What is a payroll service provider?
Among the many obligations businesses have, remuneration is one of the most important. Payroll directly impacts the financial health and trust of employees, and is a company’s most critical expense. Therefore, great care is needed when deciding on how to manage your payroll. While many options are available, but one of them guarantees security and peace of mind.
According to Statistic Canada, “Broadly defined, wages and salaries comprise the gross pay before tax that is paid to employees in cash or in kind, for work performed under the general direction of an employer.”
In addition to being mandatory and governed by various laws, payroll influences the level of trust employees have in their employer, since payroll delays and errors lead to problematic situations. There is no doubt that payroll is of paramount importance for both a company and its employees.
According to the National Payroll Institute’s annual survey and analysis by the Canadian Financial Wellness Lab, more than one in four Canadians live from paycheck to paycheck, an increase of 26% over last year.
It is clear that payroll is linked to the well-being and motivation of Canadian workers. According to a Canadian Payroll Association survey conducted by Framework Partners Inc. in 2018, 44% of workers would struggle to meet their financial obligations if their pay was delayed.
Employers are responsible for ensuring accurate and timely payment of employee wages. How to go about managing your payroll? You can either do it manually, use a software application or call upon the expertise of a payroll service provider.
Manually processing payroll requires training, both to monitor the market and laws that change regularly, and to collect employee data according to established security standards.
This complex administrative burden can sometimes lead to certain challenges and create problems when errors occur due source deduction irregularities or inaccurate payments, for example.
Several software solutions, usually installed on a company’s servers, are readily available to help employers process their payroll. While these programs automatically process payroll data, the company is responsible for managing government remittances, updating software, and ensuring adequate configuration.
Moreover, as support services are not automatically included, employers must manage the software autonomously. Payroll being a complex and highly technical undertaking, this option may prove daunting to some.
Calling on a payroll service expert and outsourcing payroll processing through online solutions presents many advantages. In this case, data is hosted on the provider’s servers, which offers clients a large-scale structure to ensure optimal data storage and security.
In addition, dedicated teams monitor the market and gather the latest legislative information to harmonize payroll with the most recent laws and regulations in effect.
This is more of a business relationship, as it is a long-term endeavour and provides companies with continuous support. These services allow employers to focus on their main business tasks by leaving administrative management to professionals who do this full time.
Partnership of trust
Have you ever wondered how payroll is processed? In fact, many companies and individuals are not aware that such services exist, only wondering about it when the need arises.
Working with an online payroll management provider means opting for a true medium or long-term partnership. Your company’s sensitive data will be in the hands of an expert who will handle the calculations and payments to your employees and government agencies on your behalf while providing support on a daily basis, whenever needed.
Many employers choose to entrust their employee payroll to a professional because of all the associated benefits, such as reduced risk and ensuring employee pays are accurate and on time. This frees up considerable time so business owners can focus on their main activities, which are usually unrelated to payroll management.
What actually happens? Payroll service providers work on your behalf to ensure employees are paid and to produce payslips that can subsequently be consulted. They also calculate source deductions and government remittances.
The same applies during busy, complex, and annual periods such as year-end, during which your provider can assist you with certain tasks, i.e., preparing documents and sending them in a timely manner to governmental authorities.
In addition, this collaboration often includes year-round support highly appreciated by employers: a payroll service provider is available to resolve issues and answer questions that may be recurrent among entrepreneurs.
Several other payroll-related elements are an integral part of running a business, namely human resources and time management. That is why some payroll service providers offer related solutions to help support these fundamental elements.
If you are the head of a company, you know better than anyone that good time management is key to greater organizational efficiency; planning work schedules can be very time-consuming.
A payroll service provider that offers complementary solutions could for example allow your employees to use digital time sheets or a punch system for entering hours worked and thus automatically generate the hours paid from the recorded data.
This type of solution is convenient for employees and employers alike. Indeed, it could also provide better visibility on your teams’ availability and streamline your operations.
According to LinkedIn’s 2020 Global Talent Trends report, 81% of HR professionals believe that internal recruiting improves talent retention.
As an employer, you could benefit from choosing a payroll service provider offering an HR solution. For example, if a position must be filled, you can easily find the most suitable profiles. This type of tool is also beneficial for employees facing new challenges in their work.
Furthermore, you would be able to prepare training plans for your employees, who in turn are more likely to stay with the company if they have career development options.
An HR management solution helps companies centralize their HR activities and provides a comprehensive overview of employee records.
What is a payroll service provider? When it comes to payroll processing, several options are available. However, one of them stands out and offers more advantages: working with a payroll service provider. Payroll service providers are industry experts and can handle sensitive administrative tasks for employers.
This partnership is a true business relationship, based on trust in the solution offered and in your provider. The latter provides support year-round on current issues, but also during critical periods such as year-end and its multiple related activities.
Often, a payroll provider offers services beyond payroll to support key elements of your business, such as human resources and time management. To find out what criteria to consider when choosing your payroll service provider, read our article on that topic.
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