Getting ready for the new year means trying to prepare yourself for the inevitable changes that lie ahead. 2023 served as a transformative period that set the foundation for how businesses handle unprecedented changes within their organization. The events of the past year have not only reshaped the way we work but have also underscored the necessity for adaptable and technology-driven solutions. As the world grapples with the aftermath of a global pandemic and adapts to remote work dynamics, the impact of emerging technologies has not only streamlined payroll processes but has also introduced complexities that require careful consideration. In this rapidly evolving environment, businesses need to stay informed and proactive in choosing a payroll provider that aligns with their unique needs.
Many companies will evaluate their back-office payroll + HR partners to help meet the new demands for people technology, mitigate the risk of ever-evolving people compliance, and trim costs related to payroll processing, tax filing, insurance, and benefits administration.
If you haven’t evaluated your partner in the last couple years, you’re missing out on valuable expertise and technology updates. After all, many HR companies adapted to provide new offerings to meet the technology needs of their clients’ completely remote or hybrid workforces during the pandemic.
As we head into 2024, here are four key trends to be on the lookout for as you search for a new payroll partner.
Trend #1: Bundled Tech Features & Service Options
We all know having employees is expensive. As we step into 2024, the expenses associated with employees continue to increase. Aon estimates per-employee cost at more than $15,000, up 8.5% from 2023 figures. From health benefits and retirement plans to the administrative intricacies surrounding these perks, finding, hiring, and retaining employees is a significant line item for any business.
The benefits you offer must be tracked, updated, and paid out every pay period, which is great news if you have a single tech solution that updates information when changes are made. However, it becomes a nightmare when you have to manage and reconcile those plans in multiple systems. And when you’re working with different partners or outsourced companies for retirement, benefits, and HR, the tech only grows in complexity.
That’s why employers in 2024 will turn to their payroll providers to assume a more substantial role in compliance and administration of benefit packages. The trend is towards bundling these services, removing the guesswork from manual calculations, and relieving YOU of the burden of trying to be a benefit, retirement, and HR expert. Most importantly, it enables employers to manage cash flow better through incentives like pay-as-you-go workers’ compensation and automated 401k retirement contributions.
The integration of these services allows employers to shift the burden of plan compliance, testing, and administration onto their payroll company, often resulting in significant cost savings through discounted bundled service packages. Mitigating risk and lowering overhead costs will remain priorities for businesses looking to thrive in an environment labeled as “evolving” and “ever-changing.”
A comprehensive solution can take a few different forms in 2024, including Professional Employer Organization (PEO) options, Administrative Services Organization (ASO) options, or bundled service packages. These packages typically encompass outsourced HR services, payroll, payroll tax filings, and insurance benefits like workers’ compensation, professional liability, medical benefits, and 401k plan options for employees. At Whirks, we offer a fully administered benefits package that doesn’t cause you to lose ownership of your employees like a PEO. To learn more about that service, click here.
Trend # 2: Industry and Multi-State Compliance
Navigating multistate compliance for remote workers remains a pressing concern. The COVID-19 pandemic revealed that “working from home” could essentially translate to “working from anywhere with an internet connection.” If work was getting done, being a commutable distance from the office suddenly didn’t matter as much anymore. This reality can present challenges for employers registered in just one state.
As employees move across state lines, employers should understand their responsibilities for registering, paying taxes, and complying with the laws applicable to their remote workers. Multistate benefits administration is making compliance more complex. Many states have enacted laws addressing required employee benefits, presenting new challenges for employers administering benefits from another state. Some state laws have differing requirements, making having one base policy for all employees challenging. Some examples of varying state requirements include:
- Paid parental, medical and family leave
- Retirement plan options
- Amount of sick time
Do you have prevailing wage requirements, run certified payrolls, or have a lot of 1099s in addition to your w2s?
