What we do – Payroll Outsourcing

When a company talks about payroll outsourcing, it refers to the situation in which it subcontracts certain parts of its administrative processes or the production field. There are many advantages of payroll outsourcing.

This type of subcontracting is carried out by an external agent and its purpose is based on improving certain aspects of the company, within the fields of quality, innovation, or financing of the firm.

This type of subcontracting or outsourcing can be carried out both within the same country and in a foreign country. If it is the latter case, it has been called offshore outsourcing.

Payroll outsourcing with PEO Middle East

These types of techniques can provide the company with numerous advantages, since their employees spend a high amount of their time and energy serving them, so it is important that the employee is comfortable and enjoys their work.

For this, the fact of being a modern and efficient company, with great attention to its workers, is something important and capable of turning the company into a better place for all those who work in it. For this reason, outsourcing moves the company towards a new point of business culture and improvement, in that aspect and many others.

Employee Information

It helps you have more information about the status of your salary. Outsourcing makes it easier for the employee to help so that they have control of dividing their payment into different bank accounts and so that they can be more focused on their savings goals.

Putting aside fixed amounts or percentages of each check-in in different savings accounts, in exchange for the rest going to a standard account where you have your billings, can help employees invest in themselves. This makes them happier with their jobs and therefore more productive.

Control of personal data

The software, also known as payroll outsourcing, has the advantage of avoiding having to depend on Human Resources, in order to obtain any type of information. With this, the employee has more freedom to view and change their personal payroll information at the time they need or want it.

In addition, this can be done from your own computer, so you have greater control of your personal data. This saves the employee a lot of time and stress, which helps, on a day-to-day basis, to be more productive.

Use payroll as a communication tool

With payroll, companies can learn about the achievements and failures of their employees. Thus, they can be rewarded for their good work or they can be given advice about their mistakes so that they improve.

Celebrate promotions

With an intelligent payroll, remembering all those facts, in order to make personalized parties, will be much easier. All this will improve communication with workers and their performance at work.

Simplify tax information

Tax withholding is often confusing, plus if you run household payroll, keep in mind that the taxes listed on the pay stub are not easily distinguished. But, by choosing modern payroll providers, employees will have quick and easy access to their tax information, and in an easily understandable format.

One of the main engines of any company is the staff that works and performs the corresponding tasks. As an employer, a decision must be made to pursue one type of hire and all options must always be considered.

Either through a more traditional contracting, making an individual, personal or collective contract, or on the other hand, carrying out the subcontracting of personnel. The most important thing is to make a decision and choose the option that best suits the parameters and services of the company, in order to obtain greater benefits and a better quality of service in the long term.

This is why we decided to clarify all the concepts, benefits, and differences of outsourcing personnel in The Middle East.

Why you should choose us?

There are different agencies exclusively dedicated to offering human capital services. These work by hiring people to carry out the activities or tasks necessary for your company. The difference is that you will not hire the employees directly, but an agency that will be in charge of covering your labor needs.

So basically the subcontracting of personnel, also called outsourcing, is a direct contract with an agency, in which it undertakes to supply the necessary employees or workers for the client company.

The subcontracting of personnel is considered a relatively new and innovative method in which unconventional and different working relationships are generated. This is due precisely to the fact that the initial relationship with the final employee who performs the determined work is not done directly.

Is there any law that speaks about the subcontracting of personnel?

Given the novelty of the matter, there is really no jurisdiction in charge of supervising or regulating the subcontracting of personnel. However, in the criteria of the Federal Courts, various agreements have been reached. One of them is that employees contracted by any agency must receive the same benefits as any worker who has been employed through an individual or collective contract.

What legal schemes can I use to subcontract personnel?

It is essential, despite everything, to maintain legitimacy in the subcontracting of personnel. Therefore, the corresponding legal schemes must be made. There are several possibilities:

The staff provided by the placement agency is registered under the concept of “cooperative partners”, and precisely that name will give the company the freedom to pay in the way that suits it, through social security remuneration, and not necessarily for monthly, fortnightly or weekly salaries. This option is mostly carried out by cooperative societies.

For integrated companies, the same method can be used or, on the contrary, carry out or sign a personal leasing contract. In this way, the main company can make collective contracts with the staff providers. Similarly, the placement agency remains responsible for each of them.

Who is responsible for the subcontracting of personnel?

It is considered that the outsourcing of personnel and work employees does not undermine labor relations in any way, specifically, for those hired. In fact, the Federal Courts have established that the companies that receive the personnel are as responsible as those that hire them in the first instance. Once it is established that they were under their direction and received some benefit from the employees, they cannot be released from said responsibility.

They must always ensure workers’ rights in labor and social security matters.

