March 13, 2018
3 Ways to Save $1,000’s on Employee Labor
HOW MANY MINUTES PER DAY ARE YOU OVERPAYING EMPLOYEES?
Employee wages and benefit expense is the highest cost for most businesses. This cost continues to rise as new laws create increased mandatory time off, paid family leave and higher minimum wage.
Now more than ever, employers seek for a balance between remaining profitable, and in business, and providing the best benefits and wages to valuable employees.
One of the best ways to do this is to eliminate wages for labor that is charged but not worked.
When employees estimate punch times, they usually estimate wrong. Employees often don’t remember or don’t account for arriving late or leaving early. They often don’t realize how the extra few minutes at lunch turned into an extra 10. All of this costs you money in labor that was never realized.
If you’re not using a time clock, you are paying too much for employee labor!
THE COST OF MANUAL TIMEKEEPING
Payroll Errors Cost Employers Money
The American Payroll Association estimates that the rate of human error in time card preparation is between 1% and 8%.
These errors can happen with typos, innocent slips or memory lapses regarding the exact times employees started and ended work.
In addition to the type of errors that cost employers additional money in wages, there is an administrative cost to errors.
These costs are shown in the time and money it costs to re-issue paychecks, re-processing fees, administrative time and more.
The Cost: A conservative 2% human error rate on a $12,000 payroll would equal $240 in erroneous wages paid per pay period.
Moreover, the cost to re-issue correct payroll amounts (if the error is detected and reported) further increases your cost of human error.
Employee Punch Cards Cost in Administrative Wages
The average payroll clerk spends 7 minutes per time card each pay period:
- Preparing and handling time cards
- Verifying time card totals
- Computing time card totals
- Computing shift and dept. totals
- Reconstructing lost/damaged cards
The Cost: Preparing 100 time cards takes an estimated 11.67 hours to complete. At an average clerical wage of $15.00 per hour, time card preparation would cost $175.05 per pay period.
This time could be eliminated and could free up your Human Resources and Payroll staff for other more effective processes.
Accidental Employee Time Theft
Employees knowingly and unknowingly often steal time from employers.
This can come in the form of untracked breaks, extended lunches and over-approximated punch times.
Did you know that just 15 employees receiving pay for merely 4 minutes of “wasted” time per day will total 1380 minutes of additional pay per month? That’s an additional 23 hours!
The American Payroll Association estimates that employees steal an average of 4.5 hours each week. That’s according to surveys of employees.
The actual time could be much more than employees will even admit on a survey.
4.5 hours per week for 15 employees equal 72 hours in a 4 week period.
The Cost: If your average pay rate is $10.00 per hour, then you pay an extra $230.00 each month for labor worked. That’s only for 12 minutes of wasted time per week per employee.
That cost multiplies if you account for an average wage loss of 4 and a half hours a week per employee!
Buddy Punching is Expensive
When late or absent employees try to escape notice by employers, they turn to buddy punching. Buddy punching is when a coworker punches in for an employee who is not present. It is illegal and unethical, but it costs employers millions of dollars in unworked wages.
It also affects 75% of all employers.
Buddy punching decreases return on investment, productivity, and decreases the profits of businesses.
It also reduces the employer’s ability to add more benefits for their employees.
Buddy punching costs employers approximately 7% of their total payroll costs.
SAVE ON EMPLOYEE LABOR WITH AUTOMATED TIMEKEEPING
Recover Overpaid wages
Even through employee labor is among an employer’s greatest expenses, there are ways to reduce expenses. Automated timekeeping helps to reduce costs many ways.
Automated timekeeping can help to reduce overtime costs. Alerts go out to managers when overtime thresholds are encroaching.
Managers can see current times and manage employees who are clocked in on overtime hours. They can also manage those who consistently clock overtime hours.
End Buddy Punching and Time Theft
Through biometric time clocks, employers can end buddy punching. Biometric clocks ensure that employees are physically present when they clock in.
Employers in some states should take extra steps to stay compliant. New York Employers can use hand geometry time clocks, but cannot force employees to use biometric clocks that scan fingerprints.
Illinois employers must notify employees and disclose the use of biometric information before implementing clocks. These employers are still allowed by law to use biometric time clocks after following state guidelines.
SwipeClock biometric time clocks do one of two things to identify the individual.
Fingerprint: The employee places their fingerprint on the clock. It scans the finger and uses a hash to identify specific points on the finger.
The fingerprint is not stored in the clock or software. The clock matches the hash to the employee’s finger to identify them. Fingerprints cannot be recreated from the hash. All biometric information is automatically deleted when the employee is terminated in the timekeeping system.
Hand Geometry: The hand geometry time clocks measure the employee’s fingers length and width. It does not scan the surface area of the hand. As a result hand geometry time clocks are legal for employers to require employees to use in New York.
