The difference between payroll management and payroll services

The two can be connected, but are not the same

With such a significant number of choices from payroll outsourcing solutions to payroll software, it would seem that keeping up with employee payments wouldn’t be an issue. However, this is certainly not the case. There are a number of different rules that have to be considered and technology that could make payroll issues easier can also make them more complicated. When a business needs to choose a payroll solution, it’s important to understand the difference between payroll services and payroll management.

Payroll management encompasses more than just distributing paychecks. It is managed using sophisticated software built around human resource or payroll solutions and often incorporates a more detailed package that can cover sick time, vacation time, pay increases, employee reviews, etc. Especially with hundreds of employees, a full payroll management solution is going to be much more advantageous and can help prevent any legal issues that might arise from pay disputes or inaccuracies.

Payroll processing is typically managed using accounting software and is not as robust as payroll management software. It isn’t designed to provide all of the details regarding employees; rather, just to allow for the payment process to be easily administrated. The processing software does not include pay rules, which can often span international regions, and is best used by small companies with only a local workforce.

Some payroll outsourcing solutions can provide strictly payroll services or can be more diverse and offer complete payroll processing. When looking for an outsourced solution, it’s important to first determine the goal and then determine which solution will work best.