thanks to everyone who has helped me so far

Another question.

I am trying to get accreditation (ISO9001) for a recruitment company. the recruitment company outsources its payroll (the company concerned collects on behalf of the client and pays us (if debt is insured) and pays all our temporary workers)

Now where would this fit into the QMS (if at all) - would it be part of Purchasing 7.4 ? or because the relationship is between the payroll company and the customer does it not form part of our QMS ?

A confused lady awaits your responses !

thanks to everyone who has helped me so far

Another question.

I am trying to get accreditation (ISO9001) for a recruitment company. the recruitment company outsources its payroll (the company concerned collects on behalf of the client and pays us (if debt is insured) and pays all our temporary workers)

Now where would this fit into the QMS (if at all) - would it be part of Purchasing 7.4 ? or because the relationship is between the payroll company and the customer does it not form part of our QMS ?

A confused lady awaits your responses !


Hi, Debbie! So you are consulting the recruitment company? The payroll company is hired by the recruitment company, correct? So, the recruitment company chose the payroll company? Then, I would hope that there was some sort of criteria used to quality the payroll company (they have to be bonded for instance)?

If all of this is true, it is most definitely a purchasing decision made by the recruitment company, and should be treated as such. Just IMHO.

Something to ponder. How many companies have payroll included in their QMS. I know we have discussed this issue in the past. IMO, the outsourced payroll company does not have to be covered under the QMS. Make a convincing argument as to how it fits within the scope of the standard. Pay particular attention to the note.

1 Scope
1.1 General
This International Standard specifies requirements for a quality management system where an organization

a) needs to demonstrate its ability to consistently provide product that meets customer and applicable regulatory
requirements, and

b) aims to enhance customer satisfaction through the effective application of the system, including processes for
continual improvement of the system and the assurance of conformity to customer and applicable regulatory
requirements.

NOTE In this International Standard, the term “product” applies only to the product intended for, or required by, a customer.

Something to ponder. How many companies have payroll included in their QMS. I know we have discussed this issue in the past. IMO, the outsourced payroll company does not have to be covered under the QMS. Make a convincing argument as to how it fits within the scope of the standard. Pay particular attention to the note.

I have been part of this argument before, and even had my position altered somewhat because of my involvement, but here I think the standard arguments do not apply. Why?

Because the employees paid are temporary, for one thing. Also, we are not making widgets, so the standard manufacturing template does not apply. We are buying a service, which, I assume, is an integral part of what the customer is buying. So, 7.4.2 applies.

Let's look at this from another angle. Suppose we don't describe the requirements for approval of the process, the qualification of personnel, or their QMS. We have these temps who for some reason are not paid, or their paycheck calculations are full of errors? Their agency decides to hold them back until the problems are fixed. Would quality suffer? In this case I would say it is likely it would. Their work is part of what the customer is paying for, as the service provided by the company as a whole, and, as a value added part of that service, is not influenced by the note.

thanks to everyone who has helped me so far

Another question.

I am trying to get accreditation (ISO9001) for a recruitment company. the recruitment company outsources its payroll (the company concerned collects on behalf of the client and pays us (if debt is insured) and pays all our temporary workers)

Now where would this fit into the QMS (if at all) - would it be part of Purchasing 7.4 ? or because the relationship is between the payroll company and the customer does it not form part of our QMS ?

A confused lady awaits your responses !
Hi, Debbie. I hate to disagree with Craig and Al :notme: but in this case payroll is part of the service you provide to your customers - both the contract workers and the clients.

The contract is set up so the client pays you and you pay the contract workers - that is one way of how you get your "share".

It just so happens in this case the actual paying is done by the payroll company. So they are a supplier and should be selected and evaluated under clause 7.4 and under the scope clause of ISO (1.2) you still retain responsibilty for the part of the process they are providing on your behalf.

I would guess you monitor payment to your temporary workers and react if they complain :lol: . That may be sufficient to demonstrate control of the process.

