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Sneaky HR Tasks Eating Your Time (and How to Fix Them)

It’s time to tackle those sneaky HR time thieves and take back your calendar. Here’s how.

IT’S HERE!

Your FREE HR Checklist

Here’s your checklist of important tasks related to payroll, benefits, compliance, and general HR.

These tasks shouldn’t take up your workweek. But when systems fall short, they do. If you’re a small or mid-size business owner or HR leader, you probably didn’t get into this role because you love tracking down time-off requests, chasing signatures, or answering the same benefits question 14 times.

And yet… here we are.

Studies show that small business owners spend about 16 hours (or two full days) per week on HR-related administrative work.

Most businesses lose valuable time to the slow drip of small, repetitive “this will only take a minute,” tasks that quietly eat up the workweek. Add them up, and suddenly your strategic HR goals, like recruitment, retention, and leadership development, get pushed aside.

Here are some of the most common areas that may be draining your time.

Time-Consuming HR-Related Tasks

They seem small. But over time, these tasks drain your attention, your energy, and your progress.

1. Repetitive Tasks and Rework

Every time you hunt down a missing signature or resend login details, you lose time you could be using elsewhere. The common offenders? Answering the same employee questions over and over:

“How do I add my baby to insurance?”
“When do benefits start?”
“How many PTO days do I have left?”

Sound familiar?

Individually, these are quick answers. Collectively? They’re a constant interruption machine. When you stop to respond, you lose focus, break momentum, and push higher-value work further down your list.

🛠️ How To Fix It: Uncover the pain points. Which areas are bogging down the process due to repetition? Where can you create a self-service culture? This can mean establishing a simple internal HR hub (in your intranet, shared drive, or HR platform), short FAQs on benefits, PTO, payroll timing, and onboarding, or short videos that walk through routine processes.

Then, train employees to go there first. When someone asks a repeated question, send the link along with your answer. Over time, behavior shifts. HR becomes a source, not a help desk.

2. Correcting Payroll Errors

The latest software makes running payroll seem easy, but if something goes wrong, the liability is still yours. Miscalculating pay, outdated tax information, and manually tracking time off are time-consuming to fix, hard to catch, and expensive if you don’t, not just in terms of costs but also in lost time and eroded trust among your workers.

🛠️ How To Fix It: Automate what you can. Look for tools that let employees request time off directly, route approvals to managers, automatically update balances, and sync with payroll.

When automation handles the basics, HR shifts away from data entry to policy guidance. You’ll still handle exceptions, but you won’t be stuck crunching numbers late at night.

Or leave it to the experts by outsourcing payroll to an IRS-certified PEO. A PEO can simplify the payroll process with a cloud-based payroll portal for employers, online employee access to pay stubs, W-2s, benefits info, employee handbooks, and secure, paperless direct deposits. They can also take care of onboarding, payroll taxes, IRS deposits, benefits administration, compliance guidance, and provide HR support.

3. DIY Compliance Monitoring

Labor laws change constantly. Posting requirements update. Salary thresholds shift. Leave laws multiply. Keeping up with shifting deadlines, state-level compliance requirements, and studying the IRS’s recently updated guidance under the One Big Beautiful Bill Act. Trying to monitor all of this yourself is not only time-consuming – it’s also stressful.

One misstep can be costly. In 2025, the Department of Labor’s Wage and Hour Division recovered more than $259 million in back wages for nearly 177,000 employees. That’s an average of $1,465 per worker (the most since 2019).

🛠️ How To Fix It: Don’t carry compliance alone. Get expert help by partnering with a professional. Whether it’s through a PEO, outside counsel, or a compliance partner, get support that keeps you updated on requirements that apply to your business.

You’ll need advice on tricky employee situations, alerts on multi-state regulatory changes, new pay transparency rules, evolving paid leave requirements, changing wage-and-hour laws, new employment-related laws on AI, and much more.

🚀 Pro Tip: Stay compliant with our HR Checklist covering the latest updates and deadlines related to compliance, benefits, payroll, and general HR that you need to take care of each quarter. Download your free HR Checklist ➡️ HERE

4. Updating Employee Data in Multiple Places

Name changes. Address changes. Promotions. New pay rates. If you’re entering the same update into payroll, benefits, retirement platforms, and internal trackers, you’re doing triple-plus work and increasing the chance of errors.

🛠️ How To Fix It: Integrate your systems, invest in HR technology, or work with a PEO. A unified HR platform can help connect payroll, benefits, time tracking, and employee records, among other things.

With better integration, changes flow through automatically. That means fewer entries, fewer errors, and more free time.

5. Handling Every Employee Issue Personally

When you’re the only go-to for every conflict, complaint, or issue, your day gets hijacked fast. Some things absolutely belong with HR. But many could be resolved earlier and better by trained managers.

🛠️ How To Fix It: Upskill your managers by teaching them to give feedback, handle minor conflicts, and document specific issues. This doesn’t remove HR from the process; rather, it elevates the role, moving them from firefighter to advisor.

Stop the HR Busy Work, Amplify Your Impact

Normalizing HR busy work has real consequences, including burnout. Your top performers may feel overwhelmed by constant overtime or pressure to meet demands. It also creates dependence on key team members, making it difficult to delegate when only a few people hold essential knowledge or responsibilities.

Maintaining inefficient processes limits growth, slows project delivery, and prevents your team from focusing on strategic initiatives. 🛠️ How To Fix It: Partnering with an IRS-certified PEO can help. By taking on time-consuming tasks, PEOs help small businesses get back more time to focus on productivity and growth. In addition to saving time, a PEO can also save your business money by identifying inefficiencies, streamlining HR processes, and helping you make critical cost-cutting decisions.

Studies show that businesses working with a PEO:

☑️Grow twice as fast and are 50% less likely to go out of business

☑️Have a 12% lower employee turnover rate

☑️Have an ROI of 27.2 % per year, based on cost savings alone

☑️Experience double the a nnual median revenue growth, with an added 16% increase in profitability

If you constantly feel behind, the fix isn’t more hustle. It’s better tools, clearer processes, and the right support. A PEO can help you stop the small stuff from piling up, so you can invest your time where it matters most. And if you need help, just give us a call at📱 800-446-6567

Find Out What a PEO Can Do for You

If you’re a small to mid-sized business, a PEO can lighten your workload and strengthen your operations. Imagine focusing on growth while experts handle your payroll, taxes, benefits, HR, and compliance.

⬇️Read more about the advantages of working with a PEO in our series:

🔷 HELP WANTED: HR Team or PEO Partner

Investing in an HR team versus partnering with a PEO, which path is best for your small business? As your business grows, managing HR gets complicated – fast.

Should you build your own HR team or explore the benefits of partnering with a PEO? Here’s how to decide which choice best fits your business. ➡️Link #1Link #1Read More

🔷 NEW RESEARCH: More Small Businesses Are Turning to PEOs

Compelling research from the National Association of Professional Employer Organizations (NAPEO) shows that PEOs are helping small businesses scale – a game-changer in 2026.

Working with a PEO isn’t about outsourcing; it’s about upgrading how you manage HR. It’s about investing in smarter growth, happier employees, and peace of mind. In a business world that’s only getting more complex, that’s a benefit worth having on your side. Thousands of successful businesses are already doing it – and the data proves it works. ➡️Link #2Link #2Read More

IT’S HERE!

Your FREE HR Checklist

Here’s your checklist of important tasks related to payroll, benefits, compliance, and general HR.

About Propel HR. Propel HR is an IRS-certified PEO and a leading provider of human resources and payroll solutions for 30 years. Propel partners with small to mid-sized businesses to manage payroll, employee benefits, compliance and risks, and other HR functions in a way that maximizes efficiency and reduces costs. For more information, visit propelhr.com

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The Productivity Playbook: How to Turn Outsourcing into a Strategic Win

Here’s your game plan for turning outsourcing into a winning streak.

