Switching payroll providers is a significant undertaking for any company – and can even seem overwhelming – but when you select the right provider, your business will reap the rewards. A new payroll provider can automate a number of your HR processes, from onboarding to tracking time and attendance, to paying out bonuses and commissions – all while saving time and cutting costs for your controller and HR department.
Hireology is in the process of switching payroll providers, so we sat down with Hireology CFO Peter Dedes to learn more about the process and what businesses should look for in a payroll provider.
What makes a decision maker realize they need a new payroll platform?
It all comes down to your current provider not meeting your expectations and needs. Switching platforms can lead to improvement and efficiency across the board – including removing manual processes, increasing accuracy, integrating with your accounting software, ensuring you’re up to date with compliance, and providing robust reporting and analytics.
Customer service quality can also greatly contribute to a decision maker’s choice to switch payroll platforms. If you’re calling a 1-800 number and being placed on hold for a lengthy amount of time, it’s a sign you need to make the switch. You should work with a payroll provider that has a person or entire team dedicated to your account and available to answer questions as they come up.
What should CFOs look for in a new payroll vendor?
Ease of use – for both decision makers and individual employees – is a top consideration when evaluating new payroll vendors. Payroll should have easily accessible robust analytics so decision makers can see such insights as turnover analysis, benefit plan spend, wage spend, headcount analysis, new hire analysis. At the same time, payroll should also be user friendly for employees using the platform to access their tax forms and paystubs.
Decision makers should also look for a single, integrated applicant tracking and payroll solution, rather than using paper forms for onboarding, and separate solutions to manage time and attendance, payroll, and benefits, for example. Another key consideration is automation, which should begin with onboarding. With a central location for each employee’s tax and other onboarding information – and having each employee fill out electronic onboarding forms before the first day on the job – you can increase accuracy and save the employee from having to spend half of his or her first day filling out paperwork.
Another important capability to look for in a payroll vendor is compliance. Businesses should look for a payroll provider that stays up to date with compliance rules, regulations and ever changing laws.
Are there any payroll KPIs or features you think are mission critical?
The most important KPI is accuracy – payroll can make up about 50% of a business’s expenses – so it’s vital to strive for 100% payroll accuracy. This includes everything from paying employees what they’re owed, paying commissions on time, accurate deductions for health insurance and other benefits, and any bonuses. Across the board, payroll should all be accurate, done on time and with no mistakes.
One way to ensure complete payroll accuracy is to work with an automated payroll platform. With some payroll platforms we’ve used in the past, our controller constantly had to make manual changes. For example, changes had to be made for life events and during open enrollment – and when done manually, not only does this take a lot of time, but there’s always the chance of human error. We were also unable to do mass uploads of payroll changes, such as for annual bonuses, so each one had to be entered into the system individually. Switching payroll providers enables payroll changes to be automated, saving time and ensuring accuracy.
What advice do you have for others looking at better ways to do payroll?
Anyone involved in the decision making process for a new payroll provider should first understand how many solutions you’re currently using for payroll – many businesses use three to five solutions, or even more, to manage payroll and benefits.
Not only should you understand how many total solutions you’re using, you should also have a grasp on the total cost of your payroll solutions. This can include anything from individual license costs to the cost of your controller managing all these systems. Another cost you might not have full visibility into – and should – is the total amount of fees you pay. Some payroll providers charge per payroll run, so if you pay employees weekly or run separate payrolls for commissions and bonuses, the fees will add up fast. To improve your payroll, look for a vendor that has the flexibility to work within your processes while only charging per employee per month, rather than for each payroll run. Also look out for separate year-end W2 fees, payroll tax filing fees, payroll delivery fees and other hidden costs that can add up.
What advice do you have for businesses looking to switch payroll providers?
Switching payroll vendors can take a lot of work up front– but is worth it in the long run – so during implementation, work closely with your payroll provider. Make sure your payroll partner runs through a mock payroll with your previous or current provider so you can be set up for success during your next payroll run.
Interested in learning more about how to improve your payroll? Read about our payroll solution here and and schedule a demo today.