Hi, Debbie. I hate to disagree with Craig and Al :notme: but in this case payroll is part of the service you provide to your customers - both the contract workers and the clients.

The contract is set up so the client pays you and you pay the contract workers - that is one way of how you get your "share".

It just so happens in this case the actual paying is done by the payroll company. So they are a supplier and should be selected and evaluated under clause 7.4 and under the scope clause of ISO (1.2) you still retain responsibility for the part of the process they are providing on your behalf.

I would guess you monitor payment to your temporary workers and react if they complain :lol: . That may be sufficient to demonstrate control of the process.

Paul,

I think we may have discussed this issue before, but now we agree, for the reasons you mentioned, except I cite 7.4.2., instead of 7.4.

Not only would they be monitored, but there should be (should have been?) some sort of criteria when they were first chosen. This is not as complicated as it sounds. If I am buying an ice cream cone, I want the ice cream frozen and the cone right side up.

Paul,

I think we may have discussed this issue before, but now we agree, for the reasons you mentioned, except I cite 7.4.2., instead of 7.4.

Not only would they be monitored, but there should be (should have been?) some sort of criteria when they were first chosen. This is not as complicated as it sounds. If I am buying an ice cream cone, I want the ice cream frozen and the cone right side up.

Sorry, Craig. I misread your earlier post. We agree!

The workers are employees of Debbie's client, not Debbie's client's customer. I haven't heard of one that has their payroll service on their approved supplier list or monitor their internal payroll process. I wonder how many companies do? This might make a good topic for a poll.

The workers are employees of Debbie's client, not Debbie's client's customer. I haven't heard of one that has their payroll service on their approved supplier list or monitor their internal payroll process. I wonder how many companies do? This might make a good topic for a poll.
Not sure this is a good topic for a poll. Maybe the poll should be:

Do you have a set of processes that require financial processes to be included in your QMS (as in this case), or
Do you have a QMS that does not require finance


As has been posted it is not an internal payroll process but is part of the services a recruitment agency provides to customers.

The only equivalent I can think of this time of the morning is for a bank providing loan and cash drawing facilities for its customers - you and me.

Oh gosh!
I think I am more confused now than I was before. Please help me as I do not want to be a total failure !!

The payroll company collect the moneys owed from the customer AND pay the temporary workers - all we do is submit the timesheets by fax to the payroll company on a weekly basis.

so in effect the payroll company invoices the customer with the value on the timesheet (agreed hourly rate to client * #of hours temp has worked) and pays the temporary worker (agreed hourly rate to temp worker * # of hours temp has worked).

Our involvement is only if a problem occurs with either the customer or the temp worker.

Would this still be considered as purchased service 7.4 ?

Oh gosh!
I think I am more confused now than I was before. Please help me as I do not want to be a total failure !! Sorry, Debbie. This happens on the cove. Participants go off at a tangent discussing elements of the standard and not all is relevant to your original post. Bear with us! :notme:

The payroll company collect the moneys owed from the customer AND pay the temporary workers - all we do is submit the timesheets by fax to the payroll company on a weekly basis. You need to have a look at the contracts between:
You and the payroll company
You and the client using the services of your agency
You and the agency workers (bear in mind there are two types Limited company and "sole trader")

These contracts will define the range of services you provide and where the payroll company comes in.

In my experience the client approaches your agency for the full service of finding, pre selection and appointing the agency worker and the ongoing management of the relationship (including payment) but are happy that you outsource payroll to another company.

Your contracts may be different - please come back and let us know.

so in effect the payroll company invoices the customer with the value on the timesheet (agreed hourly rate to client * #of hours temp has worked) and pays the temporary worker (agreed hourly rate to temp worker * # of hours temp has worked).
So here they have taken over your responsibility to pay the agency workers, or, more accurately you have outsourced it to them - hence the reference to clause 1.2 of ISO 9001. Then under clause 4.1 it puts the responsibility for managing outsourced processes back on you.
Our involvement is only if a problem occurs with either the customer or the temp worker.

