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3 Biggest Mistakes Recruiters Make When Selecting A Payroll Provider By Robert Brennan

Most independent recruiters and staffing firms make the understandable decision to outsource their back office EOR and payroll services to a reputable provider who’s been serving the industry for decades. This eliminates the financial risk, liability and headache of handling your own back office service which is better left to a professional back office provider. We all know that outsourcing back office tasks allows you to devote more of your time and energy to revenue generating activities that creates more income for your business. Make sure to shop around, as you will discover that not all comprehensive back office services are created equal.

The right payroll partner can make the difference between success and failure for your business. Protect your enterprise by paying particular attention to the following three important guidelines.

1. Make sure your payroll provider is giving you the highest profit per hour.

It sounds obvious but, unfortunately, many recruiters do not take enough time to do the research. Thoroughly investigating each option to pinpoint the provider who delivers the best profit per hour rate is critical. Anything less ends up costing you plenty of money over time. Look for a reputable provider who offers a no hassle online profit per hour calculator with and a best rate guarantee. Why pay more for the same service from anybody else?

Also, make sure that 100% of the fee is based off of the pay rate and not any portion of the bill rate which penalizes you when you sell a larger bill rate. Don’t forget to inquire if there’s any additional per hour fees on top of the percentage fee.

2. Your payroll provider should be exclusive to independent staffing professionals.

As an independent recruiter, it is critical that you work with a payroll provider who is on the same page. That means a firm that works exclusively with staffing firms like yours. Only such a provider can understand the unique aspects of your business profile. The firm can set up services to accommodate your unique professional needs and operate in synchronicity with your enterprise. Would you choose a Kia mechanic to service your Ferrari? Of course not!

Another important consideration that business owners tend to overlook is conflict of interest. Larger payroll providers work directly with clients, which means that they are also in competition with you. Keep in mind that bigger service companies are not always better. You deserve a back office partner who gives you a complete recruiter centric experience.

3. Get a FREE suite of professional-grade recruiting tools, training & services.

Contract staffing services have evolved. Gone are the days of offering only payroll services. A cutting-edge back office provider will deliver a complimentary suite of feature-rich tools, services and training designed to propel your bottom line. If you’re not getting great complimentary tools, then it might be time to start shopping for a new provider.

Make sure that the firm you select for payroll processing also specializes in handling all of the other back office tasks you might need as your business grows. Strategic branding, marketing literature, search tools, ongoing training, national conferences, discounts on top name services and job placement are just some of the extras that a full-service back office outsource firm can offer.

Final thoughts

Even though you only need payroll assistance at present, don’t make the mistake of limiting your outsourcing options in the future. Once you have established a good working relationship with your provider, you may decide to turn over more of your daily office tasks to free up your time.

Contract payroll service is a growing industry that offers many options for businesses. Due to the competitive nature of this developing field, you are likely to find some significant differences in the types of services and pricing currently available.

By understanding your own payroll service requirements as a business owner and thoroughly investigating what several providers offer, you save yourself time, money and worry in the future. Opt for a payroll provider that delivers the highest profit per hour. Choose the provider that best understands and meets your specific payroll funding and processing requirements. Insist on additional tools and services at no cost.  

Editor's Note

Robert Brennan has over 20 years of executive management experience in the recruiting and staffing industry and has collaborated with over 500 independent recruiting and staffing owners providing comprehensive back office solutions as well as business growth strategies. Robert is a partner with ARG Back Office Services based in St. Petersburg Florida. 

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