5 Things to Do Immediately to Make Payroll Easier
Regardless of the size of your business, you may find that payroll is a monstrously time-consuming task. Small businesses that only have a few employees may manually process payroll, and calculating tax withholdings and more by hand can be a nightmare. Even in a larger company that uses an effective payroll software program, you may find that it takes several members of your team many long hours to complete this process. You certainly cannot process your payroll late, and you cannot afford to have costly mistakes on payroll. With this in mind, you may be looking for effective strategies that you can implement immediately to make processing payroll easier, faster and more accurate. These exceptional tips can be used by all companies regardless of the size of your payroll tasks to generate great results.
Automate Employee and Manager Payroll Data
In an ideal world, each employee would receive the same compensation each pay period. However, in reality, there are often adjustments on each paycheck for sick time and vacation time used, unpaid time off, reimbursements for travel, changes in employee benefits and more. Each employee that you have may have individual changes on each paycheck, and this means that you need to have an eagle eye with a fine attention to detail to accurately process each paycheck manually. It also may require your HR team to keep excellent notes and to review emails thoroughly for payroll adjustment requests when processing payroll. Even with the best effort at focusing on the fine details of payroll processing, some of your employees may contact you after payroll has been processed to tell you about mistakes that were made and adjustments that are required. Adjustments may be processed immediately through time-consuming manual efforts, or they may require your team to keep track of these additional change requests for the next payroll period. A smart idea is to set up an automated system where employees and managers can make adjustments to benefits and can record sick and vacation time online. Some programs will automatically funnel the changes that employees and managers make online into the paychecks so that your HR team can take a hands-off approach with this process.
Set Up an Online Access Feature for Payroll Records
Processing payroll should be done slowly and carefully, and ideally, only the most detail-oriented individuals will complete this task in your business. When hiring HR professionals, a test to determine how detail-oriented candidates are is a great idea. However, even the most detail-oriented individual will have a hard time staying focused on the task at hand when they receive numerous interruptions from employees asking for payroll records. Employees may ask for printouts of previous paystubs, such as if they are applying for a loan in their personal lives. They may want to see their year-to-date totals for taxes withheld, review their withholdings and more. When you place all of this information online, you can drastically reduce the number of interruptions your HR team faces while performing critical payroll tasks. this can save time and reduce the incidence of processing errors.
Set Up Direct Deposit Payments
If your business is not currently using direct deposit as a method of payment to your employees, you should make this change as soon as possible. Direct deposit is faster and easier for HR staff to do as opposed to printing out checks and distributing them to your team on payday. In addition, direct deposits are also preferred by employees in many cases because it gives them immediate access to their money on payday. It also eliminates the possibility of checks being lost and having to be recreated. You can work with your bank to set up a direct deposit system for your business to use. In many cases, payroll software programs can link directly to your bank account so that you can easily keep payroll records while also automatically processing payments to your employees.
Avoid Handwriting Checks
Handwriting checks may have been common decades ago, but it should be avoided today. When you hand write checks, you are spending far more time on a menial task than you should spend. Furthermore, you may need to make a written record of the check that was written, and this adds to the time involved in this process. In addition to tracking the check number, date and amount, you also may need to create a manual pay stub that shows accurate deductions for taxes, benefits and more. Handwriting checks also comes with the possibility of transcription errors, and this can be stressful and even costly to the company. By automating this task by using a program that allows you to print checks through your computer, you can enjoy faster results and enhanced record keeping efforts.
Outsource Your Payroll Tasks
In-house payroll processing is common, but it may not be the most cost-effective solution available. The costs of in-house processing include man-hours spent on this task, the purchase of software, the maintenance of computer equipment, printing costs, the cost of checks and more. Furthermore, there are issues related to processing tax withholdings and benefits that you may want to avoid. For example, ensuring that you are withholding enough with each employee’s paycheck and collecting the right amount from each paycheck for benefits can be time-consuming and arduous. Keeping up with changes in the tax code can be a monumental task. Using a third party for all aspects of payroll processing can save you time and money and can eliminate this hassle from your regular work tasks. Both smaller and larger businesses can benefit from outsourcing this task.
Payroll can be a true nightmare that you must contend with on a regular basis. It must be processed timely and accurately to benefit your employees as well as your business. However, it is one of the most detail-oriented and time-consuming tasks that businesses deal with. By following these helpful steps, you can decrease the time and effort required to process payroll for your team going forward.