IT’S HERE!

Your FREE HR Checklist

Here’s your checklist of important tasks related to payroll, benefits, compliance, and general HR.

Productivity is the secret sauce that separates teams stuck on the sidelines from those with winning streaks. Chances are you’re juggling hiring, compliance, benefits, culture, and about a dozen other priorities . . . all while the clock keeps ticking.

➡️➡️Link #1Link #1Link #1Read More: HR Forecast: What’s Changing & How To Get Ready

Your power play? Outsourcing. When used strategically, it boosts productivity, streamlines operations, and frees you up to focus on what actually moves the scoreboard – your bottom line.

First Quarter: What Productivity Really Means

In HR, productivity isn’t about sprinting faster – it’s about running the right plays at the right time.

True HR productivity means delivering meaningful outcomes with minimal wasted effort. Speed matters, sure, but impact matters more.

Fast hiring doesn’t matter if turnover remains high. Smooth payroll is great . . . unless errors keep forcing replays.

At its core, productivity is about consistent, high-quality execution that supports your business year-round.

Here’s the basic stat line. The fundamental formula HR teams use looks like this: Productivity = Total Output / Total Input.

📤Output: Projects completed, revenue generated, goals achieved

📥Input: Labor hours, number of employees, or financial costs

It’s simple math but powerful when you track the right metrics.

Why HR Productivity Is For Champions

When HR productivity is dialed in, your entire team plays better.

Here’s what that looks like on the field:

🎯Better Employee Experience. Faster responses, smoother onboarding, clearer policies – all retention fuel.

🎯Stronger Compliance Defense. Mistakes lead to fines, audits, and penalties – that’s expensive. Productive HR keeps risk off the scoreboard.

🎯Scoring Efficiency. In the Red Zone, the stakes are high, and scoring opportunities significantly increase. When your HR team isn’t buried in paperwork, they can make a more strategic impact by focusing on culture, performance, and growth.

🎯Leadership Trust. HR shifts from order-taker to trusted partner.

The results? A productive HR function is the engine that keeps your people – and your business – moving forward.

The Stats Don’t Lie: Proof from the League

The data backs it up:

➡️Flexibility & Remote Work. A Gartner report finds that 43% of employees working flexible hours say they are more productive. Gallup found that fully remote workers report the highest engagement levels.

➡️Engagement Matters. Highly engaged teams are 17% – 21% more productive than disengaged ones.

➡️The Productivity Gap. Top-tier companies grew more productive, while others saw declines due to inefficient collaboration and low engagement.

🎯Winning teams don’t guess; they measure, adjust, optimize, and power up.

The Box Score: Common HR Productivity Metrics

To know how your team is performing, you need the right stats:

📊 Output Metrics. Revenue per employee, output per hour, goals completed vs. assigned

📊 Efficiency Metrics. Time spent per task, employee utilization

📊 Quality Metrics. Accuracy and impact, not just speed

📊 Engagement Indicators. Engagement scores and absenteeism.

📊 Financial Metrics. Total Cost of Workforce (TCOW)

These numbers tell you whether your plays are working and what needs to be redesigned.

Second Half Adjustments

This is where smart teams pull ahead. One of the most effective strategies? Outsourcing to a Professional Employer Organization (PEO).

A PEO helps improve productivity by offloading time-consuming tasks while strengthening the entire employee lifecycle through MVP expertise and next-level HR tech.

🔥Think of it as adding multiple Tom Bradys to your roster.

THE GAME PLAN

Play #1: Reallocate Resources to Core Strengths

The fastest productivity gain comes from freeing your teams from admin overload. By outsourcing, you get:

✅Time Savings. Business owners can spend 20+ hours per month on HR admin-related tasks. Outsourcing frees up time for growth, sales, and strategy.

✅Administrative Relief. Payroll, benefits enrollment, and multi-state compliance tasks move off your plate and into expert hands.

✅A Team of MVPs. Outsourcing gives you access to a team of pros, ready to help when you need it.

Play #2: Build a Deeper Talent Bench that Flexes

An engaged workforce is naturally more productive.

💼 Lower Turnover. Companies using PEOs see 10%–14% lower turnover, reducing disruptions and retraining time.

💼 Big-league Benefits. PEOs provide access to Fortune 500-level benefits, boosting satisfaction and engagement.

💼 Faster Onboarding. Streamlined onboarding helps new hires get in the game.

Play #3: Upgrade Your Tech Stack

PEOs give small and mid-sized businesses access to advanced HR technology without the big-ticket price tag.

📊 Automation. Payroll and tax automation reduce errors and time-consuming fixes.

📊 Employee Self-service. Employees handle PTO, pay stubs, and benefits updates themselves with fewer interruptions for HR.

Play #4: Strengthen Your Compliance Defense

Compliance isn’t optional and managing it internally can drain focus fast. With a PEO on your team, you get:

🛡️Expert Guidance. A team of HR pros helps prevent fumbles and penalties. PEOs stay on top of federal, state, and local regulations, including ACA and FMLA.

🛡️Safety Programs. Proactive safety audits reduce workplace incidents and business disruption.

Play #5: Win on the Scoreboard

All these efficiencies lead to real, measurable stats:

🏆Faster Growth. Businesses using a PEO grow 7% – 9% faster than those that don’t. And are 50% Less Likely to Go Out of Business

🏆High ROI. The average annual return on investment is 27.2% based solely on cost savings.

💥That’s not just a win – it’s a blowout. It’s the stuff championships are made of.

FINAL CALL: Make Productivity Your Winning Play!

How far can you go? Productivity isn’t a one-time drill – it’s a GOAT mindset.

When you measure what matters, optimize repetitive work, and outsource strategically, you’re not just working faster . . . You’re working smarter. That’s for legends.

🔥Outsourcing is no rookie move. It’s a strategic productivity partner that helps HR shift from scrambling to scoring. And keeping that winning streak hot.

Ready to Turn HR into a Powerhouse?

Ready to hear your crowd ROOOAAARRR? 🎉 This power playbook is your first step.

➡️If you need some coaching or a huddle about your productivity game plan, we’ve got you all the way to the Super Bowl winning streak and beyond – just give us a call.

IT’S HERE!

Your FREE HR Checklist

Here’s your checklist of important tasks related to payroll, benefits, compliance, and general HR.

About Propel HR. Propel HR is an IRS-certified PEO and a leading provider of human resources and payroll solutions for 30 years. Propel partners with small to mid-sized businesses to manage payroll, employee benefits, compliance, risk, and other HR functions in ways that maximize efficiency and reduce costs. To learn more, visit propelhr.com

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Scaling Smart: How a PEO Prepares Your Business for Growth

Is your business growing? Here’s how a PEO becomes a powerful advantage as you gear up for bigger things.

IT’S HERE!

Your FREE HR Checklist

Here’s your checklist of important tasks related to payroll, benefits, compliance, and general HR.

If you run a small or midsize business, you already know growth is exciting, yes — but also unpredictable, and sometimes overwhelming. That’s exactly why more business owners and HR leaders are choosing Professional Employer Organizations, or PEOs, not just to outsource HR tasks, but to grow smarter, faster, and more sustainably.

The Top 10

A PEO helps you scale without letting the behind-the-scenes stuff collapse under the weight of bigger payrolls, more onboarding, greater compliance risk, and higher employee expectations. It’s like adding an entire HR department overnight, minus the overhead and recruitment scramble. A few advantages include:

1. You Get HR Infrastructure Before You Actually Need It (Which Is Exactly When You Need It)

Most small businesses don’t feel the pain of HR complexity until it’s too late. Payroll errors start multiplying, employees want benefits you’re not equipped to provide, and suddenly you’re Googling state labor laws at 11:30 p.m.

