6 common problems encountered monthly by the human resource department

Q: What are the most common HR problems in Vietnam?

The most common HR problems in Vietnam include time-consuming and error-prone payroll tasks, limited HR department capacity to handle compensation and benefits, high investment costs with low efficiency, and frequent staff turnover. These issues typically affect payroll operations, personal income tax settlement, and social insurance management. Many businesses struggle with the complexity of managing multiple employee groups with different pay structures and compliance requirements.

Q: How can I reduce payroll errors in my company?

To reduce payroll errors, businesses should implement automated systems such as human resource management systems, cloud-based payroll services, or tools with predefined formulas to aggregate attendance data and calculate salaries. These solutions minimize manual data entry errors, save time on data compilation, and improve overall accuracy. Automation also helps ensure compliance with Vietnam's complex tax and social insurance requirements.

Q: Should I hire an in-house HR person or outsource?

The decision depends on your business size and budget. For small businesses with limited payroll workload, outsourcing to a third-party HR service provider is often more cost-effective than hiring a dedicated HR staff member. Outsourcing reduces the risk of internal data breaches, eliminates training and onboarding costs, and provides access to specialized expertise. However, larger companies may benefit from having in-house HR staff combined with outsourced services for specific tasks.

Q: What is a Compensation and Benefits specialist?

A Compensation and Benefits (C&B) specialist is an HR professional who handles payroll, personal income tax finalization, social insurance management, and other employee benefits-related tasks. This role requires specialized knowledge of Vietnamese labor laws and tax regulations. Hiring a C&B specialist can help small businesses manage these complex tasks accurately and on time.

Q: How can HR outsourcing help reduce costs?

HR outsourcing helps reduce costs by eliminating the need to hire and train full-time HR staff, reducing employee turnover-related expenses, and providing fixed monthly fees that allow businesses to measure ROI. Service providers offer comprehensive packages including payroll, tax, and social insurance management at predetermined rates. This approach is particularly cost-effective for small to medium-sized businesses that don't have consistent, high-volume HR needs.

Q: Why does HR staff turnover create problems for payroll?

When HR staff leave, businesses must restart the onboarding and training process for replacement employees, which is time-consuming and resource-intensive. This creates a repetitive cycle of hiring, training, delegating payroll tasks, and potentially restarting again if the new employee leaves. High turnover disrupts payroll accuracy and compliance schedules, affecting both the business and employees.

Q: What does a payroll outsourcing service include?

A comprehensive payroll outsourcing service typically includes payroll processing, personal income tax (PIT) finalization, social insurance reporting and management, and attendance data aggregation. These services use automated systems and predefined formulas to calculate salaries for different employee groups with varying pay structures. Most providers charge a fixed monthly fee, making it easy for businesses to budget and measure service efficiency.

16/05/2025

When providing services to support human resource and working with businesses, most of the common issues that terra’s clients face are concentrated in the human resources management. Payroll operations, personal income tax settlement, and working with social insurance agencies are quite complex, requiring human resource personnel to spend a lot of time and effort. So, what is the solution to these issues?

Most payroll, PIT finalization, and social insurance issues often fall on HR’s shoulders. These tasks are time-consuming and complex — so what’s the solution? Let’s explore 6 common problems and how terra can help.

common-issues-the-hr-department-may-face-during-operations — Common issues the HR department may face during operations

Time-consuming and Error-prone payroll tasks in human resource departments

A typical payroll process involves multiple steps: collecting attendance data from various sources → converting it into workable time records → calculating salaries for different employee groups with varying pay structures.

This process can be time-consuming and error-prone, potentially affecting not only HR’s credibility but also employee satisfaction.

Solution:

For this problem, businesses should use tools and services that support the automation of attendance and payroll processes to aggregate data, minimize errors, and save time on data compilation. Examples include human resource management systems, cloud technology, or payroll services based on predefined formulas.

the-human-resource-department-consumes-time-and-is-prone-to-errors — The human resource department consumes time and is prone to errors

The human resource department’s limited capacity in handling all C&B tasks

For small businesses, there is often no dedicated HR department – or if there is, it usually lacks the time and resources to manage payroll, personal income tax finalization, and social insurance accurately and on time.

Solution:

Businesses may consider hiring an HR staff member—specifically a C&B (Compensation & Benefits) specialist—to handle these tasks. However, given the limited workload, to reduce costs and minimize the risk of internal data breaches from the outset, many businesses choose to work with financial consulting firms or simply outsource the entire C&B operations and management to a third-party service provider.

The-human-resource-department-limited-capacity-struggles-to-handle-all-tasks — The human resource department’s limited capacity struggles to handle all tasks

High human resource department investment costs, low efficiency

If the employee resigns—or in cases where there’s simply not enough time to handle specialized tasks such as payroll processing, PIT finalization, and social insurance reporting—businesses are left with no choice but to invest additional resources to expand their HR department.

Solution:

In such cases, Terra recommends that businesses leverage employee management tools to free up time for specialized tasks, or consider outsourcing HR services. Some providers offer comprehensive packages that include payroll, tax, and social insurance management with a fixed monthly fee – allowing businesses to measure results and efficiency relative to the investment.

