The outsourcing of payroll services is when a business hands the responsibility of calculating employee salaries, emoluments, and liabilities to a third-party. In a payroll outsource, ABACUS360 assumes responsibility for computing salaries and other payments such as leave day accruals, gratuity, statutory uploads for NAPSA, ZRA, national health insurance, personal levy etc. and paying staff. When a company’s salary remittances appear on its bank statements, there is a loss of confidentiality. For companies that require increased payroll confidentiality, ABACUS360 will handle the entire payroll process, from computations to payments to relevant authorities and staff. ABACUS360 manages substantial remittances in confidential payroll each month. Payroll management can consume several man-hours and, more often than not, if left unsupervised, result in costly errors – usually with penalties and interest charges levied by tax and pension authorities.
Roger is the accountant in charge of preparing payroll returns and submitting payroll reports for Smart Alec Ltd., a company with 500 employees. After three years, Roger is leaving for a more lucrative job as a Payroll Manager for a large mining company. While handing over payroll duties to Muso, the new accountant, it became apparent that payroll returns to ZRA and NAPSA were either always late or never submitted. Additionally, Rogers computed his payroll reports in excel with several computational errors, and they did not reconcile to the accounting reports. Muso reviewed the ZRA and NAPSA accounts and discovered substantial fines and penalties that the Finance Manager was not aware of. Having left Roger unsupervised to manage payroll for three years caused a comfort zone for a dishonest and negligent employee.
Some clients want more than just the outsource of payroll services and outsource the human resources management function too. Human resources management includes staff planning, drafting contracts of employment, establishing disciplinary procedures, negotiating with unions, managing leave days, resolving disputes, etc. ABACUS360 offers specific advice on how to structure employment contracts, remuneration and statutory requirements. People are what make an organization great. However, when things go wrong, staff issues can be costly and burdensome for the employer. Legal correspondence, visits to the labour office, attending court and disciplinary matters steal valuable management time. Effective outsourcing of HRM matters will leave the client with time to attend to critical business issues and better manage staff relations.
Patience was not accruing staff leave days for the thousand security guards the company employs, and now staff is claiming significant payment for leave days not taken. Patience’s excel reconciliations of leave days accrued and due have several circular errors, and she has no evidence that the company employed 75 guards on the Copperbelt. She now needs to give the labour office a reconciliation of leave days due to each employee. The company stands to pay out more than a hundred thousand dollars in claims.
Business owners delegate job roles and expect staff to do the right thing. Sometimes, business owners hire people with little or no experience, or knowledge, apparently to save money, only to find out the high cost of hiring unknowledgeable staff, when it’s too late.
In the above case studies, Roger was negligent whilePatience was incompetent for her job role. The business owner could purchase a payroll processing system and place controls to ensure timely submission of payroll returns and statutory payments. The business owner could also buy a human resources management system and maintain and update records more accurately. Despite investing significant amounts of cash in systems, payroll and human resources, compliance errors and lapses often occur. A company is still prone to statutory fines and penalties, and incorrect data capture may remain undetected by less experienced or specialist staff. Systems fail because human beings make mistakes. And, in an uncontrolled environment – errors will rage!
We have seen client losses that run in the millions, merely because of system failures in an uncontrolled environment. The outsourcing of your payroll function to ABACUS360 guarantees the following:
1. Payroll processing by a professional team of accountants that involves a team, with qualified accountants as team leaders
2. A separate team from ABACUS360 will perform regular in-house audits for payroll compliance to check the payroll staff
3. Retained corporate knowledge requiring no hand-over or lapses in information
4. Economies of scale resulting from the outsource mean you don’t have to invest in staff and infrastructure
5. ABACUS360 would handle payroll audits by ZRA, NAPSA, Workers Compensation
6. Disclosures of all statutory matters that arise to a senior member of our client staff to ensure no surprises.
The outsourcing of your human resources management function requirements to ABACUS360 ensures the following:
1. Better commercial contracts between the employer and employees
2. Reduced labour disputes as a result of clarity and enhanced compliance
3. Reduced operational costs for your company as you outsource a non-strategic function
4. Better employee engagement between staff and management
5. Economies of scale resulting from the outsource, since you have the guidance of an HR practitioner and lawyer at rates you couldn’t obtain on your own.
Call now and get an expert to help you.