Payroll Processing Outsourcing Plus & Minuses – Part Two

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Take a minute to review the pluses and minuses
of switching your business to an outside payroll processing services provider.
Featured below are both the pluses and the minuses.

The
Pluses

  • Time savings – Several surveys over the years completed by a variety of business associations have reported that business owners place payroll and payroll taxes as the number 2 task that takes up the most time and creates the most hassle of all the tasks categories it takes to run a successful business. It’s obvious that running payroll 1 to 4 times a month requires a ton of time and focus to complete. Switching to an outside payroll processing service provider frees up time and improves effectiveness for most business owners.
  • Reduction in Expenses – Each pay period requires completion of a long list of required tasks including preparing and paying mandatory payroll taxes, running payroll reports, figuring out wages for the entire company staff, printing, signing and handing out payroll checks.
  • Better Company and Employee Data Security – In 2019 payroll processing service providers provide, mirrored backup systems, several server farms, the most up-to-date technology, solid secure SSL (secure socket layer) firewall protected systems to safeguard private employee and company information and data.
  • Keeping Current with Regulations – It is hard to stay compliant and current with payroll tax laws and payroll taxes. The financial penalties are huge. Payroll processing service providers know all the rules and regulations like the back of their hand. Their primary objective in running their business is implement this knowledge, process your payroll for your company and keep you current with all requirements and regulations.

The
Minuses

  • Ease of Use Getting Wage Reporting and Employee
    Certain payroll processing service providers do not offer reporting
    on payroll costs and other critical data about employees due to the fact they
    do not have the information or because the data is on their servers, which your
    business does get access to for various reasons.
  • Time Issues on Fixing Payroll Mistakes –
    Payroll companies are sometimes slow to respond to payroll errors. If the
    company or the employee needs aren’t met when it comes to payroll errors, it is
    bad for everyone.
  • Payroll Services Pricing –
    In some instances payroll processing service providers do not customize pricing
    to fit a company’s needs. Check to make sure the services provided fit your company’s
    needs and not the other way around.
  • Chance Your Payroll Processing Provider Closes
    Its Doors
     – Businesses close all the time. It can be due failure,
    loss of a primary partner or any number of reasons.  If this were to happen to your business, you
    may lose out on access to company payroll data, employee data and potentially
    your company’s money.  

The
minuses described here do not have to be part of your picture. The main thing
to make sure you do is your due diligence in checking out the company thoroughly
first. Use the following guidelines to make a smart payroll processing service
provider choice:

  • Recommendations from associates, mentors and business owners
  • Documented credentials including time in business, similar company
    payroll processing experience and confirmed business licenses.
  • Confirmed quality customer service and personal attention to
    detail
  • Services and support offered meet your company’s needs
  • Pricing and additional fees or charges are documented upfront
  • Reporting of data, data reporting needs and security of data are
    rock solid

Payroll Processing Outsourcing Plus & Minuses – Part One

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In today’s modern web-based technology world,
companies can choose from multiple options to complete payroll. Business owners
that opt to do it themselves is one way and businesses that choose to assign
the task of doing payroll to a department, like human resources, is another way
to go. Lots of businesses choose to go to a provider outside the company for
payroll processing like a bookkeeper, accounting firm or an online payroll
processing company. The rub lies in figuring out which method is the best way
for your company to do its payroll.

Small-business owners need to take a hard look
at where their time is best spent. Look at how much time is being spent now by
you each month doing the company payroll. If the answer is too much where for a
small monthly fee payroll is completed and the time is gain is used closing new
sales. Review your payroll to make sure you are current with all state and
federal laws, rules and payroll regulations. If you’re not sure or you’re not
current, it might be time to switch to hiring a payroll processing provider.
Look to see if you’re keeping all your company’s and your employee’s financial
data well secured and private. Also, check to make sure your company’s records
for wages, benefits and retirement programs are on time, current and correct.

