Let’s be honest: the idea of changing payroll providers can feel daunting. Payroll is one of the most business-critical functions in any organisation. People rely on you to get it right, every time – so the prospect of switching to a new provider (and something going wrong) can feel like a huge risk.
But staying with payroll software that isn’t working for you is risky too. From errors that damage employee trust to manual processes that eat up hours of your week, a poor payroll setup drains time, money and energy.
The good news? Switching payroll providers doesn’t have to be scary. With the right planning, the right partner and the right process, moving to a new system can be smooth, straightforward and even transformative.
Here’s what you need to know.
In this blog post
- Changing payroll providers: why and how
- What to look for in a new payroll system
- The payroll implementation process
- When to change payroll providers
Changing payroll providers: why and how
So, how do you know when it’s time to make a move? Some common signs include:
- Errors are creeping in – and directly impacting employees
- You don’t have the in-house expertise to keep payroll running smoothly
- Your current system is inefficient and time consuming
- Costs are rising, whether through system maintenance or staffing
- You have data security concerns
- Employees don’t fully trust that they’ll be paid correctly each month
- And perhaps most importantly: you’re spending too much time on processing payroll
If you’re nodding along, it’s time to explore a new provider.
What to look for in a new payroll system
Modern payroll software should help you automate time-consuming processes such as:
- Sick pay
- Holiday pay
- Removing double entries
- Manual checks
- Excessive spreadsheets
- Integrations with HR and other people management systems
When reviewing potential vendors, think about both functional requirements (what the system can do) and non-functional requirements (how well it fits your organisation).
Assessing your functional requirements might include:
- Reviewing your current setup and supplier
- Defining your service model (do you want to replace your payroll software, or change to outsourced payroll or a payroll bureau?)
- Consulting internal stakeholders for feedback
- Documenting your requirements before engaging vendors
Non-functional requirements to consider could be:
- Vendor profile and track record
- Data security and hosting location
- Implementation timescales and scalability
- Pricing structure, contract terms and exit strategy
- Procurement and budget approvals
The payroll implementation process
Now that you’ve selected a new provider (congrats!), what happens next? Here at Ciphr, we guide customers through a six-step tried-and-tested implementation process:
- Discovery – we run workshops to gather your payroll requirements and collect the data we’ll need from you
- Configuration – we build your payroll system based on the details you provide
- Data migration – employee data is uploaded into the new system
- Parallel runs – we run ‘dummy’ payrolls in the new system, comparing them to your live system to make sure everything matches
- Go live – you move to processing live payroll in your new system
- Post-implementation support – continued help from your project manager, customer care team and consultants
The whole process usually takes around four months, although this depends on factors such as employee numbers, pay groups, integrations and data accuracy. In urgent cases, we can go faster – and, in complex cases, we can slower. It’s all about what works best for you and your organisation.
The key thing to remember is: you won’t go through this alone. A good provider will hold your hand every step of the way.
When to change payroll providers
There’s a common myth that payroll transitions can only happen in April, at the start of the new tax year. That’s simply not true.
While April is a natural point for some organisations, payroll migrations can happen in any month of the year. In fact, many companies find that other times – such as June (for clean year-to-date data) – work even better.
The right timing really depends on your organisation’s capacity. For example:
- Schools may want to avoid August due to limited staff availability
- Some organisations prefer to avoid December because of early pay runs
- Busy audit periods can be challenging
The bottom line? It’s up to you. You can and should switch payroll providers whenever it makes sense for your team. Remember, you’re in control. The right provider should accommodate your needs and not pressure you into switching when you’re not ready or have too many other competing priorities.
Common worries when changing payroll providers
It’s natural to have concerns when changing payroll providers. Here are some of the most common – and how your chosen provider should address them:
- Data migration – providers will typically bring over current-year data for parallel runs, and you can retain access to your old system for historical reference
- Compliance – payroll data must be retained for six years, but you can do this via a read-only archive or cloud storage
- Learning a new system – training should be provided and tailored for different roles, and can include webinars, videos and ongoing support from your provider
- Integrations – modern systems, like ours, offer API-based integrations with HR, finance, pensions and your employee benefits platform
- Third-party reporting – pension and HMRC reporting can be tested during implementation to ensure accuracy
- Employee access – staff can still access historic payslips and P60s via an archive or bulk upload into the new system
Switching payroll providers is less about risk and more about planning. With the right provider, your concerns will be anticipated – and managed – at every stage.
Ready to see it in action?
Payroll is too important to settle for a system that doesn’t work. Errors, inefficiency, security worries or lack of trust are all signs it’s time to explore a change. And while changing payroll providers might feel intimidating, the reality is far more positive: with the right partner, the process is structured, supportive and successful.
We’ve helped hundreds of organisations move to a payroll system that works harder for them – saving time, reducing errors and building employee trust.
Request a demo of Ciphr Payroll today and see how easy changing payroll providers can really be. Or, if you want an even more in-depth look at what we’ve discussed in this blog post, watch this recent webinar from payroll experts Amanda Barnden and Kohini Kawol: