Understanding Payroll Automation
Payroll automation has become an invaluable tool in modern business operations. The automation of routine processes reduces stress at each pay period, saving time by simplifying critical steps. Here we look at the role payroll automation plays in small to medium businesses and why it is worth consideration for HR and finance executives.
What is Payroll Automation?
Payroll automation manages common tasks, including filing taxes, making direct deposits, and calculating withholdings. The software is updated with current tax laws and regulations, ensuring your company remains compliant. Payroll automation reduces errors that can lead to frustration with employees who end up owing taxes when remitting their tax filing.
It also reduces wasted time and money related to correcting payroll withholding and tax filing errors and the cost of penalties and fines. Payroll software streamlines error-prone, time-consuming tasks that put your business at risk for compliance issues. Through automation, your team can focus on business-critical strategies to improve both human capital and financial performance.
When Do You Need Payroll Automation?
Although payroll automation benefits all businesses, there are signs indicating it’s time to deploy effective payroll software, including:
- Your business is on a growth path with an expanding labor force
- You are operating in different states, which is complicating withholding compliance
- You have introduced new deductions related to a benefits plan, or that includes things such as retirement plan contributions, etc.
- Your workforce includes more complex payroll needs such as contract workers, overtime, expense accounts for things like meals or car allowances, etc.
- You are paying fines and penalties related to compliance due to a lack of understanding of tax rules
- You are having trouble keeping up with regulatory changes
- Your team is spread thin, which causes stress at each pay period
Benefits of Payroll Automation
Deploying payroll software to leverage automation offers several benefits, including:
Time and Cost Savings
Automation eliminates error-prone repetitive manual tasks and the need for corrections. It also eliminates the risk of double entry and redundancy among your HR and accounting team. Everything is streamlined into your system following a simplified process that keeps pay periods organized.
Accuracy and Compliance
The importance of compliance with tax laws can’t be underestimated. Choosing an IRS approved payroll software that meets all IRS Business Acceptance Testing requirements ensures every 941 e-filing is error free. You will also remain compliant with state labor laws regarding overtime and proper tax processing for each worker classification.
Enhanced Security
Payroll manages some of your most sensitive employee data. Outdated manual records and processes make sensitive information vulnerable to breaches. Payroll software is protected with graded security levels assigned to each person who has access.
Improved Efficiency
With the elimination of time-consuming tasks, the correction of errors related to compliance and human inaccuracies, and manual data entry you improve efficiency. As a result, HR/payroll teams focus on strategic initiatives. Integration with workflow management platforms provides access to self-serve benefits, training and onboarding that also reduces HR workload, while allowing for automated expense processing and employee bonus administration.
Employee Satisfaction
Employee satisfaction is improved in two meaningful ways:
- Payroll/HR staff: With the elimination of repetitive manual tasks, your HR and accounting team will be able to use their true skills to meet their career goals, improving retention.
- General staff: Accuracy of pay and timely payroll deposits demonstrate your commitment and appreciation for your team.
Scalability
Payroll automation software remains scalable, accommodating business growth with minimum effort. Integration with onboarding and performance software automatically adds new hires to your payroll system and implements raises in a timely fashion.
What to Look for in Payroll Automation Software
Once you decide you need payroll automation software, you want a solution offering the following:
Customer Support and Training
Although you might find all the features you want in your payroll software, deploying it without reliable customer support and comprehensive training resources will interfere with success. Customer support teams should be available not only when finding suitable solutions but also through implementation and as your needs change and expand.
Reporting
Comprehensive analytics of your payroll costs and employee time utilization ratios provide valuable insights to inform your decisions. This allows you to constantly review and improve your workforce management strategy and budgeting.
Tax Filing
Poor compliance leads to unnecessary fines and penalties that add to your company’s tax burden. Payroll tax software should be IRS-approved to ensure you remain compliant and accurate. Updates on current tax rules each year are also critical. The support of tax specialists as backup provides the guidance you need for withholding and 941 e-filing requirements. Finally, payment options such as a direct deposit setup integrated with your accounting software ensure you cover tax payments on time to avoid fines and penalties.
Integrations
Integration with your existing time tracking, HR, accounting, and payroll systems is crucial. Software that allows you to migrate current systems with their platform reduces training needs and allows people to continue using familiar, effective tools.
Mobile Access
Today’s workforces tend to be hybrids with remote workers, flexible schedules, and in-office teams. Therefore, you need secure access to real-time payroll data 24/7 using customizable cloud-based software.
Features and Functionality
Features such as payroll processing, tax management, and reporting capabilities in hand with customized solutions suited to the specific needs of your industry or business operations ensure you have everything you need to streamline your payroll function. An intuitive interface and user-friendly design such as at-a-glance dashboards and customized reporting are also important.
Pricing and Scalability
You need a solution that suits your budget without sacrificing the features most important to your business. Customization often works best as you can invest in the critical functions you need, avoid paying for functions you don’t need, and remain scalable.
Payroll Automation with Paypro
It’s never too early to explore payroll automation options. First, you can find the right software to facilitate long-term success. You can then integrate the functions you need with current systems to streamline your payroll process, save time and money, improve compliance, and increase employee satisfaction.
Paypro offers a top-rated, customizable payroll software solution to help you find time and cost savings opportunities, reduce errors, and eliminate manual tasks. Learn more about our payroll automation solutions or to set up a free consultation today.
About the Author
Kayla is the Marketing Manager at Paypro Corporation overseeing all inbound and outbound marketing and sales efforts. She has 7+ years of experience working within the B2B and SaaS based solutions space and thrives on creating messaging and campaigns that introduce products and services to those who need them most.