Working for the workers - is the payroll taking up all your time and money?
Workers mean wages and wages mean payroll. Paying wages for a recruitment business, whether your own staff or that of your contract, temp, or other workers, is a fact of life.
Every morning, most of us get out of our warm beds and do the commute to work. We do this because, as Lunchmoney Lewis recently sang, ‘I got bills, I got pay’. He is right, we all go to work to get paid. Well okay, in fairness there is a lot more than just money that influences our work choices. Things like job satisfaction and contentment with the management make a huge difference as we all know, but underpinning all the other factors is the salary at the end of the month that keeps food on the table.
If you happen to be old enough to remember the days when computer support for a business was less common, then you will probably agree that modern accountancy packages make life a lot easier. The use of electronic methods of banking also helps reduce the burden of payroll. We should also remember that the impact of electronic submission of paperwork, and even things we take for granted such as email and messaging have also reduced the chore of payroll.
So does all this mean that payroll is now something that has minimal impact on a business? We don’t think so. In fact, we need to be vigilant about how much we allow the apparent simplification of the process to lull us into a false sense of security about the impact something as important as the payroll process can have on a business.
Naturally, there is an impact on the running costs because, to put it simply, someone needs to sit down and do the payroll function and that means a salary. Payroll specialists don’t come at minimum wage, and for good reason. The vital function of efficiently getting the wages out and the associated bookkeeping that is needed in terms of tax, National Insurance, auto-enrolment, and all the other associated areas, is a skilled job. Skills cost money and rightly so. This is also assuming that the person performing the task within the recruitment business is a specialist and that you are only looking at a pro-rata wage cost. However, that is often not the case, and payroll may well only be part of a highly skilled person’s duties.
So we are now talking about more than just a financial cost of a wage. We are also talking about expensive team members using their time on what can be a fairly mundane task. Remember all that software that simplified things? Well if you are not careful it is now just a way of soaking up the time of a highly skilled staff member on entering data.
On top of all this, there is about to be a whole raft of changes from new IR35 rules for public service through to potential international law changes as we exit the EU.
Why not call us to see if outsourcing your payroll is right for you? It often not only makes financial sense but also means that you can free your team up to do what they do best.
That can lead to severe cash-flow issues, and you are now also showing a downturn in business. That’s when the sleepless nights really start.