Payroll services form an integral part for most organizations. What happens when your salary is not being credited to your account at the beginning of the month or when there is a delay in paying your salary? What if your provident fund dues are not being settled on time? Many business organizations want to settle the dues of their employees on time without any delay. Hence payroll outsourcing services are becoming immensely popular among many business entities in recent times.
Payroll management has gained significant importance among organizations in recent times. Any business having more than a single employee must have a payroll system. Paying the employees on time without any delay will not only boost their morale but also reflect the company’s financial stability. Though the entire process may look complex, having an efficient payroll management system will help streamline the whole procedure without much hassle.
But first, let’s discuss what the payroll management process is all about?
To put in simple words a payroll management process refers to the payment of salaries and other benefits like PF, ESI, professional tax and labour welfare fund (LWF) on regular basis. It includes salaries, wages, bonuses, deductions, and net pay. Maintaining of these statutory records is very important on regular/ monthly basis such that no discrepancy arises in the future.
In India, most of the companies give payments to their employees on a monthly basis. To establish a well-structured payroll is one of the fundamentals of managing your payroll system. This focuses on better organizing from employer’s point of view and will be a morale booster for employees.
What an organization can look forward from an efficient payroll service?
- Morale of employees
Late payment of salaries and wages will have a negative impact on the employees. This will make employees question the ‘financial integrity’ of an organization. Payments not done on time will make them feel their job is not stable and secure. This, in turn, will decrease productivity as employees may start underperforming.
- Less tax
Payroll services that are appropriately maintained will minimize the taxes. Doing it inaccurately can lead to hefty fines. Hence it is the duty of the company HR to secure the employees to fill appropriate forms correctly.
No matter what is the size of an organization, it is very crucial for managing the payroll system. It is very difficult to manage the salary structure manually where the firm’s employees are in hundreds and thousands. In such scenarios maintaining a proper payroll management system will be highly beneficial not only for the company but also for the employees.
Start-ups and new business entrants may find the payroll management a challenging task. Hence many firms outsource their payroll services to ensure compliance.
After discussing what a payroll management process is, it’s important to look at the solutions that streamline it. Apart from outsourcing, a business can implement payroll software to accomplish their payroll processes. This is to ensure that the compliances are legal and the method of paying the employees is a more simplified process.
The following are the 5 reasons to consider having payroll software for your business.
- It saves time – Calculating a payroll may look straightforward as adding up the number of hours worked with the employee’s rate. However, taking into consideration factors like leaves, overtime and benefits make things look tedious. Hence payroll software can be very much handy in these circumstances. It saves a significant amount of time compared to doing all the calculation manually. As the tasks are already saved in the system one need not create a new format again and again manually.
- Payroll information can be maintained – The information obtained from payroll must be implemented when paying employees their compensation or when settling their full and final settlements. Many payroll packages have a customized module that maintains the data. Since all the information is compiled in one place it eliminates the need for consulting various other sources.
- Cost-effective – As most of the payroll systems are cloud-based solutions one need to subscribe to the service in order to use it. Moreover, the upgrades are automatically upgraded. No need to invest in hardware or outsource to manage the payroll management. In this way, it is cost-effective and saves money in the long run.
- Safe and Secure – The payroll software comes with high-end security standards that are safe and secured. Employee’s data are kept confidential as only authorized persons are given access to the system. Meanwhile, employees can also sign in to track their working hours, leave allowances, leaves available, deductions and other fringe benefits in their payroll profile. This not only gives information to the employees but also reduces the work of the HR manager or payroll administrators.
- Optimizes the process – Repeated tasks can be monotonous and can result in errors. Systems resolve these issues and errors are minimized. In this way, the information generated will be accurate. In case your system breaks down or gets corrupted your data will not be lost. One can still get the access from other platforms as long as you have the log in details.
