As the owner of an organization there are so many things that need to be taken care of, one the most important things among them is the employee payroll, advocates Charles Spinelli. It is absolutely mandatory to streamline this process because ensuring the comfort of the employees is one of the basic responsibilities of an employer.
Payroll administration, thus, is the process adopted by virtue of which the payroll of all employees is properly organized and distributed. The bonuses, deductions, and wages are all taken into consideration to ensure an accurate calculation of the salary deserved by each employee. This process is also employed to make sure that the payments are made on time.
Need for payroll administration
The kind of help this process of payroll administration renders to employers makes it a mandate for every organization, irrespective of its type and size. Some of the very crucial areas that this process eases out include the following:
- Regulatory and legal compliance – As mentioned previously, ensuring the comfort of every employee in every aspect is among the primary responsibilities of an employee. This is why there are several legal and regulatory obligations that an employer must comply with to be able to satisfy the employees and extract their optimum performance in the bargain. This kind of compliance also prevents one from getting entangled in penalties which in turn becomes a liability for the business.
- Streamlining of payroll process – With the payroll administration in place, the process of the payroll gets simplified, automated, and streamlined, emphasizes Charles Spinelli. This saves time and mitigates the risk of errors substantially.
- Effective record-keeping – The inclusion of this kind of administrative work helps the organization maintain the records of their employees at their fingertips. These records assist in carefully understanding the deductions and tax withholdings of the employees.
- Punctual payments –Timely calculations invariably lead to the punctual payment of wages and salaries for the employees. This is a great morale and trust builder of the relationship between the employer and the employee.
- Increased productivity– The mental satisfaction of the employees on getting their salaries on time and accurately instigates in them a sense of loyalty and belonging to the organization. Enhanced performance and productivity are a direct consequence of such faith in the organization.
However, to have a proficient payroll administration in place, says Charles Spinelli, there are a few steps that need to be followed religiously.
- Collection and verification of employee data
- Calculation of gross pay
- Calculation of deductions
- Calculation of net pay
- Processing of the payroll
- Distribution of paychecks
- Maintenance of records of payroll
- Winding up of tax reporting
- Managing the payroll-related inquiries
The primary purpose of an adept payroll administration process is to provide a precise and punctual salary to the employees. However, the direct and indirect by-products of it in the form of enhanced productivity and employee retention and engagement cannot be denied. It is thus quite evident that every organization, irrespective of its size must have a proper payroll administration in place, fi they wish to win the confidence of their potentially skilled employees.