Tag: payroll outsourcing

21 Feb 2019

Payroll Outsourcing: What is it and why do it

Payroll Outsourcing Defined

Payroll outsourcing simply refers to the hiring of an external firm that will be responsible for some or all of the payroll functions for the company. These companies generally take the responsibility of paying the employees, distributing pay slips, obtaining the appropriate and up-to-date payroll software and making the necessary statutory deductions. Many companies whether large or small find it necessary to outsource their payroll function as a makes their job while ensuring that they are fully tax compliant. Payroll outsourcing is the fastest-growing aspect of the global human resource outsourcing (HRO) industry and research conducted estimates that that it is expected to grow at a CAPR of 4.4% during the period 2016 – 2020.

Why Outsource Payroll?

The benefits of outsourcing your payroll should definitely be considered before making a decision to hire a payroll outsourcing company.

  • Payroll is a time-consuming process. Outsourcing your payroll process to a third party and allows you the time and convenience to focus on your core business with the knowledge that your employee’s work hours, pay rates and wage deductions are being handled.
  • Outsourcing your payroll reduces the possibilities of tax compliance errors and possible fines that might be associated, as well as likelihood of missing key tax deadlines. That is because the payroll is being handled by trained experts that have the responsibility of being aware of all changes that are being made by the tax authority and making the necessary changes to ensure compliance with government regulations. So as an employer you can focus on other aspects of the business without the need to worry about missing tax deadlines.
  • Payroll is not just about getting your employees paid on time however, that is an important aspect of the payroll process. Ensuring that employees are paid on time and that their statutory and employee deductions are accurate of the payroll process. Missed pay deadlines can lead to unhappy employees and continuous missed pay deadlines will result in. If considerate time and focus is not dedicated to the process of payroll, it can negatively affect your company, your production and your overall bottom-line. If you are constantly paying your employees late and missing pay deadlines then you should outsource your payroll process.
  • Outsourcing your payroll is also cost-effective. Cost-savings can be calculated based on the time savings that is not spent on conducting your own payroll. Time saved is money saved. Outsourcing your payroll allows you to save time in the following ways allowing you to focus on the overall company business.
    • Calculating payroll each pay period per employee
    • Creating and Distributing pay slips
    • Preparing and sending payroll taxes and tax returns to the government.
    • Outsourcing your payroll also tends to less expensive than keeping payroll internal.

Things to consider when choosing a payroll outsourcing provider

To ensure that you have a seamless payroll process it is important that as a company you do some research into the payroll industry prior to choosing your payroll provider. Here are some things to consider when choosing a payroll outsourcing provider.

  • Price – what is the price and additional fees that  the company is charging and is it worth the service that they are providing?
  • Service – what are the services being offered?
  • Reputation – What is the company reputation? Reputation is a critical factor as the reputation will help to dictate when can be expected from your payroll provider. As this process is outsourced, business owners will not be able to oversee the process as they would with their other operations. There is therefore a risk of using an unreliable firm to conduct your payroll which can lead to more problems than solutions. It is important to review the company’s reputation whether by get references from other companies or other means available to ensure that you will receive quality service.

Want to outsource your payroll services. Contact us at 1-876-971-7632 or email sales@caribbeanhrsoluions.com for more information.

 

Payroll Outsourcing Market 2017 Global Share, Trend, Segmentation and Forecast to 2021
http://www.digitaljournal.com/pr/3558598#ixzz5en0D0IoM

The Pros & Cons of Outsourced Payroll

https://yourbusiness.azcentral.com/pros-cons-outsourced-payroll-3039.html

 

Why Payroll Is One Function You Should Outsource

https://smallbiztrends.com/2014/11/outsourcing-payroll-tips.html

 

 

 

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15 Nov 2018

The Cost of Payroll Errors

Processing payroll is a critical aspect to your company. Employees want to assured that payroll is being properly calculated and that they are paid on time or production can be affected. There are many ways both indirectly and directly that payroll errors can prove to be costly for your company. Here are a few

Time (Labour) spent on correcting errors

Every payroll error that is made MUST be corrected. The payroll has to be accurate for taxation and recording purposes. The employee must be paid what they are due. That means that the time that that employee could have been doing something else is now spent correcting errors which in some cases can take more time to do that than the payroll had initially taken.

