HR and payroll services refer to all activities related to HR and payroll in a given company. It can be carried out by both internal and external departments, and the scope of activities depends on the specifics of the company. Which is more beneficial? Is using the services of an external company a good solution?
What is HR and payroll services?
These are activities that are performed by HR and payroll departments, accountants or external accounting offices, but also temporary employment agencies. The scope of HR and payroll services is very large and can apply to virtually all aspects of office and accounting work in a given company. HR and payroll departments are primarily responsible for managing the company’s human potential, so this applies to all activities related to hiring employees and paying them salaries.
HR and payroll services – what is the difference?
Although HR and payroll services are usually related activities, it is worth distinguishing between HR activities and payroll activities. What are the differences? The composition of personnel activities includes:
- keeping records of working time,
- management of documentation regarding the course of employment,
- records of employees’ personal files,
- referring employees to initial and periodic examinations,
- motivating employees to improve their competences and strive for development,
- conducting recruitment processes,
- directing employees to health and safety training and ensuring that it is up-to-date,
- Measuring employee engagement metrics.
In turn, the payroll department takes into account the following in its activities:
- organizing and implementing the employee payment system,
- running payroll,
- cooperation with the accounting department,
- settlement of social security benefits, holidays and other breaks in work,
- issuing payroll documentation for retirement and disability pension matters, benefits, etc.,
- making tax settlements,
- calculation of salaries and other benefits on the basis of civil law contracts,
- keeping documentation and settlements of personal income tax, social security contributions or the Labor Fund.
HR and payroll services are often a combined activity, which is why appropriate specialists are hired, who can have both HR and payroll activities in their scope of duties.
HR and payroll within the company or outsourcing?
Any company that wants HR and payroll services to be in-house must take into account the need to hire a full-time employee, and thus a financial contribution.
These costs must include not only the salary, but also the creation and equipment of the workplace, e.g. with computer hardware or specialized software. It is also necessary to pay salaries on a monthly basis, but also to refer the employee to training and courses so that they are up to date with the regulations and can manage human resources. In the case of small or medium-sized enterprises, one specialist may be enough to handle the entire department. But what if he goes on vacation or sick leave? This is when HR and payroll outsourcing can come to the rescue. What are its advantages?
- Comfort and safety – entrusting HR and payroll activities to an external company is a guarantee of continuity of services. The company does not have to worry about an employee being on leave or sick leave.
- Confidentiality – any confidential data will not be disseminated, so it will not be a source of potential problems between employees, such as the amount of salaries.
- Savings – the entrepreneur does not have to create a workstation or deal with its equipment. HR and payroll services outsourced to an external company are usually lower costs than the monthly salary for the employee.
- Speed of action – all issues of remuneration or sick leave are calculated in accordance with the law. External companies offer a comprehensive service, so having various specialists on site, they can quickly respond to current situations.
- Trained team – external companies have a team that is up to date with the provisions of labor law and social security and tax law.
When else is it worth using outsourcing? First of all, when there is a need to hire a large number of employees. Temporary work is often associated with looking for candidates for fixed-term jobs, and thus increasing the workload of the HR and payroll department. In the case of employees who will appear in the company temporarily, hiring an additional employee for HR and payroll services may not be profitable. On the other hand, an already hired HR and payroll specialist may have an excess of responsibilities related to the management of new employees’ documentation. It is important that in addition to documentation, HR and payroll services also include recruitment processes, which can be time-consuming and involve additional workload.
Temporary employment agencies offer a full range of HR and payroll services and relieve entrepreneurs in recruitment processes and all formalities related to
hiring employees. Take advantage of professional HR and payment services.