Accuchex Blog

10 Signs That It's Time To Outsource Payroll Management

Posted by Leslie Ruhland on Apr 11, 2019 9:00:00 AM
Accuchex Payroll Solutions
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As your business grows, so does the volume of administrative work. And when your HR and payroll staff are overwhelmed, more costly mistakes occur.  



[Editor's note: This post was originally published in January 2017 and has been completely revamped and updated for accuracy and comprehensiveness.]

Increasing numbers of mistakes with payroll processing serve as warning signs that indicate your payroll team may need more staff and and better resources. On the other hand, it's very likely that it's simply time to consider other options for managing your payroll process, such as outsourcing.

The larger your organization becomes, the more time-consuming and complex your payroll functions and processes become. And then add the never-ending jungle of federal and state regulations and changes to the mix.


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Doing More With Less is Not a Business Strategy

Too many owners and management teams simply opt to add hours, add lower-level admin staffers, or spend large amounts of money on new software. And all of this in hopes of taming the beast of a growing payroll management process. There is a point of diminishing returns, however.

The problem is that mistakes begin to occur with more frequency. And errors and omissions in your payroll process can be dangerously expensive. Between the IRS and the state labor boards or commissions, the impact of fines and additional taxes and fees can be debilitating for a business.

This doesn't even take into account the impact on employee morale and the reflection on your own integrity.


[image courtesy of Guidant Financial]

According to a study from Guidant Financial,

"Despite the challenges of time management and administrative efforts, only 10 percent of small business owners outsource bookkeeping, 17 percent outsource accounting to a CPA, and 15 percent of small business owners outsource payroll. While many businesses outsource at least one service, there may be more room for small business owners to mitigate challenges with thoughtfully outplaced business services."




Give Me a Sign

There are a number of errors and oversights that can occur throughout the payroll and HR processes. We have narrowed these down to ten of the most common and illustrated them in a "top ten" list for quick reference. If you recognize three or more of these occurring in your company, perhaps it's a sign that you need to consider a viable option for your payroll process.


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Not every business can or should outsource all of their HR functions. However, even smaller companies can benefit for the cost-savings of outsourcing one or two major functions. Perhaps the most commonly outsourced process is payroll.

You might already find that you are dealing with growing frustration and insufficient resources if you are experiencing the following issues:

1. Too many mistakes. 

Payroll mistakes are costly. A good payroll services provider is far less likely to make serious errors. And in the unlikely event that it happens you able to receive financial restitution from the provider. Peace of mind is one of the greatest benefits of outsourcing your payroll process.

2. Taking too much time.

Professional payroll management services specialize in processing complex payroll systems. Since your payroll staff probably has multiple roles to fill in your business, removing the burden of constantly processing your payroll will increase their productive time.

3. Staffing costs keep going up.

While large corporations might be able to absorb the cost of fully staffed payroll departments this is not the case for smaller businesses. And when you include the cost of printing and distributing checks, creating tax documents, and related tasks associated with your payroll process, the savings can be substantial.

4. Compliance becomes overwhelming.

A good payroll services provider is up to date and knowledgeable of all new tax laws and regulatory mandates on the federal, state and local levels. The burden on your own staff to maintain this level of compliance knowledge only increases with each legislative session.

5. Constantly having to upgrade payroll software.

Outdated software tax and payroll information can be a nightmare for a business requiring regular updates or upgrades. Outsourcing your payroll management process eliminates the need for these expenditures.


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Where to Go When It's Time for a Change

Take some time to assess the state of your own payroll management capabilities. If these signs are present and you're finding that your payroll process has become a drain on your company's time and resources, then it's time for a change!

Employee development and engagement, building company culture and workforce management can all be part of the responsibilities of a company's HR staff. And oftentimes the tasks and demands can seem overwhelming. This is where having an alternative for your HR management can be highly beneficial.

Another key step in maintaining HR workload, while increasing your company's cost-effectiveness, is to consider outsourcing. A professional agency such as Accuchex can provide much-needed help with Human Resources needs and questions.

Accuchex is a full spectrum Payroll Management Services provider offering expertise in Time Management, Insurance and Retirement issues, as well. Get your Free Download: Payroll Outsourcing Guide to help you make an informed decision or call Accuchex Payroll Management Services at 877-422-2824.


Free Download: Payroll Outsourcing Guide

Topics: payroll management, payroll management companies, payroll process, outsourcing payroll management, payroll compliance

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