Interest and Penalties From Payroll Errors

It is important to ensure that your payroll calculations are in compliance with the law. Failure to do so can result in interest and additional penalties being enforced by the government.

Loss of Employee Trust due to late or short payments

Employees expect to be paid accurately and on time. When paychecks are late or short they will affect the lives of the employees. Employees will become dissatisfied with the company which can result in lower productivity and absence.

Cost of rehiring due to payroll error turnover

When payroll errors occur, particularly when they occur more than once, some employees will decide to leave the company. Companies must at that point seek to replace these employees which will incur additional costs in recruiting, interviewing and training.

 

Caribbean HR Solutions, as a payroll outsourcer, can aid in preventing payroll errors. Their experienced payroll staff will manage your payroll processes; making payroll seem easy. You can save time and money in your payroll process. Contact us at 1-876-971-7632 or email at sales@caribbeanhrsolutions.com.

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19 Jul 2018

The Real Cost of Not Outsourcing Your Payroll

Each and every business is different from the next: different in its size, different in its goals and different in its needs – but at the end of the day, payroll is something that every organization must manage.

When approaching payroll, there are two options: complete it in-house or outsource it to professionals. In running your business, you will undoubtedly be doing everything in your power to minimize financial risks, maximize your core business activity and out-do your competitors. However, turning down the opportunity to outsource payroll is often unhelpful to these aspirations.

Here are just a few reasons to consider outsourcing your payroll:

  1. You Are Incurring Direct & Indirect Financial Losses
  • You Have the Cost of Financing In-House Payroll
    Clearly, choosing to complete your payroll in-house comes at the cost of having your own payroll team. This practice is considerably expensive, as you must pay all the associated wages and benefits of employing the team, not to mention the other hidden employment costs, such as staff-retention and recruitment costs. If your business is reasonably small in size, there’s a considerable chance that the cost of employing this team would be significantly greater than the cost of using an outsourced payroll service as required.
  • You Must Purchase and Update Expensive Software / Technology
    One thing we can all agree upon is that payroll software is not cheap. When choosing to complete your payroll in-house, you will need to purchase and update the latest software for all your payroll needs. Such programs can include “benefits management” software, “time and attendance” management, as well as other services such as the automated sending of pay slips. By contrast, those who choose to implement payroll outsourcing have the privilege of a simple periodic payment. This means that their whole payroll function is taken care of in this one payment.
  • You Have the Cost of Providing Training
    Having your own payroll team comes at the cost of providing effective training. To ensure compliance, you must ensure that your payroll employees are always up-to-date with the latest government regulations and any changes in policies. Providing this training is time-consuming and costly. Those who choose to use outsourced payroll gain access to payroll experts, without having the worry or financial burden of providing the latest training.
  1. You Do Not Have Industry Experts to Ensure Compliance

As mentioned previously, payroll mistakes are all too common and all too easy to make. For example, you may assume that the overtime rate is 1.5 times the employee’s hourly rate, but this is not always the case. These unintentional mistakes can place your business in hot water. By contrast, those who choose to use payroll professionals have the peace of mind, knowing that the experts are always up-to-date with every last detail. Choosing to outsource payroll ensures constant compliance.

  1. You’re Wasting Valuable Time

I’m sure you’d agree that time is one of the most valuable resources. Completing your own payroll is hugely time-consuming, as it requires attention to detail and tedious re-checking of data every pay period. This process consumes efforts which could potentially be invested towards your business ventures. Any alternative which allows you to reclaim this time should be considered as highly worthwhile. Payroll outsourcing is so valuable as it allows you to reclaim this time, rather than spending it on administrative duties.

