In reality, juggling is an illusion. The balls are being tossed and caught independently in rapid succession. Mastery of this art depends on an individual’s ability to alternate between tasks with barely any time in between. Seems relatable? Is this you? Have you been juggling and multitasking day in and day out ever since you became an entrepreneur? Well, the truth is, many professionals envy your spot and aim to become an entrepreneur someday, but very few realize the challenges you face. Jobs must get done, and there are fewer to delegate unto. Besides, the coffers aren't exactly brimming with funds just yet, isn't it?
You’re exhausted; we’re listening! Every vertical needs your oversight and your time is precious. We agree; there are only so many hours in a day! Besides, you need to focus on your core functions and KPIs. Thus, it's crucial to streamline, delegate, and automate to sustain your business and scale to the levels you dreamed of. Outsourcing routine and administrative HR service functions such as payroll services can take an entire load off your chest.
But, entrepreneurs shy away from engaging HR service providers solely because they have some misconceptions regarding the plethora of functions that fall under this category. They don't realize it's not just about outsourcing a routine process but so much more. Irrespective of the size of your company, your people still need to get paid. In fact, smaller organizations rely on the dedication and loyalty of their employees to stay competitive and relevant. They cannot afford to lose proficient staff or engage in legal hassles, or worse, pay fines due to negligence regarding payroll services. Employees who are compensated and reimbursed on time without miscalculations and hassles are less likely to leave you. Remember, remuneration and payroll services are the main criteria for professional contentment.
So, let's thoroughly analyze how payroll service providers can help SMBs:
1. Payroll Service Providers bring in and maintain the organizational structure
Payroll service companies specialize in payroll functions, among other tasks. They ensure you pay your staff on time. They take the burden of reimbursement calculation, local, state, & central tax computations, incentives, and timely deposits off their clients. Entrepreneurs juggling multiple tasks may, at most, have a faint idea of the jobs and responsibilities across these verticals. But, only once you dip your fingers in the inkpot you'll realize how messy and deep it is. There are laws at play here. There may be severe consequences if you inadvertently violate these due to negligence or callousness. Thus, for clarity, every business must have a set of policies and procedures that both the employer and employees must comply with. There must be a basic framework of each side's expectations, responsibilities, and functionalities to ensure smooth operations. Besides, being on time with payroll services builds trust among staff. It enhances teamwork, dedication, productivity, and in turn, profitability. Additionally, it helps maintain the integrity of your workforce structure, which is sure to crumble if payroll lapses recur.
2. Payroll service providers keep a check on compliance
As mentioned in the previous point, it is even more critical for small business owners to comply with labor laws. Codes, statutes, regulations, and standards must be met and adhered to. Violations in this regard can drain any SMB leaving them with little to no scope for resurrection. One cannot plead innocence due to ignorance. It is the responsibility of the company's leadership to ensure these criteria are met with strict compliance, failing which there may be consequences. Insurance, income tax, provident fund, medicare, salary deferrals, and arrears must all have an accessible and transparent audit trail in case of inspections. Having a blemish-free record helps create and uphold the reputation and values of a company and its brand image.
3. Payroll service providers help mitigate risks
Let's consider an example to understand this point. If you terminate an employee without following appropriate policies, you could be inviting a host of legal hassles. First, there must be a fixed notice period with reasonable terms and conditions that apply to such a case. Then, as applicable, you must calculate their full and final settlement along with their provident fund, gratuity, and bonuses. When staff is entitled to certain benefits such as encashment of leave upon termination, retirement, or resignation, the persons processing these must be aware and adjust accordingly. They must follow the company policy agreed upon by the employee when joining. If TDS is deducted, you must provide a Form-16. Likewise, you must be careful to ensure the TDS is deposited on time to avoid attracting fines. Oversight may lead to penalties which can be too heavy a burden for SMBs. These fines are compounded over time, leading to huge losses from cumulative liabilities. Besides, your reputation and goodwill are also damaged in the bargain. A payroll service provider will ensure you do not face the brunt of unwarranted legal complications by following due processes without you dedicating time or involvement towards payroll functions, which brings us to the next point.
Also Read: Benefits of HR Outsourcing: How Small Businesses Can Ace their HR Functions
4. Payroll service providers help you save time
SMBs tend to multitask a lot. As a result, time management is the top priority. The essence of effective time management lies in the ability to characterize tasks based on their importance and urgency. Routine, mundane tasks like leave management, clocking in and out, and calculating overtime don't require active supervision. Dedicating resources, including time and money, towards these tasks that can be taken care of by another person or agency that is competent and better suited is just bad planning. Leadership's time is valuable and must be utilized for vital decision-making, planning, and strategizing. Daily operations, routine, and administrative tasks must be the least of their concerns. That's valuable time that can be better utilized for core functions and responsibilities.
5. Payroll service providers provide auxiliary support and flexibility
Most payroll service providers are adept at handling a vast array of HR service functions. Depending on whom you choose to partner with, you can outsource as much as your company requires while maintaining autonomy in all other areas you'd prefer to. With payroll services taken care of, you can also seek RPO (recruitment process outsourcing) services that help absorb shocks in disruptive markets. Take, for instance, COVID-19. It coerced businesses to follow workflows that were never even considered before the pandemic. Flexibility is key to sustainability. And the more capable your business is of adjusting to changes, the greater your chance for survival. With the world opening up and proceeding towards normalcy, the demand for staff and employment opportunities is likely to increase. Among others, recruitment and payroll service functions will proportionately see an uptrend. As a small business, one cannot cushion themselves against such shocks and dynamic fluctuations. However, scaling up staff and the respective administrative and payroll responsibilities that increase simultaneously can easily be handled by a payroll service provider whose sole function is to concentrate on these HR tasks. Basically, do what you do best; outsource the rest and make the most of having a structured web and support system.
Juggling is the art of controlling objects and their patterns in time and space ...with grace. In the end, it's a question of balance; juggling is a balancing act. Sure, it's impressive to see an adept juggler at the circus. But while running an SMB, it's not solely about creating fascinating impressions. It's about squeezing the maximum ROI from the least resources while deriving the best output in a way that also minimizes risks. While you're still going to have to juggle with a few balls, passing a few of them onto reliable outsourcing agencies will ensure you juice out a good squeeze. And if you begin in the early stages, you'll relieve yourself of many future hassles with this wise decision. Sure, you can hire in-house teams, but those cost big bucks. Additionally, the burden of scouting for and retaining a good HR team is yours to bear.
Give us a call and find out how we can take over some of the weight off your shoulders. Exela is a world leader in BPA (Business Process Automation), providing end-to-end HR services. Payroll processing is what we ace at. We have a variety of solutions to suit your requirement and budget. We can customize plans to suit your needs and preferences, from entirely automated HR suites and enterprise solutions to a more hybrid approach. Find out more about what Exela HR Solutions can do for your business today!
DISCLAIMER: The information on this site is for general information purposes only and is not intended to serve as legal advice. Laws governing the subject matter may change quickly, and Exela cannot guarantee that all the information on this site is current or correct. Should you have specific legal questions about any of the information on this site, you should consult with a licensed attorney in your area.