Pay raises make employees happy, don’t they? Not only do raises make employees happy, most small business owners are very proud of their ability to not only provide employment, but also to increase wages.The Bureau of Labor Statistics (BLS) provides quarterly reports on average wages in each state, so if you want to be sure you are staying abreast of current wages in your state, you can find it at the BLS website.
As exciting as pay increases in an employee’s wages are for everyone, it also requires several other adjustments in the payroll process. Since many deductions and taxes are calculated based on employee wages, they must be recalculated – and double-checked – at every payroll period. If pay increases are retroactive, well, that opens up adjustments for several pay periods.
Avoid costly errors in adjustments for pay increases
The process we employ at The Payroll Department makes certain that no necessary adjustments fall through the cracks. The reason for that is because when errors are made on payroll, it affects the taxes collected and paid to the state and federal agencies. And errors can be devastating for your small business; not only in potential costly fines and penalties, but also in time to resolve errors – it could take months or, if it spans over the year end, errors can follow you over a couple of years.
So, while giving raises makes everyone smile, it takes work to make sure that the changes and adjustments are calculated correctly and deposits to the state and federal agencies are reported and paid correctly. THAT is one of the big reasons small business owners find outsourcing their payroll to a payroll provider like The Payroll Department is a priceless benefit to their business. The cost of the fretting and worry is gone because they know payroll and payroll taxes will be handled on time and accurately.
You can get that same priceless benefit and really smile when you give your employees raises. Contact The Payroll Department today!
-Elaine of The Payroll Department Blog Team