A PEO lays the foundation before those cracks show. Payroll scales without drama. Whether you have 10 people or 110, payroll stays smooth, compliant, and on time. Onboarding becomes a real process and not a scramble. Templates, checklists, digital forms, background screening, and automated workflows ensure consistency as you grow. Policies adjust proactively. A PEO helps you build employee handbooks, update them with new laws, and create clear rules that reduce risk as your headcount increases.

2. A PEO Delivers the Big-Company Benefits Employees Want

Here’s the part that often surprises business owners: a PEO can give you access to benefits packages typically reserved for much larger companies.

Because a PEO pools together employees across its client base, you essentially get to “buy in bulk,” accessing high-quality benefits at lower rates. That means you can offer your team robust health plans, retirement savings options, and other top-tier benefits typically reserved for larger companies (and top talent expects).

🎯When employees enjoy comprehensive benefits without compromise, your company is seen as a long-term career option. Retention rises, and as every HR pro knows, that’s a growth strategy.

3. Compliance Stops Being a Guessing Game

Growth = risk. New states. New regulations. New employment laws. New reporting requirements.

This is where many small businesses unintentionally step into danger territory. The rules change constantly and the stakes are high.

A PEO becomes your compliance command center:

✅They track federal, state, and local employment laws.

✅They help maintain the required documentation.

✅They ensure new hires are classified correctly.

✅They reduce risk with structured workplace policies.

✅And because of the co-employment relationship, many PEOs also share certain administrative responsibilities – meaning you’re not alone if something goes sideways.

🎯Growing is risky. Growing without compliance support? That’s gambling.

4. HR Technology You Don’t Have to Build Yourself

Scaling is smoother when everything is connected, such as payroll, onboarding, PTO tracking, benefits enrollment, performance management, and reporting. But building your own HR tech stack or licensing multiple vendors gets expensive fast.

🎯A PEO delivers the all-in-one HR command center designed for your business. Better data, better workflows, better decision-making.

5. A PEO Frees Up Time (A Lot of It)

If you’re a business owner, your job is to grow the business, not troubleshoot payroll deductions. If you’re an HR manager, your job is to support the people strategy, not drown in admin work.

A PEO takes on repetitive, time-consuming tasks, such as processing payroll, managing benefits, handling tax filings, and preparing compliance documentation. The more you grow, the more time you reclaim, instead of watching your workload escalate with each hire.

6. You Gain a Team of HR Experts Without Expanding Your Staff

Growing companies don’t always have the luxury of immediately hiring a full HR team — HR generalists, benefits specialists, payroll administrators, compliance officers, recruiters, risk managers, the whole lineup.

A PEO gives you access to exactly those roles, on-demand expertise, without the full-time salary load.

Need help rolling out a new PTO policy? Preparing for benefits renewal? Handling a sensitive employee relations issue? There’s an expert for that. It’s like having a seasoned HR department already onboard, ready to advise you every step of the way.

7. You Become More Attractive to Investors and Partners

Here’s something entrepreneurs don’t always think about: investors love operational maturity. When a PEO is part of your infrastructure, it signals you’re compliant, manage risks well, your HR processes are stable and that you can scale responsibly.

🎯For investors, lenders, and potential partners, a strong HR foundation = reduced risk. And reduced risk makes you a better bet. For acquisitions and rapid growth phases, a PEO can also make integration smoother.

8. A PEO Helps You Build a Better Employee Experience

Growth doesn’t just require more people; it requires keeping the good people you already have on board.

A PEO helps you:

✅Improve communication and access to information.

✅Build modern HR processes that employees trust.

✅Provide competitive benefits

✅Create fair, consistent workplace policies.

🎯A better employee experience leads to lower turnover and higher morale. And in high-growth companies, stability is gold.

9. You Can Expand Into New States With Confidence

Need to hire employees in another state? That’s great for growth, but it creates compliance challenges due to different tax rules and labor law requirements.

🎯A PEO handles all of it, letting you recruit the best talent in any location without losing sleep or risking penalties.

10. You Scale Strategically

Growth can stress your business when operations lag behind headcount. A PEO aligns both, so you’re expanding strategically.

🎯The result? Smooth transitions. Predictable costs. Cleaner processes. Less risk. Happier employees. And more time to focus on what actually grows the business — not on what slows it down.

Growth Is Easier ➡️When You’re Not Doing Everything Yourself

If you’re preparing to scale — or even thinking about it — the question isn’t whether you can handle growth alone. It’s whether you should.

With a PEO, growth is a plan.

A PEO delivers the infrastructure, expertise, and stability that power growing companies, without requiring a major investment or a staff increase.

Ready to see what a PEO can do? We can lighten your workload and help you drive growth, just give us a call at (800) 446-6567 or visit propelhr.com

🎯PEO Series: The PEO Difference🎯

Learn more about how a PEO can help your business in our series:

🔶HR Help Wanted: In-house Team or PEO Partner. Investing in an HR team versus partnering with a PEO, which path is best for your small business? As your business grows, managing HR gets complicated – fast. Should you build your own HR team or explore the benefits of partnering with a PEO? Here’s how to decide which choice best fits your business. Read More

🔶Navigating Compliance Minefields. Navigating HR compliance can feel like tiptoeing through a minefield — one wrong move can trigger costly consequences. From pay transparency laws to overtime thresholds, new regulations evolve faster than most small HR teams can keep up with. Here’s a look at the top HR compliance challenges and how to avoid turning small missteps into expensive lessons. Read More

🔶New Research Shows Why More Small Businesses Are Turning to PEOs. The data is in! And it shows how partnering with a PEO will be the smartest move for small businesses in 2026. Recently released research from the National Association of Professional Employer Organizations (NAPEO) shows that PEO partnerships are helping small businesses scale. It’s smarter, more efficient, and a game-changer. Here’s what the latest data shows. Read More

IT’S HERE!

Your FREE HR Checklist

Here’s your checklist of important tasks related to payroll, benefits, compliance, and general HR.

About Propel HR. Propel HR is an IRS-certified PEO that has been a leading provider of human resources and payroll solutions for more than 25 years. Propel partners with small to mid-sized businesses to manage payroll, employee benefits, compliance and risks, and other HR functions in a way that maximizes efficiency and reduces costs. For more information, visit www.propelhr.com

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Your HR Checklist For Q2

From new laws to filing deadlines for state, federal, and local compliance, HR responsibilities continue to grow. Here’s your HR checklist for Q2.

PAYROLL & TAX

Prepare for Applicable State-Specific, Mid-Year Minimum Wage Increases. Applicable to all employees covered by the Fair Labor Standards Act (FLSA) except for agricultural employees and employees of municipalities and the Commonwealth of Puerto Rico. Many states also have minimum wage laws. When an employee is subject to state and federal minimum wage laws, the employee is entitled to the higher minimum wage rate. To learn more about applicable minimum wage laws in the states where you have employees working, visit the Department of Labor’s interactive map.

COMPLIANCE

File 2023 EEO-1 Component 1 Report. The EEO-1 Component 1 Report is a mandatory annual data collection that requires all private sector employers with 100 or more employees and federal contractors with 50 or more employees meeting certain criteria to submit workforce demographic data, including data by job category and sex and race or ethnicity, to the EEOC. The 2023 EEO-1 Component 1 data collection will open on April 30, 2024. The deadline to file the 2023 EEO-1 Component 1 Report is June 4, 2024.