Payroll Processing Success, But Is It Taking
You Away from Important Tasks

You are managing running your company’s payroll successfully. However, if keeping up with running payroll, maintaining legal requirements, data security and records is eating up a good amount of your time, you may want to switch to outsourcing payroll to an online payroll processing company. Payroll processing company will calculate your company’s payroll and its associated taxes, print and handout checks, complete direct deposit payroll checks and complete all the company’s payroll reports. It will file payroll taxes, issue annual Forms W-2, set up worker’s 401(k) deductions and connect their contributions to investment account providers and keep records on benefits of employees.


Payroll Processing Systems in 2019

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Payroll is the biggest financial duty each business must comply with other than paying its legally owed income, payroll and sales taxes. Payroll mandates accurate payment to employees and full compliance with all federal, state and local government laws, rules and regulations. Severe financial fines by government agencies like the IRS and State and employee anger will be part of a business’ picture if payroll processing is not done accurately and on time. Make a choice to use online payroll processing or to use in-house payroll processing hinges on having a full understanding of the needs your business for both payroll itself, financial accounting, cash flow and budget forecasting.

In-House Payroll Processing

In-house payroll
processing is a solid selection to consider if your company features ten or less
employees with little to no changes in hours, benefits and deductions from week
to week and month to month. If your company’s payroll processing requirements
are simple and payroll fields for deductions are easy to update and answers to
questions from employees are easy to provide, keeping payroll processing in
house using a payroll software program. The bottom line for in-house payroll
processing is the company’s employee charged with the task of doing payroll and
managing it on-going basis absolutely has to stay current with company staff
turn-over, payroll tax laws and stay current with tax filings, tax withhold for
the company and its employees and pay payroll accurately. In-house payroll processing
might reduce security and risk factors for the company and its employees’
financial data.

Bookkeepers and CPAs Payroll Processing

Businesses across
the USA outsource payroll processing to bookkeepers and CPAs all the time, but
most of time each one prepares it similarly to doing it in-house and bank
interface services including 401(k) deductions and direct deposit for employees
may not be offered or available. Be certain to check to see if the bookkeeper
or CPA provides the knowledge and skill sets your company requires such as payroll
changes like increased wage per hours or new deductions to keep any payroll processing
mistakes from being made.  Federal tax liability
payroll deposits and payments to the IRS are a 100% a business’ responsibility.
If an error is made the IRS will call you the business owner and not the
payroll processing company. Be sure the company you hire can and will take care
of all tasks on time and without fail.

Payroll Processing Service

Payroll processing service provides are professionals with
high-level payroll tax and regulatory mandate expertise. They are professions
with excellent skill sets that will make sure your business is 100 % current with
all regulatory reports and tax deposits, leaving your time completely unencumbered
from dealing with payroll task responsibilities. Payroll processing services
include disbursing payroll wages to company employees via paper check, payroll
debit cards and direct deposit as well as automated deductions from paychecks
for benefits retirement savings such as 401(k) and 403(b). Payroll services
quite often provide services guarantees and the chances of mistakes and ensuing
penalties for incorrect or tardy payroll tax filing are very low. The federal
government’s Electronic Federal Tax Payment system provided by the U.S.
Department of the Treasury is a no cost secure service gives employers the
ability to login online to the Treasury website and confirm their tax payments
have been made through the system.

Online Payroll Processing

Managing and overseeing payroll 365 days a year, 24 hours a day, is offered by online payroll companies through a web based online payroll processing platform complete with an SSL certificate and firewall to protect sensitive company and employee data.  Once enrolled with an online payroll processing provider you will not have to buy payroll software or expensive equipment. On-boarding new employees for payroll, entering current payroll and tracking employee paid vacation and sick leave pay can all be done from a desktop, laptop computer or a smartphone. Most online payroll companies provide payroll services, payroll tax filing and payment. Signing up for online payroll services with tax filing and payment included gives company owners peace of mind and it frees up time to manage and grow their company.

