6 Tips for Better and More Efficient Payroll Management
Finance lies at the heart of every business. It exists to make money but will also have regular outgoing expenses. It may be relatively easy for a sole trader to manage their company finances, but when there are partnerships and larger companies, things can get very complicated and time-consuming. There may be remote workers because of the pandemic, and bonuses and salary deductions to worry about.
If someone decides to become an electrician, they may do so because they don’t want to be an office worker or accountant. The reality, however, is that they will need to spend regular time performing administration work and managing the accounts. One survey asked a number of businesses what their least popular activity was. 40% said it was sorting the payroll and other related activities. This article will give you six strategies to make your payroll process more effective.
Use Payroll Software
Any company that uses several payroll systems should consolidate them into one. A business may be purchasing new software or upgrading its current package. It’s highly advisable for the software to be able to synchronise with the rest of your accounting system. Many employers are looking online for a solution. The specialists at zenefits.com/payroll/ say some software will suit both one-person businesses and companies that employ a thousand. People want access to unlimited pay runs and direct deposits. They may require multiple schedules and pay rates, and to access general ledger reporting.
Have Only One Payday
When an employer has full-time workers and also freelancers, things can become messy. One person will like to be paid regularly, whilst others will be content with a monthly paycheck. The more pay runs a company operates, the more time will be spent on it. The prudent way forward is to choose the salary frequency – be it weekly, bi-weekly, or monthly. This way, there will be less chance of errors or duplications.
Go Paper Free
The concept of the paperless office was born thanks to the internet and cloud storage. Companies no longer needed to keep endless folders and manuals. All they need is safely stored online, benefiting both companies and the environment.
When the payroll process is fully computerised, staff don’t need to wade through paper timesheets. If paychecks are issued online, they are easily accessible, and staff can print them off whenever they need to. Many employees prefer this option.
Conduct Regular Training
When companies use accounting software, there may be regular updates and upgrades. This may reflect new legislation or improved technological design. The systems may now function or look differently following a special project. Human Resources staff need to stay on top of any such changes.
Employees may need to be taught about state law differences, and to be fully aware of the different forms they will encounter. They could be anything from a W-4, W-9, I-9 to various withholding forms.
Training becomes particularly pertinent when there is a change in personnel. In the ‘old days,’ a person may have had their own way of doing the payroll, and a new person favour a different approach. When software is used by a company, the process will fortunately remain unchanged, no matter who is working in the accounts department.
It’s also worthwhile checking the market to see if better software is available. Things never stay the same, and innovative technology can quickly become outdated.
Businesses won’t want to pay too much or too little tax by mistake. The State and Federal requirements regularly change, thanks to the IRS and government agencies. Companies need to be sure of what forms to submit and when. If a business misses deadlines or makes incorrect payments, it could be penalised.
Let’s go back to our electrician. If he wants to be freed up to simply do his job, this could be the answer. A third party can use its time and expertise to lift the burden. Payroll management companies are not a luxury for some: Research shows that nearly half of American companies outsource this role. Of the large businesses included in the survey, nearly three quarters delegated their payroll accounting.
Outsourcing companies frequently offer additional services that may be of use. They may include conducting background checks or overseeing pay-as-you-go compensation.
When a company’s payroll is effectively managed, it’s not just a case of having a happy HR team. The employees will be safeguarded from being paid wrongly or not at all. When efficient software is put in place, staff morale is protected. The IRS will be happy too.