Remove OSHA Form 300A. As part of OSHA’s record-keeping requirements, applicable employers must post a summary of the injuries and illnesses recorded the previous year from February through April. Employers must maintain these records at the worksite for at least five years. On April 30, 2024, applicable employers may remove OSHA Form 300A, a summary of workplace injuries and illnesses.

Employee or Independent Contractor? On March 11, 2024, the Department of Labor’s final rule goes into effect and revises prior guidance on how employers determine whether a worker is an employee or independent contractor under the FLSA.

Schedule Required Compliance Training. Check all required federal, state, and industry workplace training requirements that apply to your business, as well as workplace training mandated in your state.

Watch for Updates in DOL’s Overtime Rule. The Department of Labor plans to release the final overtime rule in the spring. Look for potential changes or additional requirements.

BENEFITS

Review Your Employee Benefits Plan. Follow up with your benefits broker for updates, deadlines, and any changes in reporting. Also, verify that all healthcare reform requirements are met.

⚠️And don’t let your Benefits Renewal Date sneak up on you. Renewal dates will be here before you know it. Review your benefits plan and consider options to get the best coverage for your employees at the best price. Then start the conversation with your benefits broker at least 60 days in advance.

Review All Insurance Policies. Is your health plan the right fit for your business? Do you know what to expect during the insurance renewal process? Do you have all the policies in place to protect your business? National Insurance Awareness Day is June 28, 2024, and an annual reminder to review all of your insurance policies. Determine if changes in your work environment or staff work assignments may impact your current exposure and codes on your account. Also, check with your Workers’ Comp insurance broker to determine if you need to make any necessary adjustments to cover additional exposure, including remote workers.

Medicare Part D Disclosure. Employers providing prescription drug coverage to Medicare-eligible individuals must also disclose to the Centers for Medicare and Medicaid Services (CMS) whether the coverage is creditable or non-creditable. This annual disclosure must be made no more than 60 days after the beginning of each plan year.

GENERAL HR

Review Record-keeping Requirements for Small Businesses. Small businesses are required to follow a number of regulations for record-keeping. A few examples include:

Employment Records: 1 Year. Age Discrimination in Employment Act (ADEA), Americans with Disabilities Act (ADA), and the Civil Rights Act of 1964 (Title VII) require employers to retain hiring (including resumes or applications of those interviewed) and employment records for one year after creating the documents or the hire/no-hire decision, whichever is later. In addition, after employment terminates, employers must keep existing employment records for one year from the termination date.

Leave Records: 3 Years. The Family Medical Leave Act (FMLA) requires employers to keep leave records for three years.

Employment Tax Records: 4 Years. Under the Federal Insurance Contribution Act (FICA), Federal Unemployment Tax Act, and Internal Revenue Code, employers should keep employment tax records for four years after filing the 4th quarter taxes.

Form I-9: 3 Years. The Immigration Reform and Control Act (IRCA) and Immigration and Nationality Act (INA) require employers to keep copies of Form I-9 and supporting documentation for three years after the date of hire or one year after the date of termination, whichever is later.

➡️➡️READ MORE: Harnessing the Power of AI in Recruitment

Need Help? We’ve got you covered. Depending on your business and industry, your HR checklist may be different and even more complex. As an IRS-certified Professional Employer Organization (PEO), Propel HR has been a leading provider of Human Resources and payroll solutions for more than 25 years. We partner with small to mid-sized businesses to manage payroll, employee benefits, compliance and risks, and other HR functions in a way that maximizes efficiency and reduces costs. If you need help, just give us a call at (800) 446-6567, or to learn more, visit www.propelhr.com.

PLEASE NOTE: This information is for general reference purposes only. As we continue to work during an active pandemic, laws, regulations, and filing deadlines are likely to change. Please check with the appropriate organizations or government agencies for the latest information and consult your employment attorney and/or benefits advisor regarding your responsibilities. In addition, your company may be exempt from certain requirements and/or be subject to different requirements under the laws of your state. (Updated March 14, 2024)

Harnessing the Power of AI in Recruitment

AI-driven tools are reshaping the recruitment process and revolutionizing how employers find and hire top talent.

The Advantages of AI-Driven Tools

Traditional recruitment methods are time-consuming and often fall short of locating the best hire from a pool of job seekers. That’s changing. AI-powered automation is playing a pivotal role making it easier and faster for companies to discover the most suitable candidate from a pool of job seekers.

Increased Efficiency and Time-Savings. Studies show that employers are recognizing the value of AI and turning to AI-powered tools in the recruitment process. By leveraging the power of machine learning and predictive analytics, employers can dramatically improve the speed and quality of hiring, ultimately enabling them to identify the right talent more effectively than ever before.

For short-staffed HR departments, AI has already proven its worth. Studies show that employers using AI have found that automating processes reduces the administrative burden and also, boosts efficiency. In a recent study, 96% of employers surveyed believe that AI can enhance recruitment and retention efforts helping HR managers save an average of 14 hours per week – the amount of time that HR managers say they spend on manual tasks that can be automated.

Link #1Link #1Link #1Link #1Link #1➡️➡️Read More: 7 Heart-felt Ways To Show Your Employees That You Care

By leveraging machine learning algorithms, hiring is accelerated by the ability to scan thousands of resumes against pre-defined criteria and vast amounts of data from various sources, including social media platforms, and professional networking sites, in a fraction of the time it would take one human recruiter. These algorithms can also be used to predict candidate behavior, enabling recruiters to tailor outreach strategies and build a more diverse talent pool.

Stronger Forecasting Capabilities. HR can use AI-driven predictive analytics to forecast future hiring needs, identify talent gaps, and develop strategies to address them. These insights empower recruiters to build stronger talent pipelines by nurturing relationships with potential candidates and anticipating hiring challenges before they arise. This ensures a steady supply of skilled workers to fuel long-term growth. By analyzing historical data, AI can also identify patterns to help HR predict the likelihood of a candidate’s success with high accuracy. As a result, employers can prioritize candidates most likely to excel in a given role.

Link #2Link #2Link #2Link #2Link #2➡️➡️Read More: Embracing the Hybrid Work Model

Greater Cost Savings. In a recent study, 41% of HR managers reported that productivity suffered by not automating manual processes, and 35% said it actually increased costs. Automating routine and repetitive tasks, like resume screening and scheduling interviews, can significantly reduce expenses. According to a LinkedIn study, using AI in recruitment efforts can reduce hiring costs by 30% per hire and increase revenue per employee by an average of 4%. Taking advantage of AI-driven insights, employers are able to make more informed hiring decisions and focus on the most promising candidates, minimizing turnover and ultimately saving money.

Accelerating Productivity. Once a candidate is hired, AI continues to play a pivotal role in the employee’s journey. A recent Stanford University study found that using generative AI for onboarding significantly improved productivity among new hires. Intelligent onboarding platforms can personalize the onboarding experience based on the employee’s role, preferences, and learning style, fostering a sense of belonging from day one.

Better Engagement Experience. Engaging with candidates throughout the recruitment process is a must for building relationships and enhancing the candidate experience. AI-driven analytics can monitor employee engagement and satisfaction levels, identifying and mitigating potential retention risks.

Areas to Watch

While AI offers numerous advantages for talent acquisition, keep an eye on areas that may present potential challenges, such as:

Unintentional Bias. Regularly audit algorithms prevent biases from from historical data.
Privacy Concerns. Collecting and analyzing vast amounts of candidate data can present privacy concerns. Ensure compliance by following data protection regulations and obtaining consent from candidates before using their personal information.
Transparency Issues. Be transparent and let candidates know when AI is used during the hiring process and allow them the option to opt-out.