  1. The Knowledge Behind Your Payroll May Leave

Processing payroll is hardly an easy feat. Not only does it require a complex understanding of surrounding regulations, but also how to complete it for your particular business. In recruiting your own payroll officer or payroll team, you encounter the risk of the employee/s leaving, and this knowledge leaving along with them. Training and onboarding a new payroll officer for your specific business can be a mammoth task, often leaving your payroll processing in jeopardy while this retraining takes place. If you choose to outsource your payroll, you do not have to solely rely on your internal payroll team.

Depending on the size, structure, and industry of your business, you may find that some of these disadvantages do not apply to you, however, it’s likely that a majority of these setbacks will apply to your organization. Payroll outsourcing often offers a cost-effective solution to completing payroll alongside the added benefits of increased security, time-effectiveness and compliance, giving you complete peace of mind.

 

Read the full article here:

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12 Jul 2018

Professional Employment Organization (PEO): The Benefits 

In our previous article we looked at a guide into Professional Employment Organizations. In this article we want to look at what are some of the benefits of using PEOs.

Business owners and managers know that every dollar, and frankly every cent, counts when it comes to running a business. As your business grows, your HR demands can pile up.

What if you had specialized HR experts readily available to help you fine-tune and economize some of the most challenging aspects of your business? How about having a trusted set of advisors to guide your company on employment issues? And how would providing your employees with access to big-business benefits improve your recruiting and retention efforts?

All of these factors have the potential to transform your business, but are they really possible? They are when you outsource your heaviest HR burdens to a professional employer organization (PEO).

So, where are the savings?

PEOs do more than just save time and headaches by handling many employer responsibilities. They can also save you money by helping you avoid costly pitfalls – like hiring the wrong candidate for a key role – and helping to steer you clear of HR-related compliance issues that could result in hefty fines.

Here are seven key areas where outsourcing your HR challenges to a PEO can help you save money:

  1. Employee Benefits

A primary goal of the PEO relationship is to provide your employees with access to cost-effective, comprehensive benefits without the administrative and regulatory burdens that can be so overwhelming and costly.

As a co-employer, the PEO is able to offer a wide variety of benefits to your employees through PEO-sponsored benefit plans, such as medical, dental and vision coverage, a healthcare flexible spending account, and life and disability benefits.

As the plan sponsor, the PEO will handle the related administrative tasks, such as negotiating with carriers and enrolling employees.

  1. Payroll

Working with a PEO can decrease your payroll-processing and related accounting costs. PEOs can also conveniently automate the payroll process and handle your Employers Monthly Payroll Deductions (so1) and Employers Annual Return (so2).

  1. HR compliance

Employment law is complex and ever-changing. Not keeping up with the countless HR laws, regulations, and rules that apply to your business can cost you big time.

Are you up to speed on the following laws and regulations? If not, a PEO can provide guidance from seasoned HR professionals and help you avoid compliance mishaps.

  • Are you aware of the paid sick time policies in effect?
  • Are you aware of current regulations for hiring and firing practices?

Regardless of whether you have an in-house HR person (or staff), teaming up with a PEO can give your business a significant advantage. You’ll have access to trusted advisors who work hand-in-hand with you to keep you aware of regulatory updates and guide your business in making the appropriate adjustments.

  1. Workers’ compensation

Insurance premiums and claims management – both of these components make workers’ comp costly and time-consuming. As a co-employer, a PEO can provide workers’ compensation coverage to your employees through its own workers’ compensation insurance program, as well as handle the compliance, audits, paperwork, and certifications associated with running these programs.

  1. Lawsuits

Think you can minimize legal expenses and PR fallout from lawsuits? A single lawsuit can devastate your business, so keeping your employer liabilities in check is critical. A PEO shares liability associated with certain employment-related claims, including wrongful termination.

