The Risks & Costs of Managing Payroll In-House
Navigating the challenges posed by managing payroll is not an easy thing to do, especially as there are constant changes. In this edition of the Bachmann Group blog, we look at some of the ways in which carrying out this vital task in-house is fraught with potential problems.
Payroll management today is vastly different than it was a few short years ago. When the pandemic hit, companies which managed payroll in house were faced with a new set of complexities and challenges, such as handling job relief schemes and dwindling staff numbers. It soon became clear that payroll systems needed to be more agile to cater to the sweeping changes.
Before the pandemic, managers essentially had three options for payroll management: they could stick with existing systems, move to new software or outsource their payroll. The pandemic proved that sticking with existing systems was no longer a viable option.
The latest Global Payroll Complexity Report showed that many companies plumped for the second option, that of switching to new, cloud-based software to manage their payroll in-house. While such software can help to streamline the payroll process, it soon proved to be problematic for those who were not highly trained. The software is also incredibly expensive.
One of the biggest problems is that software cannot be blamed for any gaps in the knowledge and expertise of those operating it. Legislation changes all the time; tax bands, staff benefits and pensions are just some of the many factors that are affected. If payroll staff are not aware of a change, HMRC will not accept the excuse that a team was relying on software to keep abreast of the law and will impose fines regardless. An employee who is paid incorrectly or late will not be appeased by the payroll team blaming software for the mistake.
The expense of purchasing payroll software, training teams to use it effectively and continuing to ensure that all legislation changes are adhered to rigidly soon add up. Any mistake will add further pressure and cost. With this in mind, it will come as no surprise to learn that more than 61% of respondents to the Global Payroll Complexity Index Report have opted to outsource their payroll to a reputable management company like Bachmann Group.
We would like to invite you to find out more about our leading BACS-approved payroll management services by browsing the Bachmann Group website. To discuss the unique requirements of your business and to discover just how much time and money you could save by using these services, please get in touch with our customer service team.
