Back in the days of yesteryear, payroll was all about making manual calculations on ledgers and all workers were paid in cash. When paychecks were first introduced, employees may have to wait for anything up to a month receive their pay, and the federal withholding taxes came along and made everything more complicated.
While payroll today is made far simpler with the help of advances in technology, the regulations and complexities relating to federal, state and local jurisdictions, have made reporting laborious, and recordkeeping requirements more detailed than ever before. Keeping this in mind, never has it been so important to avoid payroll errors and inefficiency, and mistakes can cost businesses big money that they cannot afford to lose.
Payroll professionals today are not only the stewards of tax law, but they report regulations that are vital to the financial health of businesses, and so it’s crucial that your company has some best with the law:
Reevaluate your company’s timekeeping procedures:
Classifying your employees correctly is extremely important, especially as recent overtime pay requirements for white-collar employees have changed. Even temporary employees must be classified correctly for the purposes of payroll, since job classifications are the driving force behind payroll management, reporting, and tax requirements, and can even affect how federal overtime rules are applied within your company.
Should your company be chosen for an audit and it was later discovered that some employees had not been classified correctly, you could enter a world of accounting nightmares and potentially costly penalties.
Keeping track of how your employees spend their time is a best practice that will help ensure that changes to their job duties or circumstances haven’t warranted a change in the classification of their job role. Track your workforce with online systems, time clocks, and other attendance technology and limit the risk of fraud while ensuring that you remain compliant with overtime rules and regulations.
Consider outsourcing payroll:
This is a fantastic time and money-saving decision for most companies, since processing pay period data, printing and signing of paychecks to name but a few payroll activities, are all incredibly time-consuming, and keeping in line with government rules and regulations can be mind-boggling if you’re not a payroll professional.
See if your systems can be streamlined:
A fully integrated system that can easily and efficiently take care of the HR needs of your company means that you only have one system of record that management can leverage for analytics, and the information that they require to make sound decisions related to pay and organizational management, is far easier to garner.
Outsourcing payroll can offer up a huge return on investment in terms of time, cost and efficiency, and when you apply these best payroll practices to your company, you give the professionals the very best tools to work with.