So, what are the main differences in the labor relations of the subcontracting of personnel?

The first difference, and the most noticeable, is that there is no common employment relationship. The employee is not being hired directly by the company. Second, the contract is given by the employee’s responsible intermediary. The placement agency offers human service and is in charge of sending the required personnel.

Finally, the schedules, areas, duration, and amount of work are completely variable when outsourcing staff. It is not something fixed or established but depends exclusively on the needs of the client company.

Benefits of outsourcing your company’s staff with PEO Middle East

As a boss, you must visualize what the optimal conditions are for your company and carry out the procedure that is necessary and required for it. In this sense, the advantages that you can receive when subcontracting personnel are the following:

• The most outstanding advantage with respect to outsourcing or subcontracting personnel is that as an employer, you will not be forced to be responsible for hiring personnel. With this modality, you do not have to spend time conducting interviews, making contracts, or doing other tasks of that type. All the time you have available can be invested in the development of your business.
• Although the client company must pay the placement agency a fee corresponding to social security, the amount of money invested in labor relations will always be fixed and less than what it could pay with a typical one.
• The good quality of the employees is permanent. The recruitment agency is responsible for all labor obligations and ensures proper performance of the tasks to be performed by workers.
• By not having a permanent staff, seniority is not in the employment relationship and the corresponding premiums do not have to be met. All this means saving money for the company.

Recommendations for subcontracting personnel

If, as an employer, you consider that the most advisable thing for your business is to subcontract personnel through a placement agency, you should take into account the following recommendations:

• Seek the advice of a lawyer who has knowledge about the operational needs of your company, he will indicate the personnel you require and carry out the necessary procedures to maintain legality in all senses.
• Always keep an amount of money saved, destined for the payment of expenses, insurance, or compensation.
• Be clear about the conditions you expect to receive and meet.

Now more than ever, companies are looking for solutions to focus on their business activities, and outsourcing companies are one of them. Far from representing an expense, outsourcing can generate savings of up to 50 percent on the payroll.

The subcontracting of services, also known as outsourcing, is when a company transfers to an external provider those activities that are not basic for its business, especially of an administrative or transactional nature. This gives you time to really focus on your business management and competitive advantage.

Service outsourcing as a business strategy, subcontracting emerges as a tool that facilitates managerial management: it becomes a means for the company to concentrate on its true areas of work and can access other specialties unknown to her in an operationally efficient manner through external personnel who are experts in these subjects.

More and more companies are hiring third parties because it is usually cheaper to use providers that already have organized systems than to implement them from zero. It must be remembered that despite the fact that personnel outsourcing companies carry out some processes, it is the companies, through their Human Resources departments, that maintain control over them at all times.

Requirements

• A single delivery or outcome of the tasks is not determined.
• The supplier acquires responsibilities for these activities.
• The agreement includes quantifiable quality criteria.
• Variations in the provision of service are agreed upon from the hiring.

In times of crisis like now, this model allows companies to adjust their resources according to their needs, that is, if there are peaks in work or the opposite. In situations like the current one, companies demand greater cost flexibility and do not want to commit their staff to activities other than those of their core business.

At PEO Middle East we help our clients to focus on their business. Through our services, we achieve great savings and improve your processes while facilitating your business management.

In a nutshell, outsourcing payroll means exporting some or all of your payroll administration to a specialized external organization. The payroll package you choose will integrate with your existing infrastructure, including your human resources department, and will serve you every pay cycle.

Access to cloud computing and a variety of software platforms has dramatically improved the services that payroll providers can offer their clients. Businesses can choose packages that range from simple tax, pension, and salary calculations to end-to-end recording of employee hours and issuance of payday paychecks.

Why is it important to have an outsourcing service in The Middle East?

Outsourcing payroll is more than a matter of ensuring employees receive their payments on time. Payroll is time-consuming and complicated. If a significant part of your attention is this each month, it is very likely that your core services will be not good.

However, neglecting payroll is not really an option. While compliance errors can lead to costly fines from the tax collector, missing payment deadlines can lead to something worse: disgruntled employees.

The administrative burden that comes with payroll can easily have a domino effect, especially in closely connected departments like human resources. HR staff will bear the brunt of employee dissatisfaction if their payroll performance declines.

What should I take into account when choosing an Outsourcing service?

Guarantee through experience

When a process of a company is finished and it has payroll services and consultancies, it is generally because it does not belong to the core business of the company, but this does not mean that it is not important and transcendental for the development of the company, so that having the best professionals is essential.

In this sense, choosing a company with extensive experience and specialized personnel selection services will allow you to obtain favorable results and really facilitate the process. Confirming that experience will help you consider if it is what your company really needs.

