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How to Choose the Right Payroll Services for Your Needs

By Webb Ward
Posted: 27th May 2014 08:45
Payroll performance was often traditionally thought of as part of the manager’s or HR department’s tasks – a boring and tedious job that takes up much time, but an important task nevertheless. In recent years, however, it has become more common for such activities to be outsourced to other companies, companies that specialise in payroll services. Its popularity has nothing to do with trends, however – there are some very practical reasons why it has shown to be the right decision.
There are several advantages to outsourcing payroll services. First of all, you can save a considerable amount of time. Time that otherwise would be spent on tons of paperwork can now be spent on other activities such as sales or production. Secondly, payroll service providers possess knowledge and expertise that are of great value in a world where employment laws and payroll regulations change from country to country and over time. Furthermore, hiring experts for payroll services internally is often risky, and outsourcing saves money.
However, despite its numerous advantages, care must be taken in choosing the correct payroll service provider. It is, after all, an important decision.
Understand your own company
First of all, it’s important to understand that there are outsourcing models and providers for all different kinds of companies. The goal of your company should be to simplify things and to aspire for higher quality. A manager can use the supplier’s model or platform and adjust to the supplier. Often, an existing system is in place and can be taken advantage of. It can also be to mutual advantage for the client and provider to sit down together and figure out a tailor-made system. It all depends on the kind of business you are in.
Ask yourself whether you need only payroll calculation and the production of payslips, or do you want the provider to provide end-to-end payroll management for a global organisation? How does your company handle absence management and time management? What about changes in status such as transfers or promotions? It’s important to have a clear perspective of your internal mechanism before it is left to an outsourced payroll provider.
Check the market
Once your company has a good grip on its own system and has made the decision to outsource this particular payroll system, there are some important factors to consider when choosing an outsourced payroll service. Here’s a short list:
 - Proven track record.Your payroll service provider will take on a big responsibility for you and your employees. Payroll service providers with proven track records lower your risk substantially.
 - Geographical location.Will it be important for members of your team and members of the payroll service provider to meet each other regularly? Does the payroll service provider have expertise in different countries, considering the different laws and regulations?
 - Standardisation approach. Does the payroll service provider have a proven system or platform in place? Does it fit with yours? How will communication and information exchange take place?
 - Compatibility in culture.Does your team and the payroll service provider’s counterpart understand each other? Do you have common values and principles, and do you understand each other’s expectations?
Outsourcing your payroll service can have tremendous advantages, but great care should be applied when choosing the right provider – after all, a payroll service provider is an important partner whom you should be able to count on. Check with specialist companies such as, and see if the provider’s services are compatible with the needs of your company.

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