Eliminate Overhead & Administrative Time
Small business owners often have smaller margins than larger companies. As a result, reducing overhead costs can be vital to growth.
Large employers can save thousands each month by reducing payroll overhead and administration time.
Automation is more effective than outsourcing.
Take the pain out of collecting time and preparing payroll! Turn tasks that take days days into only hours and minutes.
Automated timekeeping allows managers to track hours, manage overtime, track holidays & time off requests. Employees can view accruals balances, employer notifications, and manage personal information through an employee self service portal.
People make mistakes, so tracking this stuff usually results in costly errors and time. Automated timekeeping will simplify the process and change how you do business.
Preparing time card data for payroll takes a few clicks when time keeping is automated.
Whether it’s the convenience of gathering punch data in a fraction of the time or simply minimizing the cost of human error, with automated timekeeping submitting payroll doesn’t get much easier!
Compliance Fines Kill
Employers in New York City who failed to properly comply with the new sick leave law were fined over $800,000 in only 4 months of 2016.
An Oregon restaurant failed to pay $30 for a working interview and ended up paying $30,000 in fines for non-compliance.
Mandatory sick leave laws, local minimum wage ordinances, and secure scheduling laws are only a few of the employee-wage related laws that employers must be aware of and track.
These laws require tracking of employee hours for accrual purposes. They require employee location tracking for minimum wage compliance. They also require planned schedules to be posted and employee input and requests for specific schedules.
Employers who do not automate timekeeping and payroll often find themselves hiring additional positions to manage the overhead and documentation these laws require. Plus, they are more likely to be found non-compliant.
Unfortunately, many employer laws require proof of compliance from the employer or the law assumes employer guilt. SwipeClock’s software tracks, retains, and helps employers to stay compliant.
March 12, 2018
Top 10 Reasons to use a Payroll Partner
Working hiring a Payroll Partner can save you valuable time and money. Below are the top ten reasons to work with a Payroll Partner:
- Save Time and Money – Payroll is an essential part of business, working with a payroll partner will save you time and money as it cuts cost to train employees and develop a payroll department within your company.
- Improved Company Focus – As a business owner or manager with more time and money at your fingertips, your focus can be on what really matters – the success of your business!
- More Internal Resources – With a payroll partner in place, you can free up your employees in-house to do more important tasks directly related to your business.
- Access to Professional Payroll Expertise – Your Payroll partner will be there to assist with payroll matters as quickly and easily as possible.
- Increase Accuracy – Payroll specialists are trained to make sure your information is done and processed accurately and timely for you.
- Access to Several Payroll-related Functions – The right choice in a payroll partner also gives employers access to other payroll-related functions, such as timekeeping solutions, human resources support, mobile pay stub delivery, etc.
- Peace of Mind – Letting someone else handle your payroll can mean less headache and less worry for you. Leave it to your payroll company to deal with any payroll-related issues. You have better things to do!
- Less Liability – The last thing you want to deal with is a penalty from the IRS or state. Partnering with a payroll company means you have less risk of your taxes being paid late, and thus avoiding penalties. If you receive a notice, forward to it us, and we will take care of it.
- Compliance – With the constant changes in governmental rules and regulations, outsourcing your payroll will give you that advantage of staying ahead and keeping your company compliant.
- A Partner – You get a strong partner working for you to make sure your payroll is accurate and your employees get paid in a timely manner making your job easier.
March 7, 2018
7 Ways Employee Self Service Benefits Your Business
One important component of the Workforce Management Suite is the Employee Self Service (ESS) portal. Today’s post looks at the specific benefits of employee self-service workforce management.
1. Empowers Employees
Employees are able to view their schedule, time cards, and accruals without having to go through a supervisor or the HR department. Instead of waiting for their supervisors to circulate shift-change requests on their behalf, staff members simply place requests on the Virtual Trade Board. Managers can conveniently view, monitor and authorize shift request changes online. Managers choose which associates are allowed to manage their own time cards.
2. Prevents Understaffing
Interested employees can request open shifts from the Virtual Trade Board. Managers approve shift changes which triggers automatic notifications to all parties involved.
3. Eliminates Confusion
When time cards, schedules, accruals, and shift changes are centrally managed, managers and associates are all on the same page and can access the information any time. Automatic notifications inform all parties of important scheduling and time card information.
4. Eases Burden on Managers
Supervisors transfer tedious admin tasks to authorized employees and are spared from all the back-and-forth of shift changes and HR info monitoring. Let the associates check their own accruals and total hours worked—they are happy to take you out of the loop.
5. Leverages the Power of Mobility
The Workforce Management Suite mobile app gives employees and supervisors 24/7 anywhere access and convenience.
6. Reduces Admin Time
When the automated system takes over tedious assignments, supervisors can work on other projects. Growing companies won’t need to hire as many HR people as their workforce grows.
