Keeping employees happy can seem like a full-time job at times. While you can do a number of things to keep your employees satisfied with their work environment, none are as important as paying them the correct amount of money for the hours they work. Few things make a worker more dissatisfied than receiving a paycheck that is short, which is why you need to avoid problems in your payroll department.
Inexperienced business owners have a tendency to make payroll mistakes that usually lead to their employees jumping ship. If you want to avoid losing valued team members, you need to avoid making the mistakes covered below.
Processing Your Payroll Manually
Trying to keep up with the hours an employee works manually is a futile effort. Not only is tracking hours manually difficult, trying to deduct the right amount of taxes can also be difficult if you ignore the need for modern technology. The longer you use outdated methods of payroll management, the more you risk making big mistakes. Rather than dealing with the fallout these errors can cause, you need to check out a comprehensive list of payroll software options.
With the addition of the right payroll software, you can reduce the number of mistakes you make when paying your hard-working employees. Most people want to work for companies that use modern technology in their daily operations. The money spent on new technology will be worth it considering how efficient it will make your human resources/payroll department.
Neglecting Payroll Tax Payments
One of the main things you need to be concerned with as a business owner is staying in the good graces of the Internal Revenue Service. As you figure out your employee’s paychecks, you need to make sure to withhold the right amount of taxes. If you are new to the world of payroll taxes, then you need the right technology at your disposal. Modern payroll software provides you with accurate information about the state and local taxes that should be withheld from employee pay.
If you don’t have the time to process payroll and make tax payments to the IRS, then you need to let professionals assist you with this important task. Many companies outsource their payroll to experienced accountants. Before hiring an accountant to handle this important job, find out more about their reputation and the previous experience they have with businesses in your industry.
Not Paying On Time
A recent study found that over 53% of American workers have experienced a paycheck problem in the past year. One of the worst mistakes you can make with your payroll is missing payments to your employees. Most business owners are extremely busy and letting important tasks fall through the cracks is a common occurrence. However, you should never miss payments to your employees due to the damage it can cause to your relationship with them.
You need to realize that your employees rely heavily on their paycheck to pay their bills and feed their families. Making the mistake of not paying employees can lead to them feeling like you don’t care about them and their well-being. If an employee feels like this, they are more likely to seek out another job with a competitor. The main thing you need to do to avoid this problem is to delegate some of your responsibilities to trusted employees. By doing this, you can focus more on growing your business and less on managing the writing of paychecks.
Forgetting About Overtime Pay
The average employee doesn’t mind working more hours for a business if they get rewarded for it. Most businesses will offer their employees overtime pay for anything over 40 hours a week. In fact, the Fair Labor Standards Act mandates that employers pay their employees for overtime. While there is no set guideline for overtime pay, most businesses pay anywhere from 150% to 200% of an employee’s normal hourly rate.
If you are not keeping track of the amount of overtime your employees are working, it is easy to make mistakes with their paychecks. Avoiding this problem is easy if you invest in state-of-the-art timekeeping and payroll software. Before you choose new technology to use for your HR department, take some time to look at the reviews. With these reviews, you can see how well a software program has performed for other business owners before you invest in it.
Put These Tips To Use!
Now that you know about payroll mistakes you need to avoid, it is time to optimize this vital part of your business. With the information in this article, you can reduce the number of payroll mistakes you make.