Payroll

Payroll is one of the most critical functions of running a business, and getting it right is no simple task. Direct deposit, tax filings, wage garnishments, vacation and sick time tracking, health benefits, retirement - all of these things take time and resources most small businesses don't have. Payroll is also covered by any number of federal, state and sometimes local rules and regulations, and the costs of noncompliance can be substantial. You have two choices: do payroll on your own or outsource it to a payroll processor.

Benefits of Outsourcing Payroll

Outsource payroll providers typically charge a flat fee plus some amount per employee to process payroll. Providers vary in offering the ability to manage payroll online versus over the phone. Some processors are full-service: that is, they process payroll, make the necessary tax deposits and filings, manage year-end W-2s and 1099s, manage employee benefits deductions, and more. Some also offer limited services for less money. Outsourcing payroll can reduce your exposure to liability from noncompliance with the various federal, state and local laws, and can also inform you of changes to rules such as minimum wage, overtime, time and attendance, COBRA liability, and more.

Other services include:

Check Sign & Insertion

Processors typically offer support and some access to experts and a knowledge base. Many also offer to print paychecks, sign them electronically, print your company logo, and insert each check or voucher into its own envelope to ensure security and confidentiality.

Vacation & Sick Time

Many companies track vacation and sick time taken and due to their employees through their payroll. Payroll processors can track the time taken by each employee as well as the balances of both their vacation and sick time. Some can even use a custom tracking method, should your company have a specific accrual formula.

Direct Deposit

Most payroll processors offer direct deposit, where employees designate the accounts in which they want their pay deposited. Then, each period's pay is automatically deposited into their choice of multiple checking, savings, or retirement accounts. Employees receive a pay voucher showing the amounts deposited, and you receive a detail of transactions each pay period.

New Hire Reporting

A few processors such as PayChoice, offer New Hire Reporting to ensure that your newly hired employees are reported to the appropriate state agencies. Your staff is relieved of the burden of responding to state inquiries, or maintaining employee historical information.

Wage Garnishments

Statistics reveal that for most small businesses, 25% of their employees have some type of wage garnishment. Yet, many small businesses are unable to manage the process in a simple, cost effective manner. That's where a processor can help ease the burden for your business. With wage garnishment payment options, each pay period your provider can process garnishment payments along with payroll for items such as child support payments, tax levies, bankruptcies, and liens. It's a benefit for both you and your employees.

Time and Attendance

For most businesses, tracking the hours worked by employees and translating that into a payroll check can be a big task. Some processors offer time and attendance tools replace manual methods of tracking with electronic clocks or internet-based systems. With manual tracking methods, human error, audit costs and lost time can really add up. An average small business can save 1-4% of their annual payroll costs simply by automating their time and attendance. Employees simply swipe an electronic badge or type their "pin" into the clock terminal recording start and end times of their work. They also can use one of our advanced web-based time tools that they can access from their desktops. The data captured can then easily be approved and submitted for payroll processing.

Articles and Templates

• Payroll Services: What They Offer and When to Consider One
• Absence and Vacation Tracker
• Request for Time Off Form
• Managing Poor Attendance: Dealing with Excessive Absenteeism and Tardiness
• Daily Timesheet
• Vacation Planner
• Vacation Tracker