What are the Top Factors to Consider When Picking a Payroll Company?

Kevin Kenealy factors to consider when Picking a Payroll Company Leave a comment  
What are the Top Factors to Consider When Picking a Payroll Company?

Bringing on your first employee is a huge milestone in growing your company. It also brings stressors, such as how you’re going to pay them.

Logging hours manually and crunching withholdings isn’t a good use of your time as a business owner, but the options for payroll providers can seem overwhelming, and can range from bare-bones payday products to those with full-blown employee benefits programs. Which of those payroll processors is best for your company?

Your business’s specific needs will guide your decision, of course, but I’d tell anyone who consults clients on payroll systems (yes, it’s a thing) that certain features should be nonnegotiable when choosing a payroll provider. These are seven features I feel are the most important to set up and then select for your payroll service.

Customer Support

Strong support with great customer service is an absolute must. When there is a system bug, or when something goes wrong in a payroll run it’s important to be able to speak to an empathetic, knowledgeable person immediately. Missing a payday is a trust destroyer with your employees, even if it’s a technical flub, so you want to have a payroll provider that has a great support team.

Payroll Automation

The best way to keep your employees and maintain a trusting relationship with them is to have accurate paychecks and paychecks on time.

I suggest eliminating the potential for human error by finding a provider that handles payroll automation. From computing wages and withholdings to hitting the right day of the week to deposit pay into bank accounts, automation helps streamline the payroll process and save you time.

Approval Process

Organization is critical for making sure your payroll is accurate – and it becomes even more important as you move from one employee to the next handful of employees.

And finding a payroll provider with a streamlined approval process for payday can keep employees in the loop while giving you – along with whoever else is helping you with your finances – the last say before the money leaves your business bank account.

Time Clock Management

Hourly employees should be able to report the hours they’ve worked in a pay period accurately. I suggest a single payroll compliant provider with time clock management instead of multiple systems to track time, report time and calculate wages.

Payroll solutions exist that use bespoke time-tracking software, or those that integrate well with a third party. Whether you connect your time clocks with the payroll system or not, you and your employees will save time in the approval process.

Low or No Fee Bonus Payrolls

Doing a bonus payroll run makes it a little simpler to pay an employee supplemental wages like bonuses and commissions. While you may pay your normal wages differently than bonus payroll runs, this type of run typically lets you configure the correct withholding, contributions and tax rate.

Others charge you hundreds of dollars to do bonus payrolls. Instead, allow yourself the option of bonus payrolls with a provider that charges low fees – or better still, none.

Detailed but Easy-To-Use Reporting

Your employees are one of your biggest outlays – the people who keep your business running and growing.

Reporting tools will provide you and your staff with insight into wages, taxes and time worked, and this is useful information for your accountant and will help guide your planning year over year as well. The reports you have access to through your payroll provider can get quite granular, depending on which provider you choose.

Compatibility with Existing Software

You know that employee paychecks are expenses that should be reported in your business’ books.

I cannot emphasize how much easier it is to start with a payroll provider whose product works well with the financial software you already have. “We recommend starting with a payroll solution that integrates with your existing software, that way you are saving future you the headache of manually consolidating records from multiple systems.”

How to Choose the Right Payroll Provider

A simple Google search for payroll providers will present you with numerous possibilities. From there, narrow down your options by searching for my seven must-have features for a payroll provider.

Such as: Your business needs – how much your budget is, how many people you’re hiring and the type of employee you’ll have on staff. These should help inform your final choice.

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