Can payroll outsourcing improve business efficiency?

Payroll is more than just calculating and paying employees accurately. It requires more time and effort to learn about legal terms, ensure all processes are in compliance, and protect employees' personal data. In fact, it is a job that many people do not like. Is this why companies outsource payroll services? Does payroll outsourcing help save costs?

For any business, time is money. However, payroll processes are repetitive and require careful attention, despite not being able to generate any profit. As your business grows, these administrative tasks become more time-consuming. Every little task, such as calculating monthly salaries, distributing salaries, maintaining payroll records, preparing tax reports, updating employee status or handling employee requests, etc., can take away time that you could be focusing on your core business activities. Additionally, recruiting, training, and retaining employees in the Payroll and Benefits department requires a lot of effort, time, and money.

I.  Can payroll outsourcing improve business efficiency?

By using a payroll service, your employees can focus on activities that can bring profits to your business.

1.  Ensure regulatory compliance

The modern workforce can include full-time, temporary, part-time, or contract employees. They have different minimum wages, benefits, pay conditions, and tax rates. Meanwhile, government laws and regulations are constantly changing, and it may not be possible for an in-house HR team to always stay up to date with these changes. More importantly, any mistakes related to payroll will lead to costly audit errors and penalties, which can damage your business's profits and reputation.

So why not let the experts do this? Payroll companies understand the law, and their experts can keep up with all the latest updates. They can ensure accuracy and legality in all business processes and keep you up to date with local regulatory changes that may affect your business.
 

How to optimize payroll outsourcing expenses

2. Ensure data security

Managing your own payroll comes with its own set of risks, including identity theft or records being leaked by payroll administrators. In addition to employee trust issues, you will need to ensure that your payroll software is secure and that your data is stored on a reliable server and network.

Payroll services make it easy for you to address these issues. These companies always provide advanced technology and high security to ensure customer privacy. Your confidential data will be stored and protected from cybercrime and information disclosure as part of the service provided. Trying to invest the same level of security into your in-house payroll operations will cost you a significant amount of money.

3. Access to more services

Some payroll companies offer a range of additional services that can meet your needs beyond just calculating and paying your employees. For example, at Faro Vietnam, our experts assist clients with contract creation, tax reporting, statutory reporting, social insurance, benefits payments, maternity leave services, reference checks, high volume recruitment, professional recruitment, and annual leave or sick leave replacement services.

II. How to optimize payroll outsourcing expenses

2.1 Moving to an automated payroll system

Manual payroll processing is a time-consuming and labor-intensive process for HR departments. Printed payslips are easy to lose and are not an environmentally friendly solution for the workplace, plus there is a high risk of errors due to incorrect entries and calculations.
 

How to optimize payroll outsourcing expenses

Is payroll outsourcing expensive? That is why payroll software from payroll outsourcing will enhance the efficiency of payroll management. Automated systems provide a higher level of security and accuracy in all calculations, from salaries, bonuses, overtime payments to taxes. In addition, you will spend less time on payroll reports, then use this valuable time for activities that are more valuable to your business. Your employees can also easily access their payments and salary history online, so automating your payroll management process is a win-win.

2.2 Consolidate Payroll Schedules

Some businesses maintain a variety of employment contracts, from permanent, temporary, seasonal or shift workers, to freelancers and contractors. These companies also often have separate pay schedules for each group of employees. Monthly, weekly or bi-weekly pay schedules may make sense in other respects, but when it comes to payroll management, these processes are prone to duplicate errors.

To minimize risk and process payroll properly, you should pay all your employees on the same pay schedule. Likewise, since payroll is more than just calculating and paying salaries, your employees will also need to work on other tasks, such as tax reporting or ensuring compliance. So, give them all of their attention to one important task at a time.

Does payroll outsourcing help save costs? A great payroll company will provide highly customized solutions that help you reduce redundancy and focus your resources on revenue-generating activities. If you are ready to learn how a payroll company can benefit your business, contact us now:

Faro Vietnam
Email: service@farovietnam.com.vn
HANOI HEAD OFFICE

• Tel: + 84 24 3974 3091

HO CHI MINH CITY OFFICE

• Tel: + 84 28 3821 4654

Grow your business with our trusted Human Resource Solutions.