After going through this blog on Payroll Management Process, here are some of the payroll software solutions that you can look into;
This is most suitable for small businesses. It is fast, reliable and easy to set up. It is helpful for users with no technical knowledge.
This full-fledged accounting software takes care of invoicing, inventory, bank reconciliation, among others. The software is safe to use and user-friendly.
- ADP Workforce Now
This is one of the most compact HR management tools that provide an ultimate solution for all payroll related management services. It is suitable for small and midsized business enterprises. One of the unique features of this software is that it runs totally on COBRA platform.
- Dayforce HCM
It is considered to be one of the best-known payroll software. It consists of a rich set of features that take care of payrolls, taxes and workforce management. The software is packed with effective multi-tasking features and HR tools.
Wave is known to be one of the most compact payroll software that is suitable for small firms and start-ups.
Now let us discuss why a company prefers to outsource their payroll services.
Payroll outsourcing services have become an integral part of every organization. Manual payroll is tedious and cumbersome. Many times it becomes a nightmare in the worst case. Hence payroll outsourcing services provide a multitude of benefits to the corporate sector, especially the small and the mid-sized firms. Some of the noteworthy benefits are listed below:-
- Free up your time
Many times organizations feel that processing a payroll is a brainstorming process. HR managers and payroll administrators can have a huge sigh of relief when payroll is outsourced. It can free them to pursue and focus on other important tasks.
- Costs can be trimmed
The costs involved in processing a payroll can be greatly deducted by working with an efficient payroll provider. Moreover, it is a cost saving for the company by way of outsourcing the payroll services. One of the main features of outsourcing a payroll is costs can be trimmed to a great extent.
- Avoid fines and penalties
No organization would like to bury a deep hole in their pocket by paying hefty fines and penalties. By outsourcing payroll, business enterprises can relieve themselves from worrying about fines and penalties. It is estimated that nearly 50% of the firms pay penalties due to late or incorrect filings. This can be avoided by availing the services of a payroll provider. Several payroll outsourcing firms also give a guarantee to an extent that one does not need to pay any fine.
- Risk can be curtailed
Undertaking the payroll on your own is indeed a risky process. One needs to take care of other aspects too like updating tax tables, computation of salaries, submitting reports, making payments and so on. This diverts the attention from relevant work and at the same time increases the chances of occurrence of errors. By outsourcing the payroll one can free oneself from such woes.
- Quitting doesn’t matter
Any employee who looks after the payroll services resign or are on leave from the services of the company, then it will not make much difference to the payroll processing as the same has been outsourced.
- Expert service just a call away
Outsource payroll experts are always available at your beck and call. One need not keep a close watch on the rules that are changing constantly. Once the entire payroll process is being outsourced, everything is taken care of by experts. Hence to be on the safer side it is advisable to outsource the payroll services.
There is no doubt that dealing with payroll process poses serious challenges to enterprises. Handling attendance, taxes, and the compensation of the workers can be a tricky situation even for most experienced business leaders. That’s where payroll service providers come into the picture. Payroll service providers handle a wide variety of duties like:
- Monitoring employee time and attendance
- Setting up and making adjustments to direct deposit accounts
- To calculate the payroll taxes and to ensure the deductions are error free
- Providing electronic payroll records to employees and employers
- To ensure a compliant free process
One of the key features of a payroll service provider is to make it easier to monitor employee attendance and time. Most organizations do this by offering a combination of punch-in or clock-in options. There are cases where employees clock-in using secured badges or fingerprint scanners. They log in at the beginning of the day and log out at the end of the day. The system can also be configured to monitor breaks and intervals.
To conclude choosing the right company that offers payroll services is a great way to streamline the entire payroll management process. It eliminates the need for an in-house payroll department. Many organizations opt for outsourcing payroll services because they offer the best services with respect to legal compliances and accountability. It’s a great way to provide employees with an efficient and reliable pay service while minimizing the errors.
Aavana can help with payroll services in a most efficient and a hassle-free manner.