Question

Can you identify at least 5 reasons why it's a good idea to use a payroll service provider to outsource your payroll activities?

What are the additional expenses incurred by the employer? Why is it necessary for the employer to incur those expenses above and beyond what he withholds from the employee?

Answer 1

Following are the 5 reason one must outsource the payroll services:

1) Saving in time: The core function of business is to foucs on it main activity instead of wasting of time on the non-value added work like payroll. by outsourcing the payroll function company pay more attention on it's main work which will result in saving of lot of time and money as well.

2)Managed by experts: Once the services of payroll is outsourced it was managed by the experts who is familiar with this kind of work and even perform it on daily basis.Experts will minimal the errors which results in saving from the panelties of IRS also.

3)Saving in cost of administration: Maintaning a payroll system where thousand of employees are engaged is one of the toughest task. it required a lot of employees to manage the entire payroll system which will increase the salary cost of company by outsourcing the payroll companies can save this costs.

4)Security of data: Company which manage the work of payroll are complied with the system which provide the security to the data which they collect from the client.Enhanced security is provided by the outsourced organisation which may not be possible if payroll maintained within the company.

5) Focusing on core work: By outsourcing the payroll work more and more employees of company will work for the predefined objective of company and try to achieve it hassle free. Also the top management have not to worry about the useless activities and government rules and regulation.

Answe 2:

Employe has to bear Additional expenses of outsorcing the payroll services. The firm which manage payroll will not only charged for the mainatance cost but it also charged cost of their expertise in the field. Apart from premium charges of expertise employee may always have a fear that it might lost the valuable data of employees and the data can be shared with the compititors as well. But still it is good option to outsorce the payroll activity as it has numbers of advantages in comparision to disadvantages as mentioned above.