Consider all the options for payroll processing while looking at the needs and legal requirements of your company and then make a smart well-informed decision. For further information about payroll processing look at this article: “Why Payroll Processing Is Highly Important to Every Albuquerque Business Part One“.


Benefits of Payroll Debit Cards for Employees and Employers in 2019 – Part Two

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payroll-debit-card-for-wages-the-payroll-company-albuquerque-nm-505-944-0105

Companies need to check to see if there are extra fees assessed to employees when issuing payroll themselves via debit card and when choosing a payroll processing company offering pay debit card program. Companies need to offer several ways for company employees to receive their pay. A company is not allowed by law to require employees to receive pay solely by payroll debit card. Employees must be provided several options as to how they receive their wages, not just via debit check card. It has been reported over recent years that some employers didn’t do this for their employees, which is against the law. In response the Consumer Financial Protection Bureau issued a bulletin covering legal regulations covering payroll cards. The main points on the bulletin were as follows:

  • Fee Documentation – Documentation must be provided of fees
    charged by the issuing bank to the employee related the EFTs (electronic fund
    transfers) and written explanation about liability limits.
  • Account Records Access – Regular statements must be given to
    card holders by payroll debit card issuers electronically online or telephonically
    providing account transaction history and fees charged.
  • Unauthorized Transfer Liability Limits – Employee’s limit of
    liability for use not granted if reported within a specific written time period.
  • Rights to Resolution for Errors – Payroll debit card financial
    institution mandated response to card holder within 6 months of occurrence of mistake
    or error.

Several different organizations over recent years have provided
statements about the pluses of wages being disbursed to employees via payroll
debit cards and regarding the top ways for employers to make the most of the
program for their employees. The top recommendations included issuing pay without
fees being charged (employer pays the fees) and to provide the wages using the
top credit card brands such as VISA, MASTERCARD and DISCOVER. Employers must also
give complete documentation of fees employees may incur.

Payroll debit cards are a big part of
providing payroll to employees today that do not have a bank account. Operated
correctly, payroll debit cards provide wages at a low cost with speed, easy and
convenience to employees. The program helps both the employer and employee work
together efficiently. Look today with your local payroll company to see if your
company can save money and improve its payroll process each month by starting a
payroll debit card program as part of its payroll disbursement options.


Why Outsourcing Payroll Processing is a Smart Move for Your Business

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Businesses are required to complete and meet obligations to employees. Payroll problems are difficult for today’s high-tech business world. A business’s payroll division oversees multiple components of employee compensation. It manages payroll processing, direct deposits to employee’s bank account, FICA, FICO, State Income tax payments to government entities including the State and the Federal Government, reporting requirements, time and attendance tracking, company payroll management reports, worker’s compensation, 401k’s plus other types of retirement account reporting, unemployment claims, vacation time-off and more. This is a giant set of tasks to manage for a small business while running the business itself. Putting time into these tasks means a business owner is not focusing on building and managing current business.

What is the Appropriate Amount of Time to Spend on Payroll?

The practical way to answer this inquiry is a business owner needs to calculate the amount of time spent working on payroll each week, every two weeks or month and multiply it out for 52 weeks, 26 weeks or 12 months. After the totals for each segment of time are calculated, a business owner needs to look at the true cost of working on payroll by comparing it to the amount of business not generated related to working on payroll instead of managing and building the business. To make the comparison and analysis useful and valid each payroll task needs to be included in the assessment including managing tax reporting, employee benefits, retirement funds to new name just a few. Several studies over the years indicated in real numbers that business owners spend 3 full weeks a year dealing with federal tax problems. Add all the hours spent dealing with all the other payroll problems and tasks and it becomes readily obvious managing payroll is costly from both a time and business growth perspective. There’s not a fixed number or an empirical study out there that provides when a business owner should hire a payroll processing company, instead of doing it themselves. However, it’s easy to assess if an owner is spending 10 – 20 % of their time working on payroll and all its accompanying issues it’s likely a smart move to hire a company to process payroll to save time and money and then put those savings into managing and building business.