The Competitive Edge in Recruitment

While there’s no replacement for human expertise and judgment, AI can be a valuable tool to enhance the work of your HR teams, allowing them to make more informed hiring decisions, reduce costs, and gain a competitive edge in the search for top talent.

About Propel HR. Propel HR is an IRS-certified PEO that has been a leading provider of human resources and payroll solutions for more than 25 years. Propel partners with small to midsized businesses to manage payroll, employee benefits, compliance and risks, and other HR functions in a way that maximizes efficiency and reduces costs. For more information, visit www.propelhr.com

7 Heartfelt Ways to Show Employees You Care

Employees thrive in environments where they feel valued and supported, and while a paycheck is important, it’s not the only way to show you care. Here are seven heartfelt ways to make your employees feel appreciated and loved.

Do you love your employees? Taking care of employees ensures that your employees will take care of your business. According to a Gallup survey, when workers feel valued, employers experience increased engagement, enhanced productivity, improved morale, experience better recruitment and retention results, and end up with a more motivated workforce.

“Customers Will Never Love Your Company Unless Your Employees Love Your Company First,”

— Simon Sinek, speaker, author.

How to Show the Love

Recognize and Reward Employees. Never underestimate the power of recognition and rewards. Everyone loves a pat on the back. Employee recognition is one of the most effective and affordable strategies employers underutilize.

Acknowledging your employee’s efforts does more than drive employee well-being – it promotes a positive work environment and helps to prevent burnout. That’s according to new research from Gallup. Recognition and well-being, combined, can significantly improve business outcomes. Employees who feel recognized perform better, feel fairly paid, and are less likely to seek new jobs.

Think about the employee as a person and not just a worker. Be sure to make it personal. Taking the time to recognize each employee’s hard work and achievements can be a game-changer. This can include Employee of the Month, awards, bonuses, shout-outs in company newsletters, emails, and public recognition during team meetings. And remember to acknowledge and celebrate important occasions, whether it’s work anniversaries, birthdays, or hitting company milestones.

Offer a Competitive Benefits Package. Employees are the heartbeat of every business. How successfully a business operates depends upon the dedication level of every employee. In addition to compensation, a competitive benefits package can be the deciding factor for top talent wanting to stay at their current job. According to the Society of Human Resource Management (SHRM), 92% of employees consider employment benefits important for overall job satisfaction. Almost one-third of employees cite work benefits as the top reason for looking for a job and choosing to stay at their current job.

“When You’re a Dedicated Employee, You Spread Love Where You Work,”

— Mark Sanborn, author, professional speaker

Employers who had enhanced their benefits packages reported better results in overall employee performance and recruitment and retention efforts. This may include top-rated health plans, retirement plans, paid time off, mental health benefits through an EAP, parental leave, and other perks and incentives designed to keep workers satisfied and engaged.

Prioritize Employee Wellness. Prioritizing employee wellness is one way to show that you care about your their overall health and happiness. A wellness program can take many forms. Depending on your workforce preferences, it can include subsidizing gym memberships, providing health assessments and screenings, or offering other wellness-related activities promoting physical and mental fitness.

Emphasize Work-Life Balance. Show employees you care about their work-life balance by offering flexible work arrangements. Whether it’s remote or hybrid work options, giving employees more control over their schedules to manage personal and professional responsibilities can enhance their overall well-being. By prioritizing work-life balance and accommodating diverse needs, you show that you value and respect each employee’s unique circumstances.

Commitment to Diversity and Inclusion. Creating a diverse and inclusive workplace where every voice is heard and respected is important for employee satisfaction and retention. Demonstrate your commitment to diversity and inclusion efforts through recruitment practices, diversity training, and fostering a culture of belonging where employees feel empowered to be their authentic selves.

Invest in Professional Growth Opportunities. One of the top reasons workers consider a job change is the need for more professional opportunities for growth and advancement. Creating a culture that prioritizes continuous learning and skill development is another way to show your workers are valued.

Strengthen bonds and boost morale by organizing engaging team-building activities. Whether it’s a company retreat, a team lunch, or an afternoon of team-building, exercises, these activities help build camaraderie, foster collaboration, and break down barriers between colleagues. Plus, they provide much-needed opportunities for your team to unwind and have some fun together. Mapping out career paths, providing mentorship programs, and offering opportunities for professional development demonstrate to employees that you are investing in their future and give them a reason to want to stay.

To Truly be Customer-focused, You Need to Care About Your Employees,”

— Simon Sinek, speaker, author.

Schedule Regular One-on-One Check-ins. The way you treat your employees is essential in employee retention. This includes working on effective ways to communicate and promote positive attitudes. Create a work environment where employees feel comfortable sharing their ideas, goals, progress, concerns, and other feedback. Encourage open communication through regular one-on-one meetings, suggestion boxes, anonymous surveys, and other feedback tools. By actively listening to employees’ feedback and addressing any issues promptly, you show that their opinions matter and that you’re invested in their success.

All You Need Is Love

The secret to business success may just be love. When employees genuinely love their work, they become instrumental in helping your business thrive.

Embracing the Hybrid Work Model

As remote work gains popularity, more businesses are adopting hybrid work models. Here’s what employers need to know.

What is Hybrid Work?

Hybrid work models combine working in the office and remotely, giving employees the flexibility to choose where and when they work. According to a Gallup poll, 52% of employees who can work remotely reported working in a hybrid model. This shift in how we work acknowledges that work is no longer tied to a specific location and can be completed effectively from various locations.

Benefits of Offering Hybrid Work Options

Reduced Costs. Employers that allow employees to work remotely can save money on office space, utilities, and other expenses.

Access to a Wider Talent Pool. Offering a hybrid work option is an attractive benefit that opens the doors to a broader talent pool. According to Gallup, job openings may receive as many as two to three times more applicants for certain jobs that allow hybrid or remote options.

Stronger Retention Results. Numerous studies have shown that many workers prefer flexible work options over pay. A quarter of employees surveyed said they would be willing to give up as much as 15% of their annual salary in exchange for flexible work arrangements.

A Gallup study found that three out of 10 hybrid workers are highly likely to quit their jobs if they are not given some degree of remote flexibility, while the same applies to six out of 10 fully remote workers.

Improved Productivity. Based on recent research by Boston Consulting Group and Scoop Technologies Inc., employers who offer remote-first or hybrid work environments experience four times faster revenue growth than those who require office attendance. Another study found that firms allowing employees to choose when to come to the office and offering remote work saw an increase in sales by 21% between 2020 and 2022. These growth rates are due to the companies’ ability to hire from a wider geographic area and retain employees.

Stronger Employee Satisfaction. Flexible work options give employees more freedom to build their schedules around their personal lives, resulting in higher job satisfaction and overall well-being.

Steps to Navigating Hybrid Work

Establish Hybrid Work Policies. Employers and employees are not always on the same page when determining the division of days between working in-office and remotely. Studies show that most employees (more than half) work in the office three days a week, while less than a quarter work two or four days. Employers should establish clear policies, schedules, and definitions of hybrid work.

Redefine the Manager’s Role. Employees and employers have found a middle ground in hybrid work that works well when managed effectively. The same Gallup study revealed that management style had four times more of an impact on employee engagement and well-being than the physical location of work. Shifting to hybrid work requires employers to take a fresh look at the roles and responsibilities of their management team.

Prioritize Multistate Compliance. When employees work remotely from different states, employers need to be aware of their obligations to register, pay taxes, and comply with local laws. Employers need to educate their employees on the importance of reporting their relocation and updating their addresses so that they can take necessary actions such as state registrations, tax payments, and compliance with other requirements.

Rethink Workspaces. As the hybrid work model continues to gain traction, traditional office spaces are transforming. The emphasis moves from providing a fixed workspace for every employee to creating new collaborative environments. Rethink the office space as hubs for innovation, teamwork, and social interaction rather than mere spaces for routine tasks.

