An essential ingredient to running a successful business is ensuring

you compensate your employees accurately and on time, even though there are now

many tools available that ease the headaches of the payroll process.

Mistakes, believe it or not, are still quite prevalent and fixing them.

Unfortunately, requires time and sometimes additional costs to the employer.

So in this episode of Our Party of One, we'll cover some of the most common

payroll mistakes and we'll share seven helpful tips that you can implement

to ensure that your payroll management process runs smoothly.

Each time, we'll discuss common payroll mistakes.

Seven Tips for Effective and Efficient Payroll Management

and a peek into Bernie Portal's payroll solution.

Now let's dove in.

Common payroll mistakes.

The truth is, payroll management can be a downright

daunting task, but it has to get done and done right the first time.

Let's take a look at five of the most common payroll errors.

Number one, incorrect worker classification.

The Fair Labor Standards Act established a minimum wage, overtime pay,

record keeping, and child

labor standards that affect both full time and part time workers.

It also specifies the requirements

for paying exempt and nonexempt employees, including the forms of payment employers

can include or exclude from the time and one half pay calculation.

The FLSA also clarifies rules about how to calculate

perks, benefits and bonuses, plus so much more

so to avoid violating the FLSA and incurring compliance fines.

It would be beneficial for you to learn how to correctly classify

your employees and understand what this means when running payroll.

I'll drop a link in the description where you can find more information.

Number two, miscalculating an employee's pay.

When it comes down to it, there are a multitude

of possible errors to be made when calculating employee pay.

In addition to base pay, compensation, bonuses,

reimbursements, stipends and sales commissions need to be factored in

as well as correct garnishments for fines, taxes and child support

which need to be deducted and properly disbursed.

It's also imperative that benefits deductions

like health insurance, HSA or FSA accounts and pre tax deductions

like commuter cost are accurately withheld.

These days.

So many people live paycheck to paycheck that miscalculating pay

can significantly impact their livelihood in a negative way.

Not to mention this calculating pay could lead to higher penalties,

particularly if you pay less taxes on income than what is really owed.

Neither is a desirable result, so it's best to get the details right.

Number three, missing pay deadlines.

Missing pay deadlines is a common mistake.

And when it happens, you can be assured that your employees will not be happy.

One way to ensure that you don't miss a payment

deadline is to have a pay schedule in place and a payroll system

that send you reminders like Bernie Portal.

Whether you pay your employees monthly, semi monthly, biweekly, weekly,

or even on demand, you need to first satisfy state requirements

and then determine what's best for you and your employees.

I'll put a link in the description below that can help you determine

which pay schedule is right for your organized action.

Number four. Neglecting tax forms.

Tax forms are an important part of your payroll process.

While they may seem like a hassle failing to keep them up to date and remain

compliant can create an even bigger hassle,

since you'll need to issue payroll corrections that will cost time and money.

Plus, you run the risk of incurring a hefty fine.

Three of the most important forms you'll need to keep track of are form 940,

which will use to report annual federal unemployment tax

for the calendar year Form 941, which you'll select quarterly to the IRS.

So employees know how much income tax, Social

Security tax and Medicare tax you've withheld from their paychecks.

And finally, form W-4, which employees fill out

so the employer can withhold the correct federal income taxes from their wages.

Two additional forms you'll need to keep track of are form W-2,

which details the amount of compensation you paid out to your employees

in Form 1099, which details the amount

you've paid to freelancers or independent contractors.

Lastly, if your state collects income tax.

Be sure to include your state's withholding documents as well.

And finally,

number five, incomplete records.

No one likes to be audited, but it does happen.

And therefore, it's critical that you as an employer maintain proper

employee pay records.

The FLSA requires that organizations

retain payroll records for three years.

These include time cards, wage

rate tables, work and time schedules, plus many other items.

For a complete list, visit the FLSA website.

I'll put a link in the description below.

This may seem like a lot of documentation, but consider that

having all these records updated and on file could potentially

prevent your organization from incurring fines down the road.

Now that you're aware of the most common errors employers

make when it comes to payroll management, let's take a look at the seven

helpful tips that will ensure a smooth and seamless payroll process

for you and your organization.

Seven Tips

for Effective and Efficient Payroll Management.

In order to have an effective and efficient

payroll process, you'll need to create an intentional plan.

The seven tips I'm about to share with you will help you develop and maintain

that plan. Let's dove in.

Number one.

Create a payroll process manual.

The first step to creating an effective and efficient payroll management system

is to develop a manual

outlining the detailed steps of your organization's payroll process.

