Payroll Mistakes for an employee might be a good news. Almost as hitting a lottery to see some extra buck in their pay slips and at the same time it might not be such great news for the employer. If you make a payroll mistakes that benefits an employee, you probably will get that money back if you figure out the reason behind it. But if your employee decides it to be difficult, it could take a while and require a lot of effort and time on your part.
Some example situations that can lead to payroll mistakes benefiting employees:
- Hourly workers whose schedule fluctuates from one week to the next
- Getting caught in a time crunch and rushing through payroll, leading to accidental overpayment
- Software glitches that can cause overly generous pay checks, particularly when you upgrade current payroll system or switch to a new one
- Changing pay schedules
- Inaccuracies in payrolls
You’d like to think that your employees would be forthcoming and let you know when you’ve made an error, don’t count on it. The best way to fix the problem is to head it off entirely. Periodically audit and cross-check your payroll records, to make sure you aren’t overpaying.
To avoid such payroll mistakes you need to have your payroll system in place this allows you to take care of every last detail, regardless of how big or small, with less concern about making a payroll mistake.
Payroll can be very simple for some companies. If you’ve only got salaried employees there is little variation from month to month. The temptation is to set up some direct debit payments then once every few months get the payroll records up to date. Invariably something goes wrong with this approach. Leave taken from months ago is missed. A change in tax rates isn’t noticed and so net pays have been wrong for several months. Suddenly you’re wasting an hour or three unpicking the mistakes. Using good payroll software, these simpler pays should take no more than a couple of minutes to run each month, make sure you set aside the time for this minor but important task.
A good payroll system will take a lot of pain out of the process but you still need an understanding of the principles underlying the calculations done by your payroll system. Most payroll software providers will provide resources to answer most common payroll questions. And thereby safeguarding you from making payroll mistakes.
It’s a legislative requirement that you keep a detailed employment record. Every time an employee takes leave, ensure that the days taken are tracked. For employees with irregular hours, ensure you capture the times worked on a day by day basis. If you make changes to an employee’s set up, ensure you also add a note to document why the change was made. This comprehensive record is a lifeline if you find yourself in a dispute situation.
Adopt a systematic payroll system to avoid all such mistakes. At DKM Online our payroll management system will allow you to save your valuable time, resources and cost. We will not require you to purchase a special time system or download software to enter your own payroll time.
We will perform all the payroll tasks for you and enable that your team operates more efficiently and effectively. And our best-practice tools and processes will help to ensure accuracy and timeliness. Additionally, DKM provides complete support for all of the processes we partner with you on.
Payroll Accounting
- Recording and Reconciling Payroll Transactions
- Professional payroll processing- paychecks and pay stubs
- Payments to independent contractors
- Management of leave, vacation and sick pay tracking
Payroll statutory compliance
- Generating statutory reports which include preparation and filing of PF forms, challans and inspections
- Remittance of taxes as per the respective local statutory norms
- Guaranteed, accurate federal, state and local tax calculations
- Preparing and submitting ESI wages and assisting on audits and inspections
Easy CTC calculations
- All major pay types: salary, hourly wages, multiple pay rates, bonuses, cash tips, paycheck tips, expense reimbursements, allowances, holidays, etc.
- Voluntary deductions, including taxable and pre-tax premiums for medical, dental and retirement plans, flexible spending accounts, dependent and medical care, cash advances, loan repayments and more Health, Medical, Life, cafeteria plans, etc.
To conclude with, it’s important to know how you manage everything as an employer in the case of any major or minor payroll errors. Make sure that if you have made a payroll mistake, you catch it early and act quickly to avoid further complications for yourself and the team member.
If you require any payroll consulting to overcome payroll mistakes, drop us a line or send us an email at helpdesk@edkmonline.com