Most people only think of payroll when it comes time to receive their checks, but the fact is that payroll is an ongoing process that takes place every day. Much of that process is invisible to the average employee, but we all benefit from the team that consistently “gets it right.” Misunderstanding one aspect of the day-to-day payroll process can put a company out of compliance with state or federal laws or may cause an employee to not be paid correctly for the time they’ve worked.
So, in celebration of National Payroll Week, FrankCrum, your PEO solution, wants to provide some insight into a few focus areas important to every payroll process.
Timekeeping
Timekeeping has always been a huge factor of the payroll process and with the recent new overtime pay requirement for certain white collar employees who are typically classified as exempt from overtime, it’s even more important especially if the number of non-exempt employees increases at your company. The bottom line is that in order to comply with federal law, companies must properly classify employees and account for hours worked.
It is important to re-evaluate how your employees account for time worked in light of this regulatory transition. One way to maintain accuracy in timekeeping is to utilize timekeeping technology. Whether it’s a simple system of time clocks, card readers, or online tracking software, or more tech savvy options like finger print reading devices, having a reliable system can reduce fraud, automate time keeping and potentially even feed data directly into the payroll process.
Payroll Submission
Submitting payroll data, at the outset, seems like it should be a quick and streamlined process. Unfortunately, not all systems are created equally, and some companies still do payroll manually. This can introduce mistakes and lack of efficiency. It’s helpful to consider ways to reduce the likelihood of mistakes, automate as many steps as possible, and build in effective auditing steps that allow you to apply payroll expertise to your submission and review process.
PEOs are able to help with payroll submissions by providing a strong combination of technology tools and people to easily handle payroll data. You get effective tools and a team of payroll experts who know how to look for red flags in payroll data, and they can assist with compliance and problem-solving all along the way.
Payroll Compliance
Government compliance in payroll and payroll taxes is a difficult responsibility, especially for smaller businesses in do-it-yourself mode who don’t have a dedicated team of experienced payroll pro’s. But maintaining compliance with local and federal laws can mean the difference between having smooth business operations and facing big fines.
Staying abreast of the laws and ensuring that you comply with all the overtime, wage garnishment, deduction, tax, and alternative pay (commissions, bonuses, etc.) regulations requires good processes and solid expertise.
PEO’s can be invaluable in the area of compliance. They specialize in payroll and can help guide you to compliance and payroll best practices. They also take a huge portion of the work load off your shoulders so you can focus on other things.
Although this is not a comprehensive list of payroll undertakings you’ll want to keep track of, it is a good start. In most cases it is beneficial to take a look into working with a PEO in order to have dedicated experts running every facet of your payroll department.
