Typical cost of outsourcing payroll
That said, several things can determine the basic cost of outsourcing your payroll. Among the primary factors are the total number of employees in the company, how often the employees are paid (be it once a month or twice a month), how many employees reside in more than one state, the need to do direct deposit, and any additional tax filing services your company needs.
A number of BPOs specializing in payroll services already market themselves toward SMEs, and due to the high level of competition, offer some reasonable rates. Prices can range from around USD $20 to $100 per month, but what is common all throughout is that the pricing model typically charges per employee or per check, on top of the base accounting fee. The company should then conscientiously monitor all the additional costs that may add up, such as for auxiliary services and for each new employee that the company might gain in the future.
Off the bat, it is wise to ask for a price quote from your potential services provider. They should be able to offer you a project proposal that caters to the size of your company and your price point. From this initial contact, you will also be able to gauge their level of knowledge about your industry, state and federal tax laws, and the like.
Salary comparison for payroll professionals
To give you an idea of how much a business saves by outsourcing payroll, here’s a look at how much average payroll professionals in the Philippines, US, Canada, and Australia earn every year:
|Job Title||Annual PH Salary in USD||Annual US Salary in USD||Annual CA Salary in USD||Annual AUS Salary in USD||Annual UK Salary in USD|
|Human Resource Assistant||$ 3,254||$ 39,124||$ 29,685||$ 34,027||$ 26,428|
|Human Resource Manager||$ 9,069||$ 64,476||$ 59,778||$ 62,690||$ 46,398|
|Payroll Analyst||$ 5,664||$ 55,184||$ 42,801||$ 62,808||$ 45,503|
|Payroll Manager||$ 13,321||$ 64,035||$ 51,870||$ 72,517||$ 40,338|
|Payroll Specialist||$ 5,482||$ 46,858||$ 41,221||$ 59,707||$ 35,703|
|Payroll Supervisor||$ 7,900||$ 58,764||$ 52,338||$ 60,040||$ 34,246|
|1 USD=53.44 PHP||1 USD=1.31 CAD||1 USD=1.35 AUD||1 USD=0.76 GBP|
Companies stand to maximize their savings should they choose to outsource to countries with a lower cost of labor than their own. Payroll services providers operating in the Philippines may be expected to offer more affordable rates compared to companies based in Australia, Canada, and the US due to the lower labor cost and cost of living. At the same time, Philippine-based companies have easy access to a well-educated workforce and a pool of experienced professionals that are quite familiar with various payroll standards and systems—which means that their clients can expect high quality service for a fraction of the original cost.