5 Essential Qualities In Payroll Providers To Look For

Things you must look for in a payroll provider


For small businesses, payroll can seem daunting due to tax obligations and employment law compliance, employers can’t just hand out cash or write cheques on payday. Running payroll is an ongoing process that you have to manage with care from the moment your first employee is hired and when there’s a problem, you need to solve it quickly so your employees are paid accurately and on time.

So in this article, we’ll cover the five top qualities to look for in a payroll provider. By the end, you’ll have all the tools you need to choose a provider equipped to help you tackle one of hr’s biggest challenges, managing your payroll along with staying fair and compliant in your compensation practices. We’ll discuss the need for great customer service, limited manual data entry, an intuitive user experience, transparent pricing, and access to resources. Now let’s dive in. 

The quality of services you should look for in a payroll provider


We’ve all been victims of bad customer service and getting it from your payroll provider can make an already stressful part of your job even harder. Some providers limit their service options to a 1-800 number, putting you through the wringer of confusing automated responses before finally connecting you to a human. Your payroll provider is supposed to simplify this part of your job and not complicate it. So when your problems arise service is crucial. 

What should you look for in a payroll provider in terms of service?

First, make sure they give you easy access to a real person to talk to. You want to feel confident that when questions come up, your providers’ team is staffed with experienced payroll experts ready to offer top-of-the-line support whenever it’s needed.  

Second, ask about an implementation plan. You are going to have questions and concerns as you work through the initial stages of setting up the software, and a good vendor will have the bandwidth to work with you on those nuances. 

Before choosing your provider, consider these questions;

Do they offer training sessions to support you and your team as you learn the ins and outs of the system?

Do they offer an FAQ page on their website where you can find quick answers to common questions? 

What are the options for contacting support about your implementation concerns? 

During what hours is support available? Are these hours sufficient for your company’s needs?

Payroll problems need to be solved quickly, so look for providers with active and robust customer support services such as a helpline or an omnichannel chat box with live support staff available to help 

Things you should look for in your payroll provider in terms of data entry

Amount of Manual Data Entry

As an HR professional, you know how much of time-consuming data entry can be and with so many moving pieces to payroll such as time, paid time offs(PTOs), benefits deductions, new hire information, direct deposits, reimbursements, etc. there are always be data to enter. But the more you have to input manually the less bandwidth you’ll have for the more strategic parts of your job.

Consider all the steps that go into calculating and distributing employee’s paychecks

Calculating Hours and Gross Pay

These calculations can vary based on whether employees are exempt(salaried), or non-exempt(hourly), and many businesses employ both types. Managing salaries alongside more varied hourly rates can get complicated, and calculating these rates manually, with overtime, bonuses, tips, and commissions is a surefire way to guarantee errors. Using a payroll system that includes PTO and time entry can help cut down on these calculations. 

Once gross pay is calculated, you still have to deduct benefits and withhold taxes. 

A smart payroll system knows what programs each employee is enrolled in and can eliminate data entry for deductions and withholdings. This includes subtracting insurance premiums, Health Savings Accounts(HSA), Flexible Savings Accounts (FSA), 401(k) contributions, and other pre-tax deductions from gross pay before calculating how much social security, medicare, and income tax to withhold, and finally subtracting post-tax deductions like Roth IRA contributions, all personalized to the unique situation of each employee. 

As you can see, it’s a lot to juggle. You’ll want to choose a payroll provider that can take care of as many of those steps as possible. Since each one you have to do manually increases the risk of errors not to mention the hassle. 

So, it’d always be wise to choose a payroll provider that integrates with the overall Human Resource Information System(HRIS) to populate employee data such as PTO, time, and benefit deductions and automate most of these calculations, and handles all tax withholdings on the backend. Overall, your organization should feel confident, you’re remaining compliant and you can focus your time on other projects like recruitment, retention, and developing a healthy company culture

Things to look for in your payroll provider in terms of user experience

User Experience

While all this backend calculation is crucial in a payroll service. Don’t forget that your employees need to use the software too. That’s why it’s important for you to consider user experience both for you and your organization’s workers.

