In order to better assist you, you will find below a list of frequently asked questions about our payroll outsourcing expertise. This FAQ will help you better understand our approach and services.
Frequently asked questions
How do you outsource your payroll with HR Path?
Payroll outsourcing is becoming increasingly popular with companies, but are they embarking on this project for the right reasons? Are they aware of the real benefits of this type of project? As payroll is a vital human resources mission, it is important to identify the impact that outsourcing can have on the company and to define an appropriate methodology. HR Path gives you the keys to the success of all your outsourcing projects.
Financial reasons but not only
Cost reduction is one of the main reasons why many companies outsource their payroll management. In a context where they are often asked to do more with less, the delegation of support functions is a logical choice. In fact, payroll outsourcing usually has a positive ROI. But the reasons why companies make this choice are varied, and financial reasons do not always take precedence. The difficulty in recruiting qualified and experienced payroll specialists is another determining factor. The race for talent is fierce in the HR sector and high turnover or simple retirements can cause significant problems for the HR function.
Preventing regulatory risk
Payroll outsourcing is therefore an outsourcing of HR talent management, but it is also and above all a delegation of responsibility. Payroll is a sensitive issue within a company: a stable and correct payroll preserves social peace, while a false payroll very quickly generates internal tensions.
By entrusting this task to specialists from outside the company, managers prevent any tensions that might arise from this type of error. At the same time, they protect the company from the regulatory risk that is weighing more and more heavily on HR departments. The payroll business is subject to a great deal of legislative activity and therefore requires constant efforts to monitor regulations, without which the company could be severely penalised. Payroll outsourcing is therefore motivated as much by a need for peace of mind and regulatory security as by the need to reduce costs.
Being well supported
Because of these advantages, payroll outsourcing is becoming increasingly popular. But before taking the plunge, it is important to be aware of the risks and to know that some projects end up in deep dissatisfaction on the part of the client. The cause is usually insufficient communication between the service provider and the client.
Payroll outsourcing should not be limited to the delegation of a task. It must lead to a complete overhaul of the internal collaboration processes: who will the employees be talking to? How will the data be processed and exchanged with other departments? To answer all these questions, the company that outsources its payroll must transmit exhaustive information about its internal processes, otherwise the tools and methods put in place will be inadequate.
Measuring the ROI of outsourcing
The return on investment of a payroll outsourcing is not limited to economic aspects. It is important to measure the qualitative aspects. When a company entrusts its payroll to a specialist, it has the right to expect a higher quality than what was previously done in-house. This is why performance measurement systems can be put in place during outsourcing, where one used to rely intuitively on the level of employee satisfaction. The added value of HR Path outsourcing is thus multifactorial: it includes peace of mind in the face of regulatory risk, focus on its core business and a qualitative improvement in payroll processes. With this in mind, outsourcing must be treated as a genuine company project.
What are the benefits of outsourcing payroll to HR Path?
Companies that decide to outsource also choose to focus on high value-added tasks, and to ensure better quality of service by saving time and money.
When a company chooses to outsource its payroll (entrusting the processing of its employees’ payslips and DSNs to a service provider), it must take into account a number of factors: it must measure the costs and benefits, both in terms of money and time and security, of this outsourcing.
HR Path provides a summary of the benefits that the company must consider before making a decision.
Security and assurance on legal issues
Firstly, compliance. If we stay with the example of payroll, today many companies are confronted with legal changes that are quite abundant.
Outsourcing your payroll to experts ensures a result that complies with the legislation in force: in fact, legal regulations are constantly changing and being analysed by payroll management companies and updated instantly, which will avoid possible disputes with employees.
Disputes with URSSAF and other social bodies due to errors are also minimised.
It is indeed very difficult to find good payroll skills on the market today, to train them, and above all to keep them. By outsourcing, the company is assured of having the best expertise at all times. Finally, the last important argument is economic, since by outsourcing certain processes, the company will be able to concentrate on what represents real added value for it.
- Saving time
If the skills are not acquired internally, outsourcing the company’s payroll will allow the company to save time and money in training and recruitment in particular.
