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Payroll can be a pretty big responsibility. Sometimes it can feel as if you have way too much to deal with to be worrying about your employees’ finances as well, and you may be more than a little tempted to outsource the work instead.
However, like everything else, there are both pros and cons of outsourcing your payroll to other companies. Before you decide to make the leap, you need to know exactly what you’re getting into first.
Outsourcing Payroll: The Pros and Cons of Outsourcing
Once you know the good and bad sides to outsourcing payroll, you can be more prepared to make a decision for yourself. Keep reading to learn more about it.
Pro: They Have the Experience
One of the biggest reasons to outsource your payroll is because you can be sure they have a ton of experience to handle it.
First and foremost, you are in business to run a business, not to be an accountant. There’s a good chance you don’t have much experience with handling payroll, which could lead you to problems if you’re not careful.
When you outsource your payroll, you know the company helping you has the know-how to work with it, and they’re dedicated to the task.
Con: You Lose Your Control
Most business owners love to keep control of every aspect of their business, because…well, it’s their business. When you outsource your payroll, however, you’ll have to give up some of your control.
The payroll company that you work with writes out a contract with you outlining how they’ll have control over practically all of the aspects of employee pay. Being able to make last-minute changes or additions won’t be the case anymore.
Pro: You Save Lots of Money
As a business, you’re always looking for ways to save a dollar. By outsourcing your payroll, you will be saving many dollars.
Keeping payroll work in the company requires a lot of separate aspects: training your personal staff, getting the necessary equipment and tools to make creating payroll possible, arranging for things such as direct deposit…the list goes on.
Why do that when you can let someone else do it for you?
Outsourcing means you don’t have to deal with any of the expensive matters associated with payroll, so you keep more money in your pocket.
Con: You May Be More Prone to Cyber Risks
Every company has to deal with security issues, but when you outsource your information you may be more at risk.
Outsourcing requires you to send information about your employees over the internet. Although working with these companies always involves a higher level of security, it goes without saying that anything on the internet can be at risk.
The cybersecurity of your employees is something you’ll want to discuss with the outsourcing payroll company before you move forward.
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