From tracking hours and paying wages to reporting taxes, payroll is the one area of HR that you can’t get wrong. Salaried staff, hourly workers, or independent contractors all require different solutions for managing employee compensation.
You can use spreadsheets and databases to deal with W-2s, W-4s, 1099s, and other required paperwork. Manually running payroll is fine for smaller companies with just a few employees. But what if you manage payroll for a large corporation with hundreds or thousands of employees — or even a growing small or medium business?
It may be time to look at finding a payroll solution. Here’s a look at the benefits of payroll software and how it could help you better manage your business.
What is payroll software?
Calculating hours worked, withholding taxes, and performing the calculations needed to run payroll is not a big deal when you only have a handful of employees. But how do you scale this operation as your company grows?
Verifying time, attendance, and rate of pay data is a complicated task when you have a large staff or workers spread out across multiple departments. A payroll software solution can help you automate and manage all these tedious and time-consuming tasks in a single platform.
Each payroll solution has its own unique features, but some of the most important ones include:
- Providing an all in one solution
- Keeping track of hours worked
- Calculating wages due
- Cutting down on manual paperwork
- Withholding taxes
- Preparing tax forms
- PTO management
- Printing checks
- Making direct deposits
Benefits of payroll software for your business
Payroll software can bring a host of benefits to your business. From better record-keeping to tax compliance, here are a few of the biggest advantages.
Makes record-keeping easier
Switching to a cloud-based payroll system reduces the need for storing and accessing paper records. This lets you store most employee files and forms electronically for easy access at any time.
Helps improve employee engagement
1 in 6 workers said they would quit their job after receiving an incorrect paycheck.
QuickBooks polled employees on what they value most at work. Pay, job satisfaction, and benefits were at the top of the list. They also reported some interesting payday facts:
- 1 in 4 workers reported receiving an incorrect paycheck
- 1 in 6 workers said they would quit their job after receiving an incorrect paycheck
Payroll software can help reduce human error; it can also distribute payments automatically. When people receive their paychecks on time and at the correct rate, this helps build trust and keeps them happy.
Saves you time and money
Do you ever wish there were more time available to run your business? According to a recent small business payroll report, 24% of small business owners reported devoting 4 or more hours a week to payroll administration. Automating repetitive tasks reduces the risk of error and improves efficiency.
Less paperwork means less time spent on routine admin tasks and more time for your HR team to focus on more important functions. For instance, you can spend more time interacting with customers or brainstorming new ideas for new lines of business.
Helps you stay on top of tax rules and regulations
You need to stay on top of all local, state, and federal laws to ensure you stay compliant with all payroll rules. According to the same report, only 36% of small business owners said they were familiar with FICA tax contribution requirements. Yet mistakes in this area can cost your business.
Missed or late filings could lead to tax penalties and high fines and harm your brand reputation and public image. Fortunately, most payroll software platforms automatically update when tax laws change so you don’t have to worry about potential compliance issues.
Reduces common payroll mistakes
There’s a greater chance of making common payroll mistakes when you calculate payroll manually. According to the SurePayroll report, 32% of small business owners admitted to making at least one payroll mistake. The most common one reported was an underpayment of wages.
Keeping incomplete records, missing federal tax filing deadlines, and miscalculating overtime pay are just a few costly errors you can avoid with a payroll software solution.
According to the SurePayroll report, 32% of small business owners admitted to making at least one payroll mistake.
Lets employees manage their payroll info
Look for a payroll system that your team can access wherever they are via cellphone, tablet, or desktop computer. This lets employees access and edit their personal information or submit time-off requests without having to go through HR.
Although some employees are going back to the office, many workers will continue to work on a remote or hybrid basis. It’s important to have an employee self-service dashboard that’s accessible to a diverse and dispersed workforce. That way your workers can sign in to the portal wherever they are to view their schedules, payroll, benefits, and accumulated PTO.
Allows you to customize for your business
Payroll software allows you to run customized analytics and detailed reports. Integrated payroll software helps your HR team keep track of all staffing expenses.
This can help you compare employee costs from one period to the next on a weekly, monthly, quarterly, or annual basis. This helps you know if you’re on budget and able to scale your business when you need extra help.
Is payroll software worth it?
When you’ve outgrown your spreadsheets, at some point you’ll want to turn to a payroll software solution. But, how do you determine if your return on investment (ROI) is worth it?
If your HR team is already juggling multiple tasks, at some point they will need help. Don’t wait for paycheck errors missed tax form submissions and record-keeping mistakes. You’ll eventually need to find a reliable and easy-to-use solution to help minimize these mistakes and complete payroll on time.
Zenefits can help streamline your payroll experience. Our fully integrated, all-in-one software includes advanced payroll features to address your unique needs. We can help you sync your payroll system with the rest of HR, including benefits changes, salary updates, time-off requests, and more. Start a free trial today to see how our payroll solution can help you better manage your business.