4 Best Practices to Succeed in Payroll Outsourcing

Posted by Gillian Vitug

Aug 30, 2016 1:20:26 PM

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Once you have decided to outsource all or some of your payroll functions, it isn’t just ideal, but it’s necessary for you to still be completely involved in your payroll process. Payroll outsourcing services take the meticulous work off of your hands, however, the success of how it runs will rely on the relationship between your company and the payroll provider. To help ease the transition and overall administration of employee payroll and benefits, here are some best practices to consider:

1. Have someone in your company who completely understands payroll laws and processes. 

While you might think that payroll outsourcing completely relieves you of all your payroll responsibilities, there should be at least one person in your company who is fully knowledgeable about how payroll laws and calculations work, so that somebody can perform accuracy checks when necessary. This person shall be the single point of contact between the company and the payroll provider, and all concerns and issues shall be coursed only through this person for an organised flow of communication.

2. Establish a clear division of payroll responsibilities.

To ensure a smooth and hassle-free payroll process, the division of tasks and responsibilities between your internal payroll staff and your external payroll provider must be clearly established before onboarding. This should be written in detail through the contract or service level agreement, for a solid reference for both parties.

3. Communicate openly and be accessible at all times. 

The main ingredient for a successful outsourcing venture will always be open and constant communication. You cannot just pass on the work and expect your payroll provider to instantly transform your payroll process like magic—that will never be the case. Outsourcing is not just any mundane business solution, it’s a partnership that requires two parties to work together in achieving a common goal, and the foundation for that is open communication channels. Both parties shall ensure that there is no room for conflicts and misunderstandings, and that they are both easily reachable whenever there are issues, clarifications, or approvals needed.

4. Prepare your in-house employees for the changes about to take place.

Inform your employees about all the changes that will take place in your company so everyone knows what to expect. Payroll is a sensitive topic for all employees, therefore they should get a clear idea of what functions remain in-house and what is being outsourced, and also to who they should raise their concerns about their pay. Should a new payroll system be introduced by your payroll provider, ensure that your employees get proper training to access the software accurately.


All companies should understand that outsourcing payroll is not an instant solution that will miraculously run by itself. It requires an open and collaborative partnership wherein both parties will do their part to create an efficient and successful payroll solution.  

Whether you need an enterprise-wide solution or a small business payroll, D&V can be your partner in building a payroll process that will help optimise your resources so you can save time and money to devote to the more important core activities of your business. Contact us now to learn more about our Payroll Solutions for Australian businesses!

Download the Australian Payroll Management Whitepaper

Topics: Payroll Services

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