Electronic Payroll: How to Make the Switch From Paying With Checks
Many businesses like yours are going digital with their payroll. As more aspects of everyday business are being conducted online or by computer, it’s important for companies to evolve with the technology that’s becoming the standard for a growing number of industries. If your company hasn’t yet made the change from written to electronic paychecks, then you should consider the benefits and how it’s done.
Defining Your Payroll
Electronic payroll is a form of paperless payroll in which all your payroll functions and systems are handled digitally. Records are stored digitally, and your employees’ paychecks are made over the internet through direct deposit services. While you can handle this type of payroll internally, it will require you to understand how to set up the systems and handle the records yourself, as well as make sure that you follow all your local, state, and federal payroll laws regarding digital payroll. If you’re not knowledgeable about these systems and don’t want the expense of hiring staff to handle it, you have the option to hire a third-party payroll provider instead.
The Benefits
Electronic payroll comes with several plusses to its services. Paperless payroll is environmentally friendly since it requires no printed copies of paychecks or records. It makes it easier to file your taxes since all your records are stored electronically, and if you go with a payroll provider, it will file your tax returns and issue your employee’s W-2s automatically. It allows your employees easier access to their payroll information, including the previously mentioned W-2s, time sheets, pay stubs, vacation time, and benefits. Finally, when you go through a payroll provider, you can get certain services as standard, where a bank would charge you an extra fee, including direct deposit, payroll records, and employee self-service models.
Some Challenges
Of course, no system is perfect, and even electronic payroll does have some things which you need to take into consideration. Many payroll systems, even those administered by payroll providers, use software that you need to access the system, which isn’t free. It’s important you’re certain that you have the budget to afford the necessary software. Because this is an online service, reliable internet access is a must, so make sure you and your employees have a reliable internet service and the capacity to handle the software. Finally, both you and your employees need financial institutions and bank accounts that can receive and make direct deposits. Check with your company’s bank and make sure your employees check with their personal banks to be sure you’re ready to start this new model of payroll.
The Setup
After considering your options, if switching your payroll model seems like the best option for your company, your first step is to contact either your company’s bank/financial institution or a payroll provider. When selecting who will handle your payroll administration, check the fees, what services come standard, what costs extra and how much, and how closely they stay in communication with their clients. Customer reviews are very helpful in this regard. Next, fill out the necessary paperwork provided by your chosen service provider. Gather all the necessary employee information to allow for direct deposits, including bank names, routing numbers, account types, and account numbers. Some providers allow for self-service to upload this information, while others require you to submit employee information in file form.
Go Digital Payroll With Payroll Vault
At Payroll Vault, we’re ready to provide our payroll expertise and technology to you and your company! We’re a payroll company that provides a boutique-style selection of payroll and human resources solutions for companies like yours. We provide a range of services, including direct deposit, paycards, tax filings, employee handbook tools, training on-demand, and more! Contact us today or visit your nearest Payroll Vault location to find out more about what we can do for your company!
