It is indeed true that the payroll function is an indispensable function of every business organization. However, handling the payroll function in-house can be quite taxing for the HR department and the business heads. Moreover, the constantly changing business scenario along with the changes being introduced in the labour laws and regulations, make it a challenging task. As a result, several small and mid-sized enterprises are opting to outsource their payroll function.
You might not be convinced with the idea of outsourcing your payroll function. So, let us take a look at some of the benefits which you derive by outsourcing payroll.
- Saving time: One of the primary benefits of outsourcing payroll is that you save time which would otherwise be spent on the monotonous time consuming payroll tasks. Several tasks such as calculation of payroll, disbursal of salary, generation of reports (attendance and leaves status), deduction of taxes, TDS and income tax computation –every month, can be time-consuming and cumbersome for the HR department. However, by outsourcing your payroll, you will not just save time but also gain peace of mind to focus on other strategic arenas such as attaining customer satisfaction or business development.
- Reducing payroll errors: When you manage payroll in-house, there are chances that you might commit mistakes in calculation, or amount of tax deduction. It is quite possible that you are not up-to-date with the changes or implementation of new labour laws and regulations. This might lead to levy of unwanted penalties and fines. Also, it can hamper and strain the employer-employee relationship. However, a professional payroll outsourcing company is adept and proficient in handling these payroll-related tasks.
- Saving money: Yes, it is surprising to know that outsourcing your payroll function can help you save money. This becomes all the more practical when you are running a small-sized or mid-sized enterprise. When you are the owner of a small-scale enterprise with limited resources and workforce, it is apt for you to outsource your payroll function. In this manner, you will save money and thus, find relief from stress as well.
- Security of company data: Handling the payroll function is certainly complex and requires maintaining the security of employee data. This can be cumbersome and difficult when you are handling the payroll function in-house via manual records. Moreover, detecting any kind of fraud or lapse can be easily possible through the usage of latest software technology. Again, installing them in-house can be costly and time-consuming. So, the best alternate available is to hire a payroll outsourcing provider who is proficient and uses the latest technologies in handling the payroll function.
- No hazard from the loss of employed HR employee: It is quite possible that your HR team or some members might quit leaving you in an awkward and troublesome situation to handle. Hence, several small enterprises opt to hire an efficient payroll outsourcing provider who can deliver accuracy and results without loss of revenue.
Therefore, to conclude, it is indeed tough to decide to outsource a major business function---payroll. But, considering the benefits you derive by outsourcing payroll, you will facilitate in not just achieving your results but also staying ahead in the competitive and dynamic business world.