December 8, 2021

How to Simplify Your Payroll Process

By: Justin Pothoven, CPA, Client Advisor

Having a good payroll process is one of the most important things you can do to maintain good employee morale. It can also save your dental practice time and money.

This may come as a surprise to many dental practice owners but, no matter what size your business, having an efficient and reliable payroll process is one of the most important things you can do to maintain good employee morale. Given the current workforce shortage, where it’s never been harder to find and keep good employees, it’s worth thinking about whether your payroll process needs updating. The good news is that modernizing your system will not only increase employee satisfaction, it will also save you time and money.

If you like the idea of happy employees and efficient operations, here are a few ideas that can improve and simplify your payroll process. 

Establish a Payroll Schedule That Works for You

It’s surprisingly common to find offices that pay employees the day after the pay period ends. The problem is that leaves just one day – maybe just one evening – to wrap up payroll for your employees. A tight turn-around like that puts a lot of pressure on the person responsible for payroll, increasing the potential for errors. I think we can agree that the quickest way to drive down employee morale is to make a mistake on a paycheck or get payroll out late. 

To avoid this problem, think about what payroll schedule you want to use and pick a pay date that gives your payroll staff some breathing room. A popular option is to cut off hours on Sunday and make Wednesday the payday. The advantage is you have a two-day buffer on either side: two days to get payroll out and two days to address any queries that might come up afterwards. Whatever day you choose, be sure to give yourself a few days between when timesheets are due and payday.

 Since the pay date is typically included in employees’ terms of contract, when you’re making a change, you’ll need to get your employees buy-in. With clear communications and adequate warning, there shouldn’t be a problem. Especially if the change includes things your employees will see as enhancements, such as the next suggestion.  

Set Up Direct Deposit for Payroll

If your dental practice is still using an old-school approach that involves distributing printed checks to your employees, it’s time to switch to direct deposit. Here are a few reasons why:

  • Saves money – the cost of direct fund transfers is less than the cost of printing and mailing paper checks.
  • Saves time – Once you’re set up, payroll by direct deposit only takes 5-10 minutes. Compare that to the time it takes to print checks, stuff them in envelopes and distribute them. 
  • Enhances employee satisfaction – Employees love direct deposit because the funds show up in their account immediately, eliminating the need for them to run to the bank over their lunch hour. 

Collect Info Before New Hires Start Working

It may be tempting to take a relaxed approach to collecting paperwork for new employees, but waiting too long creates unnecessary headaches when it comes to your payroll taxes. Not having the correct withholding status for just one pay period can create a tangle that might later take hours to unwind. Avoid this situation entirely by requiring new hires to complete and submit all their paperwork prior to their first day on the job. 

Leverage Technology to Improve Efficiency

Electronic W-2s are a good example of how technology can simplify your process. By going electronic, you eliminate time spent printing and mailing W-2’s. There’s no need to keep tabs on your employees addresses, including that one employee who left last January and hasn’t been heard from since. You never have to worry about mail delivery service or deal with the hassles of employees who lose their W-2. 

Avoid the Costs of Outsourcing

If you’re outsourcing payroll services to a third party, it might be time to think about bringing it back in-house. Advances in technology mean there are lot of robust and cost efficient payroll platforms to choose from that will provide the benefits of automation without the expense of a third-party service. The trick is to select payroll software that fits your business needs and then set it up to do what you want.

Engage Advisors Makes Changing Payroll Easy

If you’re interested in making a change but don’t feel confident choosing a payroll software package, or aren’t sure how to get started, Engage Advisors helps clients make the switch. We’ll get you on a platform that has the capabilities you need without the overkill of bells and whistles that add unnecessary complexity. We do the groundwork to get your system up and running properly and provide the hands-on help to make sure you’re comfortable with it. We also make sure your system is set up to efficiently deliver tax filing info, another time saver. 

It’s easy to get complacent and stuck in a rut of doing things the old way, that are no longer best practice. To succeed, we need to embrace new tools and systems as they become available. If you’d like to learn more about how you can simplify your dental practice payroll system, contact us at Engage Advisors. We’re ready to talk about ways we can help you build a successful dental practice.