Payroll processing comes every week or two. It's a routine process but complex and ripe for mistakes. Even the most seasoned HR employees can make a payroll mistake that could result in unhappy employees and government fines.
Companies must do payroll and tax remittances correctly every single time. Ensuring this level of accuracy routinely requires a keen eye for detail, as well as a serious time commitment.
Fortunately, your company has options aside from hiring a costly HR and payroll expert. By outsourcing your payroll, you partner with another company to handle your payroll and tax remittance.
The Risks Of Doing Payroll In-House
Doing your payroll in-house, whether yourself or with your in-house HR team, increases the chances of a mistake. Whoever does your payroll has many other duties requiring their time and attention, and payroll can be incredibly burdensome when added to their other responsibilities.
Payroll requires more than just paying employees. You need to review timecards and ensure that employees are classified correctly as exempt or non-exempt, so you know whether they are eligible for overtime pay. Making a mistake on employee classification has ripple effects that could result in costly fines for your company.
When an employee doing payroll makes a mistake, that too has ripple effects. Most importantly, it serves to demotivate employees. If an employee receives an incorrect paycheck, it’s a hassle at best and may demotivate employees if it happens consistently.
Payroll is subject to federal, state, and local laws. Keeping up to date on all of these different laws and new employment laws and regulations is a full-time job by itself. When you partner with a trusted HR outsourcing company, they handle all of the work and analysis on new laws and regulations to make sure your company remains compliant.
Payroll Outsourcing Options
When your company outsources payroll, it frees up your internal HR team to focus on your core business needs. A payroll outsourcing provider also has a team of payroll experts you can rely on and trust to get your payroll right.
By partnering with a payroll provider, your company saves money. You and your employees can focus on what you do best without worrying about payroll processing and tax remittance complexities. Some HR outsourcing companies can even help your business grow by offering you a comprehensive package that includes much more than just payroll.
Payroll Services
A payroll services company does exactly what it sounds like and provides companies with payroll services. They will handle your payroll on your regular schedule, ensuring that each employee gets the paycheck deposited into their account.
Payroll services only handle payroll, but not any other aspects of benefits administration. They’re well qualified to complete this task if it’s the only thing you need. However, other services have increased offerings that can help your HR team in other ways.
PEOs
A Professional Employer Organization (PEO) combines what payroll services providers and ASOs do, plus it adds even more. PEOs handle payroll processing, tax remittance, and benefits administration.
PEOs also shoulder the burden of ensuring accurate payroll, but they do more than simply entering the hours you provide and have you verify it. They take on liability for making sure payroll is correct, making them invested in the success of your business.
PEOs can offer additional and enhanced services over other HR outsourcing options through co-employment. This relationship makes your chosen PEO the employer of record for your employees, giving the PEO the ability to administer payroll and benefits and get your company great rates on healthcare plans. Through this relationship, your company can offer Fortune 500 benefits at Fortune 500 prices.
Choosing the right PEO for your business does not need to be hard. Your PEO can take massive burden off you and your in-house HR team, freeing your employees from complex and time-consuming HR tasks, and allowing more time and energy to focus on growing your business.
Outsourcing Payroll Ensures Accuracy
Payroll is a crucial part of any business. When done incorrectly, the ripple effects can damage your business and reduce your profitability. That's why it is vital to your company's ability to grow that you choose a payroll processing provider that you can trust to get the job done right and do it cost-effectively for your company.
If your company only needs payroll processing services, a payroll processing company or ASO might be right for you. But suppose your business can benefit from a more comprehensive offering, helping your employees feel more comfortable at work, making them more loyal to you, and ensuring that your payroll is right every time. In that case, a PEO might be your best choice. Through a comprehensive package that includes payroll processing and tax remittance, your company can see a positive ROI with a PEO.