Look at the questions below to determine if it’s time to hire an outside payroll processing company:

  • Is the time spent on payroll exceeding your comfort level?
  • Is your business growing, adding more employees and now is
    payroll becoming a much bigger task than before?
  • Are payroll mishaps become more costly due to tax penalties assessed
    for filing errors charged by the IRS?
  • Is payroll taking up so much time that the critical time needed
    to manage and grow your business is compromised.

From a logical assessment perspective, if the responses to this set of questions happen to be yes, it’s makes good sense to outsource payroll processing. The monthly cost of payroll processing fees, while not nominal, is affordable for most businesses. The benefits of outsourcing payroll processing are time-savings, cost savings generated from reduction in penalties and fines and the improved ability to focus time on and energy towards building and growing your business.


Why Payroll Processing Is Highly Important to Every Albuquerque Business Part Two

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If you’re having a hard time to get payroll done promptly
each week or every two weeks and your team isn’t up for completely the task the
right way and on time, it’s time to alter your procedures.

Remaining Super Organized with Your Company’s Payroll All the Time

To stay organized and maintain records of company staff
member data, including hours worked and benefits provided, you need to develop
and keep a payroll record. This organized payroll record must feature the sum
of employee gross pay, a list of all deductions, and complete net pay for every
payroll period. You likewise must maintain a record backing up all your
historical company payroll information for each week, month, current year and
prior years.

It’s true, that online bookkeeping systems have a payroll
register, including a full set of required record keeping tools, such as
records of employee wages.  Maintaining
this data is critical for finishing your company’s annual payroll sums records,
the accompanying reports that go with them, and to finish your company’s
mandatory annual payroll tax obligation jobs.

Establishing a yearly tax obligation schedule is likewise a
great plan, which should be set up prior to the beginning of each new year.
Maintaining this calendar will make certain you maintain a working knowledge of
the entire set of payroll tax days during the whole calendar year.


Why Payroll Processing Is Highly Important to Every Albuquerque Business Part One

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Handling payroll properly and reliably is required by Albuquerque business’ due to multiple legal and ethical requirements. The fact of the matter is, you’re legitimately obliged to compensate your workers. Not paying your staff in a timely manner will flat out ruin your firm’s credibility, and if you do not stay in compliance your business will deal with the lawful consequences.

Paying workers continually and in a timely manner
demonstrates your firm’s economic security. It additionally affects staff
member spirits. Paying on time protects a company’s credibility with its
employees. Employees that do not get paid on time will look for work elsewhere
quick.

Precise payroll processing is additionally critical to stay
in line with both government and state wage and hour laws. Legal changes can be
intricate. You need to steer clear of dangers like lawsuits, fines, as well as
massive penalties by keeping payroll in line, paying on time and 100%
accurately.

Is your business dealing with payroll processing problems?
If so, it’s time to do some investigation.

If you’re releasing paychecks filled with errors, for
instance, your workers will find them! Be positive– dig much deeper right into
all transaction mistakes and determine perfect solutions as to just how you
will certainly stop future payroll processing blunders from occurring ever
again. Employees expect to be paid on time and to be paid accurately.


Why It’s Critical Payroll Must Be Paid On Time and Precisely in 2019 & Beyond

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In 2019, more than ever, it is a fact it is the responsibility of every company, business and corporation to make certain that staff members are precisely compensated for different sets of hours worked. Even though employers know it is a legal requirement to for business to pay workers for the hours worked, employees do not always get paid the amount of wages they have coming.

In some cases, this might be intentional, however possibilities are great that typically, it is caused by an oversight. Charged with the duty of producing accurate wage information, it is up to Human Resources to maintain a Human Resources system that can track the necessary details to make sure workers are compensated properly for hours worked.

