As the end of the year gets closer, businesses get busier and busier preparing financials and compiling projections for a new year. With a fresh slate starting in a few months, now is a great time to shop payroll and HR outsourcing services and compare vendors to make sure you are getting the best service, software, and pricing.
Which areas do you need to focus on when shopping payroll and HR providers?
Service levels vary from company to company, so how is it possible to compare providers? Here are the key areas you should target when shopping payroll and HR providers to maximize your return on investment and save you the most time possible.
Although a lot of businesses get their Workers’ Comp insurance from a standalone insurance broker, a great way to save money and time is to become a part of a Workers’ Comp master policy with a payroll provider or a Professional Employer Organization (PEO). Not only do you have access to more buying power through a master Workers’ Comp policy, but some payroll providers even offer options to help you save time and improve cash flow.
When shopping your workers’ comp policy, make sure to ask the provider if they offer a “pay-as-you-go” option. With the pay-as-you-go option, there’s no need to pay a large premium up front for your policy. Because workers’ comp payments are tied to the amount your company pays out in wages, you can pay on a month to month schedule through your payroll provider. This eliminates the large premium up front plus an additional payment at your year end audit. Because you’re paying on a monthly schedule, there is also no need for a year end audit saving you time, and money!
For a lot of companies, going to the market for a healthcare plan can be very expensive. Until your company has several hundred employees, you typically don’t have the volume to qualify for discounted pricing on healthcare. This makes it expensive to compete with larger competitors when it comes to offering comparable employee benefit packages to attract and retain top industry talent.
By working with a payroll and HR provider that also has a master health policy, you are able to gain access to healthcare pricing usually reserved for very large companies. Not only does a master health policy potentially save you thousands of dollars, but you are also in a better position to attract and retain key industry talent when you provide a competitive healthcare plan.
Is your current payroll and HR provider a “one-size-fits-all” relationship model? If so, you could potentially be paying for things that you’re not taking full advantage of. As your company grows and evolves, so do your needs. Sometimes this means an increase in your service level, but there are other times when it makes more sense to bring something in house and downsize your service level.
In the PEO relationship, typically a vendor will provide you with a complete HR infrastructure and take on legal responsibility for making sure you are compliant with government regulations. However, if you don’t need all the services, there is no need to pay for them. As your company brings certain functions in house, you may need a change in your service level, which is why it’s important for your HR outsourcing provider to offer PEO as well as ASO relationships. In an ASO relationship you’re able to pick and choose what services you want to outsource and what services you want to keep in house, saving you from paying for services you don’t need.
Further Reading: Assess the Health of Your HR
If you are operating on an outdated or incompatible software platform, you could be wasting valuable time and resources, not to mention increasing your level of frustration. Human Capital Management (HCM) technology is crucial to competing in today’s business world, and if you aren’t proactively reviewing your different software systems, the rest of the industry could pass you by on the way to the top.
One area of complication that we see repeatedly when we begin talking to a potential client is that many companies are using too many software systems instead of one comprehensive system. They have one platform for payroll, another system for benefits, another piece of software for timekeeping and attendance, and even a different program for tracking employee data! When operating in multiple systems, the potential for error becomes extremely high, especially if you have to manually input information in multiple systems. Even if your different platforms do “talk” together, there is always a potential for complications when using middleware to make those systems communicate back and forth. In addition to increasing your potential for reporting errors, you’re also paying for multiple software systems which is almost always more expensive than one complete HCM system.
Customer Service and Support
While all the above things are important when shopping payroll and HR providers, none of them outweigh great customer support. How does your current vendor view customer support? Is customer service at the front of their minds, or is it just an afterthought? Do you have a dedicated payroll specialist you know by name, or do you get someone new every time you call with questions regarding your payroll or HR outsourcing services?
Any time you switch to a new vendor, there is always the potential for some slight bumps in the road, but that’s just a small cost in comparison to all the benefits of being in the right relationship with your payroll and HR provider.
What’s most important to remember is how responsive your support team is and how quickly they begin working on a solution when problems do arise. Does it take days or even weeks to hear from your current vendor, or do you get a helpful call as soon as possible? If you’re waiting on the edge of your seat for a call back from your current vendor, it may be time for a switch.
The end of the year is a great time to review your current vendor relationships. If you focus on the above areas involving payroll and HR, you will maximize your time, ROI, and savings in the shortest timeframe possible. Is it time to start shopping your payroll services today? Give us a call at Propel HR for a free review of your current payroll and HR functions as well as a review of your software systems. We’ll show you how to propel your business forward with powerful technology, competitive benefits, and stellar customer service.