Leverage Technology. Invest in stronger security infrastructures, project management software, and other tools and systems so that employees can work remotely and collaborate regardless of location.

Link #2➡️➡️ Read More: How to Be Survey Savvy

Focus on Communication and Engagement. According to a Harris Poll, poor communication can cost employers up to $12,506 per worker annually. Building a connected workplace means developing stronger strategies related to communication and collaboration among team members.

Embracing the Future Work

How we work is constantly changing. Striking the right balance between remote and in-office work requires thoughtful planning, effective leadership, and a commitment to creating a united and inclusive workplace culture. To succeed, employers must remain agile, continuously adapting to their workforce’s evolving needs.

Survey Savvy

Here are some tips on how to get the best results from surveys.

It seems like surveys are being used everywhere. From doctor’s visits to car repairs to online shopping, we are often asked to complete a survey. What do organizations really gain from the results, and does it make a significant difference?

Maximizing Survey Success

Define the Goal. One survey can’t capture every aspect of your business. Define the goal and then design the questions around that objective. To measure customer service, focus the questions on human interactions. If you want to measure your software, ask questions about usage and results. Do not try to mix customer service with technology – limit the survey to the goal at hand.

Carefully Craft the Questions. Nothing is worse than agreeing to a survey, thinking it will take a few minutes, and then opening it to see 30 questions. If you are like me, you quickly log out. Limit questions to less than 10. Closed-ended questions with pre-populated answers are easier for respondents to answer. Open-ended questions are valuable, too, but should be limited in number and placed at the end of the survey. Don’t ask leading questions and avoid absolutes, like “always” and “never.”

➡️➡️Link #1Link #1Link #1Link #1Read More: 6 HR Trends to Watch

Know the WHY. Before you ask, consider how the results will impact your overall mission and goal. Are you measuring the right things? Will you be able to make changes based on the results? Are changes even possible?

Analyze Data Appropriately. Consider how you view the results and who has access to it. Artificial intelligence and outside consultants can help you analyze data with an unbiased perspective. Will the results be confidential or shared with others? Which stakeholders, if any, should have access to the information? Trends may appear as well as specific flaws; before jumping to conclusions or making rash decisions, consult with others.

Work with HR. Survey results may have an impact on your people, and HR can help. There may be insight into the work quality of specific departments or individuals. Your PEO or HR department can help you determine the next steps, such as coaching or a performance improvement plan. When results are exceptional, use the opportunity to praise performance and celebrate success. And ask yourself if the measurements are fair. I have been asked by individuals to give them a 5-star rating, or else they would be disciplined. This doesn’t make sense. A survey should be used to improve, and employee evaluations should not be solely tied to the results.

➡️➡️ Link #2Link #2Link #2Link #2Read More: Your HR Checklist for Q1 2024

Surveys can be very helpful tools for businesses to streamline processes, evaluate tools, and improve customer service. Yet, if not used properly, they are just a waste of time. Businesses need to evaluate what they gain from the questionnaires and how they can be used for growth. Modern survey platforms are wonderful ways to gather information and hear directly from your customers. But don’t forget that old-fashioned conversations with your clients are the ultimate test of your service. As a leader, it is important to spend time with your customers and to spend time considering your clients’ experience. Good leaders gather data, talk to employees, evaluate staffing needs, and spend time in the trenches to see what adjustments need to be made.

About Lee Yarborough, Propel HR President

Active in many professional and community organizations, Lee recently served as Chair of the Board of Directors of the National Association of Professional Employer Organizations (NAPEO). As NAPEO Chair, Lee focused on diversity and initiatives to deepen member relations. Under her leadership, she formed Women in NAPEO (WIN), a networking group designed to engage, empower, and encourage women working in the PEO industry. In 2023, she was honored with the NAPEO Michaeline A. Doyle Award for her leadership and contributions to the PEO industry.

On the local level, Lee also served as the Chair of NAPEO’s Carolinas Leadership Council for more than a decade. In 2015, she was named a Fellow of the eleventh class of the Liberty Fellowship Program and an Aspen Global Leadership Network member.

An advocate for public education, Lee has served on the executive board as Chair of Public Education Partners and is the founder and director of Read Up Greenville, a young adult and middle grades book festival in downtown Greenville, SC.

When she breaks from board meetings, client visits, and networking, you will most likely find Lee reading, camping, or spending time with her family. She also enjoys volunteering at her church and staying involved with her children’s schools.

6 HR Trends to Watch

New and emerging trends continue to reshape the workplace and impact the role of HR. Here are some of the top areas employers are focusing on in 2024.

1. Leveraging New Technology

As we move into the new year, HR professionals are leveraging new technology to streamline processes and enhance decision-making.

As the fast-growing technology, generative AI contributes up to $4.4 trillion annually to the global economy. According to Deloitte, in 2024, employers investing in AI will experience a 30% increase in their investment, and more employers will develop their own generative AI models.

Training and Reskilling Workers on AI. As AI continues to evolve, the need for training and reskilling becomes increasingly important. According to a recent study by Morgan Stanley, generative AI technologies are projected to impact 25% of all occupations, and this percentage is expected to rise to 44% within the next three years. Consequently, the displacement caused by generative AI will create a $16 billion market to address the demand for training and reskilling workers.

Artificial Intelligence in Recruitment. AI is transforming how companies hire new employees. By utilizing AI, HR teams can quickly and accurately sift through resumes, assess candidates, and even conduct preliminary interviews. This not only speeds up the hiring process but also guarantees a more impartial and data-driven approach to candidate selection.

➡️➡️Link #1Read More: Here’s Your HR Checklist for Q1 2024

Personalized Learning Paths. Utilizing the power of innovative AI technology, HR teams have the ability to design personalized learning paths for employees, enabling them to assess their individual strengths and weaknesses. This allows for the creation of training programs that cater to specific needs, ultimately enhancing employee development and growth.

Employee Experience Platforms. Employee experience platforms are gaining traction, providing a unified interface for employees to access HR services, training modules, and performance feedback.

2. Remote Work Continues to Grow

The remote work trend has accelerated and continues to grow as employers learn hybrid work environments are good for business. Research shows that since the pandemic, offering hybrid work has also played a pivotal role in keeping and attracting workers.

Hybrid Workforce Management. Hybrid work models, which involve a combination of remote and in-office work, are quickly becoming the new standard. HR professionals must focus on creating policies that support flexibility while still maintaining team collaboration. Virtual collaboration tools and project management software are essential for effectively managing hybrid teams.

Well-being and Mental Health Support. In 2024, the employee well-being remains a top priority. Companies are placing a strong emphasis on mental health programs, offering flexible schedules, and implementing initiatives for work-life balance. These efforts are important in nurturing an engaged and productive workforce, and will continue to evolve and adapt to meet the changing needs of employees.

3. Increased Emphasis on Diversity, Equity, and Inclusion

A diverse and evolving workforce necessitates a steadfast commitment to fostering diversity, equity, and inclusivity.

Addressing Shifts in Workplace Demographics. Today’s workforce includes a diverse mix of full-time and part-time employees, contractors, and remote workers. This diversity increases as older generations retire and new generations enter the workforce.

To prevent turnover, employers must adapt to these demographic changes and address specific needs in employee benefits, skill development, training, communication, and management practices.

Commitment to Pay Equity & Pay Transparency Measures. In the new year, employers will face a growing expectation to prioritize transparency when it comes to compensation, covering both salary and benefits. To meet this demand, employers are opting to disclose their pay structures, conduct regular audits to ensure pay equity, and implement corrective measures for fair compensation. However, multi-state employers may encounter an even greater challenge in maintaining confidentiality regarding compensation, as numerous states have enacted laws mandating pay transparency and equity. These laws may require employers to disclose compensation details in job postings and during the applicant screening process, further emphasizing the need for transparency in the workplace.

