How to switch from traditional payroll providers to a modern, in-house payroll solution

We've all been there – dreading the payday as it gets closer, tired from constantly looking at numbers, and frustrated by the endless back and forth with our payroll provider. But it doesn't have to be this way.

‍

Bringing payroll in-house has never been easier.

Moving payroll in-house often requires a dedicated, full-time employee with payroll expertise - an investment few can afford. Not anymore.

Fortunately, modern payroll software providers have built payroll expertise into their software and have local payroll experts just one click away. And apart from access to payroll expertise, new-age payroll software is intuitive, inherently compliant, efficient, flexible, and entirely in your control.

‍

Is bringing payroll in-house the right solution for you? And how do you determine the right time to switch your payroll providers?

At Pento, we've spoken to hundreds of companies looking for their next payroll solution. And we've realised there are some signs to determine if in-house payroll is the right solution for you. 

The timing of switching your payroll providers is also crucial. As your company grows, your payroll processes and needs change too. You may only realise payroll is painful once you hit specific roadblocks while scaling up.

So, ask yourself these questions:

1. Are there headcount changes every month, or do you already have over 100 employees? Has the list of changes, joiners, and leavers per payroll considerably grown? And do these changes come in until the last minute?
2. Are there multiple data sources that you need to consult to run payroll? Have the number of internal stakeholders involved in payroll increased? Do you require additional team members to have different levels of visibility and input into payroll?
3. Has your time spent liaising with and passing information back and forth with your payroll provider significantly increased?
4. Do you catch errors in the payroll drafts shared by your payroll provider? Do you have multiple layers to check and balance payroll data across the payroll process? And is more than one team member involved in it?
5. Do your internal payroll management responsibilities sit with someone whose main job is not payroll? Is your People or Finance team managing payroll as part of their responsibilities?
6. Have you recently delayed other work or personal commitments to meet your payroll provider's deadlines and cut-offs?
7. Does your Finance/Accounting team need to manipulate or split payroll journals every month?
8. Are you introducing enhanced benefits that will change your contract with the payroll provider or increase your payroll costs?
9. Is it essential that your company stays GDPR compliant?

If your answer was yes to 5 or more of these questions, you should consider in-house payroll. You'd benefit a lot from the time and cost savings.

Companies that answer yes to most of these questions spend more than a week on payroll per 100 employees every month. Try to add up the time you spend across all your pre-payroll preparations and post-payroll reconciliation; chances are you're in a similar situation. Whether your time is spent on data collation, manual calculations, manual error checks and corrections, journal manipulation, or payments, in-house payroll can significantly reduce the payroll workload you're used to with outsourcing.

And let's face it – there are better uses for those hours. With a modern in-house payroll provider, you can get back with just one pay run, much more than the time investment required to make the switch.

‍

What is it like to migrate your payroll? Here's everything you need to know.

You can start by ensuring that your next payroll provider is open to at least one or two parallel pay runs. A parallel run is where you simultaneously run payroll with your old and new payroll providers. They are perfect for reconciling tax and payment numbers between the payroll providers and your best defence if you want to switch payroll providers confidently.

The time investment spent preparing for the switch is less than expected; the long part is waiting for the parallel run months to pass until your first live payroll!

Your new payroll software provider should provide you with a pre-written message to send to your old payroll provider to request the data needed. After you pass over the data from your previous payroll provider, the new payroll provider should do the heavy lifting to get your data in shape. You'll get a sneak peek of your unique payroll experience during the parallel run.

And that's it!

‍

Making the switch to in-house payroll with Pento – we'll let our customers speak.

From seamless onboarding…

…to making the right decision by choosing Pento as the next payroll provider, our customers have said it all.

At Pento, we're not building another payroll company.

We're transforming how payroll works – making it efficient and cost-effective. We want to ensure that nobody has to sacrifice precious time to get people paid. And we're doing that by making payroll so easy that nobody ever needs to be a payroll expert again.

Learn more about how Pento works.