As an outsourcing partner, we want to understand what is causing this unhappiness.
- Is it because there is no longer confidence in the provider’s abilities to transact payroll accurately?
- Is it because there is a lack of trust in their knowledge and capabilities?
- Or is it because there is a lack of communication between the service provider and customer?
Ultimately, almost one third of businesses are not happy and we believe it is because these three key components are missing: trust, confidence, and communication. They are all vital to a successful service provider partnership. We want to reiterate to you why they are so important and offer some food for thought, so that you can question whether you are truly happy with your provider.
46% of companies believe their service provider does not understand their business requirements.
Trust is vital in any relationship, and payroll is no different. Payroll is about so much more than just paying people. It is about managing data and handling it in a controlled and secure way, in an ever-changing and complex landscape. You need a supplier who you can comfortably trust with your PII data. A payroll provider can prove that they are trustworthy through:
- being BACS & HMRC approved
- being GDPR compliant
- having ISO accreditations
The storage, usage and transferring of this sensitive data is heavily regulated by the General Data Protection Regulation (GDPR), so it is no surprise that remaining GDPR compliant is a main concern for all payroll departments and businesses alike. As well as remaining GDPR compliant, your service provider must consistently implement the latest government legislation and regulation updates. Therefore, you need a provider who you can trust to handle all your data sensitively, and trust to implement the latest legislation requirements.
19% of companies believe their service provider is not adequately trained to deliver payroll.
Confidence in your provider is essential because payroll inaccuracy can cost you valuable employees. One in five employees have stated they would change their jobs due to being paid incorrectly, this is the equivalent of 7 million people in Britain. And for the employees who would stay through the payroll inaccuracies, 51% would lose trust in their employer, and 41% would feel unmotivated. The inaccuracies can be caused by changing employee data not being entered at the correct time and therefore retrospective payments are needed.
The shift over to ‘employee-focussed’ salaries means that people might be on different packages for similar roles. ‘Employee-focused’ salaries are set up around employee benefits and rewards rather than basic salaries, resulting in a significant increase in the amount of adjustments and exceptions needed per pay cycle.
Payroll inaccuracies can commonly be caused by not acting on legislative changes, not understanding your company’s payroll cycle or due to data being entered incorrectly. Your service provider should ideally have a first-class system to deal with the complexities of your employees, a first-class system also means it can automatically calculate retrospective payments.
55% of people find it challenging to very difficult to get in touch with their service provider.
A key component of running a business successfully is communication, and payroll is no exception. You should feel confident in your ability to contact your provider, and when you do, that your worries or issues are being heard and resolved.
Changes to organisation structures are the third greatest challenge for any payroll team. Therefore, you need an open and easy dialogue with your provider so that they can keep up with your ever-evolving business. You should have a clear understanding about the exact roles and responsibilities between you and your service provider. Your provider should review your relationship semi-regularly, to keep up with your evolving business and to build trust.
Service providers are in abundance, offering the latest technologies encouraging seamless integration into all business functions. However, we know that a staggering 36% of companies would not recommend their current service provider. Clearly, trust, confidence and communication are lacking. Which is worrying, because regardless of the size of your company, payroll is complex.
The more complex your company’s payroll is, the greater the benefit will be when outsourcing these transactional activities. However, you need to find a payroll provider who integrates nicely into your business in order to understand your business’ complex payroll cycles and how this feeds into your overall business strategy. Don’t settle for less.