The-investment-costs-in-the-human-resource-department-are-substantial-but-havent-yielded-desired-efficiency — The investment costs in the human resource department are substantial but haven’t yielded desired efficiency

The human resource department is unstable, experiencing frequent changes

When hiring in-house HR staff, businesses must allocate time for onboarding and training before the employee can handle payroll and compliance tasks. However, in situations where turnover is frequent, this results in a repetitive cycle: onboarding a new staff member, having them take over payroll tasks, reviewing their work, and potentially restarting the process if they leave. This constant turnover creates an endless loop of onboarding and retraining, draining both time and resources from the HR department.

The-process-that-businesses-need-to-undertake-when-there-is-a-change-in-payroll-staff — The process that businesses need to undertake when there is a change in payroll staff

Solution:

The optimal solution to this problem is to reduce the “payroll staff turnover” and “re-hiring” stages in the loop by reevaluating the reasons why employees frequently resign and implementing policies to attract and retain talent.

Alternatively, if a company wants to proactively reduce this issue from the very beginning, it can consider using HRM and payroll software, or outsourcing services to manage payroll, tax, and social insurance tasks. This helps the company avoid worries about staff turnover and allows them to focus on their core business activities.

Staff unfamiliar with labor laws, policies regarding PIT & Social Insurance

During the payroll process, a basic payroll sheet includes not only salary but also deductions and policies related to personal income tax (PIT) and social insurance (SI).

However, due to numerous complex and cumbersome procedures involving multiple policies such as sick leave, maternity leave, occupational accidents, retirement, etc., many difficulties can arise during implementation — including calculation errors, disputes, or complaints from employees.

Solution:

To address this issue, if concerned about the time needed for training and skill improvement, businesses should seek out a unit or hire at least one Compensation & Benefits (C&B) specialist with professional knowledge in tax and social insurance to handle necessary procedures and communicate directly with social insurance officers.

Human resource lacks knowledge of labor laws and policies on PIT & SI

Labor, personal income tax, and social insurance regulations are mandatory in completing payroll. However, many companies are unclear about these administrative procedures, leading to serious errors in payroll calculation, tax finalization, and social insurance payments.

Such errors may cause legal risks such as incorrect PIT declarations, inaccurate social insurance records, late tax finalization submissions, which seriously affect employees’ rights and may result in fines of tens of millions of VND for the company.

Solution:

To optimize, from the recruitment stage, businesses must require relevant professional experience, ensure timely updates on PIT and social insurance regulations, and apply the law accurately and compliantly in operations. Special attention should also be given to building good relationships with tax and social insurance agencies to receive timely support when needed.

Staff-Unfamiliar-with-Administrative-Procedures — Staff unfamiliar with administrative procedures

Propose solutions to 6 problems from the human resources department

An almost complete solution to the 6 problems faced by HR departments is outsourcing services, which can help businesses optimize employee management and operational processes.

After listening to and compiling the issues businesses encounter, as a third-party payroll service provider with extensive expertise, terra has continuously developed and improved its services based on customers’ needs and problems, aiming toward the motto: “Your Problem – terra’s Solution.”

Problems	terra Payroll
HR spends too much time & is prone to errors in payroll tasks	terra Payroll ensures accurate and timely payroll processing. Customers using terra Payroll service get free access to terra HR System to integrate timekeeping and payroll data processing on one platform.
Thin HR team unable to handle all C&B tasks	terra Payroll handles all payroll processing, tax settlements, and social insurance contributions on behalf of the business, minimizing the risk of internal data leaks and ensuring confidentiality.
High investment costs but low effectiveness	terra Payroll helps businesses optimize monthly costs and ensures efficient, timely payroll processing in compliance with the law.
Unstable staff, frequent turnover	terra Payroll eliminates recruitment, training, task performance, resignation, and rehire stages. Enterprises only need to verify data after terra Payroll completes its work.
Difficulties in handling PIT & SI procedures	terra Payroll has a professional C&B team experienced with social insurance agencies across provinces, deeply understanding local procedures and work culture.
Lack of knowledge of labor laws and PIT & SI policies	terra Payroll regularly updates and notifies customers of new policies. Specialists advise and suggest corrective actions if the company misapplies the law in payroll or operations.

Compilation of benefits when human resource departments choose terra Payroll

In summary, when choosing terra Payroll, businesses will benefit in several practical ways:

Time and Effort Savings: Minimizes time spent on complex payroll tasks, reducing administrative burdens.
Integrated HRM System: Free access to terra’s HRM system, featuring modern payroll technology.
Cost-Effective: Service costs are comparable or lower than hiring a full-time HR employee, ideal for SMEs.
Professional C&B Team: Support from specialists managing salary, bonuses, PIT, and social insurance matters.
Accuracy, Timeliness, and Compliance: Ensures precise, timely payroll calculations and legal compliance.

benefits-of-terra-payroll — Benefits when using terra Payroll

The six issues mentioned above can all occur during the payroll process for employees. These are also the very issues that terra’s clients have encountered and successfully resolved.

Based on experience assisting over 250 businesses in optimizing HR management via payroll, PIT finalization, and social insurance services, terra Payroll confidently offers a comprehensive solution that thoroughly addresses these problems while enhancing accuracy and operational efficiency.

See more:

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terra Payroll: Fast, accurate payroll with easy-to-manage features and 24/7 support.