Enhance Security by Outsourcing Payroll

Payroll outsourcing is the use of a professional service provider to handle a company’s administrative and compliance functions of paying its employees.

A payroll outsourcing service provider will gather employee information such as hire date, job title and pay rate to process your payroll. They’ll also be the ones who’ll obtain time card data, calculate the salary of each employee, and then pay the amount due through a payroll check or direct deposit.

Outsourcing of the payroll process is a common practice of many businesses around the world, especially in the United States. So, what benefits does it bring to a company? Should you follow suit?

The Truth About the Payroll Process

Many companies mistakenly think the act of writing out checks to make sure employees get paid on time is already the whole equation of payroll processing. The truth is that it isn’t.

Of course, to successfully carry out payroll processing, there should be effective communication between you and your workers. Payroll taxes are also something you have to calculate and pay accordingly. Add to it the need to accurately keep records of all data related to your payroll.

But, the most important thing is to maintain a safe and secure payroll processing. The problem is that companies often get bombarded with other day-to-day responsibilities, and keeping up with the demands of processing payroll can be very challenging, if not exhausting. It’s where payroll outsourcing service providers come in and give you the breathing space you need.

Outsourcing Payroll and Ensuring Your Security

If there’s one potentially risky business operation that should enter your mind when asked to name a few within your company, it should be payroll processing. From embezzlement to identity theft, security will always be a significant concern. In-house payroll software is also prone to breaches. All of those things can consume the energy and attention of any business owner.

Payroll outsourcing providers, on the other hand, offer protection for all your confidential payroll data. Here’s how your company can enhance security by outsourcing payroll:

  1. State-of-the-Art Systems

Part of the service that payroll outsourcing companies provide to clients is to invest in state-of-the-art systems for the storage and protection of data. As you probably already know, constant monitoring is crucial for data protection and operational continuity. And since state-of-the-art systems monitor better, you can trust that they ensure payroll data privacy.

  1. Up-to-Date Software

Automated platforms are now common in payroll processing. However, automated software is also prone to breaches if it’s not up-to-date with all the latest firewalls and deployed codes. Luckily for you, payroll outsourcing service providers make use of software that undergoes updates from time to time. It makes it difficult for online thieves outside your organization to break into and hack the platform.

  1. Cloud-Based Systems

Cloud-based systems are a trend, and there’s a good reason why. Of course, it brings many benefits to the table. In audit tracking and data management as part of payroll processing, payroll outsourcing service providers use cloud-based systems for better data visibility and integrity.

Aside from better data visibility and integrity, a bonus of keeping all payroll information in one centralized place is the possibility of greater online access for customers. It makes it possible for your company to get away from the need to submit requests in-house that usually takes days for the processing to complete.

They say the future of tax is in the cloud. Well, it also holds for payroll.

  1. Security Schemes and Encryption

To prevent outsiders from possibly obtaining any data from your company, payroll outsourcing service providers enable security schemes and encryption in their systems and software. These security measures ensure that security breaches get prevented, and businesses won’t experience data loss and corruption. A remote connection between the outsourcer and the company also gets enabled to give business owners access to the files.

  1. Data Recovery Services

Another good thing about outsourcing payroll is that if the business loses payroll data, it will get the guarantee that the outsourcing firm will do its best to correct the disaster. The payroll outsourcing service provider does this by providing disaster recovery services. This makes it possible for the business to regain access to its files after data restoration.

Also, the outsourcing firm makes use of backups that are handy when property or environmental damage occurs. Again, it makes it possible to restore any data lost in the process. The payroll outsourcing service provider doesn’t stop with only restoring the files, though, as it also corrects all the vulnerabilities immediately, securing the data better, going forward.


The importance of compensating employees for their hard work is second to none. It makes it possible for businesses to retain their most skilled individuals and continue operating efficiently. It’s the reason why payroll is something that every company must take seriously.

A payroll system houses sensitive employee information, too, so it only makes sense to keep it safe and secure. While it’s true you can implement security measures for your payroll processing on your own, payroll outsourcing service providers go beyond what you’re capable of, freeing up time within your company while delivering peace of mind.