Simplification of the process
No time is wasted with payroll software, which is complex and requires expertise. The company will, in most cases, only be dealing with a simplified interface, in addition to its dedicated contact person.
Better cost control
Internal costs related to payroll (direct and indirect) are often difficult to measure (e.g. parameterisation, operation, software evolution, etc.). Outsourcing makes it possible to reduce these costs while better controlling the overall budget by including external costs.
Before signing the contract with its service provider, the company must define the scope of the work it is delegating. Is it just payroll? What about social charges? Social reporting?
To do this, it must decide on the level of outsourcing. There are four types of outsourcing: hardware and hosting, maintenance (TMA), hardware and maintenance (ASP or SaaS – shared between several clients), and the process itself and its actors (BPO).
If your company decides to outsource, we advise you to set up this payroll outsourcing on 1 January in order to facilitate the process.
How to outsource your payroll internationally with HR Path?
Each country has its own payroll outsourcing challenge!
Payroll outsourcing has many advantages, including the reduction of direct and especially indirect (often hidden) costs, the absence of errors and the reduction of risks in general for the company. By outsourcing, you benefit from additional payroll expertise while avoiding the cost of hiring, managing staff turnover and the “tiered” effects of an in-house team. Choosing to outsource your payroll means that you can trust external teams of payroll managers, whether it be on a legal, cultural or technical level. Ease of communication is a key point as payroll is a process combining internal resources and a payroll partner.
Time zones, working days, language, currency, religion, politics and cultural practices are all factors to be taken into account when outsourcing your company’s payroll.
In Singapore, for example, the ethnic origin and religious status of employees must be collected and recorded in a very specific way in order to access payroll funds. In Australia and New Zealand, regulations require that leave balances be managed by the payroll department itself, rather than by HR. In addition, English language skills are rare in some Far East Asian countries such as Japan, South Korea, Vietnam, Indonesia and Thailand. Belgium requires the payroll provider to be a social secretary. The United States integrates payment and benefit management dimensions.
The specificities of each country make payroll outsourcing a complex area if the service is not offered by a local contact who understands and adapts to the issues at stake. Contact with a local payroll manager is therefore essential when choosing your outsourcing contact.
How can VSEs/SMEs outsource their payroll with HR Path?
By choosing to outsource your company’s payroll, you save your employees time while benefiting from the expertise of the profession. This service is not reserved for large companies as payroll outsourcing with HR Path is available at several levels depending on your needs.
Payroll outsourcing as a universal enabler for all types of businesses
Whether small or large, payroll services are a strategic choice for businesses. Whether you are a very small company or a large corporation, there is an outsourced solution on the payroll market today that is adapted to your needs. For example, companies with a single service provider, a single manager, a single MSA or a single CRM prefer to choose this service.
Outsourcing your company’s payroll provides compliance (guaranteed through payroll legislation); an HRIS interface (ideally cloud-based) as well as a reporting system. In addition, it provides a trusted local partner for local customer service.
Outsourcing reduces costs and TCO (total cost of ownership) and commits you to data privacy (RGPD). It is also a real asset in terms of flexibility because your service provider takes into account the company’s scalability, whether it be geographically or in terms of the number of employees to be supported.
Choosing a service provider adapted to your structure
For VSEs, it is recommended that you use a payroll service provider, which will ultimately be more profitable than in-house production. In VSEs, when payroll is not outsourced to an external payroll manager, it is often carried out by the company’s manager, which does not allow him to concentrate on his core business and therefore to develop his company properly. Considering the cost of the solution (which varies according to the experience of the manager), the cost of the payroll and the cost of social monitoring, it will be much more interesting for companies with less than 10 employees to use an external payroll service provider.
For SMEs, payroll is usually managed by a human resources manager, who is also responsible for managing employee administration, recruitment, professional training, human resources development etc. The time spent on payroll management is very time consuming, and in this case is used to the detriment of overall HR development. At the same time, it is rare for an HR manager to master all the