Payroll Best Practices: Driving Results and Productivity
Payroll isn’t just about writing checks and hoping your employees are happy. It requires precision, strategy and teamwork to ensure budgets, calculations and forms are accurate every time. Take a look at these payroll best practices, especially if you’re new to the human resources field.
Are you utilizing direct deposit? Direct deposit allows a business to deposit funds into a recipient’s account electronically. Direct deposit saves time since it reduces the need to go to the bank, stand in line and fill out deposit slips. In addition, the more employees you have, the more challenging and time-consuming making deposits will be. Simplify the payroll process by encouraging all eligible staff to sign up to receive their paychecks with direct deposit.
2. Develop a Payroll Approval Process
In order to stay in control of your payroll process, you have to be aware of pay periods, budgets and schedules. Develop an easy process for approval of hours worked by knowing who to talk to. If your office allows managers to approve hours worked, it’s good practice to conduct audits during the pay period. Double check anything a manager may have missed that could result in accidental error.
3. Maintain a Policies and Procedures Manual
It’s wise to spend time creating a policies and procedures manual so everyone in the company is on the same page. By encouraging employees to read the manual before asking questions, you can save yourself time in the future.
Distribute the manual electronically via email or have it accessible in a storage area online. Always notify employees of any updates or changes to the manual.
4. Be Aware of Deadlines
Never let a deadline slip through the cracks. Keep a calendar of dates and events that need to be remembered. Loop your staff in so that everyone is on the same page.
After you set up a calendar highlighting deadlines, make sure you execute on them. The penalties for filing IRS forms late are not something you will want to be responsible for.
5. Know Your Employees
In order to file the appropriate tax forms, you must know how to classify your employees. Do you have contractors? Part time employees? Full time employees? Exempt or nonexempt?
Accidentally misclassifying employees can result in penalties from the IRS and miscalculations of state wages and ACA reporting.
6. Know Your Payroll System
Know your payroll system like the back of your hand. Make sure not to assume your system is running all the necessary calculations. Begin by asking yourself questions about different scenarios, research payroll and tax law (federal and state), and even run audits on pay statement calculations. Identify what’s working and what could be improved so you can minimize error and increase efficiency.
7. Collect Real-Time Data
When you collect real-time data, you always know how your time stands against your budget. If you’re trying to improve productivity (and who isn’t?), this insight will help you reach those goals. Real-time data lets you know what’s coming. Receive alerts when employees are reaching overtime or benefits eligibility. And never have end-of-the-month surprises.
8. Keep Records
You must keep records for all employees at the company. Utilize PROWORK to keep everything organized for each employee from hire all the way to retire.
9. Process Payroll From Anywhere
With PROWORK, there’s no need to download software; all you need is an Internet connection to utilize its benefits. You’ll have personalized service from a dedicated, client-assigned payroll specialist, direct deposit, automatic tax filings and payments, plus access to all of your essential payroll data. You’ll get an all-in-one package from PROWORK, allowing you to access your information from anywhere.
Payroll should be an organized process that delivers results. If you’re ready to save time and money on your HR systems, switch to PROWORK today for an integrated workforce management system.