Payroll compliance is an essential function of human resources and payroll experts. You must ensure that you can protect your payroll team and the rest of your organization from any fines incurred due to non-compliance. You must also make sure that you’re keeping your employees pleased by paying them on time and making sure they’re getting the proper wage during the process.
To help you stay compliant with payroll laws and regulations, follow these ten tips:
1. Make Use of Payroll Software
Another way to safeguard your business against fines and penalties is to use payroll software. Using the Zenefits payroll system will help automate the process and ensure that everything is correct and complies with all relevant laws. Also, make sure that your payroll software is up-to-date. This includes the software you use to process your payroll and any software to track employee time and attendance. Updating your software can help ensure that you’re using the latest algorithms and procedures for calculating wages, tracking hours, and preparing tax filings. It can also help minimize the chances of mistakes or discrepancies.
2. Familiarize Yourself With the Relevant Laws and Regulations
You’ll need to keep up with payroll legislation, as things can change regularly. But how do you keep up with it? The best way is to familiarize yourself with the relevant laws and regulations. This includes both federal and state laws and any city-level ordinances that may apply. You can find many of these resources on government websites or by contacting your state’s department of labor.
Attending payroll seminars, watching webinars, and attending industry conferences might also help you stay up to speed on the newest trends. You’ll discover that she provides advice on a wide range of issues, including legislative changes and new payroll procedures. By reading the news, subscribing to relevant email lists, and following payroll experts on social media, you and your team should make it a point to stay up to date on modifications.
3. Use a Certified Payroll Processor
Consider using a certified payroll processor if you’re not comfortable handling your company’s payroll or don’t have the time to do it yourself. These professionals are well-versed in all aspects of payroll compliance and can help ensure that everything is done correctly and on time. This is a service that will process your payroll and ensure compliance with all relevant laws. They will also help you prepare and file all appropriate tax documents, saving you time and stress. Remember, though, that using a certified payroll processor may come at a cost.
4. Train Your Employees On Time And Attendance Procedures
One way to help ensure compliance with relevant laws is to train your employees on proper time and attendance procedures. This includes tracking hours, clocking in and out, and taking breaks. You can provide this training through online tutorials, interactive learning modules, or even face-to-face meetings. Your employees should also be aware of your company’s policies on overtime and working off the clock. By implementing and following a consistent attendance policy, you can help minimize the chances of mistakes or non-compliance.
5. Make Sure Your Employees Understand Their Wages
Another way to help ensure compliance is to make sure your employees understand their wages. This includes understanding the types of wages they’re being paid (hourly, salary, commission, etc.), how their wages are calculated, and when they will be paid. There is a difference between employees understanding their wages and knowing all of the relevant payroll laws. However, the more your employees know about their salaries, the less likely they will make mistakes. You can provide this information through written policies, online resources, or handbooks.
6. Calculate Overtime And Other Wages Correctly
One of the most common causes of payroll non-compliance is an incorrect calculation of overtime and other wages. This can include calculation errors, failure to pay overtime, and inaccurate payment of bonuses and commissions. To help avoid these mistakes, be sure to use payroll software specifically designed to calculate overtime and other wages. And make sure that your employees are familiar with the proper procedures for calculating their wages.
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7. Track Employee Hours Properly
It’s also important to track employee hours properly. This includes tracking hours worked, overtime, and hours taken for breaks and lunch. Many laws and regulations specify specific requirements for hours worked and time off. To avoid fines and penalties, make sure you’re tracking hours in compliance with all applicable laws. Using spreadsheets or other tracking tools, you can use time tracking software to help automate this process or track employee hours manually.
8. Prepare Accurate Tax Filings
Another common cause of payroll non-compliance is inaccurate preparation of tax filings. Please make sure you have procedures in place for accurately filing all required taxes and double-check your calculations before submitting them to the government. Taxes can be complicated, so it’s a good idea to consult with an accountant or tax specialist to make sure you’re doing everything correctly.
9. Switch to a Self-Service Model
One way to help minimize the chances of payroll non-compliance is to switch to a self-service model. Your payroll team should not have to chase and add every piece of data about the working lives of your employees into systems. Tracking timesheets and expense forms take time to do more valuable tasks. Use a system that lets your employees enter their time and expenses directly into the system. It makes it easier to review and approve their requests as they come in, and it also makes it easier to spot any discrepancies.
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10. Use a Professional Bookkeeper
Consider using a professional bookkeeper if you’re not comfortable handling your company’s books or don’t have the time to do it yourself. These professionals can help you stay compliant with all relevant laws and regulations, and they can also help ensure that your financial records are accurate and up-to-date. In addition, they can provide valuable insights into your company’s financial health and performance.
Payroll compliance can be a tricky business, but you can make it much more manageable with the right tools and procedures in place. As you have seen, there are several things you need to do to stay compliant, from tracking employee hours to preparing accurate tax filings. And don’t forget that you can also reduce your chances of non-compliance by switching to a self-service model and using a professional bookkeeper.