Running any kind of business, especially a small business, comes with many responsibilities and challenges. Making sure the product is satisfactory for the consumer, as well as making sure everything is running smoothly behind the scenes are hard to do alone as an owner. This is where using a payroll company can be a lifesaver for these businesses.
Brent Ponstingle, director of sales at Ahola HR Solutions in Brecksville, and Dan Ungar, owner of Mar-Lou Shoes in Lyndhurst, said payroll companies can assist businesses in different ways.
Ponstingle, who works for a payroll company, said most people tend to use a payroll company to handle things like paying their federal, state or local payroll-related taxes. Payroll companies will help to make sure that they’re in proper compliance and that they don’t miss payments. They can also help with the prospective employee application process.
“We know the IRS isn’t necessarily forgiving when you miss payments,” Ponstingle said. “So, one role is to provide tools so that companies can help simplify their process. Things like time clocks that integrate into the payroll software, things like electronic applicant tracking. So, when you post a job on a job board, a prospective employee can see it, click on it, enter their information and apply through the system. And then all of their information is already captured in the company’s payroll system.”
A company’s payroll system can also be referred to as HRIS systems, or human resource information systems. The prospective employees’ information will already be in there.
“So, after they go through the interview process, a company decides they want to extend them an offer, they extend it and put it out through the system, and then from there, they can on-board electronically,” Ponstingle said. “So, it’s no more big paper handbooks to go through and sign. Your I-9s, your W-4s, any type of a welcome packet, all of that is done electronically now and stored in a cloud based system, instead of having tons of file cabinets full of paper.”
As a small business owner who does biweekly payroll, Ungar said these payroll services are a great time saver.
“Insofar as everything is either done electronically or via email, I don’t have to worry about determining taxes,” Ungar said. “I have no payroll tax to calculate because it’s all done by the payroll companies. When you’re paying upwards of 17 people, it is a huge time saver.”
Ungar added there is automated functionality of their employee benefits, such as retirement savings program and the deposits in the matching funds. The same goes for health insurance, premium reimbursement and contributions to their employees health savings accounts.
“As the old adage goes, time is money,” Ungar said. “It actually saves time and stress. Doing payroll manually, which is what we used to do. I remember growing up watching my father write the checks, insofar as writing checks, it’s just one aspect of it. The time and the energy expended to calculate all the payroll taxes is really almost inordinate. It’s just a huge amount of time. And doing that for 16 to 17 people every two weeks is crazy.”
As someone who grew up in a small family business that his dad had started, Ponstingle said he knows people in small businesses wear a lot of hats and serve in a lot of different roles.
“If you’re running a company that has five,10,15 employees, chances are you don’t have dedicated people to do a dedicated process,” Ponstingle said. “So, it may be that the owner, while they’re trying to run the company, also is in charge of doing the payroll each week or every other week. So, our job is to just help make that easier. You want the people running businesses, especially family businesses, to spend more time on running their business and less time on doing sort of the more mundane functionality of the business.”