4. Developing Skills to Stay Competitive

Finding and keeping skilled employees continues to be a priority in 2024. According to a study by Deloitte, 90% of employers will shift to a skills-based approach, seeking specific skills to build their workforce. Employers will invest in employee development and engagement programs and provide more personal and professional growth opportunities to workers.

5. Stronger Focus on Multi-State Compliance

Multi-state compliance continues to be an issue for employers with employees working across state lines. Because state laws can vary, employers need to understand their responsibilities, such as taxes, benefits administration, and changes in laws that may impact their business, such as minimum wage increases and paid leave requirements.

6. Leverage Outsourcing Strategies

As the demand for skilled workers continues to grow, many employers are turning to outsourcing to support their HR teams. Many small businesses already take advantage of the resources and expertise by outsourcing to a Professional Employer Organization (PEO), like Propel HR, for HR-related tasks such as benefits, payroll, compliance, and general HR, as well as a host of services that can also be customized.

Outsourcing some of your HR functions can significantly reduce your administrative workload and give you more time to invest in growing your business. For instance, if you want to improve your customer service, outsourcing that function can make you more competitive. Similarly, if you need to expand your HR department but cannot afford to hire (or find) skilled staff, outsourcing can provide the expertise, knowledge, and resources you need. Even if you already have an in-house HR manager, outsourcing to a team of HR experts can make good business sense.

➡️➡️Link #2Link #2Link #2Link #2Link #2Read More: How Remote Workers Impact Payroll

New Year, New Trends: Prepare for Changes Ahead

To navigate change, you need to know what trends are shaping the workplace. In 2024, the workplace will be impacted by technological innovation, demographic changes, a demand for transparency, and a dynamic approach to skills development and performance management.

We hope your year ahead is both productive and successful. If you want more information on how outsourcing can help your business, please call us at (800) 446-6567 or visit www.propelhr.com.

Your Q1 2024 HR Checklist

Stay on top of new laws and important tasks related to payroll, benefits, compliance, and general HR to help your small business prepare for 2024. Here’s your checklist for Q1.

PAYROLL & TAX

File FICA and FUTA. IRS (FICA) Form 941 for Q4 and federal unemployment tax (FUTA) Form 940 are due Jan. 31, 2024. However, if you deposited all FUTA taxes when due, you have until Feb. 10, 2024, to file.

File Form 720. If you own a business in goods and services that are subject to excise tax, you must prepare and file Form 720 by Jan. 31, 2024.

File Forms W-2 and W-3. The due date for filing 2023 Forms W-2 and W-3 with the Social Security Administration is Jan. 31, 2024, for filing paper or electronically. Feb. 1, 2024, is the deadline for all businesses to distribute Form W-2 to employees.

File Form 1096 Annual Summary and Transmittal of U.S. Information Returns. If your business paid independent contractors or freelancers in 2023, you must file IRS Form 1096, Annual Summary and Transmittal of U.S. Information Returns, by Feb. 28, 2024, or March 31, 2024 if filing electronically. Form 1096 is a

Prepare Tax filings for Non-employee Compensation. By Feb. 1, 2024, employers must distribute appropriate tax forms to individuals who received cash payments during 2023, including wages, non-employee compensation, dividends, royalties, and profit-sharing distributions. Additional copies must be submitted to the Social Security Administration at the same time. Employers have until Feb. 28, 2024, to send corresponding copies to the IRS if filing by paper and March 31, 2024, if filing electronically.

COMPLIANCE

Update Federal and State Labor Posters. Make sure required federal and state labor posters are up to date. All required posters must be displayed prominently in your workplace. Required federal and state labor posters must be made available to remote employees as well.

Review OSHA Record-Keeping and New Final Rule Requirements. Applicable employers are required to post OSHA Form 300A, Summary of Workplace Injuries and Illnesses, from Feb. 1. through April 30, 2024. The deadline for electronically filing the completed summary is March 2, 2024.

Beginning Jan. 1, 2024, a new final rule requires applicable employers with 100 or more employees in certain high-hazard industries to electronically submit information from their Form 300-Log of Work-Related Injuries and Illnesses and Form 301-Injury and Illness Incident Report to OSHA once a year. These submissions are in addition to the required Form 300A. OSHA will begin accepting 2023 injury and illness data on Jan. 2, 2024. The deadline to file Forms 300, 301, and 300A is March 2, 2024.

Submit Mandatory 2022 EEO-1 Component 1 Report. The deadline to submit the 2022 EEO-1 Component 1 Report was Dec. 5, 2023. Applicable employees have been given an extension and have until Jan. 9, 2024, to submit and certify the mandatory 2022 EEO-1 Component 1 Report.

Check All Required Compliance Training. Check all federal, state, and industry workplace training requirements that apply to your business, as well as workplace training mandated in your state. For example, many states require certain workplace safety training and best practices for sexual harassment training.

Audit FTEs and Prepare ACA Reporting. Under the Affordable Care Act (ACA), the responsibility to offer affordable healthcare coverage is on the employer, and reporting requirements depend on the number of full-time equivalent employees (FTEs).

To determine if your business is an Applicable Large Employer (ALE) and must comply with ACA’s coverage, affordability, and reporting requirements in 2024, audit your FTEs for each month of 2023 to determine if you have reached or exceeded 50 full-time and/or full-time equivalent employees. ALEs that fail to provide full-time workers with minimum essential coverage that meets the affordability threshold are subject to two different penalties, which the IRS refers to as shared responsibility payments.

The deadline for applicable employers to distribute Form 1095-C to their full-time employees for the 2023 tax year is March 2, 2024. Forms 1094-C and 1095-C must be filed by Feb. 28, 2024, if filing by paper, and March 31, 2024, if filing electronically. Also, check with your benefits broker for any reporting changes and ensure that required annual notices, such as Medicare Part D, HIPPA, and CHIPRA, are distributed to employees.

BENEFITS

Prepare ERISA Plan Report. Applicable employers are required to file an employee benefits plan report, Form 5500, with the Department of Labor (DOL) if, on the first day of an ERISA plan year (which is different than the policy year), 100 or more participants are enrolled in coverage.

Medicare Part D Disclosure. Employers providing prescription drug coverage to Medicare-eligible individuals must also disclose whether the coverage is creditable or non-creditable to the Centers for Medicare and Medicaid Services (CMS). This annual disclosure must be made 60 days after the beginning of each plan year. The disclosure is required regardless of whether the entity’s coverage is primary or secondary to Medicare.

GENERAL HR

Monitor Changes in State Laws and Regulations. State laws can vary. If your business has locations and employees working in multiple states, stay updated on any state-specific changes that may impact your organization, such as minimum wage increases and paid leave requirements.

Conduct an Annual Pay Equity Audit. Review compensation components to ensure there is no unintended wage disparity.

Check State Pay Transparency Requirements. An increasing number of states have added pay transparency laws that include regulations such as disclosing pay in job postings and/or during the applicant screening process. Be familiar with these laws if your job postings permit out-of-state applicants and remote workers.

Plan Ahead for Employee Appreciation Day. An annual holiday observed on the first Friday in March, Employee Appreciation Day recognizes employees for their commitment and hard work. On Friday, March 1, 2024, plan to celebrate your most valuable asset – your employees!

