4 Benefits Of Outsourcing Your Payroll

At first glance, outsourcing your payroll might make you think, “Why should I have someone else do something I can do myself?”

Anyone who has personally handled a company’s payroll can attest to the amount of time and work it takes. Calculating employees’ payroll involves getting employees’ time and attendance information correctly, understanding payroll rules, and working with varying benefits policies from employee to employee, and employer to employer.

Payroll outsourcing is a viable and effective way to reduce cost, save time, and improve payroll processes for many organizations. If you haven’t considered it yet, check out the four things it can potentially provide your business:

Professional Service

One of the benefits of payroll outsourcing is that all that difficult and complex work is handled by a professional team. This way, not only do you get accurate results and computations, you also get it done efficiently.

An effective outsourced payroll services provider will also keep track of changes in labor laws and tax tables that affect payroll computation. Organizations who choose to handle payroll on their own (even with the aid of their own payroll software) are many times at risk of missing these changes. This results in inaccurate payroll calculations usually leading to fines, penalties, and disgruntled employees.


It is in the best interest of an outsourced payroll provider to ensure that your data is secure. This is just as it is in the best interest of banks to ensure that their clients’ money is secure. Because of this, a good payroll provider will ensure that they observe industry best practices in maintaining security on all fronts: infrastructure, technology, and people.

Don’t let security issues worry you when you can have a professional team take care of it. Outsourcing, by its very nature, means that you trust another provider who can do what you do for you, but better. A good provider can potentially provide you better information security. That said, when choosing to outsource your payroll, be sure that your provider meets industry standards. These include ISO certifications and professional third-party certifications for the actual team that will process your data and information.


One of the benefits of payroll outsourcing is potential savings. According to a 2014 Global Study of Deloitte, “regardless of an organization’s payroll operating model, nearly all organizations outsource some portion of their payroll operations to reduce cost”, among other benefits.

Even big companies who can afford to have their own in-house payroll system can still find outsourcing as a viable means of reducing operational cost by getting savings directly and indirectly.

Savings can be achieved when the direct cost of outsourcing is lower than the direct cost of hiring, training, and keeping an internal staff to handle payroll. Second, savings can also be achieved through optimizations only professional payroll practitioners are able to spot and implement. And thirdly, savings can also come indirectly through increased worker productivity.

Time and Productivity

Highly effective organizations know better to focus on what really makes their business grow. This is why even though payroll is one of the most basic functions in an organization, it is mostly more efficient to have this outsourced. The less time staff have to spend on those, the more time they can spend focusing on the business.

Depending on an organization’s size and industry, processing payroll when done in-house can take anywhere from 6 hours to up to 36 hours a month. Just think of how much potential high impact productivity is lost in those hours. Now imagine, what if HR staff can get even just half of those hours back and reallocate it to more mission-critical activities?

IMPORTANT: Choose The Right Partner

Ultimately, outsourcing will only be successful when it’s done right and done with the right partner. To maximize the potential benefits of payroll outsourcing, be sure to engage only with a provider that will not only give you the outsourced service but is also equipped to provide you the technologies to make payroll seamless end-to-end.

If you want to know more about our complete payroll solution, send us an email at customersuccess@bridgepayday.ph or BOOK A DEMO.



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