Five Fantastic Ways for Employers to Process Payroll More Efficiently

August 22, 2018

Achieving payroll efficiency feels like an unattainable burden, so we've laid out five steps to get there so you can start processing payroll like a champ!

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Is Payroll Efficiency Your Forte?

Many of us operate our lives wearing multiple hats. We identify ourselves as spouses, parents, and business owners, and then we would also say we are the sales manager, the accountant, and the janitor. We thoughtlessly perform countless tasks each day, which is a great attribute to have—to be willing to do whatever it takes to run a company.

Some things we do just because we are physically able to (placing the box of samples on the tallest shelf in the sample closet). Some things we do because we’re the last person left in the building (plunging the clogged toilet). And some we do because… well, we do not know why we do them, but we just do.

payroll efficiency blog image 3At this juncture, it would be a good idea to ask ourselves, “Is this something I am doing because I am the best person for the job?” Or, “Is this something I am doing because there is no one else here who can do it?”  Or, “Is this something I am doing because I am afraid to relinquish control?”

It’s quite likely that most of us didn’t reach the higher ranks of a company, or become an owner due to our ability to unclog a toilet. Yet, unclogging toilets is something we know we will willingly do, should the occasion arise.

Paying employees and/or contract workers is one of the biggest tasks that a company performs. Employees are the most important cog in the wheel—without them, the company would have an undeliverable service or product. Not only is payroll essential to a business, but it is also taxing (pun totally intended).

Regardless of whether it’s you or someone else in the position of being in charge of processing payroll, there are a few things you can do to ensure efficient processing each time.

Below are five easy things to remember, and once you’ve established a rhythm, you’ll be able to quickly check payroll efficiency off your long to-do list.

1 – Pinpoint the Point Person

The first thing you will want to do ensure efficiency while processing payroll is to make sure you have identified the person who is best suited to process payroll within your company. Keep in mind that it needs to be someone who is frequently in the office (or available virtually, if a remote employee), frequently on time (or responds promptly, if a remote employee), and who understands the components of payroll.

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Jaime Zuder, Managing Partner of Journey AZ

It is always an interesting thing to hear when the person processing payroll is the highest-ranking person in the company. Believe it or not, the most senior person in a company is not necessarily the person who knows the most about processing payroll.

Yes, the owner or CEO probably knows a lot about many things, but processing payroll is likely not the essence of the company—the owner or CEO likely knows most of the ins and outs of providing a product or service.

Related:  On the Hunt: Identifying Payroll Resources

When in doubt, ask yourself these questions:  How much do I make per hour? Am I the best person for this task? Is processing payroll worth the hourly rate I am worth? Remember to always strive to wear the hats that make your business most profitable.

Also, make sure to select a payroll company that is dependable and available to answer any questions. “At Journey Payroll, we strive to automate the back-office tasks as much as possible for our clients, so that they can focus on what they do best, which is running THEIR business”, says Jaime Zuder, Managing Partner of Journey AZ.

2 – Stay Positive

The second thing you will want to do to ensure payroll efficiency is to stay positive. Attitude is key! If you’re the person in charge of processing payroll, take it on as if it is your only task.

Accurately processing payroll is actually that important. Research indicates that we perform tasks better when they are tasks we enjoy. Payroll can seem redundant at times (for example, if all employees in the office are salaried and have little variation in the payroll entries), but staying on our toes and anticipating upcoming changes (vacation, sick time, bonuses) will keep us from going on autopilot, which ultimately can lead to errors. Payroll errors take more time and effort to correct than it would to simply do it correctly from the beginning.

3 – Know It All

Speaking of errors, the third thing you will want to do to ensure efficiency while processing payroll is to become a know-it-all. No, it’s not recommended to be that person everyone runs away from when they see her coming (you know the one:  she makes a bee-line right for you each time you try to load the copy machine). Keep it in your own head and become a payroll know-it-all.

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Payroll can be tedious and tricky. If you are going to perform the task, learn to be good at it.  Know the difference between sick time, vacation, and PTO.  Research the tax laws in your state and be prepared to answer employee questions after employees receive their paychecks. This question is so common, we wrote a previous blog about it! Don’t assume most people don’t look at their pay stubs—assume they all look at them!

Pay attention to details from the start. Set good habits so you don’t have to relearn how to process payroll correctly later on. Processing payroll accurately from the beginning will put you on the road to payroll efficiency.

4 – Be Consistent

payroll efficiency blog image 2The fourth thing you will want to do to ensure efficiency while processing payroll is to be consistent. Pick a time and day each pay period to perform the task. Make a list of the steps you need to follow for payroll efficiency. As Fast Company explains in their article, Why Our Brains Love Lists and How to Make Better Ones, our brains love lists and a list will make large tasks easier to tackle. So give your brain a hand, make a list! Block out your calendar, close your office door, and pull the blinds.

Related:  Mileage Reimbursement: Rates, Rules, and Tips

As far as anyone else is concerned, it’s the most important part of your day, and must remain uninterrupted. If you have assigned payroll processing to another employee, make sure neither you nor anyone else distracts that employee.

Nothing can derail efforts faster, and cause more errors, than frequent interruptions.

5 – Be BFFs with Your Payroll Provider

Finally, the fifth thing to do to ensure payroll efficiency is becoming best friends with your payroll provider. A payroll company like Journey Employer Solutions will have an account person assigned to each client. Have that person’s number on speed dial!

If you process payroll via a portal and it goes haywire, you want to have someone to call for troubleshooting. Sometimes your payroll contact will simply have you read the payroll and they will process on their end.

Employees of payroll companies often know more about payroll and taxes than even accountants do! In fact, most accountants will actually refer their own clients to have their payroll processed at their favorite payroll company.

Efficiency Street

It can be easy to try to be Jack-of-all-traits. Many people have a personal motto of, “I got this.” However, it’s important to recognize whether you’re the person best equipped for a task, and when to raise the white flag.

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Regardless of who’s performing the task, keep in mind that the fastest route between two points is a straight line. If that straight line had a street name, it would be “Efficiency.” As long as you stay on Payroll Efficiency Street, you have won half the battle that is processing payroll.

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