Paying your employees might seem like a fairly simple process, but at many places of business, mistakes happen all the time, and they can be costly.
What if you've got a stack of forms listing employees who need to be paid, and one gets misplaced?
For example, what if you've got a stack of forms listing employees who need to be paid, and one of them simply gets misplaced? The impact can be catastrophic for your business. The unpaid employee will almost surely become disgruntled, and that negative attitude may soon spread to the rest of your staff. You might end up with a full-blown employee engagement problem, all because of one innocent mistake with one sheet of paper.
To run a successful business, it's absolutely crucial to get these payroll issues under control. Unfortunately, that's often more difficult than you might think. How can you overcome the problem? Read on.
Small mistakes can lead to big problems
The risk of large-scale payroll problems wasn't always a well-known thing, but it's starting to become one. According to Human Resources Director Australia, a series of high-profile failures in the business world has brought awareness to the issue. For example, celebrity chef George Calombaris was recently revealed to be paying staff incorrectly for a long time, leading him to owe $2.6 million in back payments.
Jason Low, head of The Association of Payroll Specialists, told the publication that even small errors can have a large impact on your company's cashflow.
"You can make a tiny mistake and it compounds so quickly," Mr Low warned. "Before you know it, you're in the headlines for all the wrong reasons.
A problem that seems relatively innocuous, such as a payroll system being out of date, can easily snowball into a bigger issue if you're not careful. Even if you're not guilty of outright fraud, or deliberate non-compliance with payroll regulations, even the appearance of such an issue can get you into legal trouble.
Get every single detail right
You surely want to avoid getting tangled up in a high-profile case of payroll mismanagement yourself, and that being the case, it's important to be detail-oriented in everything you do. To this end, The Pulse Australia recommends paying close attention to details like employees' addresses; tax ID numbers; start and termination dates; and payment information like hours, wages and other allowances.
If you're not up to juggling all of these logistical details yourself, it might be worthwhile to find payroll software that can help you with all of it. This makes it easy to handle money matters efficiently, which should free you up to focus on other aspects of the business.
Of course, errors can still happen, even if you have the best technology money can buy. If and when you do have trouble with your payroll, it can be damaging to your business, you might be facing fines or a need to give employees pay raises to keep them engaged, which means you'll want to have fast access to working capital that can help you address that damage.
Seek cashflow help if you run into trouble
Whenever your business finds itself in a jam with payroll processing, it helps to have a little extra cash available for dealing with the problem. To that end: Have you considered debtor finance? By collecting a portion of your accounts receivable in the form of fast cash, you can get through whatever payroll issues you're dealing with.
Companies of all types and all sizes can benefit from this resource. Really, anyone looking for a little extra consistency in cashflow can. If you need money for your payroll, your suppliers or any other reason imaginable, just get in touch with us on 1300 760 205 and ask.
If you'd like to learn how Earlypay's Invoice Finance & Equipment Finance can help you boost your working capital to fund growth or keep on top of day-to-day operations of your business, contact Earlypay's helpful team today on 1300 760 205, visit our sign-up form or contact [email protected].