In 2024, companies will place an even greater emphasis on partnering with a payroll company and support team that not only understands their unique organization but also possesses industry-specific expertise, such as shift differentials and bonus structures. Companies will want strategic advice for developing sophisticated compensation packages to attract and retain the best talent. Employers will need their payroll team to understand their industry to handle the complexities of multi-state, multi-layered, fast-growing companies.
Trend #3: More Convenient Tech Features
In 2024, we can anticipate the emergence of more intelligent and user-friendly HR technologies. As many companies have pivoted to remote and hybrid options, employers need ways to onboard new hires seamlessly, connect and engage remote teams, and build team culture through screens.
Employers are seeking solutions that not only streamline payroll processes but also encompass a broader spectrum of services that cater to the diverse needs of a dynamic workforce. This includes sophisticated mobile interfaces and enhanced self-service options for tasks like accessing check stubs, managing paid time off, and updating tax withholdings.
The integration of digital tools for managing employee documents and assets has become a priority, allowing for secure and efficient digital record-keeping. Learning management platforms tailored to the development and training of hybrid teams are also in high demand, reflecting the ongoing emphasis on continuous learning and skill development. Employers should also look for solutions that contribute to fostering a positive and connected work culture. This involves tools for effective communication, real-time feedback mechanisms, and platforms that support employee well-being, particularly for those navigating burnout or working in fast-paced industries.
As the integration of AI becomes more pivotal, it is set to streamline people and payroll processes, empowering business owners to focus on their employees and overarching business goals. Amidst evolving compliance issues and work-related regulations, a systemic approach is helpful, particularly in remote and hybrid workplaces, where AI can streamline complex processes. The emergence of AI, however, prompts organizations to consider how to deploy it, especially in areas like recruiting and hiring, as the impact of AI on various aspects of HR continues to unfold. The expectation is that these advanced functionalities will not only meet the current demands but also anticipate and adapt to the evolving needs of the workforce.
Trend #4: Better Back-of-House Customer Experience
This is one of the most important things to consider when choosing any business partner. You want someone who will be there for you when issues arise, whether it’s a simple question or something more complex.
This is an underrated point because every single person defines customer service differently. Recently many payroll companies have undergone transitions in their support staff which has led to increased hold times, voicemails, and delayed resolutions to time-sensitive and urgent payroll needs for their clients. Some payroll companies have outsourced their support altogether and forced clients to go through multi-button call queues and automated chat supports which causes enormous frustration for loyal, long-term clients.
So, what truly makes for a positive experience?
- Rapid Response: The ability to promptly address queries, concerns, or issues ensures that payroll-related matters are efficiently resolved, preventing disruptions to daily business operations.
- Streamlined Processes: An effective partner simplifies payroll tasks, reducing complexities, minimizing errors, and contributing to a smoother operational workflow.
- Reliability: Consistency and reliability are foundational when outsourcing payroll services. Your provider should meet deadlines, maintain accuracy, and provide a dependable foundation for payroll management.
- Approachability: Friendliness and approachability in customer service contribute to a positive experience. A payroll partner should be accessible and responsive, fostering a collaborative and communicative relationship that goes beyond mere transactional interactions.
- Genuine Human Touch: The human touch ensures that the tools and platforms used in payroll services resonate with the needs and experiences of employees. This connection enhances the overall user experience, making technology more relatable and user-friendly.
- Equipping Employees with Resources: A forward-thinking payroll partner understands the pivotal role of employees. Providing them with tools and resources empowers them to manage their payroll-related tasks efficiently. This not only contributes to employee satisfaction but also streamlines the overall payroll process.
Support preferences vary widely among employers. While some are proficient at DIY solutions and lean towards self-help tutorials and automated tech support, others place a premium on a personalized approach. They value direct communication with their support team, finding it essential for addressing queries in real time.
As you reflect on your goals for 2024, it’s key to assess whether your current payroll provider aligns with your objectives. If not, it’s the right time to re-evaluate your partnership.
Considering Whirks? Explore our comprehensive services here and review our pricing structures here. Our commitment is to provide a payroll solution tailored to your needs, ensuring your business thrives in 2024 and beyond.