Pros and Cons of Payroll Outsourcing 

Angelina Winn/ June 2, 2022/ payroll outsourcing

Payroll outsourcing is becoming more and more common practice, whether it is required by law or because a company prefers to leave the work to be done with the right professionals. However, like with everything there are pros and cons for Payroll outsourcing, something you should assess before making a final decision. Some of the important questions you should be asking yourself are what are the best areas you want to invest your money, employ your resources and save your time? 

You may be thinking that outsourcing may be the right thing for you but you do not have the money for it or you may find that your payrolls are straight forward enough and that you can manage it within the company. Here are some of the most common pros and cons to help you guide your decision.  


If you are considering hiring one of the many payroll services Australia has, the first thing that comes to mind is saving time and money. You will no longer need to hire employees to specifically work on payrolls and you do not have to have all the material resources for printing and issuing paycheques and other payment related materials.  

Furthermore, there is generally less error which means that there is less time spent communicating with HR trying to identify problems and solving them.  

Security and compliance  

Most Payroll outsourcing services have extremely secure systems and often back up their systems regularly and in multiple servers, hence, there is much less chance of losing any data. They are also very secure and your information will remain protected.  

Companies are also much better informed or regulations and regulatory obligations that tend to change often. This way you do not have to worry about that and about facing problems with the government.  

Your employee information is no longer yours 

A major problem with payroll outsourcing is that you no longer have direct access to your employees’ data and information. By hiring someone to do this work for you, you are giving them access to and ownership of this information and getting any of that may be difficult for you to do.  

Longer correspondence time  

With payroll information being processed at an outside company, you minimize the risks of error, however, the time it takes to adjust or investigate an error may be longer.  


Even though you will be saving the cost of hiring someone to work on payroll, you are hiring a company and depending on the number of your employees and the work you need done, the associated costs may be much higher.  There is also always a risk that the company may go out of business and leave hanging.  

Remember that processing Payroll outsourcing the right way and following the rules is very important to help you avoid trouble with employees as well as fines and penalties. You should not take the decision to outsource lightly. However, should you choose to outsource, you should look for the best payroll services Australia has and see how they match your needs.  


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