As a small business owner who’s looking for a payroll service, you’ll notice that payroll services vary a lot. That’s because many are customizable, and many others have limited manpower or software capabilities.
While we claim to be a one-stop shop, we also acknowledge that we can’t do it all. After nearly six decades of service, we’ve worked out what we can and can’t reasonably provide while maximizing efficiency and minimizing fees.
Here, we’ll break down some of the things that prospective clients would like us to provide that we do not, including:
- Job costing.
- Manually adding up hours worked and entering them into our system. However, we do offer an integrated timekeeping solution that does this automatically.
- Determining overtime hours.
- Divvying up pooled tips.
- Calculating commissions.
- Reporting fringe benefits to unions.
- Determining monthly deductions for non-monthly payroll. A common example is health insurance invoicing.
Job Costing
In another article, our team wrote about why we won’t do job costing from an accounting standpoint. We also don’t handle the payroll portion of job costing.
That means we can’t assign your labor, payroll taxes, or benefits to specific jobs. This isn’t a service that’s commonly provided by payroll services due to its high complexity, so many small businesses that want this done will have to handle it in-house.
Manual Timekeeping
We don’t have the manpower to manually add up your timecards or enter your hours worked into our system (without charging an additional fee for data entry) – but we don’t need to!
Our iSolved timekeeping system tracks your staff’s hours and automatically enters them into our system so all you have to do is verify the timecards for accuracy.
Overtime Determinations
Overtime isn’t as clear as it seems. If you have overtime hours, you need to specify when they were worked unless you use our timekeeping system that does it for you.
For example, if you report 85 hours for a biweekly period, we can’t assume it’s five hours of overtime just because anything over 40 hours per week is overtime. Why? It could be 10 overtime hours for one week and zero for the other.
Pooled Tip Distributions
If your staff has a tip jar or digitally shares tips, your preferred method to distribute them isn’t always clear to us. We’ve seen it involve some time-consuming calculations (based on the hours worked per employee, for example).
While in theory we could handle this for a client, we have hundreds of current clients to consider – which could each have different preferred calculation methods. That means there’s no way to standardize this.
When you can’t standardize something, it takes a ton of manpower and can make things more problematic. That means you’re forced to hire more staff and increase prices and it opens the door to possible mistakes. To avoid this fiasco, we ask that our clients tell us the tip amounts per employee.
Commission Calculations
Want us to calculate what the commission amounts are for each employee? There are tons of different ways to structure commissions, so just like my point about pooled tips above, this is also a service that can’t be standardized.
We could handle this for our clients in theory, but it would require extra manpower, causing us to increase our prices and risk payroll issues that nobody wants to see happen. To avoid this, we ask that you handle this calculation in-house to your standards, then communicate it to us.
Union Fringe Benefit Reporting
Unions require detailed fringe benefit reports from employers. These reports are required on a monthly basis, not weekly (which is the frequency most unions require payroll be run). Also, generally, the report includes a payment for the fringe benefit amounts.
That’s why this is rarely offered by payroll services, and most employers who deal with unions will need to handle fringe benefit reporting in-house.
Monthly Deduction Determinations
Similarly, some deductions (such as health insurance premiums) are invoiced monthly. When you have monthly deductions and don’t have monthly payroll, the monthly deductions need to be divided up so the correct amount is withheld from each payroll.
So, what makes this difficult? Months aren’t always the same. (For example, some months you may run four or even five weekly payrolls – or two or three biweekly payrolls.)
Since you need to be very cautious to avoid inaccurate reporting, and this requires a keen eye on each payroll client, we once again wouldn’t have the manpower for this. That’s why we ask that clients determine their appropriate deductions.
Is CSI Really a One-Stop Shop?
We know that “payroll services” can mean something different to everybody, which is why we want to be transparent about what we don’t include.
While we can’t offer job costing, manual timekeeping, determining overtime hours, divvying up pooled tips, calculating commissions, reporting fringe benefits to unions, or determining monthly deductions for non-monthly payroll, we include just about everything else related to payroll that will keep efficiency high and fees low!
If you know that we can’t do it all, but we do enough for you, feel free to schedule a free consultation by clicking the button below!
Not ready to talk? That’s okay! First, learn more about what to expect from your payroll specialist at CSI Accounting & Payroll.
