Outsourcing your company’s payroll offers distinct commercial advantages. As you may already be aware, Snow’s external payroll system means you won’t have to pay for an accountant or payroll professional to process your weekly or monthly staff payments. Equally, you won’t have to oversee their work, something that will free your time up. Nor will you risk any inaccuracies that might occur from payroll errors being made by your in-house team and the fallout that could happen as a result of them. However, these are not the only benefits of getting rid of old-fashioned approaches to payroll and turning to a professionally run digital sub-contractor instead.
Read on to find out why so many Irish businesses are turning to Snow to manage their payroll functions these days and why doing the same could give your organisation a competitive edge.
Digital Integration
Here at Snow, our outsourced payroll platform will integrate with a wide range of systems. When Irish businesses have already invested in accounting packages, financial control software and human resources platforms, it can mean that financial directors and chief executive officers are sometimes reluctant to not also use their systems for payroll. This can be an error, especially when you take into account the seamless integration that Snow offers with respect to payroll functionality.
For example, our payroll software will integrate straightforwardly with accounting packages like SAP, Sage Line, Pegasus and Microsoft Dynamics, among others. If you’re looking for digital integration with time and attendance systems, then note that outsourcing your payroll to Snow would mean full compatibility with Timepoint, Bizimply, Mitretech TMS, Softworks and more besides. The same goes for HR systems like Oracle HCM, Workday and Peoplesoft, among others.
Expense Reduction
It is technically possible to run your in-house payroll team more cost-effectively than outsourcing it. Of course, this would depend on how you outsource your payroll and which systems you opt for. Typically, however, Irish companies will find that they reduce overheads by switching to an external payroll model. Why? For one thing, in-house payroll personnel costs only tend to go up over time. You might have a payroll clerk who is quite inexpensive to employ on your books, but what would happen if he or she were to be poached by a competitor or retire? More than likely, you’d need to increase your pay offer to recruit someone of the same or a similar standard.
Equally, relying on people who’ve done the job for years will often mean needing to reinvest in terms of training. Keeping up with changes to Irish tax laws and wider European directives over company pay means keeping abreast of all the latest regulations which ultimately costs firms. By contrast, if you outsource your payroll, then all of these training costs are not dealt with directly by you as an employer but by the sub-contractor.
Business and Information Security
Nearly every professionally managed Irish company knows that it has to comply with GDPR and other digital information regulations. However, what some businesses don’t always appreciate is that the protection of sensitive data – like that which surrounds pay – needs to be safeguarded as a high priority. In short, if your payroll data is lost or hacked into, you could face much stiffer penalties than if other digital information were to be stolen. Therefore, digitising payroll mustn’t just be something that makes reporting easier and processes simpler to manage but constitute a wider part of your digital security strategy.
Needless to say, here at Snow, we offer the highest level of digital security as payroll information is encrypted when it is passed back and forth. Given that we put the cybersecurity measures that are needed today in place, you won’t have to. In short, we’ll ensure data security regulatory compliance and protect you from the potential of a data breach while also spreading the cost of implementing such systems across our entire customer base, thereby affording an economy of scale with digital security.
International Expertise
In the modern Irish economy, many firms are international in their setups. Although your firm may be incorporated in Ireland and mostly employ Irish citizens, you could also have sales representatives based in other parts of the EU and elsewhere. It is not uncommon for Irish firms to also have US or UK employees on their payroll, for example. This means taking into account other tax regimes for one thing and it might also mean paying certain staff members in currencies other than the Euro.
If so, then outsourcing this complexity to a payroll firm that knows how to handle the finer points of an international operation would be very beneficial. Doing so in-house will mean hiring highly specialised payroll clerks when you wouldn’t really have to if you were to opt for a more straightforward approach, such as outsourcing instead. In short, if you run a business that has employees and representatives in multiple time zones, then the benefits of outsourcing payroll functions are thrown into even starker relief than doing so with a workforce that is only made up of Irish citizens.
Business Planning
Most Irish businesses want to plan for the future, to invest in their core business processes, lower costs and increase their market share. Typically, this will mean understanding exactly what your cost base is for back-office processes like payroll. Unfortunately, conducting payroll in-house can mean changing costs that are hard to predict. Running your payroll one month could take twice as long as usual if there was lots of overtime claimed for in the month before, for instance. Equally, end-of-year payrolls tend to take a lot longer to process than those at other times of the year.
With varying manpower requirements come unpredictable costs and financial processing resources that can’t be spent on other processes, such as credit control, for example. However, with a single monthly fee agreed for a set number of employees, outsourcing your payroll means being able to more accurately predict how much you’ll spend on such processes not just in one year but over the course of several. In turn, this greater certainty helps with business planning and growing enterprises in a more thought-through way.
Dealing With Failures
In-house payroll teams can be inaccurate which has a knock-on effect but there can also be more worrying problems, too. In some circumstances, businesses have faced fraud from within their own ranks by employees claiming more overtime or bonuses than they’re really entitled to because they’ve struck a behind-the-scenes deal with someone processing payroll. Equally, it has not been unheard of for financial managers to defraud their employers by adjusting their own pay. If such a business process failure were to occur in-house, then the financial consequences would be yours to face even if the police were to be subsequently involved with criminal investigations.
However, outsourcing to a reputable payroll firm usually means some form of reimbursement could be sought in the unlikely event of an innocent error being made. Equally, the risk of fraud is greatly reduced because of the financial oversight systems that will be in place to protect you and the other companies that also use the service. Given that outsourced payroll is a competitive sector in Ireland, you can always decide to go elsewhere, subject to any contractual obligations you may have, if you were to be unsatisfied. In fairness, most companies stick with outsourcing their payroll because they’re very pleased with the results. However, it is good to know you can switch if you want to, something that’s much harder to do if you adopt an in-house approach instead.