Outsourcing payroll can bring untold benefits to payment management. Instead of dealing with complex payroll systems and mundane admin, you can focus on growing your business while ensuring your people are paid on time and correctly every time.
Payment management is the process of administering and paying salaries within your organisation. It requires a complex workflow of tasks, like calculating employee earnings, withholding taxes and deductions, and generating payslips and payroll reports. It also demands understanding labour laws and taxation legislation tied to compensation, expenses and benefits.
Sound complex? That’s precisely why many companies choose to outsource payroll instead, freeing up time and resources and providing absolute peace of mind that everything is managed compliantly and by experts who know what they’re doing.
In this piece, we’ll take a look at how outsourced payroll streamlines the overall payment management as a simpler way to do things.
The challenges of in-house payroll management
Manual payroll is error-prone, time-consuming, and a legislative minefield, especially given the evolving legislation regarding employee classification, benefits and payroll. According to a YouGov survey, 61% of businesses now outsource their payroll. As your business scales, the intricacies of payroll management can become unmanageable, leading to human error, risk of non-compliance, and even financial penalties.
Manual payroll processes can lead to poorly managed data and are wide open to human error. Imagine if an overworked administrative staff miscalculates a wage or enters the wrong tax code during onboarding. That would result in an employee not being appropriately paid for their time, which leads to understandable dissatisfaction and could result in legal issues or problems with employee retention down the line. Manual processes take longer, too, which could have a knock-on effect on salary disbursement due to processing delays. Again, that means your employees aren’t paid correctly and on time, which comes with considerable reputational risk that isn’t worth it.
Engaging the experts to manage your payroll is a more intelligent solution; it keeps you agile and laser-focused on your business.
Benefits of outsourced payroll services
Outsourced payroll services provide a portfolio of benefits that shouldn’t be ignored. Businesses just like yours save money by not having to run their own in-house payroll teams. An external provider streamlines the process, managing payroll, calculating tax, and reporting for you. Automated workflows reduce strains on resources and increase efficiency. Imagine running payroll in just a few clicks, anytime and anywhere. That’s precisely what ADP provides.
Automation and specialised software used by payroll service providers lead to time savings and increased efficiency. Outsourced payroll services like ADP have crafted specialised knowledge in managing payroll for companies of all shapes and sizes. They can handle complex payroll scenarios and stay up-to-date with evolving legislation, so you don’t have to. Their payroll experts can help answer your questions promptly, which puts clients at ease.
Improved accuracy and compliance
Outsourced solutions use advanced payroll software to calculate your payroll accurately, minimising your risk of errors and keeping you compliant without having to think about it. Specialists bring next-level knowledge of payroll legislation to your organisation, which protects you from any risk of non-compliance in the eyes of HMRC. That reduces the chance of being flagged for auditing or penalties for non-compliance, saving you time and money.
How to lower your costs by outsourcing payroll
Download nowEnhanced security and data protection
Organisations often struggle with safeguarding sensitive employee information. Outsourced solutions always treat personal data securely and confidentially, meaning this is no longer a worry for overstretched teams. Established outsourced payroll providers use cutting-edge tech to safeguard employee data: from advanced encryption to firewalls and multi-factor authentication, it’s a safer way to manage employee data. They also stay switched on to data regulations like GDPR, so clients don’t have to think about it.
Scalability and flexibility
As your business scales, so will the complexity of managing your payroll. Outsourcing enables companies to adapt to these changes, reflecting new employee demographics, the use of contingent workforces, and any fundamental changes in your organisation’s structure. Updates to payroll processes and taxes are all calculated for you, providing total accuracy and compliance. And, as you scale, your reporting can match your business's intricacy without worrying about getting things wrong.
In the undisputed era of remote working, payroll processing for distributed workforces can be a nightmare. It’s harder to track hours, benefits, and expenses and pay your people relative to their geographic location. An outsourced solution streamlines this for you, working out global payroll for your dispersed workforce and ensuring payment is on-time, compliant, and tax-appropriate, no matter where your staff are based. Whether you’re on a hiring spree or have decided to streamline your business, outsourced providers are flexible to your changing needs.
Efficiency in payroll processing
Outsourced payroll provides streamlined efficiency for you, resulting in considerable savings. Here are a few automated features that save businesses like yours time and money:
- Pay, track, manage, and analyse your employee’s activity in one dashboard
- Integrate time tracking with payroll
- Access the latest payroll data globally
- Analytics help you make better strategic decisions
- Receive quarterly and annual reporting on your behalf
Integration with HR and accounting systems
Integration with HR systems should be a top concern, no matter what payroll process you decide upon. When shopping around, look for solutions that integrate HR and accounting seamlessly, as it will save you time and resources in the long run.
Integrations with HR and accounting systems optimise HR efficiency, creating one single source of truth: a 360 perspective of everything related to employee data from absences to annual leave and pension information. Integration removes the need for manual input by providing cross-functionality across different systems while ensuring compliance and minimising risk.
With ADP, you’ll get automated data transfer across different systems. When one is updated, it automatically updates the rest, including payroll, reducing your admin burden. ADP also provides frictionless access to important info. For example, if you need to calculate the impact of an employee bonus, integration across systems shows you what that looks like in real time. That improves organisational visibility, offering invaluable data-powered insights for decision-makers.
Case studies and success stories
ADP is the global solution for outsourced payroll management, trusted by the likes of PayPal, Innocent and Amazon. In the UK, Amazon needed help finding a payroll solution that could keep up with its explosive growth. They needed something beyond tech: a team of legislative experts who could help the company comply with global compliance regulations and labour requirements.
According to Amazon, “On short notice and with ADP’s help, we moved half a million employees to weekly pay, the largest pay cycle acceleration in history. There was no room for error and no time to waste. All of this was done on ADP technology. The team at ADP had our back — and they nailed it.”
Considerations for choosing a payroll service provider
When you’re choosing a company to handle your payroll, bear in mind your business goals and scalability. Do you manage dispersed teams and need a payroll provider to take care of everything for you? This is often the best solution for enterprise companies. You’ll need to make sure your provider has a good track record of following UK laws and legislation–read client testimonials and reviews on sites like Trustpilot. Also, think about functionality and the ease of what they offer. Do they provide integration with HR and accounting solutions? These should all influence your decision.
When you outsource your payroll to ADP, you’ll:
- Receive round-the-clock compliance support
- Benefit from automated online payroll processing
- Have payroll taxes calculated and paid for you
- Access best-in-class expertise and unified technology
- Free up HR to focus on engagement and productivity
Seeking peace of mind that your people are paid on time, correctly and compliantly. Managed payroll services are designed to meet your needs. ADP serves 1,000,000 clients worldwide, of all shapes and sizes. Leave your payroll in safe hands, and see how ADP can help.
For more information read our full guide on how to outsource payroll here.
