6 Tips on Managing Payroll More Effectively for Small Businesses


Payroll is an important department in any business. Your employees come to work to earn money, and if you’re not paying them what they’re owed, then they are likely to become dissatisfied in their jobs. 

Making sure you get payroll right takes a lot of effort. You’ll need to put tools in place to avoid missed payments and to keep the department running effectively. 

But what can you do to ensure your payroll department is as efficient as possible? 

Here are six tips on managing payroll more effectively in your small business. 

- Advertisement -

1. Create a Payroll Calendar 

A payroll calendar will help you align your payroll dates. Having set out pay dates and timecard due dates will make it a lot easier for your employees to keep up with where they are in terms of their pay. 

A regular payment schedule that is simple and transparent will allow employees to budget and manage their own lives much easier. 

2. Automate Your Payroll System

Processing payroll is a time-consuming process. Not only that but when you’re putting your payroll through manually, it leaves you open to human error.

An automated system may allow you to create check stubs by yourself without having to write them out by hand. 

Payroll automation will make everything quicker and easier. You may even be able to manage the process using fewer employees. 

3. Don’t Borrow From Your Payroll Tax Funds

It may seem obvious, but you should never borrow from your payroll tax funds to cover any financial shortfalls elsewhere in the business. If you don’t have the money to pay payroll taxes when they are due, you could find yourself in trouble with the IRS

You should look at keeping your payroll taxes in a separate bank account until they are due. 

Instead of borrowing from your taxes, you could start a contingency fund that you can use specifically for emergency spending. 

4. Share Payroll Duties Across Your Entire HR Department

To make payroll into a more manageable task, you may want to share the burden by assigning different tasks across your entire HR department. Since there are several different functions involved in the payroll department, it doesn’t need to be done by one person

5. Use Employee Scheduling Software

Handwritten or paper employee schedules take a long time to process. They are very susceptible to errors, as such, they can be very problematic. Using scheduling software will allow you to export all of your schedule data into your payroll software.  

6. Get Feedback From Your Employees

If you want to know what is working and what isn’t, ask the people who are affected by your payroll system the most; your employees. You may be surprised to find that your employees may have some fantastic suggestions for ways to improve payroll. 

Once you have feedback from your employees, you should take this on board and consider making suggested changes. 

Managing Payroll in Your Business Made Easy

Managing payroll is important in any business, but through automation, it is possible to create a more efficient system. Utilize the skills and experience of your existing HR team and spread the workload. 

For more great articles, check out the rest of the site. 

Previous articleHow to Make Your Resume Stand Out: 4 Hacks You Need to Know
Next articleHow to Spot a Fake Pay Stub