Seth gave an overview of some problems he has seen when businesses do their payroll in-house:
Misclassification of employee vs. contractor: Sometimes businesses try to save money by not paying payroll taxes saying the worker is a contractor and responsible for paying their own. But if you tell that worker when to work, where to work and give them the equipment needed to work then they are an employee.
Not outsourcing: May be cheaper in short term to have employee do it but fines resulting from mistakes would end up being more costly.
Failure to re-evaluate options periodically: New options and improved technology are always being developed that may save your business money.
ADP is the largest payroll processor in the world and can work with companies with as few as one employee.