How Efficient is Your Payroll Service?
Your payroll service holds one of the more important jobs in your business, so it’s vital that it be efficient and correct at all times.
Payroll is a necessary part of your business, and outsourcing this recurring task is often the best way to get it done efficiently. However, not all payroll services are adept at the job, so before you let a company handle everything without supervision, check that it is doing a good job of the payroll. Like any other outsourcing, you should have a probationary period where you will closely monitor the company and how it performs.
Hire a payroll service to make life easier. It can take at least a day, if not longer, to work out all the numbers each time payday rolls around, which is time you could be using for other, more productive activities.
What Makes an Efficient Payroll Service?
Your payroll service is responsible for one thing and one thing only, to ensure that your employees get paid the correct amount, on time. If they cannot manage this, then you need to look elsewhere.
Timeliness is key in paying employees. Those working for you have bills to pay and mouths to feed, so they need to know that they will be receiving their money on the specified dates. Whether you pay once a month or once a week, it’s important to have consistency, which is what you need from the payroll service.
Before hiring a company to handle the checks for your employees, check to see if it has a policy about late payments or incorrect checks. Will it pay the penalties if things are done incorrectly? What about any interest incurred by the error? While mistakes are bound to happen from time to time, you don’t want to be the one paying for them.
Pick a service that is easy to work with, since you will be talking with the accountant assigned to you on a regular basis. Many companies do their own in-house accounting for the first few years in part because they have complete control over last minute changes to checks. When you select a payroll service, you will need to make sure that you can change things as necessary. Unlike many other outsourced tasks, payroll usually requires quite a bit of communication.
An efficient service will provide you with all the records necessary, in a timely fashion. It should also be equipped to handle taxes and all the paperwork that goes along with this, as there is little reason to be working with more than one company to cover both payroll and taxes. This would cause more errors and cost you more money in the long run. Instead, find a company that will handle everything for you and you will save not only time, but sanity, as well.
You should be able to choose from more than one package to tailor the services to your particular business needs. Depending on the payroll service, you may pay less if you need fewer services. If you can’t slim down the offerings when you need something less, then look elsewhere; there’s no need to pay for services you won’t actually use.
Evaluating Your Payroll Service
Employees are usually very quick to say something if they get the wrong paycheck or if they don’t receive one on time. By paying attention to what your employees have to say, you can pick up on problems that might otherwise take you much longer to catch.
Of course, you should still be checking the payroll service yourself, but part of the appeal of outsourcing is the fact that you can have someone else doing the work for you, so you should choose a company that you can trust. It can be difficult to judge just how well the company is doing until a couple of pay periods have gone by. Expect these to require extra communication and time as the company gets to know your business.
Take the time to give the service all the information required. Every payroll company should have a privacy agreement, so you can feel safe giving them privileged information such as tax information and bank account numbers. The company cannot share this information and it is necessary in order to complete the payments that you are outsourcing.
If you aren’t happy with your payroll service, look for a new one. The move to a new service can be tiresome, but in the long run, it will be much easier when payments are sent on time and paperwork is available whenever you ask for it. Make sure your existing service is able to fulfill your business needs quickly and efficiently, to avoid problems with your employees or even the IRS, come tax time. Choose carefully, evaluate the company on a regular basis and make sure you listen to your employees. When everything is running smoothly, you won’t hear any complaints.