A fresh approach to Payroll Services!!!

Hi all,

I have been reading the books and the, extremely useful, posts on this site for the past few weeks with the intention of starting trading towards the end of the year. Events of the past few days have broght the launch date forward somewhat.

I am currenlty, whilst operating as a sole-trader, providing payroll services to a software house offering HR and payroll solutions. For the past 3 years I have been responsible for 'all things payroll' including implemention for in-house solutions, project management, product direction, and payroll bureau services. During this time I have found the customer service elements to be the most rewarding and have built up some strong relationships with colleagues and clients alike.

Recently my Jerry Maguire'esqe rants to the 'powers that be' have led to an agreement that we would go our separate ways, with the managing director even showing a desire to invest in my new company. When asked to bring my business plan for discussion it quickly became apparent that the interest in investment was not there and instead attempts to persuade me to stay followed. I think the agreement to split was intended to scare me into submission but instead really pushed me 100% into following my ambitions and dreams.

One important point that I am keen to stress is that I do not intend to compete in any way wih the client that I currenlty service.

They provide solutions and systems to large clients whereas I plan on targeting small employers for payroll bureau services and all customers for training and consultancy services (not software specific!) It seems like I am following a Flying Startups trend as I, like others whose logs I have read, am now prepared to offer customers what THEY NEED, not what SUPPLIERS want to sell!

All sounds great so far, now I just need a little help so if you have another couple of minutes please keep reading.

An item in the confidentiality agreement that my client is now asking for me to sign suggests that I cannot 'offer ANY services to any existing customers of the client for a period of 5 years after the termination of our contract of services'

Are there any lawyers out there that could advise whether it would be considered as reasonable expectation for me to sign this? As I say although I do not want to compete for ethical reasons, I also do not want to sign away a potential customer base. I would be happy to sign that I would not offer any services currently being offered. I can just see this opening up a potential legal minefield and so need to weigh up the pros and cons becuase I am reluctant to spend a large proportion of generated revenue in the court room. Who normally wins such cases?

Anyway thanks to anybody that read through this essay, I would greatly appreciate any advice that anybody has, and I am sure you will all be subjected to more of the same over the coming weeks and months.

Steve

steve [dot] sweetlove [at] pay-expert [dot] co [dot] uk

Comments

Don't be Intimidated

Hello Steve

First thing, don't enter into any agreements, just walk away, it's time to go. It might be argued in court that five years is an unreasonable period of time as it would make you un-employable/wreck your business, why wait!

Sorry to be so blunt, I have never done payroll. My accountants never did payroll (as such) till I started in business sixteen years ago. Because it was such a good idea (of mine) they have a payroll department and look after over 100 companies payroll, (two ladies do this).

Now you can kickstart your payroll business into overdrive and make loads of dosh for you.

Kind regards

Harry R Smith

Harry R Smith

Harry, Thanks for your

Harry,

Thanks for your input. You have confirmed what my head has been telling me. There is something else that is as much a sense of loyalty, ethics, as what my heart says that tells me that I should ensure that there is an ongoing relationship, if only for the use of software that I am familiar with (and that I have effectively written). Maybe it would be safer to go with an independent provider with no strings attached, and eventually develop my own software.

It is a shame as the directors, of the client, and I still get on very well personally although my ambition has outgrown theirs professionally.

You are right in terms of the opportunities available in this sector. The team I have put together can take services provided to a previously unseen level (to my knowledge) of being able to take on the payroll operations of accountancy firms who themselves offer outsourced payroll services. The tried and tested procedures I have developed will enable my team to process client payrolls cheaper, and with less operational risk (such as sickness, unforseen hardware problems) than the 2-3 employee payroll teams currently in existence at such organisations.

Maybe my only trouble is moving from the mindset of an employee within the payroll industry, where ethics, loyalty towards the employer are ingrained, to one of an entrepeneur where these attributes need to be re-directed towards the customer and used as an advantage in the cut throat world of business.

Thanks again for your input and reassurance.

Steve

steve [dot] sweetlove [at] pay-expert [dot] co [dot] uk

Go for it!

Dear Steve

Go to McDonalds have a good luck. Then spend time working out your system. Benchmark one, Benchmark two, etc etc. You are then effectively working on your business not in it, (unless you choose to). You can then spend your time getting the work in for your team. You have the tried and tested procedures already, so you can work from home, your garage, your shed (it's warmer now). Please spend time planning it out well, please don't focus on the salary you can survive on or worst still, break even on. Go for your dream salary, aim for the stars and then if you hit the clouds it will still be brilliant!

Take Care

Kind regards

Harry R Smith

Hac57 [at] fish [dot] co [dot] uk

Confidentiality agreement

Hi Steve,
I really don't understand why you would like to sign a confidentiality agreement at all at this stage. This is what you do when you START an employment or start a business agreement. What is in for you to sign it now? Nothing as far as I can tell, so if I were you I would just say, thanks for the offer but no thanks I am not signing.
Quite frankly employers put these things in contracts to protect themselves and their business, and if I was advising an employer I would advise them to put it in writing from the start.
There is really no benefit for the employee (or business partner / sole trader) to sign it at anytime. Apart from the one thing, which is that they want the job/business that they wouldn't get otherwise.
And you don't want the job anymore.
They have just been plain silly not protecting themselves from the start, and it really is not up to you to "help" them with this at this stage.
Good luck
Anna
Moderator, flyingstartups.com

Anna
Moderator, flyingstartups.com

Harry and Anna, Thanks very

Harry and Anna,

Thanks very much for your responses. I will next be in the office on Tuesday when the 'crunch' will come and I am sure the ultimatum will be sign or walk, in which case I will keep you updated on the time I walk (might have a glass of champagne first so I apologise if your not the first to know, but you will be shortly behind the bar staff!)

Regards

Steve

steve [dot] sweetlove [at] pay-expert [dot] co [dot] uk

Good Luck

Steve

Best of Luck.

Please stay calm and focused

Kind regards

Harry R Smith

yeah right You are right in

yeah right You are right in terms of the opportunities available in this sector. but how you have put your team together so that it may take services provided to a previously unseen level of being able to take on the payroll operations of accountancy firms who themselves offer outsourced payroll services? is it really a change or just limited to policies yet?

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