourced, a team of dedicated payroll professionals will always handle your payroll. That means somebody else, not you, is paying for all the necessary training and compliance issues. You no longer have to worry about being exposed to liability for payroll non-compliance, and you will have the peace of mind that comes from knowing that your payroll is being handled expertly and efficiently. Employees get the correct pay and they get it on time, and any problems can be resolved quickly and without causing any disruption to your regular business activities.
Another advantage is that you no longer have to pay for payroll processing software that is a burdensome expense. This kind of software is expensive to purchase in the first place, but it also needs to be updated every time there is a change in employment law or taxation law, which is often enough that it can be a major on-going expense. Also, if you are unaware of the changes, you may be unaware of the need to update, and once again you get exposed to potential liability if mistakes are made causing your business to be non-compliant.
When you outsource, those kinds of headaches simply don’t happen. Somebody else is responsible for taking care of all that, so it becomes something you don’t even have to think about. This way you’re free to get on with the business that really matters.