A couple of months ago, I made my first overseas trek since 2017 – not for vacation – but to meet with the rest of the Fritz Financial Solutions team of accountants in the Philippines. It was important to me to show these women the time and attention needed to...
Who is responsible for payroll?
One of the most expensive resources for any business is payroll. It’s also one of the most important. We are firm believers that people are your most valuable asset, so it’s no wonder that payroll gets costly. Especially if you are a professional services company, and in this market, you need to be competitive to get top talent.
When looking at your business structure, payroll can be claimed by two departments. Is it a Human Resources task, or does it fit more into Finance? We are here to tell you that in an ideal world, payroll is a function of HR.
And it should be! There is a lot more that goes into payroll than just money. HR Professionals are the experts with the rules, benefits and policies which govern this large chunk of your budget.
- Time off- Did you know, Chicago has a Paid Sick Leave ordinance which entitles all employees to five days of sick time? Even if they are part-time? And that some unused sick days carry over to the next year?
- Attendance- What happens if someone moves from part-time to full-time?
- Expectations- Do you know what governs whether a worker is a 1099 Contractor vs. a W2 employee? Do you know the difference in these employment statuses?
- Labor Laws- How do you legally terminate an employee? What can and can’t you say? And to what is a terminated employee entitled?
Okay, so these are all Human Resources questions. But what happens if you aren’t quite ready for an HR team?
It’s important to note that if you have under 50 employees there are far fewer legalities to consider and many financial experts can help you through the payroll process. Therefore many growing businesses turn to the finance team to handle payroll.
The financial team can process payroll tasks, but unfortunately, they can’t provide the expertise around rules and regulations, time off policies and the intricacies of payroll taxes. They also may not be privy to benefits selections, employee schedules and other human resources related areas of the business. If your outsourced accountant or CPA is handling payroll, it’s most likely as a favor.
With so much money being funneled to payroll, finance has to be involved, right? You bet!
No matter your size or structure, your financial team still has a role to play when it comes to payroll. Here are several ways that your financial partners can share insights and add tons of value when it comes to your payroll processes.
Most often payroll is run through your HR software but that isn’t the only system that needs to be aware of the expenses. Whether that be ADP, Paychex or Gusto, it’s critical that the wages, payroll taxes and benefits expenses and liabilities are reflected correctly in your accounting software. Getting these programs to transmit correct data is mission critical to cash flow, deductible expense and submitting payroll taxes on time.
Checks and Balances
HR and Finance professionals are watching for different things and bringing different perspectives to the business. While HR is focused on keeping you compliant and the team engaged, Finance keeps a strong pulse on the money. In a recent example, The Fritz Financial Solutions Team discovered that a payroll service was charging the bi-monthly fee, weekly! The company was being overcharged hundreds of dollars and we were able to get that money back.
Payroll taxes are serious and have detrimental ramifications if not taken care of properly and on time. One of our clients paid $15,000 in payroll taxes late and was charged over $5,000 in penalties and fees. Another client who had engaged a full service payroll company to run payroll and submit their payroll tax returns had a late filing. Fritz Financial Solutions worked directly with our preferred payroll partner to get to the bottom of it. We learned that there was a mistake from the payroll company and negotiated accommodations from the payroll company on behalf of the client.
When businesses move from one payroll company to another, there are a myriad of documents, reports, deadlines and systems to connect with each other. Your financial partner can guide and support you throughout this process depending on what level of services for which you’ve engaged them.
Fritz Financial Solutions can help your business get the right information to make important hiring decisions from a financial perspective. Get insights into:
- Can you afford to hire?
- Are you overpaying for talent?
- Do your payroll expenses align with your profit margin?
Building the right team of experts to support your business is both challenging and rewarding. We’re also clear on our strengths and where we need to leverage other experts. We highly recommend our Payroll Partner Cody Zak, District Manager with ADP. Our clients can rely on him to recommend professional and comprehensive solutions which help them stay compliant with increasingly complex tax laws, payroll regulations and healthcare reform. Cody alleviates employer stress as it relates to HR and payroll and help clients focus on what they love – the business itself.
Schedule a consultation with Daliah Fritz to understand how we can support you in partnering with the right HR resources and implement a basic payroll process to keep your finances in top shape. And we’ll be happy to connect you with Cody!
What solution can Fritz Financial find for you?
Schedule a meeting with Daliah Fritz