5 Benefits of Payroll Outsourcing | Kelsa Solutions
5 Benefits of Payroll Outsourcing

For businesses everywhere, payroll processing is an essential activity that needs to be managed month after month with accuracy, efficiency and timeliness.  Anyprocessing errors or delays cause needless frustration and embarrassment and affect employee morale.

To avoid such situations, many companies today have resorted to payroll outsourcing to ensure the process effectiveness, and efficiencies in time, cost and scale.  Aside from the monthly payroll processing, outsourcing partners are also able to support allied activities such as tax calculation, statutory payments and deductions. The availability of systems to ensure end-to-end support across all payroll related requirements, frees up considerable time for HR and Payroll operations teams, allowing them to focus on more value-added initiatives and build strategic partnerships with their business.

Broadly, companies derive the following benefits while outsourcing their payroll processes toa reliable and reputable vendor. The benefits of the same may be:

1. Gain time and resources to focus on core priorities

When payroll processing is handled in-house by the HR and Payroll Operations team, dedicated resources need to be appointed to manage the activity, and a lot of time needs to be committed to drive attention to detail. And the team would need to focus not just on payroll processing, but also related activities such as enabling statutory payments, tax deductions and compliance reporting, which can typically take a lot of time.

Further, when the company grows in strength, payroll processing will be set to become even more voluminous as an activity and demand considerable time to drive checks and balances and corrections for any errors. This will take away time and energy that can be channelled to manage more strategic efforts. Payroll outsourcing enables companies to free up time and resources from routine activities and instead focus on more value added activities, ensuring outcomes that are meaningful for the business – such as improved business support, talent engagement and workflow efficiency.

2. Increase cost efficiency

 For businesses, when costs are saved money is earned. When outsourcing their payroll processes to a reliable vendor, they can take advantage of a streamlined system that caters to a range of payroll related needs, and delivers support with speed, accuracy and significant cost savings.

Several tasks relating to the payroll administration process are managed out of a shared service environment in a centralized location, and this means aside from saving operational costs, companies are also able to seek support for follow up queries and information requests through a team of specialist resources. The availability of such systems ensures productivity and drives significant savings for companies.

3. Enhance data security

Like with all company data, payroll information is highly sensitive and protecting it from internal and external threats is a key priority for IT leaders in many businesses. They spend considerable time and energy driving necessary data security systems and protecting the organisation from grave threats. However, despite their efforts,  they could still face situationswhere data may becompromised – either internally,through identity theft by company personnel, or externally, through hackers.

When outsourcing their payroll process, companies can take advantage of the highly secure data storage systems and servers, and state-of-the-art encryption technologies offered by vendors. Further, many vendors today also offer cloud-based payroll services, which offer adds security and convenience in data access and management. These sophisticated data security systems are expensive and matching / recreating such security environments in-house would typically mean a huge financial commitments for many companies.

4. High standards of statutory and compliance practices

Aside from responsibilities related to monthly payroll processing, in-house Payroll operations teams are also expected to ensure statutory payments and drive compliance records and reporting. These activities do take a lot of time and effort, and, any errors or violations can lead to severe penalties or repercussions for companies.

Outsourcing such tasks to payroll processing vendors often makes sense as they have the necessary expertise and resources to ensure all statutory deductions and payments are managed accurately,  and compliance reporting requirements are up to date and submitted well in time to authorities.  Vendor organisations are also familiar with relevant tax laws, and keep a close watch on any regulatory changes emerging in the landscape, to drive better advisory support and transactions management for their clients.

What our Customers say
“ Kelsa almost completely redefined our HR Audit process with better measurable results. Saved us a lot of time, money and effort."


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