Remember that each payroll outsourcing in UAE is unique and may specialize in different profiles or services. Therefore, do not stick with the first option you find, but analyze several that lead you to find what you are looking for.

In addition, as in all business aspects, services improve with time and implementation, thus, experience time plays a fundamental role in making better decisions that benefit your company.

But how does a company back up its expertise?

With indicators of success

The success stories in the search for candidates that have had payroll outsourcing in Dubai are the main proof and support of efficiency and that they will be able to do the best for your company. By showing you indicators of success at other companies and how long they have worked with them, you can ensure they perform optimally.

Differentiating factors

In addition to having vast knowledge in the service, personnel recruitment companies must be original and provide differentiating factors that allow them to stand out from other options in the market. Innovation in process development or offering additional benefits can be one of them, and they can become the aspect that determines your choice.

Advice and accompaniment

In the delegation of processes, it is essential that the accompaniment and attention in the service that they are offering you are the best. Thus, the communication between your company and whoever provides the outsourcing service will be fluid, it will create a strong relationship that facilitates the achievement of payroll processing, we assure you that it will keep you informed about everything that happens to avoid reaching a misunderstanding of the area.

Personalization of the service

It is important that the outsourcing service offers individual options perfect for your company. Since there are companies that offer the same service for everyone, we know that each company is unique as well as its needs. Therefore, it is necessary to prepare a plan that fully covers them and adapts to the specialized selection of profiles and talents with specific skills that the daily challenges of your company require.

The outsourcing of services is an increasingly popular practice in the business sector, as it has turned out to be a competitive strategy; given the positive impact, it generates on the operability and productivity of the companies that resort to it.

According to the Global Outsourcing 2016 survey, 78% of companies worldwide have resorted to outsourcing at least one of their processes, obtaining satisfactory results.

Among the most requested services to outsource, are those related to the management of human capital, thanks to the advantages they provide for companies seeking to increase their growth.

The offer of payroll outsourcing services in The Middle East is varied, so what is the ideal type of outsourcing for you? Or, what elements are important to consider when choosing? Next, we present information about it that will be useful to you.

Why resort to outsourcing with us?

In The Middle East, the sectors that hire the most payroll outsourcing services are generation and distribution of electricity, water, and gas, as well as financial and insurance services, both with 42% of their personnel in outsourcing, followed by the media with 40%.

The reasons for outsourcing services, in whole or in part, are due to various issues, but mainly respond to the need of companies to streamline internal processes and optimize resources, so that they can focus on their priority activity.

What is payroll processing?

The payroll processing is an administrative service, complementary to the human capital area, in charge of calculations of payroll. Such as salary, extraordinary earnings, employer contributions, withholding, and payment of taxes.

Likewise, it covers the dispersion of payroll to make payments in a timely manner and with strict adherence to fiscal and legal requirements. In this case, the contracting company remains with the legal figure and maintains the obligations derived from it.

Payroll outsourcing refers to the comprehensive personnel administration service. That is, the external company assumes the employer’s responsibility for the staff of collaborators, as well as for all the procedures corresponding to the area of ​​human capital.

Among the services that generally integrate payroll outsourcing in The Middle East, are the following:

• Creation of job profiles.
• Recruitment and staff selection.
• Recruitment process and paperwork management.
• Total payroll processing and dispersion of payments.
• Specialized fiscal and labor legal support.
• Instruction on the organization of human capital.

What criteria to consider when choosing between processing and payroll outsourcing?

Both services offer a wide range of functions to perform. Focused above all on reducing the administrative burden, either by complementing the tasks of the human capital area, or else taking full responsibility for it.

The benefits provided by payroll management companies, through their main services, are the following:

• Costs reduction. Outsourcing services will help you reduce operating costs related to payroll and personnel management.
• Priority to your core business. By having more resources and time, you can focus on value-added activities, to increase the profitability of your company.
• Operational efficiency. Reducing the administrative burden will help you streamline internal processes, optimizing your operations.
• Higher quality and fewer errors. Hiring an expert company in payroll and personnel management will guarantee the reduction of errors. Also, on incidents that could affect your collaborators and your company.

In the same way that payroll outsourcing services offer numerous advantages, depending on the characteristics of the external company, outsourcing could generate some cons; which is why you should be careful when choosing an external company.

Adaptability

Now, it is important that when choosing an option, you consider some points. The particularities of your company, size of payroll, type of employees (administrative or operational), benefits for your collaborators, main needs to attend to, business priorities, among others.

At PEO Middle East we offer payroll and HR solutions, with a personalized outsourcing service; in such a way that we adapt to the characteristics of your company and staff of collaborators.

