7 Tips for Making Payroll Less Time-Consuming and More Efficient

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Payroll is the Rodney Dangerfield of business — it gets no respect.

Although it doesn’t contribute directly to a company’s bottom line, without payroll there is no bottom line to contribute.

Like any business process, there are always ways to streamline the activity, save money, and provide better service.

Here are seven tips that can help…

Use a Calendar

Not any calendar – a payroll calendar.

A payroll calendar helps keep the payroll department on track and employees informed as to when they should expect their pay.

The calendar also lets all parties understand when critical information, like time cards, are required for processing and when payroll outputs, such as paystubs and reports, will be available.

Simplify Your Policies

Complicated workplace policies frequently increase the administrative burden of payroll processing.

Provide clear and concise policies for issues such as attendance, leave of absence, commission, and expense reimbursement.

Encourage all employees to consult the company’s written policies first before making any enquiries.

Your payroll staff will spend more time producing results, rather than attempting to interpret guidelines.

Provide Online Payroll Information

Providing online access to an employee’s current and previous pay information can reduce the amount of time spent dealing with payroll inquiries.

These distractions are not only time-consuming but frequently result in payroll errors, as staff can lose their train of thought when struggling with these interruptions.

Focus on Accuracy

Speed doesn’t help when it comes at the expense of accuracy.

Not only does inaccurate work need to be re-done, it can create feelings of distrust and animosity among employees.

Encourage anyone involved with payroll to be accurate and thorough, and only hire those who exhibit attention to detail.

Increase Employee Involvement

Get employees and managers to record their attendance hours, sign off on paid leaves of absence, verify expenses, and perform other payroll-related activities wherever possible.

This relieves payroll of the burden and allows them to focus on activities of greater urgency.

Empowering employees in this manner also requires they assume a certain level of responsibility.

Ensure they are properly trained in the procedures and understand their importance.

Use Direct Deposit

Use direct deposit instead of manual checks.

It’s faster, more accurate, and offers greater convenience.

Pay cards are an alternative for employees who don’t want direct deposit, and are more efficient.

If checks must be used, avoid writing them out manually.

Instead, reduce the possibility of a transcription error by using your payroll processing system to issue the check.

Outsource Where Possible

Payroll processing is complicated and consumes valuable time and resources, yet is absolutely vital.

Leverage the assets and skills of payroll specialists through outsourcing.

Their up-to-date knowledge provides for faster and more accurate payroll with reduced liability for your company.

Outsourcing also reduces hidden costs like highly skilled computer professionals, which are often required to maintain software and provide hardware support for the payroll department.


While taking steps to improve payroll efficiency, make sure to balance this with an adequate level of service for your valuable employees.

What Are Your Thoughts??

  Payroll’s biggest challenge is producing a 100% correct payroll, requiring methdologies and disciplines that work for them (and may not work for other payrolls). Stephen brings some good points for effectiveness, what can you add to his points?

  Outsourcing is becoming a means-to-an-end as it reduces overhead and allows the Payroll to focus more on the services they provide such as reporting to government agencies as well as the excutive departments of the company. If you have recently outsourced, what suggestions do you have?

  A badly managed payroll department can be a moral buster, what recommendations do you have for running a payroll department that creates value?

Please share your thoughts with our audience in the comments section below!

Inaccurate payroll affects employee morale.

Inaccurate payroll affects employee morale

Accurate and efficient payroll makes for happy employees.

Accurate and efficient payroll makes for happy employees

More on This Topic

By implementing best practices, a company can greatly improve its level of efficiency information reporting, especially within the payroll department. Payroll Best Practices features more than 120 best practices related to every phase of a company’s payroll activities: tracking employee time, recording deductions, paying employees, calculating commissions, outsourcing, control systems, and more.

Written by esteemed accountant and bestselling author Steven Bragg, Payroll Best Practices shows controllers, payroll managers, and CFOs how to integrate these techniques into their existing payroll system. This go-to source for payroll improvements includes:

  • Detailed policies and procedures that incorporate best practices
  • An implementation plan for achieving the greatest efficiency improvement through the selective use of payroll best practices
  • Ways to automate the timekeeping process or, at least, simplify it
  • Methods to reduce employee deductions and convert to automated processes through the use of employee and manager self-service
  • Numerous forms and reports, as well as advanced forms of data storage and electronic presentation
  • Approaches to converting to a variety of electronic employee payments, as well as ways to encourage employees to accept the change
  • A broad range of methods designed to simplify the calculation of commissions
  • Ways to outsource multiple payroll functions
  • Coverage of management-related payroll tasks, including training, process improvements, and customer service issues
  • Techniques for using major computer systems to improve payroll processing
  • Several payroll-specific measurements useful in designing a payroll metrics tracking system
  • And much more

Increase efficiency, lower error rates, and improve service to employees, with the help of Payroll Best Practices.

Payroll Best Practices examines, in great detail (120 best practices to improve the total process of the payroll department), best practices for the payroll function, and how to install them to provide readers with an in-depth knowledge of how this critical functional area can be improved. Here, controllers, payroll managers, and CFOs will discover the exact work plans needed to implement each best practice in their organizations, and lays out pitfalls likely to be encountered and avoided along the way.

This how-to resource for payroll improvements includes:

  • Techniques for reducing the workload and error rate of the payroll staff
  • Methods for switching from an in-house to an outsourced payroll solution
  • Ways to create or outsource a Web-based timekeeping system
  • Approaches to switching to an employee-driven payroll deduction system
  • Graphics indicating the cost and implementation duration for each best practice
  • Policies and procedures that support the best practices
  • A simplified best practices implementation plan
  • An appendix that summarizes the large number of best practices presented
  • A glossary of key payroll-related terminology
  • And much more
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Stephen was brought to our attention by Katrina Robinson of Media Shower and by clicking here you can reach her by email.
Stephen Jeske is an avid outdoor enthusiast with a passion for coffee. A former partner in a 49-year-old family business, he learned about payroll at a very early age, collecting time cards in the back of his father's factory. You will now find Stephen frequently writing about personal branding and small business for websites such as Reputation.com. You can contact Stephen by leaving a comment below, sending him an email, or reaching out to him on social media...

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