Would this still be considered as purchased service 7.4 ? Again yes. You have decided to bring in an outside service provider (payroll). You need to select a provider that can meet your needs (7.4.1) and then provide them with the necessary information (fee rates, timesheets, etc.) (clause 7.4.2) to enable them to carry out the service. You then need to demonstrate (under 4.1 again) that the supplier is performing to your requirements.

Again I can't emphasize this bit enough - the contracts are key to what is your scope. Have an ask around and let us know.

just to nail this last bit

I am reading 4.1 and the last paragraph but one says " where an organization chooses to outsource any processs that affects product conformity with requirements, the organization shall ensure control over such processes"

isn't that the answer - the conformity of the product to the customer's requirements is not affected by the payroll company because even though the payroll company may get the calculation to the customer wrong or even forget to pay the temporary worker, the original product i.e the actual supply of the service by us the recruitment company still complied with the customers requirements?

please say yes you agree !!

Debbie,

i think it all comes down to the definition of who the customers of the rectruitment agency are. If the people that are hired out by the agency are regarded as their customers (i think they are/should be), then the payroll process can affect "product conformity".

The product in this case is a service that they can work somewhere, and the agency arranges payment for this. That is the service that a recruitment agency provides for one part of their customer base (the hired out part). The other part of the customer base are companies hiring people, not part of this discussion though). Since the payroll process is very vital to the customer satisfaction of the people being hired out, it can be tagged as a critical process that can affect product / "service" conformity, so should be part of the QMS.

To sum it up: people hired out by recruitment agency are their customers. Payment is part of the service provided, so should be in the QMS.

Hope this clarifies things, cheers, Martijn

*edit ... so IMHO, you are incorrect in your last post

I am not sure why this question is a problem. If it is a purchased service, you still have to monitor the output and ensure that the results meet expectations. If it is an outsourced process, you have to define what controls, if any, must be applied to ensure that the results meet expectations.

Either way, ISO wants your system to ensure that the results meet expectations, regardless of who provides it. It is the same difference. Pick the better fit, and go with it, in my opinion.

isn't that the answer - the conformity of the product to the customer's requirements is not affected by the payroll company because even though the payroll company may get the calculation to the customer wrong or even forget to pay the temporary worker, the original product i.e the actual supply of the service by us the recruitment company still complied with the customers requirements? Now you have to read "service" everywhere you see "product."

As mentioned the contract will define what services you have agreed to provide. If the contract includes providing payments for agency staff then that process is still yours but has been outsourced.

please say yes you agree !! Much as I'd love to be able to give you the answer you want to hear .... :(

just to nail this last bit

I am reading 4.1 and the last paragraph but one says " where an organization chooses to outsource any processs that affects product conformity with requirements, the organization shall ensure control over such processes"

isn't that the answer - the conformity of the product to the customer's requirements is not affected by the payroll company because even though the payroll company may get the calculation to the customer wrong or even forget to pay the temporary worker, the original product i.e the actual supply of the service by us the recruitment company still complied with the customers requirements?

please say yes you agree !!Bingo, I agree, that is my argument exactly!

Oh gosh!
I think I am more confused now than I was before. Please help me as I do not want to be a total failure !!

The payroll company collect the moneys owed from the customer AND pay the temporary workers - all we do is submit the timesheets by fax to the payroll company on a weekly basis.

so in effect the payroll company invoices the customer with the value on the timesheet (agreed hourly rate to client * #of hours temp has worked) and pays the temporary worker (agreed hourly rate to temp worker * # of hours temp has worked).

Our involvement is only if a problem occurs with either the customer or the temp worker.

Would this still be considered as purchased service 7.4 ?Debbie, I would discuss this with your clients registrar. If they disagree with your interpretation, you can always ask that they submit it to the TC for interpretation (http://www.tc176.org/Interpre.asp).