Payroll problems you had better prevent

Image by mohamed Hassan from Pixabay

By Henry Brown

Keeping your employees happy is the key to keeping them productive and motivated. What can get in the way of their happiness more than an issue with their paycheck? There are plenty of ways you can mess up the payroll, inadvertently or otherwise, that you should we working to prevent. Let’s take a look at some of those problems and how you can solve them in advance, primarily by using software solutions, including software for payroll and other HR tools, instead of trying to do it the old fashioned way.

Getting the details wrong

A simple input error or miscalculation can result in a paycheck being processed using the wrong information. Sometimes this might mean an employee gets a little more than they should, which they certainly won’t complain about, but you will lose money due to it. More serious is when you pay an employee less than they have earned. You can aim to correct this as soon as possible, but it’s better to prevent the frustration by using payroll software like Xero that checks for out-of-the-ordinary accounts to double-check with you before you process.

Not getting the checks ready in time

If you fail to notice that you don’t have the resources you need for the paychecks by the time payday rolls around, you can have a serious problem. Aside from setting up backup methods of paying employees, you should use services like Laser Printer Checks to standardize and create a routine for getting the paychecks out. You should also ensure that paychecks are given out at a specific time and day every weekly or monthly period.

Work schedule changes that lead to payroll snafus

You have to account for all manner of bumps in the routine when it comes to putting payroll together. This include s overtime, vacation, sick days, and more. As such, to make sure that you’re calculating their days right, you should make use of employee schedule tracking software like PeopleHR. Not only can you better track all the HR information you need to properly process paychecks based on the time actually spent working but you can also have it automatically calculate what their pay should be.

Incorrect employee classification

You might rely on more than one type of labor, including both permanent and temporary employees as well as freelancers. All of these people are entitled to be paid for their work, but if you don’t classify them properly when you pay and file taxes for them, then you can end up owing a lot more in taxes. This is especially true if you rely on contractors but treat them as de-facto employees. It can not only get you in tax trouble, but the employees may be able to make a legal case that they have been denied the benefits they would get if they were considered employees.

Occasional mistakes may happen with the payroll, temporarily affecting one or all employees. So long as it’s very occasional, it shouldn’t warrant more than a slight grumble. However, as soon as it starts getting more commonplace, you might have a mutiny on your hands. Make sure that doesn’t happen.

______

Henry Brown is an online marketing executive. When he isn’t talking shop, he’s roaming the streets of London, uncovering the extra-ordinary in the ordinary.

Leave a Reply

The Self-Employment Survival Guide can help you succeed. Learn all about it here.

Self-Employment Survival Guide book cover