For businesses with employees, getting the paychecks correct and on time is crucial. That’s why applications that integrate with your accounting software for payroll make things easier for you and save time along the way. No need to have time clocks for employees to clock-in or out for beginning or end of day, breaks or lunches. Nor is there a need to have time clocks at each location, employees can utilize Android or iOS apps on their smartphones to clock in or out. No longer a need to publish paper schedules or let employees know there is a change in a schedule. Furthermore, the applications easily handle direct deposit and multiple pay schedules, integrate with your accounting software, workers’ compensation, benefits, human resources, and completes monthly, semi-monthly, and annual payroll tax forms and tax deposits based on your company’s government required frequency.
With the many service providers listed below, how should a small business owner decide which payroll provider to use? You should consider these factors when selecting any technology provider but specifically payroll:
a) Type of Services Needed – determining what type of services you need will set the tone for the following factors. Do you need just payroll or do you need an all-in-one package that provides an employee self-service portal, time tracking, human resource functions such as benefits, federal and state law compliance, etc. The need to process payroll remotely may be a strong consideration for you. Another consideration is do you believe your organization will change within the next 12 months such that you will need some of the all-in-one features. If so, it is easier to consider this factor at the beginning of the process. Believe me when I say, changing payroll services is hard at any time and you don’t want to do it more than you have to.
b) When do you implement a payroll processing service – At the beginning of the year! Doing it after January makes conversion complicated and frustrating.
c) Pricing – the price for services is usually a specific monthly fee plus an additional per-employee monthly fee.
d) Industry Specifics – if you are in an industry with certain demands, i.e., labor union rates, weekly paychecks, handling tips, multiple overtime rates, or human resource add-ons become important especially if you’re growing.
e) Ease of use – from adding new employees, to handling special wage withholding requirements (garnishments or child support), processing payroll remotely, or terminating employees from the service ease of use is critical. You don’t want to spend hours trying to learn the service each time you need to do something different.
f) Tax Services – in addition to being more efficient and correct with processing the payroll, the main purpose is to remove the possibility of tax fines and penalties. Be mindful of who and how your tax payments and filing are done by the service. Do you have to push the button or is the service going to take care of this when it is required.
g) Customer Service – when you need help you need help! You want to be able to obtain correct support in a timely manner.
Here’s a partial list of software as a service (SaaS) payroll service providers. Be aware, these key players offering payroll processing applications have been listed in ‘alphabetical order’ without regard to any assessment of their performance but in my opinion their best standout feature.
All of the SaaS payroll providers allow you to run your payroll from a mobile device or tablet.
ADP Run – do you need custom features or reporting? If so, this is the best option for you and your company but there is a cost associated with these features. The software is geared more towards larger businesses and instead of pricing by the number of active employees you have, the software is priced by the number of payroll executions you make each month. The standout feature for ADP is the 24/7 availability of the call center in addition to the reporting and name recognition for their services.
Gusto – Gusto Core provides these features that most other providers either charge for or don’t have at all: file 1099s, E-sign I-9 and W-4, employee payroll self-onboarding with lifetime access, and premium payments for health benefits and workers’ comp. Gusto Core also has multiple add-ons available, i.e., 401K, 529 college savings, and health and flexible savings accounts. The standout feature is the pricing we can offer clients as a Gusto partner that provides an all-in-one payroll/HR/benefits system with payroll tax return filing and payment of payroll taxes.
Intuit QuickBooks Payroll – Intuit QuickBooks Payroll offers tiers of service grouped by whether or not you run the payroll yourself or Intuit runs the payroll for you. Pricing is best when the payroll and accounting software are bundled together. If you, as the employer, are looking for management of the payroll taxes, tax filing and W-2s, then Intuit Full-Service Payroll is your only option. Standout features for Intuit QuickBooks Payroll are the phone and email support available from 6 a.m. to 6 p.m. Pacific time, Monday to Friday as well as 6 a.m. to 3 p.m. Pacific time on Saturday. They also have a searchable support center with FAQs, user guides and video tutorials and easily integrates with their Intuit QuickBooks Online Accounting software.
Patriot Software– requires more manual work, at a lower price point than any of the other payroll systems presented. It does allow the employer to decide which features are the most important to them but most of the features also have an add-on price associated with them. Patriot payroll offers customer support via phone, live chat, and email support. They’re available from 8 a.m. to 8 p.m. Eastern time Monday to Friday. The software also has help videos embedded into each menu with a small icon making it easier to get assistance when you need help the most.
Paychex – similar to ADP in that the software is best for larger businesses, Paychex has tiers of service for multiple size businesses, and provides customer service from 8 a.m. to 8 p.m. Monday to Friday via phone at one of its many local branches or online via email or chat. It also provides help solutions online. Standout features for Paychex are same-day ACH payments and the ability to run payroll from a mobile device.
PayCom – Different than the other software as a service (SaaS) payroll provider, Paycom issues checks from its checking account with the employer writing one check to pay for the entire payroll on each pay date. For large employers with many employees, this can be a benefit to eliminate the need to track each employee’s check every month. The standout features for this payroll provider are: the ability to run payroll on multiple device platforms, the ability to manage employee expense reporting and reimbursement, and human capital management features all in one system with some features accessible through add-ons.
Still trying to determine a direction? Answer these four questions first:
a) Do you have the time to learn the application?
b) Are you able to keep up-to-date on new tax laws in order to avoid legal troubles?
c) Do you have an accounting professional to assist you with understanding the changes that impact your business for payroll?
d) How easy is the payroll service to manage the payroll process and get real-time information?
Speak with your accounting professional to determine what may work best with your business. Or give us a call so we can assist you with identifying the best choice!
Sources: connecteam.com fitsmallbusiness.com fundera.com