Also, it is a fact, large businesses are vulnerable to problems when it concerns payroll. It has been reported in recent years that several big employers were found to have kept millions of dollars in overtime back earnings. According to information provided to the US Department of Labor, which performed the investigation, each of these companies have “fallen far short of keeping accurate records and had not paid employees for thousands of hours worked.”

Paying staff members in a prompt and 100% accurate fashion is a fundamental part of keeping employees pleased with their job and willing to work hard for your company. Since it depends on Human Resources to aid and retain valued employees, it remains in the best interest of all businesses that employees are paid what they are owed. It is likewise a vital action in lawful conformity, people by law are required to be paid for the time they perform services, nothing less and nothing more.

Taking care of HR, and wage and hour details, can be a difficult job. A skilled HR consulting business or payroll processing company will certainly collaborate with your company to execute the Human Resources and payroll software application systems that meets the one-of-a-kind demands of your business, helping make sure that payroll is accurate, and your business stays in compliance with wage and hour laws.


Top Payroll Issues that May Doom Your Business in 2019

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Businesses fail all the time and there are several issues that cause those failures. It’s a fact that payroll in the year 2019 may be the one that comes back to bite a business that it never even considered a risk area unless it takes action now. However, one way to mitigate that risk is use workforce management software and integrated payroll service. It’s a fact small businesses normally fail in year 1 to the tune of 25%. The top reason businesses fail is due to payroll issues. Managing payroll well can reduce cash flow problems and give businesses a better chance at succeeding for the long haul.

Payroll Services

Payroll services vary from company to company. There are several payroll service providers offering payroll processing that offer more than just straight forward payroll processing.  Several of the primary reasons payroll services are really great for small businesses is because it’s easy, eliminates the hassle and it gets payroll done on time. Companies rarely have the experience and knowledge needed about payroll taxes, payment profiles and the expertise to do it right. Payroll tax mistakes can be costly and they have caused the downfall of many companies. Payroll should never be a worry for employees. If it is a problem, employees panic, work slows down and many times employees start looking for work elsewhere.

Payroll periods never get missed when you use a professional payroll service provider. The only requirements to meet your companies payroll period are staff hours worked and making sure necessary funds are in the bank to fund the paychecks being disbursed. Using a 3rd party payroll service will help you run payroll properly, but you have to make sure you provide correct employee information from the beginning. The best way to make sure correct employee information is in place is to combine outsource payroll services with workforce management software.  Workforce management software is used to record and track company staff attendance and hours. Both your payroll services provider and your workforce management software need to be compatible.

Find a workforce management system that includes the important components of attendance, time, scheduling and document management. It is wise to find a system that can be done from mobile device and includes employee access that is self-service. Both of platforms working in tandem can help you run your business more effectively. Listed below are the payroll issues that must be avoided at all costs or they may doom your business:

  1. Cashflow

It is a fact that without cashflow your business can fail very quickly. Payroll doesn’t get paid, or it’s late. Company’s delay paying payroll taxes which puts the company in the crosshairs of the tax collectors like State Taxation and Revenue and the IRS. Overtime and overstaffing can break a business in half and destroy it. That is why payroll services and workforce management software is a critical tool most businesses should put in place. Managing payroll and staffing through these tools can help a business manage cashflow so much better than doing it manually.

  1. Employee Classifications Errors

Employee classification errors are a regular payroll mistake. It’s so easy to prevent, but it’s a regular reason for business’ doom.

Business classifications are as follows:

  1. Exempt salaried
  2. Non-exempt, hourly
  3. Independent contractor

Non-exempt get overtime, exempt do not earn overtime and contract employees are just that, on contract. If an employee is not classified properly non-compliance can turn into huge fines or penalties. Mistakes occur mostly regarding complicated classifications. The main factors that impact proper classifications are job duties and relationship status. Workers getting a salary doesn’t negate having to pay them overtime. Trying to avoid big pay expenses can lead to big trouble. Companies are smart to hire a professional payroll service and do employee classifications the right way.

