MYOB shuts its payroll outsourcing service

Accounting software provider MYOB is shutting its payroll outsourcing service because of limited demand and other payroll companies are reaping the benefits.

MYOB is withdrawing the service because of limited demand and it is working with its 72 clients, mostly SMEs, to find alternatives.

MYOB chief executive Julian Smith says a dedicated project manager is working with the clients who have been given several options since the announcement three weeks ago.

Clients have until November 30 to organise alternative options such as MYOB staff being sent into the individual businesses to do payroll for them, switching to an MYOB client that uses its software or moving to a competitor.

Smith says no other MYOB payroll solution services are impacted and MYOB continues to be New Zealand's most popular payroll provider.

MYOB has 150,000 clients in New Zealand and 40,000 clients use the MYOB payroll which collectively pays a quarter of the population.

"The reality is that the changes are small in comparison to our overall business in New Zealand and our goal is to support our existing 40,000 clients with the best solutions we can provide," he says.

As a result, competing payroll service companies such as PayGlobal and ipayroll are seeing an increase in interest.

PayGlobal head of sales and customer service Paul Morrison says inquiries have doubled since MYOB's decision to shut down its payroll outsourcing service.

"It's always good for us when an opportunity like this arises in the market," he says.

The timing is perfect for PayGlobal as it launched PayGlobal Express in May this year for SMEs. It previously only dealt with companies that had 200 employees or more.

Morrison says payroll is getting a lot of focus at the moment because in the current economic environment clients are looking at people cost versus productivity to get analysis and payroll is a good way of measuring those costs.

ipayroll put advertisements in all the major dailies around the country after they heard MYOB was shutting its service, inviting the disenfranchised MYOB clients to contact them for a continuity of payroll service.

Managing director Martin Gleeson says there has been a good response to the advertisements and it has seen an increase in leads.

He believes the MYOB clients have been given adequate time to change and says ipayroll and other service providers can easily implement clients in that timeframe.

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