Payroll is an integral part of your company’s operations. But if you don’t have an experienced and dedicated team in place, you risk making mistakes that can cost you in the thousands or even millions.
Hiring payroll outsourcing services is a great way to ensure that you meet all of your corporate obligations and regulatory requirements without experiencing any problems.
What is Payroll Outsourcing?
Payroll outsourcing is the process of choosing a third-party payroll specialist to take over your payroll processes. A payroll outsourcing services provider can take care of the following functions for you from start to finish:
- Compensation structuring.
- Deductions management.
- Mandatory contributions.
- Salary reporting & management.
- Taxation filing & returns management.
- Time & absenteeism reporting, leave management & vacation management.
Benefits of Outsourcing Your Payroll Process
1. It can lend you payroll process expertise and streamline operations
A payroll outsourcing services provider brings with them both the job knowledge and the technological resources necessary to administer your company’s payroll. You won’t have to spend money on hiring a payroll team, investing in the different payroll technology and training them on the payroll process. Instead, your payroll outsourcing company can immediately get to work and ensure your company’s payroll process is a well-oiled machine.
In fact, ROI on payroll is high if you outsource it to an adequate partner who can sufficiently assist you and your HR team.
2. It can help increase employee satisfaction
When you have a robust and dependable payroll process, all salaries are credited on time. Additionally, leaves are noted and processed correctly and employees are reminded to file their taxes in time. At no point will your staff have to worry about not receiving their paychecks consistently or about missing their crucial deadlines.
When their economic needs are cared for, your employees feel a sense of security, which increases their workplace happiness, job satisfaction, productivity and commitment to your company.
3. It can prevent payroll fraud and strengthen security & compliance
Did you know that 27% of businesses experience payroll fraud at least once in their lives? The fraud can occur due to numerous reasons, including:
- Timesheet fraud by employees.
- Padding of working hours and false reporting of overtime by employees.
- Illegal alteration of employee’s pay rate due to corruption, coercion etc.
- Failure or delay in paying advances and/or salaries to staff.
In such cases, it helps to have an experienced payroll outsourcing services provider by your side. Not only will they be able to recognize signs of payroll fraud, but they’ll be able to rectify any issues present. The payroll process outsourcing expert will also have knowledge about regulatory compliance requirements and they’ll be able to help you avoid any legal trouble with bespoke advisory and support.
4. It can give you the freedom to focus on the growth of your organisation
When you have a dedicated payroll outsourcing team taking care of all your payroll responsibilities for you, it eliminates a bulk of the administrative distractions letting you focus on other areas of your business. For added assurance, you can establish a direct line of contact between your employees and your payroll outsourcing services provider. This way staff can seek payroll-related counsel as and when necessary. All the while, your time, corporate resources and peace of mind will all be preserved, allowing you to expand your operations as you see fit.
Disadvantages of Outsourcing Payroll Services
There are only a handful of disadvantages of choosing a payroll outsourcing services provider:
- Your provider may be from another country. Communication & coordination may be difficult at the start.
- After you outsource your payroll, the entire control of payroll will be the third-party. This can take some time to get used to, especially if you were the sole leader in your business.
But to be fair, both of these problems can be avoided by having a transparent discussion with your outsourcing company about your expectations and needs, such as in-country payroll support. Setting ground rules can also ensure that your payroll outsourcing company will work in tandem with you to ensure your business objectives are met.
How to Know if Payroll Outsourcing is Right for Your Company or Not
While some companies do have their own in-house payroll teams, you might be better-suited for payroll outsourcing services any of the following applies to you:
- You are a start-up and you don’t have the in-house expertise to manage your company’s payroll.
- You want to speed up business growth by adopting a business structure that focuses primarily on core business offerings.
- You want your in-house team to concentrate on building greater employee value and would rather hire an already established payroll outsourcing services provider.
- You are planning to set up your business in another country and need payroll specialists experienced in that country’s payroll process regulations.
- You have too many employees across different countries/continents and you are finding it difficult to manage cross-location payroll.
- You are looking for a professional service guarantee and want high-quality and affordable payroll management services.
Tips for Selecting a Payroll Outsourcing Services Provider
Now that you know why you should choose payroll outsourcing for your company, let’s take a look at a few tips you can use to hire a payroll outsourcing services provider:
- Make a list of all payroll processes you need help with. Shortlist companies that offer those services.
- Make a list of important payroll questions you want to ask your prospective outsourcing specialists.
- Ask the payroll outsourcing services provider to share reviews and feedback of their work. Check Google reviews and LinkedIn testimonials to know how previous/current clients feel about the company.
- Ask to review any licenses or certifications they possess for trustworthiness. A reputable payroll vendor will typically have ISO 27001, and SOC2 certificates.
- Check if your prospective provider’s payroll solution is compatible with your own and can be integrated with existing systems
- Find out if they provide a dedicated implementation manager to help you start the payroll outsourcing process.
- Interview their tax compliance team to figure out if they are well-versed with your geography’s tax laws.
- Find out what type of customer support they offer and whether in-country support is available to your company and your employees as part of the outsourced payroll process.
- Discuss the cost of payroll management and negotiate your package.
- Decide when to onboard your payroll outsourcing provider. Usually, the second quarter is a great time to start your outsourced payroll process, since it doesn’t interfere with the year-end payroll management already in place.
- Enable seamless data migration and eliminate data duplicity by having your HR team liaise with the payroll company. Work with the provider to integrate their payroll technology into your own.
Choose Links International to Manage Your Asia Payroll Processes
Links International is one of the few leading Asia payroll outsourcing services providers that offer 100% in-country payroll support. We have offices across the continent, servicing 18 locations including Singapore, Hong Kong, Macau, Vietnam, Indonesia, Japan and more. Our team of highly qualified payroll process specialists have immense experience in payroll processing in various Asian countries.
Once you outsource your payroll process to us, we take care of your responsibilities from start to finish. With our support and expertise managing your growing team will become easier, more affordable and more profitable.
If you are expanding your business to Asia or at least planning to do so in the future, consider Links International for Asia payroll outsourcing. We look forward to helping your company grow and succeed.
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Links International is an industry leader in innovative HR outsourcing with services such as payroll outsourcing, visa application, PEO Secondment, outplacement, recruitment and more! Contact us for more information on how we can help leverage your HR function.