Reduce Payroll Costs with the Right Software

Payroll is a major business function that involves keeping track of hours, determining and distributing pay, and Federal, State and Local tax withholdings. Because payroll requires so much time and attention, making an effort to reduce payroll costs is necessary for companies who want to achieve business growth.

Companies have been able to use the right software to reduce their payroll costs by lowering their processing time, integrating payroll with job costing, improving efficiencies in billing, avoiding errors and remaining in compliance with regulations. 

With an integrated workforce management solution, it is possible to use shared data to ensure payroll is always prepared and processed from your timekeeping records and employee time off data. An integrated solution can also help reduce payroll costs by solving scheduling issues while providing time and attendance support. 

Avoiding common payroll processing errors

Reducing calculation errors can save valuable time spent on administrative tasks, especially if staffers are manually entering all of the data. Frequent payroll mistakes, such as over or underpayment-related errors, will cause larger issues. However, these problems are avoidable with the right software solution, which can minimize manual entries and automate certain tasks.

Inaccurate deductions or withholdings are another common payroll mistake that an integrated software solution can solve. Although employees typically volunteer to make the elections, these mistakes can also lead to wasted time and energy spent correcting tax forms, providing employee refunds or increasing withholdings from future paychecks.   

Misclassifications happen when employees are classified as contractors instead of employees or the inverse. These can cause serious tax issues for companies and employees. However, it is possible to create classification processes in payroll procedures with software tools.

In-house payroll processing, integrations, and outsourcing 

Processing payroll in-house

Using an integrated workforce management system to process payroll in-house can ensure that shared information is accurately prepared and processed from your timekeeping and employee time-off data. Processing payroll in-house also offers a better understanding of true labor and tax costs by job. That kind of information helps reduce payroll costs since profitability is determined by each contract. 

Software Integration

Preparing payroll in-house and exporting payroll files to compliance software offers options for wage payments, tax service and/or wage garnishments, among other solutions. A business can select one, two or all of these services. 

When it comes to using compliance software, the company must still ensure their taxes are remitted accordingly. This option offers job costing visibility, which aids in reducing payroll costs. That is because payroll batches can be created within an integrated workforce management solution before being transmitted using the tax filing interface, and then they are posted to the general ledger.

Outsourcing to a third-party

Companies can outsource payroll to a third-party provider with an integrated workforce management solution. The process can start by exporting recorded timekeeping files from the integrated software to a third-party vendor. Businesses that want to take advantage of an integrated system but lack the resources to dedicate an entire staff to payroll preparation and processing can benefit from this option, as it can also aid in reducing payroll costs.

Reduce time theft and improve turnover

It is possible to reduce payroll costs by using integrated software to minimize the amount of time theft that occurs, especially on-site. Companies that use an integrated solution can process payments knowing that time-tracking activities were verified by the software.

An integrated solution can provide other features that reduce pay costs. For example, earned wage access is an employee benefit that lets employees receive their pay as they need it, rather than waiting for a regular pay period. It has zero impact on the company payroll. Additionally, it has been shown to positively impact employee turnover.

Employees appreciate being able to access their wages at their discretion. This benefit can increase retention and inadvertently reduce payroll costs, since administrative staff can save valuable time and energy finding new employees.

Additional ways to reduce payroll costs

With the right software, it is possible to reduce payroll costs. That starts by ensuring that employees are sharing accurate data. Additionally, preparing and processing payroll with greater ease and efficiency aids in reducing payroll costs. Minimizing scheduling issues while providing time and attendance support can also help with reducing payroll expenses and costs. 

For more information on the benefits a successful software implementation can have on your business, especially if you want to make efforts to learn more about payroll processing integrations, schedule a demo.