The ultimate guide to reviewing your payroll provider

It’s important to know how your provider is doing.

Using sub-standard software or putting up with a service that isn’t as good as it could be, might be costing you and your business time and money.

That’s why we’ve put together this guide. It’s here to help you understand the reasons behind regularly reviewing your payroll provider and to assist you when you conduct a review.

There’s a full section in here that describes the key areas of your software and/or service that should be reviewed. This will hopefully help you gain a picture of what ‘good’ and ‘bad’ look like. We encourage you to compare this with what you’re getting now, to make sure you’re not settling for less.

Of course, you may find you’re getting a great deal exactly where you are. If not – it’s perhaps time to think about partnering with someone new.

But let’s not get ahead of ourselves. Start with your review and take things from there. Good luck! We hope you find our recommendations useful.

What we found in this year’s payroll survey…

According to Moorepay’s latest annual payroll survey report (2025), just over ¼ of businesses (27%) have long-term loyalty with their payroll providers – rising sharply after a dip in 2023-24.

A lot can change over the years. Think GDPR, Gender Pay Gap Reporting, the Job Retention Scheme (yeah, we don’t miss the payroll headache that came with that one), Auto Enrolment contributions, Shared Parental Leave and Pay (ShPP), and not to mention the recent change in government.

Technology has changed too. Payroll software is no longer stuck on a server; it can now be accessed any time and on any device. Which is great for the end-user and even better for employees.

Plus, a lot of mundane, manual payroll work can be automated – which means a huge reduction in time-consuming calculations.

Are you sure your current payroll provider has moved with the times? Or is there a chance it’s lagging, which means you are too?

Don’t wait to find out! Keep reading this guide to learn more.

And you can check out the interesting results from Moorepay’s recent industry survey here.

Indirect costs need careful consideration.

It’s not just about looking at the price your provider charges per employee or per payslip. These don’t fully represent the end-to-end cost of your payroll.

Businesses want bang for buck. Team that with the likely fact that the payroll is your company’s biggest outgoing: you need to know your current payroll provider is giving you and your business value for money.

However, before you can understand the value you’re getting, you need to look at the price you’re paying.

But it’s not just about looking at the price your provider charges per employee or per payslip. These don’t fully represent the end-to-end cost of your payroll.

There are a number of other factors you need to consider.

Inflexible systems

Perhaps you have a system that’s clunky, where everything requires a ‘workaround’ and you’re entering the same data two or three times over.

But what if you could be using software that’s easy-to-use, smart, and efficient?

Even if price per payslip is higher with that provider, you might still see a reduction in the end-to end cost of processing your payroll, when you factor in the cost of time.

Hidden costs

What are the cost of your salaried employees undertaking tasks associated with the payroll? Are there software and license fees?

Or fees for system upgrades and maintenance? Printed payslip costs? Bacs payment costs?

And what about fines incurred by late payments or incorrect data submissions due to poor quality payroll software?

And how much time is spent inputting data into the system?

How often are mistakes made and how long does it take to correct these? How long does it take to complete all of the processes required to run your payroll?

For more information on this, don’t miss our blog on the costs of payroll software.

Data insight

If you’re not getting solid data insight, it’s tough to make good business decisions.

If your competition has a slick system that tells them things like cost trends, absence trends and data that helps them to predict spend, all in real-time, and you can’t see that data for your business; they’ve got a solid competitive advantage.

Making good decisions driven by data insight may not always yield an obvious cost-saving. But making bad decisions driven by guesswork, will almost certainly cost you something at some point.

What your people think of your payroll

Another excellent reason to ensure you’re with a great payroll provider – and not an average one – is your people.

You may have seen that recruitment is a hot topic at the moment – many businesses are struggling to attract the right candidates for their vacancies.

Did you know the standard of your payroll provision can affect your ability to attract and retain the best people?

Want to know more? Take a look at our ultimate guide to payroll software

When to conduct your review

We recommend reviewing your payroll provider every 12 months. Why? Because technology is fast-changing and waiting more than one year could push you behind the curve when compared to your competitors.

Plus, economic and political circumstances may impact the provider that serves you. Keeping an eye on what’s changing and how that might have affected the software and service you’re getting is best conducted on a regular basis.

You want to be proactive not reactive if you do need to switch providers.

Key considerations

• When would you need to move over to a new provider?
• Does the switch to a new payroll system need to line up to your financial year?
• How comprehensive and time-consuming is your procurement process?
• How many potential providers would you want to review and consider?

Who should conduct the review

There are three key stakeholders when it comes to your payroll provision: the person (or people) responsible for the payroll; the people who get paid; and the person in charge of the money. So that’s probably you, your employees and your Finance Director.

The person responsible for the payroll should lead the review, as they’re the person who will know the most when it comes to the ‘what’ needs reviewing.

The people who get paid should provide input too, as they are – obviously – best-placed to comment on employee experience.

The person in charge of the money should get involved because if you do need to switch to a new provider and there are budget constraints, they might be more perceptive to your business case if they’ve already understood the reasons you need to switch.

Is it time to review?

We encourage you to undertake a review of your payroll provider on an annual basis. It’s all about making sure you’re getting a good deal.