As a payroll or HR manager, you’re responsible for ensuring every employee receives correct and timely earnings. Even a single error can put your business’s reputation and workers’ trust at risk. Therefore, payroll processing is an important part of your HR department and requires a lot of attention.
A significant percentage of workers look for other jobs if their employers fail to pay them correctly, even once. If you want to keep your employees happy and enjoy excellent services from them, you should look for Canada payroll services.
These services ensure the entire payroll process is error-free, meaning your employees will get paid correctly and on time. Go through the following sections to identify the key things HR and payroll managers need to do to ensure a smooth payroll process.
What’s Payroll Processing?
Payroll processing involves all the stages of paying employees. It has multiple stages to ensure employee pay is computed, traced, and given out properly and that accurate amounts for company benefits, taxes and other deductions are subtracted to obtain net pay.
Company payroll professionals are responsible for accurate processing as they deeply understand the steps and stages involved. Keep reading to familiarise yourself with these steps and all other things that HR and payroll managers need to do.
Things HR and Payroll Managers Need to Do to Ensure Accurate and Timely Earnings
Processing payroll isn’t only about compensating your workers. It’s also part of operating your company according to the law. You need to keep all legal employment and labour laws in mind when establishing and processing payroll.
Always Start with Error-Free Data
Minor and common mistakes like misreading data, typos and employee misclassification occur during onboarding. Such mistakes can result in salary errors or issues associated with employee benefits and taxes. Educate your HR team to ensure every data it captures is correct.
If your HR team is overwhelmed, you can outsource some tasks to third-party companies to help. Also, you can always request your employees to verify their information and ensure their tax codes are accurate before triggering a payroll.
Confirm Timesheet Information
Have an effective system to help you check any inconsistencies with the pay scale, hours worked and employee type. Verifying your timesheet information minimises the overspending risk on your payroll.
Know How Much Each Employee Will Cost
It’s important to know your payroll costs. Knowing the total payroll costs helps identify inconsistencies during each period of pay. When computing the total payroll costs, always consider employee benefits, taxes, gross earnings and insurance deductions for every worker. Also, you need to factor in things like statutory parents’ pay, bonuses, tips, suspensions and pensions.
Create and Disburse Payslips
Each worker must receive a payslip including their net pay, hours worked, deductions and gross pay. Payslips also include the national insurance number, the pay rate, and the tax code. Many companies use payroll software to create payslips and send them instantly to employees electronically.
If you have an in-house team, you can print and distribute them. And if you’re utilising great global talent, distributing them electronically is the best option.
Make Accurate and Timely Payments and File Reports
Every pay period includes making payments and filing reports. If you don’t make accurate and timely payments and fail to file reports on time, you can degrade your business’s reputation and employees’ trust.
Additionally, you risk facing legal charges and paying severe penalties. To avoid all these issues, keep an essential payroll date schedule, including bank holidays that affect closings.
Make any Necessary Corrections and Keep Payroll Records
When processing payroll, it’s vital to check for any errors and correct them. After that, keep the records safely for compliance and tax purposes. Well-kept payment records can play a significant role in employee disputes.
If you have correct and ready records, you can easily defend yourself, especially when an employee decides to dispute a paycheck. Ensure your records have all important details, including the date of payment, the amount received, and either an electronic or handwritten signature of the employee.
Be Mindful of Ongoing Considerations and Processes
Remember that you’ve to file your company’s taxes quarterly and yearly. Consult experts to make sure you know how all types of taxes fit into your operations. You’ll also need to report any new recruits to the concerned authorities to ensure you’re operating under the law.
When you partner with a top-rated payroll solution provider, you’ll offload some of these responsibilities, including filing taxes and being compliant with the laws of other countries if your business operates globally.
Your payroll processing system should accommodate rapid business expansion and allow you to stay ahead of changes. If your team is unable to handle all payroll processing stages and tasks, you should consider outsourcing. Outsourcing will eradicate all issues associated with payroll processing.