Hi Marcus,
I went through this same evaluation about six months ago. We have around 75 employees, sometimes more during peak times. After discovery calls with Paylocity and others, I realized two main things:
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Flexibility: Running payroll in-house lets me handle last-minute items or changes like you mentioned-reimbursements, pay adjustments, missed hours, or printing year-end bonus checks for the owners to hand out. With a third party, changes have to be made before their cutoff, otherwise they roll to the next cycle. I did not like this idea where I felt like we were losing certain control over our own payroll.
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Industry fit: In construction, foremen typically submit their crew's time rather than individuals, unless your company does it differently. If each individual were in charge of their own time, then I could see it being a good fit. But since crews shift, people get missed, we QC time on Monday mornings. If a foreman's deadline to submit time is missed with a third party, corrections can't be made until the next pay period. Plus, every job, cost code, and certified payroll detail has to be set up not just in accounting, but in the payroll system too. Outside of construction, using a third party would be much easier as the job costing element is not there and each individual employee typically is in charge of inputting their own time, and then it would go to a manager for approval/QC.
In my opinion, for most industries, outsourcing payroll makes sense once you get to a certain size and time commitment where the benefit > cost. But in ours, unless the company grows to where payroll is unmanageable, a third party seems to be more hassle than help. I took over payroll in February, and it takes me about three hours on Mondays: import QCed time from Heavy Job (our field's digital timekeeping/PM software), manually enter office staff time into Computer Ease (our accounting system), then upload a file to the bank for direct deposits.
If someone is manually entering 200 employees' hours, I'd recommend investing in digital field timekeeping-that saves the most time on data entry and then it's really just a matter of a quality control check, which would need to be done anyway no matter who is processing payroll.
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Janna Curtis
Controller
Tempest Enterprises
Murray UT
(385) 414-1120
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Original Message:
Sent: 09-03-2025 12:49
From: Marcus Mallory
Subject: In-House Payroll versus Outsourcing
Hi Everyone -
We've always handled payroll in-house and have flirted with the idea on multiple occasions of outsourcing it due to issues over the years (staffing qualified people, cost/benefit of paying someone full time vs cost of an ADP, Paylocity, etc.).
One thing we've been curious about is how much or how little flexibility is sacrificed by utilizing a third-party? For instance, we deal with missed hours, payroll corrections, etc. on what seems like a weekly basis and we have the flexibility to fix these as they come by performing payroll in-house.
For added context, we have about 200 full time employees working across 5 divisions.
Would love to hear any feedback and what your experience has been. Thanks!
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Marcus Mallory
Corporate Controller
Wright Construction Company
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