Payroll software can prove to be a highly valuable tool for a company. The software significantly improves efficiency by calculating the payroll of all employees, saving a lot of time and resources. Plus, it ensures accuracy in the calculation and maintains all the records, which are fairly easy to find. When choosing payroll software, however, there are certain factors that a company must consider to ensure that they are picking the right tool.
Ease of use
Payroll software is essential for a company to improve efficiency and save time. However, efficiency is only possible if the software is easy to use. If the software has a user interface that makes it difficult to navigate through its functions, it will take up more of the payroll managers’ time than save. A company should choose a payroll system that is fairly easy to use and has an intuitive interface to avoid that. This way, even when the company hires new employees in the payroll team, it may not have to spend much time training them to use the software.
Integration with the existing systems
A company needs several systems to manage different business and workforce management aspects. These include an attendance system, an accounting system, and a human resources management system (HRMS). All of these systems record data that needs to be accessed for calculating, disbursing, and managing payroll. This is why the company needs to check if it can integrate well with these existing systems when choosing payroll software. Even when a company is switching from an old payroll system to a new one, it is important to check the new one for integration capabilities.
Direct deposit feature
Direct deposit refers to when the wages are directly transferred to the employees, i.e., into their bank accounts, rather than handing them printed checks. Direct deposit has become the norm, and almost all the employees in the country receive their pay this way. Owing to this, many payroll systems offer a direct deposit feature, which streamlines the transfer of funds to all the employees in the organization. So, before choosing a payroll system, a company must ensure that it has this feature to automate the payments. Some payroll software providers also offer free direct deposits for a limited number of employees. This can be especially useful for companies with a smaller workforce.
Data security
Payroll software can contain sensitive data from the company and its employees. Even the slightest breach of this data can cost the company a fortune. This is why, when choosing a payroll system, the company needs to ensure that it has all the necessary data security features. This includes data encryption, multi-factor authentication, and role-based access controls. It should also ensure the software complies with data protection laws and regulations.
Employee self-service feature
A payroll system must feature an employee self-service (ESS) portal to simplify the payroll process and reduce the workload of payroll managers and administrative staff. The employees can handle a few payroll-related tasks by themselves through this portal. This includes viewing their tax forms and pay stubs, submitting investment declarations for tax-saving purposes, and updating bank details. An ESS portal eliminates the need for employees to consult administrative staff or wait for the processing of their requests.
Scalability
When choosing a payroll system, any company needs to consider scalability. With time, a company may hire more employees to adapt to its growing business. So, payroll software should be able to adapt to the eventual increase in the number of employees. Further, with growth, the company’s payroll needs may also change. For instance, it may introduce different benefits and deductions for employees. Considering these factors, a company must choose a payroll system that can adapt to its changing needs.
Customer support
Like any other software tool, the payroll system can also run into issues needing technical support. So, when choosing a system, a company must ensure the provider has good customer support. This will ensure that if the system does run into trouble, their issues can be addressed as soon as possible without any delays or errors in salary disbursement.
Pricing
Most payroll software companies usually offer a subscription-based pricing model. This means a company must pay a monthly or annual fee for using the services. Many payroll systems also charge additional monthly fees based on the number of employees. For instance, the average monthly fee that a company can expect to pay is around $30, with an additional $5 a month per employee. However, before agreeing to the amount and signing a contract, a company must check if the system has the required features in place. It is also important to read the contract to ensure the provider is not charging hidden fees.
Reviews
Before finalizing a payroll system, it is also better for a company to look at the customer reviews for the system and the provider. Some various third-party websites and forums offer ratings and reviews for payroll systems. Reading these reviews from other companies that used the systems can help one make an informed decision.