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3 Reasons Why Hiring a Full-Time Payroll Clerk is the Wrong Route

Posted by Stacey Duggan

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Jul 14, 2014 9:13:00 AM

3 reasons why hiring a full time payroll clerk is the wrong routeTypically, when a business starts up, one or two people are responsible for handling every aspect of the day to day operations. They handle the work, the billing, and the payroll. As time goes by, and the business grows, the sheer volume of responsibilities makes it necessary to bring on more people. Eventually, the time comes when the business needs a bookkeeper or payroll clerk. When that time comes, the principles of the business face a decision--whether to hire a full-time, in-house clerk, or whether to outsource their growing payroll needs. Below, you'll find three reasons why an in-house payroll clerk is the wrong choice.

Hidden Costs

To find out how much a payroll clerk will cost your company, you need to account for much more than their salary. They will need updated software, and the training to use it correctly. To keep up with legislative changes to payroll laws, they will need to attend continuing education classes and conferences which cost money and take them away from the workplace. As they learn your business, and adapt to changing laws, there's always the potential for mistakes--mistakes that can cost you money in the form of fines and back payments. In the end, it can be nearly impossible to put a definite dollar figure on what a payroll clerk can cost you from year to year.

Down Time

You'll need a payroll clerk long before you have enough payroll work to keep them busy full time. What are they going to do until your business grows into a full time job for them? A lot of clerks fill multiple roles at a business, but this presents its own dangers. Every moment they spend on other tasks is a moment when they're not gaining payroll experience. Those other tasks can also serve as a distraction when they are working on payroll. Having their attention divided between different roles leaves you with a worker that isn't completely focused on any of the tasks they're asked to handle.

Missing in Action

Your payroll needs exist 24 hours a day, 7 days a week. Issues can arise at any time, and somebody needs to be available to handle them quickly and accurately. However, even the best payroll clerk will get sick, take vacations, and move onto other employment opportunities. What do you do when a payroll issue comes up, and your clerk is out of the office for whatever reason? For minor issues, you can probably wait a few days until they get back. What if the CRA is at your door to talk about some payroll discrepancies? How long do you think you'll be able to wait if that happens? Even a full-time clerk isn't an all-the-time clerk.

Outsource for Better Results

Outsourcing your payroll needs to a payroll service provider eliminates all of these issues. The cost of hiring, training, and retaining clerks is shared by all of the clients of the payroll provider, lowering overhead for everyone involved. These service providers have a full-time staff that does nothing but handle payroll needs all day, every day, so downtime or divided attention isn't a problem. And they have support personnel available to you at all hours, every day of the week, so you don't have to worry about being able to discuss important issues with an experienced payroll clerk. These payroll providers give you the service you need, when you need it, while also helping to keep your costs low.

7 Signs It's Time to Outsource Payroll

Topics: Payroll Service Provider, Payroll Clerk

Can You Afford to Hire a Full-Time Payroll Clerk?

Posted by Stacey Duggan

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Nov 4, 2013 9:00:00 AM

Can You Afford to Hire a Full Time Payroll ClerkMany businesses employ a full-time payroll clerk to handle all of their payroll needs. They believe that an in-house clerk offers more benefits, and lower prices, than an outsourced payroll provider. On its face, this can seem to be true. However, looking at all of the hidden expenses of an in-house payroll clerk reveals just how costly they are. When you compare that cost to the advantages you get from a payroll provider, you’ll see just how affordable they really are.

In-House Advantages

Having a full-time payroll clerk on staff does offer some advantages. They can be 100% dedicated to payroll issues, instead of juggling multiple responsibilities. This gives them the time and freedom to keep up with changing regulations, and to focus entirely on handling your payroll needs accurately. Often, payroll is simply one of many responsibilities handled by a staff member. This can lead to inaccuracies, as they can’t be focused on payroll at all times. A full-time payroll clerk is much less likely to run into issues.

At What Cost?

Figuring out what an employee costs per year seems like a simple process. Add up the costs of their salary, benefits, and vacation days, and you have your answer, right? Wrong. This is what you’re paying them, not necessarily what they’re costing you. A full-time clerk will have sick days, vacations, and other absences. The time they spend away from your business will have to be covered by another employee. The time that employee spends on payroll will have to be covered by yet another employee. This cycle can drag down productivity throughout your administrative departments.

A full-time payroll clerk typically gets paid for the hours they’re at work, not necessarily the hours they’re working. There are times when they may have nothing to do. You’ll still be paying them for that time. During any periods of downtime, you’ll still be paying them for their presence.

