Organizations face seemingly unending changes: mergers and acquisitions, global restructuring, seasonal demands, and economic peaks and troughs. All these events can be overwhelming and create additional stress for payroll and benefits teams. To operate efficiently, consistently, and compliantly, many organizations are transitioning to operating towards a managed services model.
In the free PayrollOrg webinar, “Managing Risk: Navigating the Decision to Embrace Payroll as a Service for Your Organization,” sponsored by Dayforce, attendees explored how their organizations can benefit from outsourcing their payroll and using a managed services model.
This webinar on demand covers the following topics:
- Trends and supporting data around outsourcing payroll versus traditional payroll management
- Top considerations for transitioning to payroll as a service
- Specific examples exploring where organizations can benefit most from employing third-party payroll service providers
- A framework that can be used to build an effective business case
Why Go Third-Party?
Sunit Nair, Vice President, Value Advisory for Dayforce, opened the webinar by presenting reasons why payroll and benefits teams would consider transitioning to managed services.
Nair shared a case study as an example with attendees that described one company’s decision to go third-party. One of the reasons for this company transitioning was the lack of standard operating procedures (SOPs) for when a key payroll figure is absent.
“They have a few payroll FTEs [or full-time equivalents] who knew everything about the process, but when these people walk away, how are we set up for success in the absence of these few people who know the system and processes?” Nair said.
During the webinar, Nair presented six key drivers that lead companies to change their payroll model, which included the following:
- Wage and hour litigations
- Remittance penalties
- Business growth and complexity
- Data privacy and cybersecurity
- Data and process audits
- Payroll staff turnover
During the live webinar, when Nair asked attendees about which key drivers were most important to them, “Data and process audits” and “Wage and hour litigations” nearly tied for 27% and 26% of votes, respectively.
“I am surprised that staff turnover is so low,” Nair said, with “Payroll staff turnover” receiving 9% of attendee votes. “But again, we asked for the most important here, and no surprise that wage and hour litigations and audits are.”
What to Look for in Managed Services Providers
When deciding to transition payroll processes to a third-party vendor, vetting needs to be done. Researching vendors is imperative to know not only what services they provide, but how well they can provide for your company.
Nair said one of the most important features to review when shopping for a managed services provider is their tech and security.
“It’s important to know whether they’re using their own tech, or if there is a middleman, which really adds another layer of complexity,” Nair said.
Should a payroll error or security breach happen, Nair had attendees think about how many vendors were they going through to fix the issue.
“When you call support for one of these vendors, they could answer with, ‘We’re waiting on our vendor to fix this.’ That is something to think about when considering who to outsource to.”
Register today to learn more from this free, on-demand webinar, available through 31 January 2025.