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How to Avoid Paycheck Errors (And Angry Employees)
Like clockwork each pay period, employees receive their paychecks and direct deposits. You process the payroll and move on to the next task. But what happens when an employee finds an error on their paystub? You can count on a phone call, possibly an office visit, and your valuable time being spent fixing an error that didn’t have to occur in the first place.
If this scenario sounds like a headache you never want to experience, we have good news. There is a simple way to avoid paycheck errors altogether and the angry employees that tend to follow. Using a human capital management (HCM) solution that ensures automatic, accurate, and timely payroll processes will make payroll errors a thing of the past.
Common Paycheck Errors
While paying employee wages may seem like a simple task, there are a lot of moving parts each pay period. First and foremost, it’s important to make sure your calculations are correct so employees receive their correct and timely paychecks. Because, let’s face it, paychecks are the most highly scrutinized part of a business. In fact, research shows 49% of American workers will start looking for a new job after experiencing only two problems with their paychecks. This shows how vital payroll accuracy is to a business.
Did You KNow?
Research shows 49% of American workers will start looking for a new job after experiencing only two problems with their paychecks. And in a Career Builder study, 78% of U.S. workers surveyed admitted to living paycheck to paycheck - a testament to the importance of timely, accurate paychecks.
How an HCM Solution Can Help Avoid Errors
As you can see, errors can easily occur during payroll processing and inaccuracies can have a costly impact on organizations. It’s no wonder error-free payroll is a challenge when you are not equipped with the tools to simplify data entry, manage online payroll and timekeeping record, and produce proper wage calculations. On the other hand, HCM technology provides everything you need to make payroll a seamless, quick, and most importantly, precise process. With the right solution, your organization will reap the rewards:
1. Data Entry
2. Payroll Records
A common and easily avoided error is the insufficient tracking of employee labor. Without a proper timekeeping system in place that captures, logs, and syncs to payroll data, there is no way to ensure employees are being paid properly for their hours worked.
HCM solutions with timekeeping capabilities eliminate manual and paper-based timekeeping. Organizations can track hours of service across multiple departments and receive alerts for time punches that deviate from the norm. Paid time off (PTO) and overtime is accurately tracked and recorded online for paychecks to reflect the appropriate hours worked.
The accurate calculation of workers’ paychecks is the ultimate measure of a successful payroll process. This final calculation is reflected in the employee paycheck and making sure this is accurate is not only important to keep your employees happy, but also to keep your organization compliant. Failure to withhold and report the state, federal, unemployment, and Medicare taxes can result in penalties.
Once your provider’s tax compliance team has set up your tax tables and calculations correctly, an online HCM platform will calculate the appropriate taxes and deductions. Employee withholding and deductions can easily be adjusted as needed.
It Takes Accuracy
Avoiding paycheck errors (and angry employees) is the goal of any HR manager or payroll administrator, and with an HCM solution it’s possible. With the right system, you’ll find time is saved, outdated processes are eliminated, and accurate paychecks prevail - resulting in happy, satisfied employees.
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