Payroll Outsourcing in Dubai is a service by an external entity that provides legal, tax, and accounting support to companies. To ensure that employees receive their paychecks in a timely manner, accurately, and with minimal risk.

By allowing a third-party provider to manage their payroll, companies can simplify legislative compliance. This is to relieve their team of a large administrative burden.

Outsourcing your payroll allows companies to:

• Record and control incidents.
• Calculate, pay and distribute payroll according to the appropriate frequency (weekly, bi-weekly, monthly).
• Calculate benefits. Such as vacation time, commissions or incentives, vacation bonuses, severance payments, early retirement, or other payments that are not part of the employee’s salary.
• Abridge supervisory agreement, counting data defense legislation.
• Operate globally and seamlessly manage payroll across domestic and international locations.

Is Payroll Outsourcing Right for Your Business?

Businesses of all activities, dimensions, categories, and localities can benefit from a whole payroll outsourcing service. However, they must consider the quality of the service provided and the technology used to perform the functions.

Payroll outsourcing is especially useful if your business:

• It does not have an internal administration and finance team.
• You need the finance and administration team to focus on strategic tasks outside of payroll.
• It operates internationally but does not have payroll management experts in each country.
• Requires continuity in payroll management and lacks a robust data recovery system.
• You are concerned about compliance with current or future regulations.

While these reasons are valid, every company is different. Therefore, they must carry out a thorough analysis of their situation in order to choose the right provider. This examination needs deliberation of exact factors including:

• Size of the workforce and number of people performing payroll functions in-house.
• Impact on employees who performed the payroll functions of the company: will they be transferred to other areas of the company or will they have to be laid off?
• If the company lacks knowledge and experience in payroll.

How does payroll outsourcing work?

Once the company has decided to hire a payroll outsourcing service, it has to define guidelines and processes to ensure collaboration.

The first thing to do is set up an information transfer system. Businesses must part vital data about their staff with the third-party service worker. Such as names, salaries, hourly or daily rates, timesheets, vacation and sick leave policies and expense allocations. Also, any other data related to the payroll calculation.

Since the information being shared is sensitive, the company must also ensure that the payroll provider agrees to protect that information. And to abide by a security and confidentiality agreement. A data protection policy may also be necessary.

Once the system is set up and processes are definitive, the payroll provider can use the information to calculate payroll. This is to pay their employees on time. Companies need to understand that outsourcing payroll does not mean they can do without in-house payroll professionals. It means these professionals can focus on other important accounting tasks. Such as reviewing financial reports and resolving any accounting issues that may arise.

More advantages of outsourcing payroll

Payroll outsourcing has great advantages, but it can also have disadvantages that are worth weighing. The key is to weigh the pros and cons beforehand.

These are the advantages of outsourcing your payroll:

Save time

Payroll is a time-consuming process. By dismissing the staff section of these problems, these workers can concentrate on other important areas of the industry. Such as emergent financial plans that reinforce the company’s economical advantage.

Minimize expenses

Payroll outsourcing helps companies minimize expenses and quantify the visible and hidden costs associated with managing payroll.

Avoid mistakes

By signing specialists whose only responsibility and focus is payroll, you minimalize the probabilities of mistakes and missed limits. Also, omissions, or late filing of payroll taxes.

Ensure compliance

Payroll outsourcing providers are aware of labor codes and legislation, making it easy for employers to comply with regulations.

Accelerate responsiveness

Payroll providers can spend time resolving any queries or issues their employees may have, speeding up response times.

How to choose the right payroll outsourcing provider?

Internal control

A good payroll outsourcing provider takes care of your business and invests in improving its own offering. This ensures that they have good organization, structure, and are able to commit to ensuring quality performance. This commitment and focus also make them less prone to data loss payment delays, fines, and lawsuits.

Best-in-class technology

A good payroll outsourcing provider has best-in-class technology to help businesses scale. The technology provides increased functionality and offers benefits for the employer and employees. Decent equipment also delivers data backup and disaster repossession, which can alleviate possible risks.

Compliance

In addition to providing a personalized experience to meet unique company goals, payroll providers stay abreast of changing regulations. This will result in maintaining compliance with tax and labor laws, regardless of the location of the company.

Prices

Price is and will continue to be significant when selecting a provider. However, the price must align with the company’s performance goals and expectations.

Customer Service

Good customer service is critical to successful payroll outsourcing. Consider the opinions of other clients and ask for references.

Outsourcing the payroll for small businesses can be a complex process and choosing the right provider is not easy. PEO Middle East is professional thanks to our in-house HR experts. This allows you to automate your payroll process in just a few clicks.

We take care of international payroll. You can focus on growing your business and save time and money while complying with labor laws and regulations.