Payroll refers to the system of handling the wages and compensations of all the employees of a company. It is one of the most important components of a Human Resources (HR) department, and as such, forms an integral part of every company. When it comes to payroll, consistency and accuracy are crucial.
Outsourcing the payroll function is increasingly gaining acceptance amongst the business community in the UAE, especially small and medium enterprises that cannot justify a full-time HR or payroll division as it is not core to the business of an entity and it’sa full-time job. Depending on the stage of an entity’s life cycle, it may be prudent to consider outsourcing the function until the dedicated resource(s) can be justified.
Confidentiality of the payroll
Confidentiality of the payroll is often undermined and under rated. Payroll details divulged, intentionally or otherwise, to those who need not be in the know can have severe repercussions. Sincere and dedicated staff members earning less thanpeople whoare not equally dedicated or committed can dishearten them prompting them to leave or adopt a “less than interested” attitude going forward. Similarly, management desiring to reward someone with a “little extra” can be in a difficult situation if this fact is leaked. Confidentiality of the payroll therefore becomes critical, especially at the senior level. Outsourcing of the payroll function ensures that confidentiality is maintained and even the accountant need not be privy to the earnings of staff members as outsourced service providers often submit a summarized journal entry for accounting purposes, hence ensuring confidentiality.
Optimal Use of Resources
Payroll processing is an on-going operation for every business. Depending on the activity of the company and the complexity of operations, it may demand significant time and effort to get the payroll right each month and in time. An accountant is already stressed with routine accounting, accounts receivable and payable functions and can face severe time constraints by month-end when financial reporting is mandated by owners and shareholders, vendors are to be paid, customers are to be chased for payments and other such routine tasks. this is why it’s better to acquire payroll services.
There are a lot of penalties involved in small business that end up making a grave mistake in payroll activities. In UAE,the fine and penalties can be imposed for incorrect filing or delayed filings. These mistakes should not be taken lightly, because this may land you into big trouble. Filings with omissions or incorrect details raises a red flag. They can lead to undesirable events such as heavy penalties and even audits.
other than this, it is almost not possible for a business to be updated with all the latest changes to federal laws and regulations.Payroll companies haveupdated with all the regulations with all federal and state regulations all the time and they can manage calculations and filings with utmost care and accuracy.
Payroll processing is quite complex with a process which involves loads of monitoring due to inherent risks involved. Loss of personal information can cost you a lot of losses for your business. Frauds such as tampering with company information and abstraction of funds may come which can incur pretty heavy. Payroll service providers are liable to have such safety measures in place. They have state of technologies in place, timely alerts are raised in case of any payroll fraud which reduces the need of manual intervention.
payroll service provides invest massive amounts of money to have such security measures in place which is not possible for you to have in-house if you are a small business.
Professional Team of Experts
By outsourcing payroll services, you are given to professional team of experts who study and research a lot about payroll services and their functions.Professional payroll service providers or agencies have team of experts who can manage end of services benefits and deductions in payroll system.
compensation for Workers, labor issues and human resource in general. They are taken care of pretty well by the team which is an added advantage for your smallbusiness
The payroll process in a company in UAE can be quite complex, with a lot to keep track of, like the WPS payroll, deductions, monthly wage calculation, holiday records, paid leaves, overtime, etc. However, a payroll system is essential with the financial facets associated with it and the local regulations governing it. Thus, outsourcing one’s payroll processing system in the UAE makes sense specially to set up an organized and robust payroll.
Payroll processing servicesare designed for efficient employee payroll management so as to reduce administrative burden and curtail extraneous financial costs. Experts can help your business set up their payroll function in Dubai and the rest of the UAE.