Invoices and paychecks stuck in limbo is a nightmare for both parties. The payroll process isn’t complicated, but it seems to create many complications.
Failing to pay employees or get paid like one due to accounting errors, will disrupt work and morale. One may relinquish this critical operation, but…
Never Skimp on Payroll Processing: Here’s Why
The Fair Labor Standards Act (FLSA) sets minimum wage and protects workers from abuse.
This includes withholding due payments.
Businesses improperly handling the payroll process can see themselves in court. Or, dealt fines on a Federal and state-level. Also, some states may block the company from operations if it’s frequently delinquent.
Suddenly, the cheapest option doesn’t look too hot. Especially if it makes the payroll process difficult and disruptive.
Cutting Checks: 6 Ways to do the Payroll Process
A thing to note is the importance of a paper trail. Your likelihood of an IRS audit is low, but it’s not worth risking the business because of lost paperwork.
What are easy ways you can handle payroll?
#1. Direct Deposit with Payroll Software
You can set up direct deposit using payroll software. This software automatically handles withholdings and process deposits to employee’s bank accounts.
Popular payroll software brands include:
High-end payroll software comes bundled with extra features for the Human Resources department. Or, physical hardware for time management.
#2. Cut a Personal Check
Paying employees with a personal check isn’t ideal but possible. This can cover payroll when you’re in a pinch. Just remember to account for the appropriate payroll tax and withholdings.
Additionally, you could use a pay check stubs maker. This tool creates a pay stub detailing withholdings for both party’s bookkeeping. The stub is then paired with the personal check.
#3. Outsource the Payroll
Businesses can choose to outsource to qualified third-party providers. These individuals or teams use online payroll services. Then, checks, deposits, or pay cards are distributed to employee’s address.
Popular payroll services include:
The payroll service, for a fee, creates peace-of-mind and lowers the time commitment & hassle of doing it in-house.
Several peer-to-peer payment processors are available:
These P2P services are ideal for businesses using contractors. Or, freelance professionals such as hiring bloggers or day laborers. The processor creates a digital paper trail and places the tax withholding on them.
#5. Payroll Cards
Businesses may pay employees by depositing wages to payroll cards. This eliminates costs from cutting and cashing checks for both parties.
Services providing cards include:
The cards have gained popularity for those unable to set up direct deposit.
#6. Crypto Payroll
Blockchain adoption has delivered easy-to-use wallets for sending & receiving cryptocurrency. New services like Bitwage and Etch lets businesses pay employees using digital currency.
The crypto payroll work like P2P services. Crypto exchanges reduce transaction fees and create a public ledger for accountability. However, volatility of the crypto markets hasn’t made this form of payroll mainstream (yet).
Join the conversation and help others understand payroll. Leave a comment with your suggestions in the comment area below.