Should You Consider Switching Payroll Providers?

Should You Consider Switching Payroll Providers?

Small Business Owners


Should You Consider Switching Payroll Providers?

A Special Report

If you’ve been doing your payroll the same way for several years now, it may be a good time to take a look at alternative payroll providers to see whether you might be better off with a new solution.

Here are eight items to consider whether it might be worth it to find a new payroll provider and what to consider if you do.

1 Errors

For example, if you have an employee that is under a garnishment order and your payroll system does not meet that need, then your payroll system has that limitation. You’ll be glad to know that some payroll systems have more “bells and whistles” than others when it comes to payroll deductions as well as other business requirements.

Let your accountant know about the requirements you have that are not currently being met by your system so they can look for new systems that have what you need built in.

If your payroll service generates too many errors, this is

certainly a reason to switch. Ask yourself how much all the errors are costing you in terms of time and money lost. If it’s significant, then it makes sense to look for a solution with a stronger track record of accuracy.

If the errors in your payroll process cannot be avoided, then you’ll want to make sure you have a system that minimizes the time it takes to correct these errors. Speak with your accountant to determine whether there’s a better alternative. Perhaps your accountant can also review your process and make suggestions that could reduce the number of payroll errors.



If your payroll is complex, you may be performing an

extra set of steps to work around the limitations in the payroll system. These extra steps take time, and you may be better served finding a payroll system that meets all of your payroll requirements.



Similar to limitations, some accounting systems simply

lack features that you might like to grow into. Let’s say you’ve been generating paper checks and hand-deliver- ing them. You decide that it’s time that every employee get signed up for direct deposit so you can save the time and hassle of printing, signing, and delivering paychecks. Your current system does not offer direct deposit. That would be a reason to start looking for a new system that has all of the features you now need.




How responsive is your current payroll provider? If there are service issues, then it can be frustrating as well as time-consuming.  Here are a couple of questions to consider.  Do you have a regular payroll representative that knows your company and its specific payroll needs? How long does it take you, on average, to reach your representative, or if you don’t have one, to get support from the help line? How long does it take them to get you the answers you need or to resolve your problem?

Having a great payroll service representative can save time and money, and if you don’t have one with your current payroll solution, it could be a good reason to consider switching to a new provider.



When payroll taxes are not paid on time or payroll tax reports are not filed by the deadline, your business may incur penalties. These can be very expensive and will drive up the cost of your payroll fees. Some payroll providers will pay the penalties if it’s their fault that the filing or tax was late. Look for a guarantee from the payroll provider or ask them how it’s handled.

You shouldn’t have to pay the payroll tax penalties if it wasn’t your fault.


6 Cost

There are many new payroll companies that have leveraged technology so well that they are able to keep their fees very low.  If cost is an issue for you, ask your accountant to provide you with an estimate from some of the newer systems.

Be sure to find out what the fees cover. Monthly fees may not include the extra processing that is required at year end. Ask if W-2 and W-3 filings are included. Also ask about 1099’s. They are usually not considered part of payroll, but some payroll systems will provide the service.

Often there are monthly fees as well as year-end fees. Ask to see all of the fees before you make a decision so that you are making the right comparisons with your current system costs.



You might need your payroll hours to integrate into your accounting system for job costing and labor costing purposes.

There are varying degrees of system integrations. Some payroll systems only create a summary journal entry, and that’s the extent of the integration. Others are completely integrated.

What level of integration do you need? Make sure to communicate this with your accountant so they can recommend the right system for you.


8 Banking Integration

Payroll systems vary as to how much lead time they need to take the money out of your account to fund the payroll check and the tax payment.  If cash flow is an issue for your company, this can be an important consid eration.

Find out how many days ahead of payday you need to enter your hours, run payroll, and have your bank drafted for the amounts. You’ll be able to compare payroll systems and make a good decision based on your information.

One more tip related to banking issues with payroll: there are some combinations of banks and payroll systems (example: Wells Fargo and ADP) that require a phone call every pay cycle to release the payroll data.  If you have that situation now, it’s a very good reason to switch.  Do your homework to make sure you don’t get into that situation in the future.


Which of these items is currently a “negative” when it comes to your current payroll processor? How much time and cost are you spending on your current payroll solution?

Hopefully, you now have some criteria to judge your current payroll solution and whether it might be worth it to consider switching to a better and newer alternative.

If you feel like you might be ready for a new payroll solution or at least to compare the options that are out there, then let’s talk.

We offer a free initial payroll consultation with no obligation.  Give us a call or email us to schedule yours today.

Ready to consider switching

payroll providers?  Get a free quote.

Call us at 907-562-2003 or email wrconkey@wrconkey.com


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  1. Thank you for suggesting that you should make sure and find out what the fees cover. Making sure you have the best payroll processing company seems like it could save you a lot of worries. Hopefully, business owners look into finding the best companies possible.

  2. Hello there
    We know that payroll is a small business service after all this service always provided the best service which is worldwide business and included service cost very low and trusted business.
    All the business take it formally.
    Thanks for sharing positively knowledge.

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