Pizza Today - October 2020 - 28

of the direct deposit processing time so
no one receives their money late," Beasley
adds. "Some providers require a fourday lead time, which means you have to
process payroll at least four days before
you want your employees to receive the
funds."
If you have drivers, make sure a policy
is in place for filling up with gas. "The
simplest route would be to have a company
credit card they can use when they need
to refill," Beasley says. If you ask drivers
to cover the cost of gas themselves and
then reimburse them, you'll want a system
that allows them to submit the number
of miles they drive each shift. "This will
enable you to do a reasonableness check to
ensure the mileage was spent on business
trips versus personal," Beasley says.
For tip-earning employees, check that
it's easy for them to report their tips for
every shift. You might print of copies of
the IRS Daily Tip Reporting Form and
ask staff members to fill one out every
day. If your system makes it possible to
enter tips electronically, set reminders for
workers to report tips when their shift
ends.
Keep Track of Time
Without a time clock in place, "on
average, 10 percent of wages are wasted,"
says Charles Read, president and CEO
of GetPayroll in Lewisville, Texas. This
means if you ask staff members to simply
write down on a card the time they come
in and when they leave, you'll likely spend
110 percent of what you should be paying
for their hourly wages.
To correctly align wages with the
number of hours worked, consider
technology that helps record time. "A
biometric clock prevents buddy punching,"
Read says. This type of clock scans an
employee to check for unique physical
characteristics, such as their fingerprint, to
verify the worker's identity.
If your payroll system allows employees
to swipe a card to check in and out
electronically, you'll still want to manually
review their working times. You might
find, for instance, that a worker forgot to
swipe their card at the end of the shift,
making it appear they worked for an
extraordinarily long shift, like 24 hours.
Ensure Legal Compliances
If you manually calculate employee

026_PIZ_1020_OPpayroll.indd 28

paychecks and the amount of taxes due,
check that you're using the most up-todate tax tables. "The IRS tax rates can
change on an annual basis," Beasley says.
For places with more than a handful
of employees, a payroll system or service
can sort out the different federal, state
and local tax requirements. "They provide
payroll tax support by automating
deductions and tax withholdings from
employee wages, and remitting the correct
amount to the various tax agencies based
on the latest payroll tax regulations," says
Mark Dockham, president of Intrepid
Payroll, Inc.
Payroll services can also manage
annual tax forms. "When tax season
rolls around, they create, distribute and
file W-2s for employees or 1099s for
independent contractors," Dockham says.
"Tax management services might also
include 940 and 941 filings, W-2 and
W-3 processing, state withholding and
unemployment."
Clearly Communicate Policies
Once you have your payroll system
in place, write out the guidelines
for employees in a policy manual or
handbook. "Every aspect of how you pay
your employees should be covered in
detail," Read says. Include information
about pay rates, tax requirements, tip
policies, overtime, time keeping, pay
periods and pay dates, and payment on
termination. Also list how employees are
paid, such as through checks or a direct
deposit.
When you hire staff, ask them to
read and sign the manual or handbook.
"Having policies for your employees
that they have read and acknowledged
at the beginning of employment
reduces turnover, disagreements,
misunderstandings and other unpleasant
aspects of dealing with upset workers,"
Read says. If you make changes to the way
you do payroll, update the manual and ask
employees to sign it again. This will allow
state and federal labor offices to see you
have written contracts with employees that
outline your current policies. n

RACHEL HARTMAN is a freelance
writer who covers small business,
finance and lifestyle topics.

9/9/20 9:14 AM
Pizza Today - October 2020

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