Payroll is a constantly evolving animal. With every passing year comes a variety of factors that influence how companies process payroll. Sometimes those influences are the result of new technologies, other times they are regulatory. At any rate, it is up to companies to adopt the latest best practices in order to keep up.
There are five best practices we believe are essential for companies to employ throughout the remainder of the year. These are reflected in data from a survey cited by CPA Practice Advisor in a post from late 2018. The survey was conducted among 500 business owners whose companies employ between two and 500 workers.
1. Maximize Payment Options
Some 27% of the respondents indicated a need to offer direct deposit to employees. Given that direct deposit is now the norm, we want to extend this line of thinking even further. Perhaps it's better to not stop at direct deposit. Rather, employers should maximize the number of payment options they offer.
Direct deposit is certainly convenient and easy. But employers should think about payroll cards as well. Even paper checks should still be an option for those employees who don't want to utilize the other two options.
2. Offer Pay Stubs Electronically
Next, 15% of the respondents indicated the need to offer their workers' pay stubs electronically. We couldn't agree more. The entire world basically lives online at this point, so it makes sense to make things more convenient by issuing electronic pay stubs rather than printing paper and distributing them to workers every week. The average worker today has no problem going online to retrieve pay stubs.
3. Make Payroll Mobile Friendly
The next item from the survey involves making payroll mobile friendly. Some 11% of survey respondents indicated a need to give workers access to their payroll information via their smartphones. This involves one of two options. The first is to create a dedicated mobile app for iOS, Android, etc. The other option is to create a website portal that is mobile friendly.
4. Consider Daily Pay Solutions
The concept of being paid daily is catching on among workers. As a result, a small number of providers have begun offering mobile apps that allow just that. Employers partner with these providers to give employees access to a certain percentage of their daily wages as they are earned. For example, a worker might be able to access 50% of his wages for all hours already worked during a given week.
Daily pay hearkens back to the days before paper checks and payroll services. It gives people an opportunity to better manage their finances without having to wait two weeks to get paid.
5. Partner with the Payroll Provider
Survey data reveals that 10% of the respondents indicated a need to outsource their payroll. Obviously, this is something we strongly agree with. But for us, it is more than just outsourcing. We prefer to think of it as partnering with a payroll provider.
When you partner with us, you have a variety of different options. You can turn everything over to us if you like. Otherwise, we can do some of the work while you do the rest. We even have customized payroll solutions for the restaurant and construction industries.
The payroll best practices discussed here are all about making payroll better for both employers and employees. When payroll is viewed as something that every team member participates in to one degree or another, employers can start looking at solutions that make sense for everyone. That is the best way to run your payroll.