7. Accommodates Employees’ Shift Preferences
TimeSimplicity and the Virtual Trade Board make it easy to compose schedules that are best for you and your employees. When a shift comes open unexpectedly, employees who want to pick up extra hours request the shift. This eliminates the need for a manager to try to guess which employee wants the extra shift or beg an unwilling employee. Happy staff members are more engaged, loyal, and productive.
If you are still using manual systems, imagine how Workforce Management Suite could improve your WFM processes and labor force morale.
March 1, 2018
Power Up Your Productivity without A Cup of Coffee!
It’s Monday morning, and you’ve just arrived at the office. Although rested from the weekend, you need a little something to give you a boost for the day. A cup of coffee – that’ll do the trick. Yes, it’s true, a morning cup of coffee will improve alertness and productivity. Whether your an employer or employee, if you want to optimize your productivity, here are some helpful tips.
Remove Distractions: After your coffee has been freshly brewed, practice minimizing distractions and social media/phone notifications. This includes logging out of social media accounts. Keep your personal phone twice as far from you as normally would. Constantly reaching for your phone and clicking on that Facebook tab will lessen significantly and in turn, you find yourself more productive throughout the day.
Set Personal Deadlines: Mentally keep track of how much time you’d like to spend on a task, as well as the actual time spent on them. This will eliminate spending too much time on a task that should require less. Obstacles happen and delay completion, but personal deadlines and goals will help guide your work progress, as well as prompt a task review if necessary.
Prioritize, Reorganize and Master Multitasking: High-priority tasks should be completed before low-priority tasks, obviously. But what about a task that requires less than 3 minutes? It is helpful to get those quicker tasks done sooner, rather than saving it for later (and possibly even forgetting about it). As far as multitasking goes, consider your environment and task at hand. Know your limits and when it is appropriate to multitask.
Reward Yourself: It’s time for a well-deserved break! Go outside, take a stroll with a co-worker, or now that you’ve got time for social media, log into Facebook! Taking scheduled breaks increases productivity, and it is also good for physical and mental health. It is valuable to step away from the work environment, so leave your desk for breaks and lunch. For lunch, think about good nutrition. Instead of foods that slow down productivity and make you sleepy, eat healthy foods that stimulate productivity. Get back to work, ready to finish what you’ve started.
Get Ready: Before you head out the door, prepare for the next day. Whether that’s rearranging the piles of paper on your desk, updating your lists of “to-dos,” responding to emails, etc, set up processes in place that will get you ahead for the next day (or the next week, if it’s Friday!).
Whoo! It’s the end of the day. You made it and it was productive! Who knows, maybe you won’t even need that cup of coffee tomorrow. 😊
Whether you’re an employer or employee, I hope these tips will bring a more productive day for you today! For time-saving, productive payroll solutions, contact Paragon Payroll & HR today!
December 11, 2017
Payroll Year-End Prep Checklist
If you’re not already preparing for year-end, it’s time to start looking at some items that need to be considered for payroll purposes. Before we know it, the new year will be here! So as you finish up payroll this year, keep in mind the following items:
- Employee Data – Confirm identifying employee (both inactive and active) information, such as address, ssn, name, etc for W-2 purposes.
- Year-end Bonuses – If you offer bonuses in December, note whether you’d like the amounts to be considered gross or “grossed up” for the required FICA/Medicare taxes. For example, a gross $1,000 bonus (paid at an employee’s current withholding) will handle taxes differently from a net $1,000 ($1,082.84 gross) bonus. Please let us know these amounts before your last payroll of the year or before December 29th.
- Year-end Adjustments – These year-end adjustments include, but are not limited to, S-Corp Shareholders Health Premiums, personal use of company automobile, 3rd party sick Pay. Anything you need to include outside of your normal payroll, let us know for your last payroll of the year or before December 29th to make the adjustments.
- Tax Rates – Provide us with your SUTA Tax Rate Notice (State Unemployment Rate) for 2018.
- Deposit Requirements – In October of every year, the IRS determines if a change for the next calendar needs to be changed, depending on the total tax liability in the company. The company either pays these taxes monthly or semi-weekly, depending on what the IRS has determined. If you have received a notice that indicates your “deposit requirements for Form 941” have changed for 2018, please forward the notice to us.
- Time Off Accrual/Balances – Confirm employee PTO/vacation/sick balances. Take note of sick days, vacation time, and other allowed time off, carry over rules, depending on your company’s policies.
- Employee updates – Have employees review their withholding allowances before the new year. Please let us know of any new pay-rates or deductions that are effective for the new year.
As you are making plans, prepping for the holidays and other year-end items, we hope this payroll year-end checklist will alleviate some of the stress during this already busy time of the year. In fact, we wish for you, that this is truly the most wonderful time of year!