  1. Record Keeping for Records For Audits, Payroll Documentation and Future Issues

A bad audit and an ensuing lawsuit can destroy a business. This is particularly the case if you’re not ready. Setting up a system that collects and maintains your company’s payroll records can protect your business from regulatory fines and penalties, employee allegations and real life audits. Workforce management software is a built in automated component and it is works 24/7 365 days a year. You can use it to manage your business, respond to employee allegations regarding payroll. Employees are able to self-manage due to login capability to review their own hours and records. This relieves managers  and improves work place efficiency. Additional historical work records are stored and backed up in the cloud giving companies the information need to improve the company regarding a variety of work subjects.

  1. New and Existing Employment & Health Care Laws And Staying in Compliance

Compliance is not a proverbial piece of cake, it’s complex to say the least. This has been the case for 50 years or more and it is not going to change. New business owners have to begin the process of being an employer with a mind set of starting and then staying in compliance with respect all labor and insurance laws. There are regulations for a large portion of business subjects and payroll is number one without a doubt.

Payroll addresses the following important sections

  • Fair Labor Standards Act (FLSA)
  • Affordable Care Act (ACA)
  • Payroll Based Journal (PBJ)
  • Family Medical Leave and Fair Scheduling Laws
  • Union Agreements
  • Industry-specific Regulations
  • Regulation Covering Non-U.S. citizens Employees

Fines are applied to businesses from small businesses to large corporations by regulatory agencies. It’s hard to fathom, but big companies and small businesses may be required to pay fines that doom the company. Many companies are subject to a variety of laws due to the state it’s located in or location in a particular state. Due to these issues it pays literally to hire and use a payroll service provider.

Cloud Record Maintenance with Workforce Management Software Services

Companies are able to develop and manage all their payroll and employee compliance records using a workforce management software service. Fines are real and nothing to sneeze at. Well-kept payroll and personnel records are worth their weight in gold because record keeping is maintained automatically. Additionally workforce management software helps company manage people, pay and the company more effectively using its built analytical tools and reports.

  1. Payroll Input Mistakes

People makes mistakes inputting numbers. Here are a set of input mistakes made all the time:

  • Wrong hours are written down by staff on old school timesheets
  • Misplace time cards
  • Clocking out on the company time clock gets forgotten
  • Employees forget to clock out or clock in from their mobile device
  • Managers and company supervisor neglect tracking staff over time.
  • Data entry errors by human resources and staff

 One Error Translates Into Several Errors, Expenses and Time Lost Going Forward

One input error can cascade into multiple errors adding up over and over. Inputs done incorrectly directly  impact payroll taxes and withholding for social security taxes. A short paycheck is a very bad thing from an employees perspective. Fixing it on the next check or immediately can be complex, depending on the complexity of the person’s wages and payroll or commission structure. Errors can be human and sometimes the errors are due to fraud. Staff can add hours the didn’t work and managers reduce hours to meet company goals. Big mistakes our purposeful paycheck errors can end up in a company paying giant fines.

Time Element of Payroll Mistakes

There is a domino effect when there is payroll error or there are payroll errors. Payroll has to fix every component of the error and they have to meet with all concerned of affect employees and their manager to determined what actually happened, what the true case is and how to fix it. The time it takes to resolve the problem can be immense and it ends affected the company from a variety of aspects including hours spent fixing it, employee productivity and potential fines that have to be paid due to non-compliance. Big fines can doom a company.

 

Payroll services and workforce management software combine together can solve the issue and put a system in place to reduce the chances of it happening in the future.

 Manage Payroll Well and Improve Your Chances of Running a Successful Company

When cash is tight it means you really have to run payroll for your business like a Swiss watch. Observe your payroll numbers to make sure you’re not spending money on payroll needlessly and make sure you’re making the most of every penny.  Using integrated workforce management software and payroll services will give your company, its managers and your employees the tools to run the company well, get paid on time and to stay in compliance.


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