Are you a new business owner? The beginning is an exciting time for a business owner’s career, but lots of questions arise.
One of the most common questions is employee payroll. Employee payroll is more complex than it seems.
Here are 10 pieces of payroll advice for every new business owner. Continue reading and handle employee payroll like a pro.
Employee Classification is Vital
As a new business owner, you probably hire contractors. If this is the case, you don’t need to take taxes out of their pay. But if your first employees are under the W2 classification, you’ll need to take taxes out of their pay.
Save Money as Much as You Can
Individual business expenses add up, including payroll. If you’re spending too much on your employees, consider outsourcing instead.
You can also make additional cuts such as moving to a remote office.
Timely Payroll Processing is Key to Great Employee Relationships
Competition is fierce. If you want to keep your employees, you need to ensure their paychecks are delivered on-time. If you keep falling late on payments, your employees will leave.
Choose the Best Payroll Service
A great business owner is nothing without a great payroll service. So, choose wisely.
Make sure their services are regulated, they have great reviews, and they always deliver great service. A service, like check stub maker, is a great example.
If you choose to hire a bookkeeper for your payroll, make sure they have the experience you need.
Pay Close Attention to New Hires
After you hire a new employee, you have to report your new employee to the state.
This includes giving new employees tax documents, such as a W4, to fill out. You’ll also need to train your employees on payroll facts, such as when payroll is and how much they’ll receive on their paystubs.
Know Your State’s Minimum Wage
If you plan on paying your employees minimum wage, know your state’s minimum wage requirements. Each state has a minimum amount you should pay your employees.
Even if your employees work on tips or are part-time or seasonal, you still need to meet the minimum wage requirements.
Always Keep Record of Your Payments
Always keep records of your employee payments; it not only helps your company, it’s required by law. To prove your records, keep additional documents such as employee timecards.
Know Your Rights as an Employer
There are laws you must follow and other favors that are only complementary to an employee. As a business owner, know the difference.
For example, you don’t need to give your workers time off during holidays. But most employers give their employees the day off or pay them time-and-a-half out of courtesy.
But there are certain laws you must follow, including gender pay.
Each state has different overtime laws. But generally, only certain employees are eligible to work overtime. If they do, you must pay them extra. For employees who are exempt from overtime, they must clock out after 40 hours.
Exempt Vs. Non-Exempt
Certain laws apply to exempt employees rather than non-exempt. For example, an exempt employee must be paid a salary. But a non-exempt employee can be paid an hourly wage and have other benefits.
Time to Use This Payroll Advice
Understanding payroll can be difficult. Hopefully, this payroll advice can help your business owner endeavors. Knowing minimum wage and employee classification is vital.
But other laws help, such as record keeping and knowing if your employees are exempt or non-exempt.
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