5 Signs That Your Business Is In Need Of An Optimized Payroll Process
June 15, 2022
TABLE OF CONTENT
- Overwhelmed With Payroll Functions?
- #1: You've Been Fined For Non-Compliance
- #2: You’ve Miscalculated Pay
- #3: You Missed a Payroll Deadline
- #4: You Can’t Keep Up With Changing Tax and Employment Regulations
- #5: You’ve Missed Opportunities To Grow Your Business
- The Benefits Of Hiring A PEO To Handle Payroll
- SouthEast Personnel Leasing: Helping You Grow Your Business
How To Know When To Acquire Payroll Administration Help For Your Business
As a business owner, you are hard at work growing your business. We know this includes everything from keeping your employees and customers happy to developing new products or services and initiatives.
At the center of all this are your core administrative functions—like your payroll process. That being said, it can still be incredibly challenging to get payroll right. It requires 100 percent accuracy, and there are so many details to juggle, like tracking hours, calculating wages, determining which deductions to take and how much, and understanding local, state, and federal tax laws.
Plus, there’s the added responsibility of record keeping. According to the IRS, you must maintain records of employment taxes for at least four years. And, it’s important to note that things can get even more complex at tax time when you also need to distribute W-2s.
At the end of the day, payroll administration and the process needed to handle it all are burdens that take time away from your most crucial role—expanding your business.
Overwhelmed With Payroll Functions?
Here are several clear indicators that it might be time to change your payroll process.
#1: You’ve Been Fined For Non-Compliance
The IRS collected more than $6 billion in penalties in the 2020 fiscal year for employment tax problems such as inaccuracies, late filings, or failure to pay.
As a small or medium-sized business, a noncompliance fine from the IRS can be devastating and is a direct reflection on the potential gaps in your current payroll process. It’s heartbreaking to see, but this is common in many industries we serve, like construction and security companies.
Unlike standard payroll service providers, PEOs become the employers of record and are responsible for quarterly payroll tax filings, withholdings, and W2s. When you hire a PEO, you avoid penalties for payroll compliance violations, tax nightmares, incorrect filings, missed deadlines, and can be confident that you won’t wind up getting hit with a fine because your payroll process is in alignment and being executed by a team of payroll professionals.
#2: You’ve Miscalculated Pay
Because calculating pay has so many moving parts – such as paid time off, vacation time, overtime, and commissions – it can quickly become confusing or frustrating. But if you make a mistake, such as an underpayment, there is so much at stake. You can lose credibility with your employees and detract from their overall experience, hurting long-term retention. In addition, once you’ve made a mistake, it takes time and effort to complete a payroll correction.
In our experience, PEOs offer tremendous value here as they have the skills and knowledge to handle your payroll process from start to finish, so you don’t have to stress about errors or fallout.
#3 You Missed A Payroll Deadline
When it comes to payroll deadlines, you are accountable to your employees and the IRS. Your team expects prompt and reliable income, and for some employees and their families, a late payment can be disastrous.
It’s also worth noting that If you don’t have a process to administer payroll on time, it likely leads to delayed payroll taxes. If that happens, you can expect the IRS to levy a payroll tax late payment penalty—and you’ll incur interest on the delinquent payments. Lastly, some states have pay frequency requirements, and you can expect fines if they aren’t met.
When you partner with a PEO to take over your payroll administration process, you can leave the deadlines to them.
#4 You Can’t Keep Up With Changing Tax And Employment Regulations
Local, state, and federal employment regulations are continually evolving and changing. To keep up with them, you probably have to follow more than one source and even attend or read notes from regulatory forums. As a small or medium-sized business owner, you likely don’t have time or energy to do this.
PEOs have in-house experts who make it their business to monitor changing employment regulations, so you don’t have to. You’ll have the peace of mind that every function of your payroll process is being administered correctly and in alignment with all of the necessary laws.
#5 You’ve Missed Opportunities To Grow Your Business
Your company exists to fuel your mission and serve your customers and clients. Unfortunately, growth increases complexity. Increasing your staff count comes with prioritizing their experience, well-being, and needs. As the leader of your organization, it’s your responsibility to offer the right benefits, coverage, and processes to support the entire team. The catch here is focusing entirely on those efforts can lead to missed revenue-generating opportunities. If you have felt that pain, it’s a clear-cut sign that it’s time to bring in a trusted partner to shepherd and optimize your payroll process.
PEOs aren’t the only option, but if you’re looking for someone who has a vested interest in your success, a professional employer organization is likely a great fit.
The Benefits of Hiring a PEO to Handle Payroll
One way to remove the stressors we have covered so far is to hire a professional employee organization (PEO) to handle your payroll administration process. A PEO is a strategic partner for businesses needing core administrative support for many different services, including payroll.
When payroll runs are incorrect, the repercussions can include unhappy employees, fines and penalties, and retroactive payments or other adjustments to pay. In addition, you might have to go back and research payroll records, which can sap even more of your time.
When you hire a PEO, you get trusted expertise for every aspect of payroll administration. Plus, you can bundle it with key functions like your workers’ compensation coverage.
SouthEast Personnel Leasing: Helping You Grow Your Business
Running a business is a gratifying, but time-consuming, endeavor. We know what it takes to create, run, and scale a business. We’ve done it ourselves and come alongside many businesses to help them do the same. Our team here at SouthEast Personnel Leasing specializes in taking the stress out of your payroll process so you can focus on the big picture.
We’ve even had clients return after trying other standard payroll service providers and platforms once they realize the value of our model.
Our knowledgeable team can process your payroll while keeping you compliant and providing you with the workers’ compensation coverage you need for a cost-effective solution for your small to medium-sized business. Ready to see how we can help you? Contact us to request a quote.
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