One overlooked expense is training for the payroll clerk. The payroll laws are constantly changing and failing to keep up with them can lead to expensive fines and penalties. To avoid this, your clerk will need to undergo continuing education, attend conferences and workshops, and train on the latest software. The money for all of that training has to come from somewhere.

Even with all of the money you spend on training, there are no guarantees that your payroll clerk won’t make a mistake. Even though it’s their mistake, you’re still on the hook for all of the legal penalties. You could spend a lot of money hiring, training, and retaining a full-time payroll clerk, just to end up paying fines as well. As the laws and issues surrounding payroll become more complex, the chances of an error increase.

Professional Help

An outsourced payroll service provider offers all of the advantages of a full-time clerk, without the hidden expenses and risks. Instead of a single employee dedicated to your payroll needs, you can have an entire agency full of payroll professionals. You don’t need to worry about finding a replacement when your clerk is out of the office, or the effect their absence will have on your other employees. You pay the service provider for the services they render, not the time they spend in the office. The cost of their training is distributed across hundreds of clients, meaning that you get the best training for you payroll service at a fraction of the cost. Best of all, with their training, experience, and expertise, the chance of costly errors occurring is reduced to almost zero.

What Are You Leaving to Chance by Handling Payroll on Your Own

Topics: Payroll Processing, Outsourced Payroll Service, Canadian Payroll, Payroll Tax in Canada, Canadian Payroll Service, Payroll Calculator, CRA, CRA Payroll Tax, Payroll Deductions, Payroll Clerk

Don't Make a Mistake by Hiring the Wrong Payroll Clerk

Posted by Ray Gonder

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Aug 19, 2013 9:00:00 AM

Hiring Payroll ClerkOn the surface, your payroll clerk may not seem to be one of the most important players in your company. The payroll clerk doesn't make big decisions, doesn't interact with clients, and doesn't tangibly affect your bottom line. But hiring the wrong payroll clerk can have a huge impact on the way your company runs. Whether you realize it or not, your payroll clerk has great responsibility when it comes to keeping you compliant with government agencies. Therefore, your company's legal status and reputation are in the hands of your payroll clerk.

But how do you know if you've hired the right payroll clerk? What kinds of questions do you need to ask to ensure that you're putting your trust in the right person?

Questions to Ask a Potential Payroll Clerk

When interviewing candidates or payroll processing firms to handle your payroll, ask open-ended questions that will allow them to elaborate on their experience. This helps you to get a better grasp on their capabilities, education, and experience.

1. How do you ensure that payroll is completed on time?

A good payroll clerk is organized enough to have tried-and-true systems in place to ensure that each payroll step is completed in a timely manner. The detail in the candidate's description to this answer will help you to understand his or her depth of experience.

2. Do you have experience with submitting payroll deductions to the government?

This question is very important because proper deduction remittance is key to your company's compliance and legal standing. The candidate should mention federal withholding, Employment Insurance, CPP, workers’ compensation, and, in Ontario, EHT.

3. Tell me how you handle payroll year-end requirements.

Not only must payroll clerks handle the paycheque-to-paycheque clerical work, but they also must handle year-end governmental requirements like T-4 slips and direct reporting of filings to authorities.

4. How do you make sure that payroll is in compliance with the Employment Standards Act and the Canada Revenue Agency?

Legislative changes result in policy changes at the Canada Revenue Agency, and it's the responsibility of Canadian employers to keep up with these changes. When you hire a payroll clerk, you expect that person to keep up with these changes for you. If the person you're interviewing can give you specific information about the Employment Standards Act, you're in good hands.

5. What do you do when you need to communicate with someone at the CRA?

It's inevitable: questions will arise from time to time about situations unique to your company that involve the CRA. If your potential payroll clerk doesn't know how to reach someone who can answer questions, you could find yourself in a small crisis. Hiring a payroll clerk with a history of communication with tax authorities puts you in a great position. You'll be able to get questions answered in a timely manner and minimize your chances of non-compliance.

6. How can you help us with other human resource issues?

It never hurts to hire a payroll clerk who understands the ins and outs of human resources. Having an employee on board who can handle Ministry of Labour claims, Workplace Injury Claims Management, standard employment agreements, and employee orientation and training will be a great boon to your company, helping you to navigate some of the trickier employee issues common to Canadian businesses.

Once you find that perfect payroll clerk or outsourced payroll provider, you'll be able to delegate all of your payroll-related tasks, knowing that your company's payroll is on-time, compliant, and properly remitted.

What Are You Leaving to Chance by Handling Payroll on Your Own

Topics: Payroll Service Provider, Outsourced Payroll Service, Employment Standards Act, Government Compliance, Canada Revenue Agency, Payroll Clerk, Hiring a Payroll Clerk

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