If you are a business owner and you hire employees, being able to effectively and correctly manage the payroll for your company is absolutely crucial. Most of the time, starting your own business means investing some time and money into learning and mastering payroll. That’s why so many companies are looking to work closely with PEO organizations, as they have the experience and knowledge to guide you while saving time and money.
When you start your own business, you might not know the last thing about payroll management – but it’s important to get familiar with it from the moment you start hiring your first employees.
Since even the smallest of mistakes with payroll can have serious consequences for your employees and your business, it’s one of the most important factors of being an employer. Payroll management can sound easier than it actually is, and if you’ve underestimated it, you won’t be the first or last business owner to do that. So, what do you need to know when it comes to managing your small business payroll?
1. Outsource Wherever Possible:
There are more and more outsourcing companies today that provide a range of options to businesses of all sizes, including human resources and payroll services for small business from G&A Partners. Outsourcing is often the best option for small business owners as it means that you have peace of mind that your payroll is left in experienced and capable hands.
By outsourcing payroll services for your small business, you can free up your time to spend focusing on the core aspects of running your business. It will also help you avoid mistakes when it comes to paying employees, ensure that everything is compliant, and consistently pay your employees correctly and on time.
2. Choosing Payroll Software:
Whether you want to tackle payroll on your own or are working with an outsourcing company, it’s a good idea to get started by choosing a reputable payroll software program. There are several options available that are worth considering to make everything a little bit easier to manage.
Today, businesses have access to both web and application-based payroll solutions with some designed specifically for certain industries. You can find automated software systems that can be used to run the payroll system for your company, freeing up more of your time to focus on core business functions and reducing the manual work that is required.
3. How to Pay Employees:
One of the first decisions that you’re likely to make regarding the payroll is how employees are going to be paid. You will usually be able to choose between paying employees either an hourly wage or a monthly salary. Salaried employees are often easier to deal with in terms of payroll since they will typically be paid the same amount on a certain day of the month.
On the other hand, hourly-paid employees can be trickier since you will need to ensure that you are keeping track of the hours that they work so they are paid correctly, especially if employees work overtime.
To keep this information accurate, you can get a clock-in machine or an online system for employees to record when they start and finish work, which can be integrated with the payroll software that you use.
4. Develop Payroll Policies:
Whether you’re managing payroll on your own with the help of software or are planning to outsource your company’s payroll completely to another company, it’s important to have clear payroll policies in place as soon as you start hiring your first employees.
When new hires are onboarded into your business, you can immediately make sure that they are familiar with the payroll policies that you have in place and ask them to agree to them by signing a contract.
You can include various types of information in your payroll policy, including information such as how and when you will pay employees for the work that they do along with anything else worth considering such as commission, holiday pay, sick pay, and expenses reimbursement for any money that employees have to spend to do this job.
Ensure that you make this policy available and easy for employees to access, so all employees understand both what to expect of you and what is expected of them.
5. Integrating Payroll With Other Functions:
Many businesses find that it is easier and more effective to ensure that payroll is integrated with other business functions such as employee scheduling and business accounting.
It is always important to integrate payroll with scheduling if your employees are paid hourly since this will make it easier to track how much you owe your employees on payday and ensure that they are paid on time with the amount that they are expecting. Integrating payroll with accounting will make it easier for you to track business expenses as they come up over time.
6. Stay Updated:
As a business owner, it’s important to make sure that you and your business stay current and up to date when it comes to any changes to legislation, regulations, and other parts of employment law that might have an impact on how payroll management is carried out within your business.
One of the easiest ways to make sure of this is to outsource your payroll to another company that can take care of making sure that everything is current on your behalf. HR and payroll companies are tasked with ensuring that they are always up to date on these aspects of running a business and will make sure that your company remains compliant.
However, if you are going to be managing payroll fully or partly on your own, it’s important to put in the time to make sure that you are staying ahead of the latest developments and changes, putting them in place in good time, and making it easier for you to plan for the future.
Since paying your employees on time and for the amount they expect to receive is an important part of running a successful business, payroll is one of the most important aspects of hiring that any employer needs to figure out. Whether you’re doing it yourself or outsourcing, keep these tips in mind for effective and smooth payroll management.