Beware of software with little or no self-service options for employees. There is nothing more frustrating to them than having to maneuver through an outdated and confusing system to find basic payroll information, such as their pay stubs, so be sure the vendor is performing frequent updates to the platform to improve efficiency. Otherwise, employees will come to you constantly when they can figure out how to use the software, which defeats the purpose of automating payroll in the first place. 

You should also look out for systems that have been “Frankensteined” together from a variety of sources. Payroll touches almost every part of your organization, and it’s crucial that it works together with, and not against, your other HR processes. Some HRIS systems are cobbled together out of software from multiple companies, which means they’re likely not to work seamlessly. This can lead to more work for you, and more frustrated employees coming to you for help when things go wrong. 

In contrast, a good user experience is often born of a payroll system that blends intuitively with the rest of the HRIS system’s software, streamlining every aspect of the employee lifecycle, from onboarding to tracking hours to benefits and PTO.

An all-in-one HRIS can distribute and collect the necessary tax and benefit forms, track time and attendance, and host tax reporting documentation. It also simplifies the payroll process by sharing data across multiple parts of the system to automate more calculations and give employees the power to update their own information, clock in on their mobile devices, and view their pay stubs on demand.

This type of integration not only saves precious time but also improves payroll accuracy. Both of these help your company provide a good place to work and may help boost employee satisfaction. A win-win situation for the company and its workers. 

Things to look for in your payroll provider in terms of pricing

Transparent Pricing

While payroll software is usually more cost-effective than hiring an accountant, it’s still important to look for a payroll provider that keeps its pricing system clear and transparent. 

Sometimes, pricing can be deceptive. Most payroll services involve a tiered monthly fee plus a flat rate per transaction or employee, so remember that in most cases your service costs will increase as your company grows, and you’ll need to be prepared for those charges. 

In addition, beware of any additional or recurring expenses in place. This can mean paying attention to any product update charges or technical support fees that aren’t included in the original cost, such as setup fees, taxes and compliance fees, processing fees, and other add-ons. Some payroll provider companies also charge a fee for each payroll run, so making a mistake and having to run payroll again can be costly. 

Knowing these numbers from the beginning will help you simplify your decision when choosing the right payroll provider for your organization. 

Finally, some vendors may boast additional features that are actually only available at a premium. Be sure to ask which features are covered under the plan you choose and determine ahead of time whether the extra features are worth the added cost. For those reasons transparent pricing is crucial. Look for options that let you compare plans and features side-by-side so you know exactly what you’re getting, and can plan accordingly for the costs. 

While services with transparent pricing may seem at first to be slightly more expensive, remember that cheaper providers may be hiding extra fees and charges they don’t want you to think about in advance. These additional costs can take surprise bites out of your budget later on. 

Things to look for in your payroll provider in terms of resource accessibility

Access To Resources

Finally, your payroll provider company should provide access to a wealth of resources for managing and understanding not only payroll but all parts of your job. Don’t choose a provider that will leave you to fend for yourself after implementation. Instead, pick one that comes with a knowledge base, step-by-step articles and instructions, and access to the community of support. 

With payroll operations, urgent and sometimes unexpected roadblocks arise. As an HR person, you need a provider that walks alongside you as you navigate the often murky and tumultuous waters of human resources management at your organization and keeps you informed about industry trends and compliance changes that will impact your payroll or taxes. 

Look for a payroll provider that has a massive knowledge base of articles to help you with everything from setting up your subgroups and payroll to staying compliant to performance management and everything in between. 

Additionally, your Human Resource Information System (HRIS) should offer a comprehensive library of resources updated regularly to support you with payroll and beyond.

Finally, look for access to other people in addition to customer support the best payroll providers include some form of community, for example, a section named ‘active discussion forum’. Where you can find answers to your questions and interact with others using the same software. You’re a human resources professional after all and sometimes you just need to talk to another human. 


You have enough to do as an HR professional. If these five qualities are in place, you can be sure your payroll provider is compensating your employees accurately and on time and keeping you compliant so you can focus your energy on other things. As always, remember that your role is as strategic as you make it.

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