While it may seem like a huge undertaking, this document will serve

as a valuable tool.

When questions arise about payroll specific topics.

Plus, it will benefit new team members when they join your organization,

everything pertaining to your payroll process will live in one place,

removing any second guessing if and when a problem occurs.

If you need a starting point for your manual, start

with the training documentation from your payroll provider.

For example, BerniePortal has a knowledge base

with detailed articles about how to run payroll.

It will need to include things like establishing pay periods

and ensuring accurate time and PTO counts.

You'll also want to have an off putting checklist to determining employees

who have left the organization, complete outstanding benefit enrollments

and set up any custom earning and deduction types.

Lastly, you'll need to ensure that employees have completed their direct

deposit W-4 and state withholding document.

Ideally, your payroll provider will have safeguards in place for this

creating a payroll manual can be time consuming, but lucky for you,

you have BerniePortal as a resource

that outlines each of those processes I just mentioned.

Check out the link in the description for a detailed guide.

Number to classify workers correctly.

As I mentioned earlier, this is one of the most common errors employers make.

Whatever payroll process you're currently using, conduct an audit

to ensure that each employee has been classified correctly.

You may want to conduct regular audits and include them in your payroll

management manual so they become an integral part of your process.

Number three.

Classify PAYE correctly.

Once you've classified your workers correctly, then

go ahead and ensure that they are being paid accordingly.

Again, you may want to audit your payroll

so you can correct any mis classifications.

Number four, create a payroll calendar.

When it comes to payroll management, there are too many important dates

to remember, like when to submit paystubs, retirement documents and tax forms.

So creating a payroll calendar will help you and your organization stay on track

and hopefully prevent you

from missing important deadlines which could result in hefty fines.

Bernie Portal has a fantastic H.R.

calendar that includes important filing deadlines,

reminders and notifications with comprehensive explanations.

You can adopt this calendar or use it to create

one of your own that fits the needs of your organization.

All Leave a link in the description below so you can take a look.

Number five.

Run payroll in-house.

Instead of outsourcing the debate between running payroll

in-house or outsourcing, it is an ongoing one,

and organizations sometimes struggle with choosing the right option.

Outsourcing to payroll services or financial

professionals usually costs more in the long run.

If you want to have more control over your payroll management process

and ensure it's accurate and efficient, then there's really only one option.

and ensure it's accurate and efficient, then there's really only one option.

Acquiring an in-house payroll system

plus your organization will enjoy the cost savings.

Gone are the days of spreadsheets and calculating on paper.

Which leads me to my next tip number six

Automate your payroll system, including benefits, time and PTO.

By automating your payroll system, the potential for error significantly

decreases use, and that includes benefit enrollment time and PTO tracking.

So you aren't entering

or combining information from multiple systems into spreadsheets.

You simply enter your parameters like your organization's pay schedule,

You simply enter your parameters like your organization's pay schedule,

employee payment preferences and taxes holdings in the software.

Does the rest bringing for the recently launched

its own payroll feature that lives within are complete.

Yes, I'll put a link in the description below

so you can learn more about whether it can benefit your organization.

You can even demo the product to get a feel for how it could work for you.

Number seven

Consider earning your payroll certification.

Payroll certification refers to the process by which human

resources professionals demonstrate their mastery of the knowledge and skills

needed to successfully carry out payroll responsibilities.

It's by no means a requirement for payroll professionals,

but it clarifies your role and responsibilities

of the payroll management professional, which result in a decrease

in costly errors, more consistent compliance.

And it provides access to a network of payroll

professionals who can advise on difficult issues.

Plus, it looks great on a resumé and employers

are more likely to hire payroll certified candidates.

If becoming payroll certified is something that interests you.

Then visit the American Payroll Association or APA to learn

more about the various certifications they offer.

I'll put a link in the description for you.

A peek into Bernie Paul's payroll solution

here at Bernie Portal.

We understand that

payroll can get complicated, which is why we design a payroll solution

that will benefit small to midsize businesses.

With Bernie Portal's payroll feature, employers will be able to manage

all aspects of the payroll process all within one platform.

Some of the highlights of the Bernie Portal payroll feature include

seamless integration all in one, including benefits,

PTO time and more accurate tax withholding.

A limited number of payroll runs,

access to a dedicated support team

and access to a robust library of resources.

If you're looking to streamline your payroll management process,

then take a look at what Bernie Portal can offer to you and your organization.

I'll leave a link in the description below where you can find more information,

including the opportunity to demo the software.

As always, remembering that your role is as strategic