Payroll software, at its best, can significantly improve the payroll process by minimizing errors and streamlining data entry. It also reduces stress for all parties. The wrong payroll software can cause more problems than it solves. You’re either looking to upgrade from manual bookkeeping or find payroll software that meets your needs better; you’re at the right place. We will help you identify the gaps in your current system, highlight the essential features, and guide you through selecting a payroll service that is the right fit for your company.
Why choose a new payroll service?
It’s not easy to switch from an established process to a different one, especially when the function is critical, like payroll management software. Payroll admins are often tempted to ignore the possibility of complications and the overhead associated with making the switch. Broken payroll processes trap admins in a time-consuming, laborious cycle that hinders organizational and individual growth. When “well enough” is no longer enough, the inefficiencies, inaccuracies, and IRS penalties that can result from mistakes will disrupt more than your culture, employer brand, employee satisfaction initiatives, and employer brand.
You can free yourself with an efficient new process and reallocate your time to strategic, meaningful work. We’re here to help.
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Top 8 Reasons to Choose A New Payroll Service
BambooHR recently asked respondents to rank their main complaints about their current payroll system.
Sub-par customer service: 78% of respondents cited poor customer support because they were dissatisfied.
Inadequate integration: 68% were disappointed that their payroll was not integrated with their HRIS.
Unusual interface: 64% wish their current service were easier to use.
Poor employee experience: 61% wished for a better employee experience.
Lacking functionality: Half of the respondents said their current service lacks functionality.
Expensive processes: 43% wish that managing payroll was faster.
Too costly: 36% felt they were paying too much for their payroll services.
Inaccuracies. 18% were concerned by the frequency of payroll errors.
Are you unsure where you stand on the spectrum of payroll dissatisfaction? These two tasks will provide you with a solid foundation and context for creating the perfect payroll service profile to meet your needs.
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As you choose a replacement solution, this will give you a list of things to address. These items should be ranked based on personal experience. You can also add any other frustrations to this list.
Take into account the payroll cost for your current employees (in dollars and hours per employee), and then extrapolate this cost to your company’s growth projections for the next few decades. This will provide a baseline price point to help you compare other solutions.
What are your Payroll Solutions Options?
- When it comes to payroll administration, there are four options:
- Purchase of third-party payroll software
- Employer Organization (PEO), Professional Employment Organization
- Develop a solution at home
- Use a national or local accounting firm
- Professional Employer Organization
Full-service PEOs can act as an outsourced HR department and handle everything, from talent acquisition to benefits administration to payroll. PEOs can reduce the overhead of HR. However, there are downsides to a PEO, such as a lackluster culture and loss of control and security over your people’s data.
Accounting services are generally limited to bookkeeping, financial planning, and filing taxes. However, some accounting firms offer payroll services. Although an accounting firm does not handle HR responsibilities like a PEO, it can save you time and stress by combining all of the company’s financial tasks into one system. Outsourcing payroll to an accounting company is like outsourcing HR to a PEO. However, this can lead you to lose control and visibility.
- Homegrown Solution
Many organizations have the resources and expertise to create a custom-built, internally managed payroll software system. A homegrown solution can save on third-party software and give the organization complete control over features and functionality. However, it places the responsibility of maintaining payroll accuracy, compliance, and tax filing on the company, reducing the ROI of time, money, and risk mitigation.
Third-Party Payroll software
A third-party human resources technology company developed this software. It is intended to be used in-house for payroll admins to organize, automate, and store payroll, tax filings, and other related information. Advanced payroll software can be integrated with HRIS, accounting software, and other company processes.
Which is the most cost-effective option?
It is difficult to predict the cost of a homegrown solution’s front-end investment. However, here is a stat: One in six IT projects exceeds costs predictions by 200%. The ideal scenario is that homegrown software will be cost-effective over the long term. However, ROI is always at risk when maintaining and keeping up-to-date software. Outsourcing options include national and local accounting firms. Full-service PEOs are the most costly payroll solutions. A third-party payroll program is usually the best option for organizations with their HR department to implement their initiatives.
Which Payroll Solution is Best for Your Organization?
The most likely to rely on PEOs are the smallest businesses.
According to the National Association for Professional Employer Organizations (NAPEO), at least 15% of all U.S. employers have a headcount between 10 – 99 employees.
PEOs can be expensive, but they offer the opportunity to take the burden of payroll and HR management off of small- or new-business owners who already have enough.
Many businesses use third-party payroll software.
BambooHR’s research into payroll state revealed that most of our 500 respondents handle their payroll in-house. Only 48 percent use a third-party software provider.
This group of third-party users breaks down based on company size.
40% of these were companies with 26-100 workers
51% of the companies were those with 101-350 employees 58% of these were companies with 351-1000 workers
Some companies, including 24 percent of our respondents, choose to invest in a local payroll software solution right away and continue to improve it over time. However, the general trend is to outsource payroll for the initial stages of growth and then move to a third-party payroll software once they reach a certain point.
Which Payroll Solution is Best for Your Industry?
Your industry’s unique characteristics, such as how employees are paid or who they are, will influence the features and functionality that your payroll solution should have.
The payroll solution that you choose, depending on your industry, should be capable of handling things like:
- Hourly workers
- Union workers
- Tip-based incomes
- Multiple pay rates
- Shift differentials
What Payroll Solution Should I Choose?
Rhonda Abrams, the business consultant, recommends using a payroll service to replace paper and spreadsheets starting day one.
A payroll service can be a time-saving investment and risk mitigation. But which payroll solution should you choose to save time and money? Consider these questions as you weigh the pros and cons of each option.
- Are you looking to outsource or manage your payroll?
- Are you able to manage payroll on your own?
- How influential is culture for your long-term goals and objectives?
- How involved do you want to be in directing employee experience?
- Which option in payroll would be most supportive of your mission and values the best?
- What are your current payroll costs in terms of time and money?
- Do you want to spend more to get a better experience, or do you prefer to reduce costs?
- How big is your HR department?
- What level of control do you desire over the software?
- How customized does your payroll solution have to be?
The points mentioned above are issues almost every organization faces, followed by solutions. If you have an Auto systems that can control your Payroll Management System and freeze the employee data. So now, if you are searching for an app that creates all the payroll-allied tasks, Ultimate Business Systems (UBS) is a solution for that.