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Published November 06th, 2016 by

7 Common Payroll Challenges That Need Solutions

7 Common Payroll Challenges That Need SolutionsIf you are a business owner, you probably have a lot of responsibilities on your shoulder. One of which is payroll processing. Payroll is never an easy work to handle. You need the right equipment, expertise as well as experience. It can be daunting to do payroll in-house hence why, many tend to outsource to a payroll processing agency. Agencies are specialists and experts in the field. They are believed to get the job done faster and with great accuracy. Many have already experienced the great benefits of payroll outsourcing. Some employers say they were able to save costs by having less investment for human capital. Some also say that they were able to save time and increase productivity.

Unfortunately, not every business is capable of outsourcing their payroll to an outside company. Many still choose to do the work in-house due to some reasons. If you have enough knowledge about how payroll processing works and is keen with ins-and-outs of its variables, then doing the job in-house is a good choice. However, if you don’t have enough experience about it, then you are probably going to meet few obstacles along the way. In this article, you will be able to get the knack of the seven common challenges associated with payroll processing. Whether you choose to outsource payroll or do it in-house, getting to know these challenges is essential in order to gain full understanding.

Payroll Meaning

Payroll is defined as the total compensation that a business is due to pay to its employees on a given date or period of the month. Commonly, the accounting department is the one responsible for doing payroll processes. However, for small businesses, the owner usually handles the job directly. The details of a payroll can differ from time to time. Depending on the hours of work rendered by an employee or other factors like sick or vacation leave where they are still entitled for payment.

For large businesses, payroll handling can be complicated because of the number of employees and the amount of taxes and withholdings it needs to process and pay. This is why outsourcing to payroll companies is becoming popular. Payroll processing is a time consuming task and people that handles it must be up-to-date and knowledgeable with new legislation. But if you choose to outsource, you need not to worry about those stuffs anymore. Selecting the right service should be done carefully. Be meticulous and wise by reading reviews of payroll processing agencies.

So that’s it about payroll. Moving on to the bottom line of this article which is the 7 common payroll challenges that need solution.

Payroll Processes Can Be Time-Consuming

You may have already heard about payroll processing to be such a time consuming job, and yes, that is true. Without you knowing, you might already be using a significant amount of time by doing payroll tasks and that other important work stuff are being overlooked or postponed. Tasks related such as keeping track of employee’s record of hours worked, calculating pays and deductions and making sure taxes, withholding and other variables are accurate can easily get messed up sometimes. In addition, alteration of errors can also take a while, let alone when you have large pile of forms to go through. This is one of the main reasons why many employers choose to let a payroll processing agency to handle the job for them. Since they are specialists and have the right equipment in hand, they can do the work a lot faster than you or your people in-house.

Global Transition Can Be a Pain in the Neck

Not every business finds change a pretty interesting thing to deal upon especially if everything is already going well and then in a snap you suddenly have to deal with compulsory a change. The same goes through payroll. Global payroll transition is one of the most important operational changes in this field of work. Compliance to global payroll is necessary because a lot of organizations are trying to expand services and business internationally. Thus, following global compliance in tax, social security and immigration for employees assigned overseas is a must.

As a business manager, your role is to convey your employees about the benefits of global transition. It will not only benefit the company’s expansion but also the employee’s opportunities for growth. Although, it could be hard at first but eventually through proper motivation from the management, everyone on the entity can fully adapt.

Keeping the Balance Between Local and Global Standards

Global payroll implementation requires balance between process standardization and flexibility retention at a local level. With your goal to standardize and streamline your payroll platform, it may actually result for your employees to be forced in working outside the current system. Managing local requirements in every territory through a single platform can become complicated and may cause errors with payroll.

As a solution, outsourcing to a reliable payroll agency can help in maintaining the balance between local and global standards. They are professionals who are knowledgeable with the ins and outs of payroll standards on a local and global aspect. With the goal of expanding your company globally, you must also see to it that your payroll system is capable of adhering with international standards without overlooking the local ones.

Integration and Automation Can Be Tricky

We are currently living in a world where technology is developing swiftly. This development is also applied in many industries which includes payroll. Without in-depth technical knowledge, it can be hard for any manager to make any decisions related with technology integration. Payroll automation has also been one of the most helpful tools to make payroll processes a lot easier. For a lot of companies that are facing automation issues, having little knowledge about the technology can lead to unwanted errors in payroll processes. If you are dealing difficulties with your payroll, automation may not always be the best solution. There are good payroll processing services out there that can help you. You only need to choose carefully so that you’ll come up with desired results.

Employees may Easily take Legal Actions Upon Payroll Errors

Handling of various important tasks in a company including payroll can lead to commission of errors. Since payroll is closely related to employees, errors and miscalculations with their pay can result for them to file legal complaints if their concerns are not given on-time solution. Outsourcing to a professional payroll provider can help you lessen errors because they are specialists and are believed to come up with more accurate results. Choosing the right provider should be given enough time. Seek from the ones with proven experience in providing excellent service for their customers. You may consult the list of the best payroll processing agencies from CrowdReviews.com.

Data Management

According to the article Global Payroll Resources – CloudPay.net, data management is a massive challenge among payroll departments. Most especially if your company has a big number of employees, data and important information about each person’s payroll could be overwhelming which makes it difficult to sort out. Without helpful technology that will help you manage payroll data, errors and lapses is highly possible. Here is where you might need the help of a payroll processing agency. Choose the one that is equipped with necessary tools and technology that will help in better data management. Effective data management is crucial to every business. It should be given enough priority as it where payroll success depends. As a wise manager, you want to be as accurate as possible in dealing with every responsibility you have. Thus, proper management with data and information is a top requirement.

Global Compliance

Achieving global payroll compliance is another huge challenge to deal. Payroll related legislation differ from one country to another. If you have multiple branches distributed locally as well as internationally, you need to abide with the rules of payroll applicable in that certain country or region. The challenging part in having a global entity is the maintenance of global compliance. Being able to identify payroll errors late is pointless. You have no other choice but to accept sanctions and fines from the government once you commit legal mistakes.

How About Outsourcing Payroll?

Learning the challenges mentioned above is important for ever business manager. These challenges can take away your valued resources at a snap and can affect employees’ relationship with the management. Outsourcing your payroll to an outside company may seem daunting. However, if you get to choose a payroll firm with exceptional expertise and proven experience, you will be able to enjoy outstanding benefits that you never experienced by doing payroll in-house.

Conclusion

That’s it! Those are all the examples of the challenges associated with payroll. Whether you choose to outsource or not, having knowledge about these obstacles is necessary. Take note of this challenges and do further research as there might be more obstacles possible with payroll processing that is not mentioned in this article.

If you are looking for the right payroll processing company that will help you solve payroll issues special cases, check out reviews of payroll processing agencies from CrowdReviews.com.

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