Each and every day people receive payment for work that they perform. There is a large variety of ways that people can get paid for work that they completed. If you own your own company you have to make sure that all of your employees get paid. Frequently business owners do their own payroll at some point during their business journey. As business owners complete their payroll there are some common mistakes that they make. Today Mark Dicus & Company is going to go over some of the payroll errors that are made on a regular basis.
Employee Misclassification Penalties
One of the most common payroll mistakes that people make is misclassifying employees. The Fair Labor Standards Act protects employees by mandating that benefits and protections are provided for them. Some of these benefits are overtime pay and minimum wage. Not every employee is covered by these acts. Some employees have different legal rights. Keeping track of all of these classifications can be hard. If you misclassify an employee it can result in an extremely costly payroll error.
Missing a Payroll & Tax Deadline
Next up on our list of frequent payroll mistakes is missing important deadlines. Getting the timing right when it comes to payroll is very important. If you miss a key deadline it can cause all sorts of issues for your company. Your employees will appreciate you keeping track of payroll deadlines so that they can routinely get paid on time. Employees that do not get paid when they are supposed to will not be loyal to you. High employee turnover will cause you all sorts of issues as a business owner. In addition to ensuring that you pay your employees on time, you also need to keep track of payroll tax deadlines. If you miss a tax deadline you will have to pay late fees or penalties. You could even end up in legal trouble. You will want to make sure that your payroll taxes get paid regularly.
Another issue that pops up when it comes to payroll is miscalculating pay. Calculating pay is an intricate process with lots of moving parts. You may need to pay overtime, bonuses, commissions, deductions, and paid time off with your payroll. If you miscalculate how much your employees should be getting paid there are numerous issues that could arise. Making an overpayment or underpayment on your payroll is extremely stressful. Many business owners are so busy running their business that their payroll is simply not their first priority. This frequently results in poor record keeping and data entry. The Fair Labor Standards Act requires you to keep three years’ worth of pay records, including hours worked, payment rates, and the date of every payroll. If you do not have these records there could be severe consequences.
Payroll Processing, Filing & More in Everett, Bellevue, Kirkland, Renton, Kent, Tacoma & Seattle, Washington
If all of these common mistakes have your head spinning you may want to consider hiring Mark Dicus & Company to take care of your payroll. When you hire us to take care of this important part of your business you will have the assurance that everything is completed the way that it is supposed to be done. We would be happy to go over our payroll services with you. Contact us today!