For example, a top-tier PEO likely has equal employment opportunity specialists who are well-versed in the intricacies of discrimination laws. With a PEO as a resource, you can tap into the experience of multiple experts to mitigate a potentially costly settlement.

Their HR knowledge can help make sure release agreements are in compliance with the law. It’s important to note, however, that such advice is not a substitute for legal counsel. Instead, it serves as an added layer of defense – that second set of eyes to warn about potential trouble.

  1. Recruiting

These days, recruiting moves at light speed. Positions open up quickly and you almost always need an equally fast turnaround to find a qualified and capable candidate. The problem is, you probably don’t have the time and bandwidth to focus on the essentials of solid recruiting.

When you consider the time and money spent placing job ads, interviewing candidates, conducting background checks and more, hiring the wrong person can turn into a costly error. A thorough PEO should offer additional services, such as recruitment assistance, and be able to provide you with access to experienced recruiters who can size up your company’s employment needs.

A good recruiter is usually adept at reading people for particular jobs. They know how to analyze tone of voice during phone interviews, can assess a candidate’s attitude and evaluate emotional intelligence to determine a candidate’s capacity to perform well in a real-world job setting.

 

Looking for PEOs in Jamaica? Contact us at 1-876-971-7632 or email us at sales@caribbeanhrsolutions.com

 

Read full article

 

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05 Jul 2018

Professional Employer Organization (PEO): A Guide

Few entrepreneurs start their own companies because they love managing human resources. However, many become buried in the details of workforce management as their companies grow.

Small businesses with a headcount of 10 to 100 employees often find themselves in human resources limbo. They lack the time to address HR issues and also lack the resources to create an HR department.

Fortunately, many HR functions can be outsourced for a fraction of the cost of managing them in-house. Many small- to mid-sized companies hand those responsibilities over to professional employer organizations, or “PEOs.”

What is a PEO?

Put simply, a PEO is a third-party provider that can operate as your company’s off-site HR office. Just as an outside law firm might help your company with legal matters, the PEO can manage all HR-related jobs. Those functions include payroll, employee benefits, unemployment insurance taxes and worker’s compensation. The role of the PEO is to be an expert in all aspect of employing workers.

Used in Many Industries

What kind of a company would co-employ its workers with a PEO? The practice has become common across a wide range of different industries. Almost any kind of business may find value in outsourcing its employment work. Even companies with as many as 500 employees enlist the help of a PEO.

Small businesses lacking resources or expertise to perform most HR functions can gain the most from hiring a PEO. A good PEO offers efficiencies, integrated technology and cost savings in managing employees. A PEO also makes sure its clients comply with complex and ever-changing employment laws and regulations. Also, handing over most of the employment responsibilities to a PEO frees company owners to spend more time running and expanding their business.

A PEO appeals to many companies because it can help save money. Outsourcing employment responsibilities allow a business to maintain a scaled-back in-house HR department or no department at all. The PEO’s economy of scale also reduces costs related to recruiting and hiring, and software technology for HR functions.

Keeping Control

For some business owners, handing over so much responsibility to an outside firm sounds risky. Can using a PEO to handle payroll, worker’s comp, health care benefits and other functions mean possibly losing control of your company?

The short answer is no. The PEO’s client retains ownership of its company and control over operations. In a typical PEO contract, the PEO and client share employee responsibilities and liabilities as “co-employers.” The company still has control over maintaining its worksite and complying with safety regulations. Because it handles payroll, taxes and maintains employment records, the PEO does reserve a right to hire and fire. Generally, however, the PEO has no control over a client’s business operations.

Looking for PEOs in Jamaica? Contact us at 1-876-971-7632 or email us at sales@caribbeanhrsolutions.com

Read full article

http://www.rtsfinancial.com/articles/benefits-hiring-professional-employer-organization-peo

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