5 things to consider before offering payroll advisory as a service
As an external contractor, you always want to give your clients the best possible experience. For many business clients, a top concern is their payroll obligations – getting it right and getting pay to their employees on time. Taking that stress off their hands and offering payroll advisory could make you very, very popular.
However, it’s not as simple as trawling through some spreadsheets once a month and punching numbers into a calculator. Offering payroll advisory does take work, knowledge and custom solutions that are tailored to each client. The reward of added revenue and client growth is worth the effort, but it’s important to confirm that this is the right choice for your business. If you’re considering providing payroll as a managed service, here’s what you need to think about first.
What is payroll advisory as a service?
Payroll advisory services are designed to support businesses (of all sizes) in processing their payroll, ensuring their employees are paid correctly, and providing key insights into how they can optimise their business.
The exact services that businesses require from a payroll advisor are often varied – some might need short-term support for specific tasks, while others are happy to pass on responsibility for their payroll for the foreseeable future. Often businesses engage these services as they’re time-poor, concerned about compliance risks, or lack the resources to dedicate headcount towards keeping on top of payroll and legislation updates.
How can outsourced payroll improve a client's payroll function?
Improved payroll compliance
Ensuring payroll compliance can be quite a headache for businesses, particularly smaller businesses with no payroll team and limited time to track all the HR considerations. Unfortunately, compliance can also be complex, and it can cost businesses dearly if they make an error or omission along the way. By contracting a payroll advisor, they know their payroll is in expert hands, organised by someone who is knowledgeable about legal compliance.
Reduced cost of payroll processing
Every hour spent by a business’s employee (or even team of employees) on payroll processes is not only costing money through their salary, but through lost time. The benefit of outsourcing payroll beyond the company is that, done well, it can save money, and free up employees to spend their time on bigger projects or other areas of the business such as employee management and retention.
Peace of mind through staff changes
If payroll is done by one member of staff at a business, and that person unexpectedly has to take time off or leave, could the rest of the company cover payroll? Frequently, these employees have unique knowledge of systems and it’s risky to place all payroll duties on one desk. By bringing on payroll advisory services, managers and business owners have added peace of mind knowing that their payroll isn’t reliant on the knowledge of a single employee.
Quick turnaround times
Getting a pay run completed on time, with all the necessary record collecting and submissions for tax, is non-negotiable. However, for those smaller companies where payroll isn’t necessarily done by a large HR team but by one multitasking person, it can be a lot of pressure for an already packed workload. When contracting an external payroll advisor, companies can be sure that everything is done quickly and on time, without any roadblocks.
5 things to consider before offering payroll advisory services
Now that you know why prospective clients might seek the services of an outsourced payroll provider, it’s important to consider the risks and benefits for your firm in offering advisory services.
1. Make sure you’re up to date with compliance practices
Compliance is a huge concern for businesses, especially with the known ambiguity of some payroll legislation (such as the Holidays Act in New Zealand). Many companies, particularly smaller ones, just can’t afford to get things wrong, with penalties of up to $20,000 for non-compliance.
As an outsourced payroll advisor, you need to make sure that you’re bringing your A-game when it comes to compliance practices. You should be across the latest developments from relevant government and legislative bodies, and adjust clients data accordingly. Payroll software like KeyPay can help with this, with automated calculations and legislation updates handled for you by a team of experts, so that you know you’re making the right call every time.
2. Streamline processes with payroll software
What could you do with more time in the day? If you’re providing advisory to multiple clients,
streamlined processes could allow you to improve efficiency over their existing processes and even free up time to take on more clients. That’s where payroll software can really help, allowing you to automate the more manual processes and reporting requirements.
With that extra time, you can provide services in a fast fashion and build a larger client base along the way.
3. Factor in your way of working
Work-life balance is important but it can become tricky, especially when you’re working on a freelance or contract basis. Taking on new work becomes tempting when it results in clear additional income, but committing to more than you can do in a work day could lead to burnout.
Seriously consider how you can balance the way you want to work. Think about how you want to manage your hours, and whether your work needs to be flexible. Although we all know that the future of work has changed for outsourced payroll providers, you need to be realistic about your capacity.
For example, how will you manage client requests if you also need to run personal errands during the day? Do you have a way to shut off at night? Identify processes and software that will allow you to manage when and where you work.
4. Consider how you’ll safely house client data
When you support a client’s payroll, you’re responsible for a lot of very precious information. If that information is compromised, the results can be catastrophic. It’s crucial that you consider how you can safeguard client information and provide them with important peace of mind.
Cloud software can be really useful for this. Strong software often comes with added ISO security certifications so you know that the information is secure from cyber attacks. KeyPay takes measures such as mandatory two-factor authentication, limited user access, and 256bit SSL encryption to protect confidential data.
You can also relay these additional measures to the client so they’re aware of the precautions being taken, which provides added value and an incentive for them to engage your services over managing their payroll in-house and on desktop servers.
5. Make it easy for your client
Every client is going to be different. Some might be happy to hand you the keys to the payroll and leave you to it. Others are going to want more oversight, regular reporting and frequent communication. For those in the latter category, keeping up with expectations can be a challenge for providers when they’re juggling a varied client base.
That’s why it can be helpful to offer visibility through digital access to software. Payroll software can allow for additional access on the client side, with specified admin permissions granted by the payroll advisors themselves. It can save a lot of emails and calls back and forth if a client can simply log in and check up on payroll progress or the latest reports.
Thinking of offering outsourced payroll services?
If you’re considering becoming a payroll advisor for your clients, you’re onto a good thing. Payroll officers have been named by Hays as the 4th and 5th most in-demand skill in Australia and New Zealand respectively in 2022. Demand is only getting stronger and businesses are keen to outsource experts who can give their payroll the care and attention it needs.
Just make sure you’re ready, starting with the advice already mentioned. Partnering up with a trusted payroll software like KeyPay can also give you a crucial base from which to start your payroll services. From compliance to automation, payroll software gives both you and your clients the experience you want.