Current Situation in the Market
As long as your company hires employee, payroll processing is a “must do” transaction every month for all types of businesses. The complexity varies according to the nature of business as well as company policy.
In general, payroll calculations include but not limited to the following:
Daily paid, weekly paid, mid-month or monthly paid salary computation
- Bonus and ad hoc incentive processing
- Commission computation
- Employee reimbursement
- Retirement processing
- Resignation clearance & many others
It is employer responsibility to ensure accuracy of each computation of the salary, therefore, performing verification process and statutory deduction compliance management are the key challenges in any payroll processing.
Basically, your HR/Payroll/Finance team who manages payroll will start to get busy, sometime 20th of the month till the pay-out date, approximately 10-15 days in total. And, many companies ignore the fact, the attendance, OT, allowances data are collected by site office people (assuming there are multiple location) before passing to the HR/Payroll/Finance team, that takes another 3-5 days. In short, your overheads in processing employee transaction, from time attendance, overtime computation, shift allowance and others, processing, deduction and payment are more than what you may have expected.
Due to nature of payroll job which required commitment of the team to prevent delay in salary payment, many of the Site Admin, HR/Payroll/Finance who involved in this process, will have challenge taking off during payroll cycle, that leads to one of the reason why we always see high turnover in this job.
The following are all the direct cost / hidden cost in company which related to Payroll Processing:
(a) Direct cost – employee who handles the task
(b) Indirect cost -
(i) Department Admin/Site Admin who actually helps to collect time attendance, compile, gets Supervisor to sign-off and pass to HR
(ii) Resignation, retraining of Department Admin who handle data compilation
(iii) Resignation, retraining of personnel who handles payroll
(iv) Statutory compliance risk
(v) System maintenance chargeable when there is update required for statutory
So, why would you still managing Payroll in-house? Outsourcing your non-core processing such as Payroll are the current business trends, many businesses are operated with very lean resources, it is critical to ensure all non-core but important transaction are well taken care by an expert, so that you can allocate your resources that brings ROI to the business
Our company offers, end-to-end payroll processing with FREE cloud HR solutions. Let the system do the job, in collecting attendance record, verify attendance and OT based on criteria you have set in the system.
Outsourcing your payroll to us will free you from all the hassle. we take cares of everything for you, making sure the calculation is compliance to EA and statutory, backing up all your important records, no worries about people training and retention.
- Backup during maternity or sick leave
- Backup during company M&A transition
- Backup during cease operations
- Setup for start-up operations (statutory setup, pay policies)
Call us to find out more.