Businesses are built on successful relationships and partnerships. From the business partner you founded your business with to the employees that you bring on to help run your business, everything you do is built upon having fruitful relationships with those around you. This is no different when it comes to your payroll provider. Of course, these partnerships and relationships don’t just happen, and a successful partnership isn’t something you can just stumble upon. You may have or may currently be partnered with a payroll provider that, for one reason or another, isn’t the right fit for your business. This can be a less-than-ideal position for your business, as a lackluster relationship with your payroll provider can lead to numerous different issues that can result in lost time and money.
At Payday HCM, we’re very familiar with the importance of finding the right payroll provider for your business. We’re constantly working with our clients to get to know them better and develop that relationship so that, when we run their payroll, we can do it in a way that accounts for the nuances of their business. This process begins and sometimes ends with the payroll conversion process. Without a successful conversion, you may already be off to a less-than-ideal start with your new payroll provider.
So, in this article, we’ll be going over three strategies for avoiding a costly payroll conversion. The three strategies that we’ll be going over are:
- Communication With Your Current Provider, Internal Staff
- Create a Payroll Provider Conversion Plan
- What to Have Ready When Switching Payroll Providers
We’ll go in-depth with each strategy, taking a look at what each one entails and how you can perform it to ensure your payroll conversion goes smoothly.
1. Communication With Your Current Provider, Internal Staff
First, before you begin the conversion process, you’ll want to reach out to your current provider and discuss any issues or concerns you might have currently.
Discuss With Your Current Provider
If you’re looking to transition from one payroll provider to another, there’s likely something about your current provider that isn’t working. Of course, you can just switch providers, but payroll conversions can be time-consuming, especially for organizations that have been with one provider for a long time.
Before you actually begin the conversion process, reach out to your provider and find time to discuss the things that are working and aren’t working about your current relationship. Your current provider will likely be able to take your feedback and implement changes to ensure any issues with the current relationship can be addressed.
Collect Feedback From Internal Staff
While it’s possible that, if you’re considering or entering the process of converting from one payroll provider to another, you’ve already done this, we still want to highlight the importance of collecting feedback from members of your team on your current provider and system. This can be a helpful step to take before meeting with your provider to ensure you’re covering all possible points of tension.
Ultimately, the staff who interact the most either with the software you currently use or directly with your payroll provider will be able to provide you the most feedback. Take any feedback you receive and structure it into clear questions or concerns you can present to your provider to find possible solutions.
2. Create a Payroll Provider Conversion Plan
If switching providers seems inevitable, or if you want to stay prepared in case you ever need to bring on a new entity, creating a plan ahead of time can help make the process more efficient.
Create a Template For Your Company
Whether you’ve gone through the payroll conversion process before or it’s your first time, any planning that can be done ahead of time can help ease the transition from one provider to another. Creating a conversion plan for your company can save you time and streamline the process.
By creating a template for your business to follow, you’re not only able to ensure each member of your team is on the same page when it comes to the conversion process, but you’re also able to ensure your new provider receives all of the information they need to complete the conversion successfully.
Templates for Businesses with Multiple Worksites
Businesses with multiple worksites face a unique challenge when it comes to payroll conversions, as the process for converting over the different locations can prove to be more arduous and time-consuming. By creating one unified template, you can help eliminate costly barriers that might hamper the conversion process.
When communicating across multiple worksites, it’s important to have either one point of contact or a team that is in charge of the conversion process. This can help ensure that everyone knows who to contact in case of a potential issue, but also ensures the successful execution of your company’s conversion plan and strategy.
3. What to Have Ready When Switching Payroll Providers
The payroll conversion process isn’t as simple as just switching payroll providers. You’ll want to have certain forms and data ready to send to your new provider to ensure a smooth transition.
Considerations for Your Previous Payroll Provider
When switching payroll providers, you’ll also want to keep in mind certain considerations when it comes to your previous payroll provider. This includes things like:
- Filing W2s, taxes
- Possible federal or state employer tax refunds (if the conversion is in the middle of a quarter)
- Workers’ compensation reporting (a report to encompass all wages during the workers’ compensation reporting period, which may not be the calendar year)
Ensuring that you and the rest of your team understand what you’ll need from your previous provider and the role they’ll play in the conversion process can help minimize costly mistakes later on—this is where having a conversion plan in place becomes important.
Data Migration
Data migration is likely going to be the biggest sticking point during the conversion process. Seeing as your new provider doesn’t have any of your previous payroll data, you’ll need to work with your current provider to ensure all of the necessary data is either handed over to the new provider or is provided to your business so you can then hand it over to your new provider.
When onboarding with a new provider, they should provide you with a list or report of all the information they need to implement your business with their system. Proper data migration starts long before the conversion process begins, however. Regardless of whether you’ll be switching payroll providers, you should keep backups of important payroll information in a secure location, not only to make a conversion easier, but to minimize the risk of data loss as well.
Don’t Let A Payroll Conversion Cost You
Finding the right payroll provider is one of the most important decisions a business can make. You want to find a provider who understands your business and can provide you with a partnership that goes beyond just running payroll every week. Of course, finding this kind of payroll provider and developing this kind of partnership isn’t easy. For some businesses that decide to switch providers, you may be faced with a process that is both time-consuming and costly. With the tools provided here in this article, though, you can ensure that your payroll conversion process goes as smoothly as possible.
Making the jump from one payroll provider can be a tricky process. When done correctly, though, and with the right partner, switching your payroll provider can be just the thing your business needs to get back on track. The process doesn’t stop there, however: building a strong foundation and creating a good relationship in the early days after a conversion is essential for ensuring long-term success. Check out our article for more information on what happens after a payroll conversion so you can ensure your process goes as smoothly as possible.
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