Payroll processing is a tedious task for anyone that has to fulfill payroll for an organization. You’ll want to make sure that you set up the payroll system in a way that makes the process easy and efficient. This post will cover six methods that will make your payroll processing far more straightforward.
- Use Software
In days gone by, everything must have been done manually, causing mistakes, decreasing productivity, and ironically regarding payroll, increasing the amount of staff you needed to get it all done. Fortunately, you can find software that either automates or increases efficiency in almost all business areas these days. If you use payroll software as part of your workflow, you will drastically reduce the time and effort you spend on this process. Furthermore, the payroll gurus over at https://www.zenefits.com/payroll/ suggest that being a payroll compliant business can be a full-time business on its own. Therefore, software that can connect to your Human Resources (HR) department could save you a lot of effort. Additionally, these types of software usually work in conjunction with other accounting software, which can further increase productivity and remove a great deal of guesswork.
The main benefit of using software is that everything can be updated in real-time. This is an immeasurable advantage because if you give an employee a raise, you can merely plug it into the software, which will work out the rest. It allows you to focus on increasing business rather than becoming bogged down in numbers and compliance.
- Maintain Accurate Records
Any business worth its salt should always maintain proper records. This is beneficial for tax reasons, profit and loss reasons, and other payroll reasons. These records can include:
- Employee salaries.
- Time each employee has worked.
- When you hired them and their starting salary.
- Any raises they have earned over time.
- Time cards (both electronic and manual).
- Details of their 401k
- Any medical leave they have occurred.
There are far more, and the things you must maintain a record of will vary whether your employee is exempt or nonexempt. The principal point is to ensure that you have a comprehensive account of each employee you have hired.
- Ensure Your Employees Are Paid On Time
The schedule that you can pay your employees is indicated on a state-by-state basis. Not many people understand this fact and end up falling foul of the pertinent laws. While the state will set the minimum standard, you as a business owner have discretion if you want to increase the payment schedule. For example, the State of Delaware says that you must pay employees at least every month. If you wish, you can pay your staff weekly, but you cannot decide to pay them every two months as this would be against state law. There are four standard pay schedules which include:
You can maintain a payroll calendar and let all staff members know that this will be how they are paid in the future.
- Ensure You Take Proper Withholding
The employee fills out a W-4 form to choose how much is deducted from their paycheck. A voluntary deduction for insurance premiums, charitable contributions, or retirement contributions can also be made by employees. The W-4 forms for employees usually indicate what needs to be withheld for federal and state taxes during payroll processing. You must ensure that you have signed consent from all employees to deduct certain items from their salaries, such as uniforms or meals. You may also be required to withhold some of their pay for student loan payments or court-ordered payments. If this is the case, you must fully understand your obligations as an employer.
- Maintain A Simple Policy
As the saying goes, add more simplicity than subtract. It is best to get your management team together to review everything related to employee pay. Once you have this information, see hope you can simplify things and make universal rules that apply to all levels of staff.
- Outsource Your Payroll
If all of the above seem like work you would rather avoid, you can always outsource it to companies that deal with payroll. It is often relatively expensive, but if you perform a cost to benefit calculator, you might discover that you save money or at least allow yourself to increase business by focusing on what matters.
Payroll is one of those things that every business would rather avoid if possible. Unfortunately, it is impossible to avoid. It is, fortunately, possible to make things easier by utilizing a variety of methods.