More and more small businesses are finding out that hiring an outside payroll processing company is an efficient and cost-effective way to take care of employee payroll duties. Indeed, handing off the routine tasks of payroll management to a contract payroll processor frees up valuable time for the owner of small business and his or her limited workforce to concentrate on things more directly related to the survival and success of the company.
It’s important to keep in mind, though, that using a third-party payroll manager does not legally shift the blame for any payroll mistakes that might occur. Employers are ultimately responsible for correctly compensating employees and complying with all federal, state and local labor laws as well as regulations pertaining to withholding and remittance of taxes.
Payroll errors are unnecessary headaches that cost time and can possibly hurt employee morale. And, as we discussed previously in this blog, the potential fines that could result are not trivial, and could be particularly crippling to a small business. Improper withholding or late remittance of income taxes, or of deductions for Social Security, Medicare or unemployment insurance, can be severely penalized, especially for repeat offenses. The law even provides for jail time as a punishment for flagrant and willful violations.
Employers are also responsible for following wage garnishment orders for employees who owe child support, back taxes, criminal restitution and student loans. Failing to comply with a garnishment order from a court or duly authorized government agency can result in fines, and the employer may be held liable for the employee’s financial obligation itself.
The point is not that you should be afraid to turn over your payroll functions to someone else – the advantages of doing so are too great. But obviously, you should be very selective when choosing your payroll processing company. Look for an experienced payroll firm with a solid reputation and a proven track record of accuracy, reliability, responsiveness and experience.
For the greatest assurance that your company’s payroll administration is being done with the precision it deserves, hire an experienced payroll specialist from Padgett Payroll Services. Padgett has been helping small businesses since 1966, and today we perform payroll services for thousands of companies across the U.S. Call Padgett Payroll Services today at (706) 548-1040 and get the convenience of payroll outsourcing along with the peace of mind that Padgett’s knowledge and professionalism bring.
Do you have the support you need to manage your small business bookkeeping?
Contact us to schedule an appointment to speak with a local small business advisor.