Industry Trends

3 Key Reasons Why Companies Outsource Payroll

Emma Farrow

Business owners who value their time and peace of mind are increasingly turning to outsourced payroll solutions. 

It’s easy to see why. Partnering with a full-service provider means that most payroll responsibilities (wage calculations, tax withholdings and deposits, reporting, etc.) are taken care of automatically.

When you consider that the payroll bill is often one of the largest expenses for a company, the benefits of an outsourced payroll solution become even clearer.

In this article, I’ll share with you the top three reasons that most companies choose to go the outsourced route:

But before you start digging into motivations to outsource payroll... make sure that your employees are taken care of in 2023 so that they stay in your company for longer.

Download a printable HR calendar that will help you keep employees motivated.

1. Outsourcing payroll and cost-effectiveness

With most payroll providers, you will pay a fee per payslip produced for a payroll service provision. This eliminates the need to hire internal experts, procure payroll software, or spend countless hours on producing payroll for each given period.

Outsourcing could well prove to be the most cost-effective solution if:

Done properly, outsourced payroll will remove the need to hire multiple payroll professionals and even in some cases multiple software licenses.

Outsourcing, especially in today's market, can offer huge savings for companies - particularly given the current job market. Hiring and retaining staff has never been so difficult, and salaries are higher than ever before.

This is brilliant if you are a payroll professional, but not so great if you are a company trying to recruit. Outsourcing can be the key to keeping your staffing costs low, allowing you to allocate resources to other areas of your business.

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2. Outsourcing payroll and ease of regulatory compliance

In my estimation, this is the top reason why companies outsource payroll. 

Employment taxes in the UK and globally can be complex, and getting it wrong can be costly. Despite what some would have you believe, payroll is not just pressing a button.

Companies need to make sure they stay on the right side of HM Revenue and Customs and UK employment law as well as local in-country laws. 

They also need to know their obligations and keep up to date with ever-changing legislation, including paying staff accurately and on time.

Dare I say it, GDPR can also be an issue for companies as some struggle to understand the principles and their obligations on how to store and protect employee data.

If companies fail to comply, the financial and reputational consequences can be huge, not to mention the damage it may have on the relationship between employee and employer.

3. Outsourcing payroll and business continuity

It may come as a surprise, but are there many companies that still have:

So, what would these companies do should the worst happen?

Well, the biggest test for all these matters came in 2020 when the pandemic hit. Companies and payroll teams across the country were forced to evaluate their payroll set up during lockdown. 

It forced companies to scrutinize their contingency plans. For some, it highlighted risks that were not thought of pre-pandemic.

Having a contingency plan for payroll is as important as having a contingency plan for any other front line service. 

The risk involved in not having a backup plan should the inevitable happen is one of the top reasons why companies outsource to payroll providers.

“If you deprive yourself of outsourcing and your competitors do not, you’re putting yourself out of business.”

Lee Kuan Yew, Former Prime Minister of Singapore

Outsourcing payroll: conclusion

For many small and medium-sized companies, managing payroll can be a real headache that requires considerable time. 

Processing payroll involves calculating salaries, withholding taxes, updating holiday and sickness pay - all genuine dilemmas if your expertise is minimal.

When you outsource your payroll to Symmetrical, you get some of the most comprehensive services on the market as well as the peace of mind that comes with knowing that your business is protected.

Here’s what you can expect with our payroll outsourcing services:


Symmetrical is the first payroll solution you won’t hate. We enable fast-paced companies to onboard at scale and run their payroll invisibly. To run your payroll hassle-free, contact our experts to learn more!

Emma Farrow

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