PLEASE NOTE: This information is for general reference purposes only. Because laws, regulations, and filing deadlines are likely to change, please check with the appropriate organizations or government agencies for the latest information and consult your employment attorney and/or benefits advisor regarding your responsibilities. In addition, your business may be exempt from certain requirements and/or be subject to different requirements under the laws of your state. (Updated Dec. 13, 2023)

Need Help?

We’ve got you covered. Depending on the type of business and industry, your checklist may be different and even more complex. By partnering with an IRS-certified PEO, like Propel HR, you gain access to a team of HR experts to help you navigate the complexities of your business as well as stay compliant.

➡️➡️Download your one-page HR Checklist for Q1 2024 HERE.

Navigating Payroll Issues with Remote Workers

Many employees have the option to work anywhere, at any time. While there are many advantages, remote workers present new challenges for your payroll team. Here’s what you need to know.

The Remote Work Revolution

By now, employers understand the value of remote work and how it benefits employees as well as their businesses. According to a McKinsey study, nearly 60% of employees can work remotely at least part of the time. That means employers are managing remote workers in different states and even other countries on their payrolls.

The remote work revolution is primarily driven by the freedom and flexibility it offers. Remote workers have the ability to work from anywhere, allowing them to create a work-life balance that suits their needs. This newfound flexibility also leads to significant cost savings, as remote workers can eliminate expenses such as parking fees and commuting. Furthermore, remote work provides the opportunity for workers to spend more quality time with their families.

The advent of remote work also presents advantages for employers. One of these is the ability to tap into a wider pool of available talent, resulting in more productive, engaged, and satisfied employees. Allowing employees to work from home leads to significant cost-savings, such as eliminating rent expenses for office space and the option to explore more affordable alternatives like coworking spaces.

Remote Work Payroll Issues

While it can be a win-win for employers and workers alike, remote workers also expose employers to a new set of issues.

State Employment Laws. One of the primary hurdles in managing payroll for remote employees is navigating the complex maze of labor laws and regulations. Employers have a responsibility to follow federal, state, and local regulations. If you have employees working in other states, you must also follow the applicable state and local employment laws in the state employees are working. Since these laws vary from state to state, it can be challenging for businesses with a geographically dispersed workforce to stay compliant.

A few examples of state-specific mandates include:

Paid Leave. Earlier this year, the Department of Labor (DOL) issued new guidance regarding the Family and Medical Leave Act (FMLA) and eligibility requirements for remote workers. While remote workers are eligible for FMLA on the same basis as in-office workers, employers must use the remote worksite location – where the employee reports or assignments are made – as their primary address.
Minimum Wage and Overtime. Although a basic minimum wage is established by federal law and the Fair Labor Standards Act (FLSA), wage and hour laws vary depending on the state. Some cities even have different minimum wage standards. When hiring remote employees, it can be more challenging to keep track of locations, wage requirements, and overtime hours.
Pay Statement Requirements and Pay Rules. State and local laws also vary regarding pay, such as the information that must appear on paystubs, requirements for pay frequency, and vacation and final wages paid upon termination.

Multi-state Tax Implications. When it comes to taxes, the location of your remote employees can make things more complicated, especially for multi-state employers. If the employee lives and works in a different state, the employer must comply with the requirements of that state. The amount of state taxes can vary significantly depending on where the employee is located. Therefore, it’s important to determine which states have taxing authority over your remote workers. Ultimately, employers are liable for tax withholding. If the employer fails to withhold the correct tax from wages, the state can collect it from the employer.

Calculating Remote Compensation. Pay can also be an issue. Determining fair compensation for remote employees can be challenging due to disparities in the cost of living and regional pay scales.

Future-proofing the Remote Work Payroll Process: What Employers Can Do

As the remote work landscape continues to evolve, businesses must adopt a forward-thinking approach to payroll. Future-proofing payroll processes involves staying ahead of regulatory changes, leveraging technologies, and maintaining open lines of communication with remote employees. Employers can prepare by implementing the following:

Conduct Compliance Checks. Regular audits and assessments of remote payroll processes ensure they align with your business goals and comply with new and evolving regulations. To achieve this, involve your legal, tax, benefits and HR teams to develop assessment procedures that recognizes changes, such as state locations and classification. By integrating artificial intelligence and other technologies, payroll management can be further enhanced by predicting trends, identifying discrepancies, and streamlining processes. Automated compliance checks can also help businesses stay ahead of regulatory changes and ensure compliance with local laws.

Stay Up to Date with Multi-state Payroll Laws. Understand the laws in the states where your remote employees are working. Your business may be required to establish an official entity in that state, have compliance obligations, and be required to file a business tax return. Also, review guidance provided by the Department of Labor Localization of Work Provisions – Principles for Determining Where Wages Should Be Reported When Work is Performed Entirely in One State or in a Number of Different States.

Establish Remote Work Policies. Prevent payroll issues by setting clear remote work policies. These guidelines should outline expectations such as working hours, time tracking, work locations, procedures for communicating changes and move notifications, job descriptions, classification descriptions, work-related responsibilities, remote work expense reimbursement mandated by local laws, and any additional requirements for employees working remotely. Include remote work policies, as well as state-specific information, in your employee handbook.

Keep Accurate Records. Maintain accurate records, including home and worksite addresses for remote workers, to ensure compliance with local minimum wage requirements.

Remote Work is Here to Stay

Allowing employees to work from anywhere may create new legal and tax obligations and payroll issues for employers. To navigate multi-state tax and compliance issues, it’s important to invest in a payroll system that can adapt to different regulatory frameworks and engage experts, such as an IRS-certified PEO like Propel HR, who have a thorough understanding of the intricacies of payroll, HR, compliance and benefits.

Small Business Payroll Series

➡️➡️Read more about topics related to small business payroll:

01_Small Business Payroll: In-house vs Outsourcing

02_Most Common Payroll Mistakes (and How to Avoid Them)

03_Important Year-end Payroll Tasks to Take Care of Now

04_The Importance of Accurate Record Keeping for Small Business Payroll

PLEASE NOTE: This information is for general reference purposes only. Because laws and regulations are constantly changing, please check with the appropriate organizations or government agencies for the latest information and consult your employment attorney and/or benefits advisor regarding your responsibilities. In addition, your company may be exempt from certain requirements and/or be subject to different requirements under the laws of your state.

About Propel HR. Propel HR is an IRS-certified PEO that has been a leading provider of human resources and payroll solutions for more than 25 years. Propel partners with small to mid-sized businesses to manage payroll, employee benefits, compliance and risks, and other HR functions in a way that maximizes efficiency and reduces costs. For more information, visit www.propelhr.com.

The Importance of Accurate Record-Keeping for Small Business Payroll

Maintaining accurate payroll records may not be the most glamorous task, but it certainly ranks as a top priority for small businesses. Here are a few reasons to get your payroll records right.

Types of Payroll Records

In general, employers should keep the following important payroll records.

Employee Information. Employee’s legal name, address, social security number, and date of birth.
Employment Information. Offer letters, date of employment, Form I-9s, occupation/titles, job description, background checks, professional references, acknowledged company policies, evaluations/reviews, and termination information.
Pay Information. Pay agreement/status, wages paid each period, type of wage payment, time and day of week employee’s work week starts. Total number of regular hours worked each day and each week. Overtime hours and amount paid. Date of payment and the pay period covered by the payment. Supplemental pay, tips, Amounts, and dates of all taxable annuities, pension payments, bonuses, and commissions.
Deductions. Benefits, deferred compensation information, etc.
Direct Deposit Details. Bank/financial institution names, account numbers, and routing numbers.
Timesheets. Regular hours worked, overtime hours.
Leave Records. Paid time off (PTO) and vacation time balances. Leave requests documentation, such as the Family Medical Leave Act (FMLA), state-paid leave programs, and paid sick leave.
Reimbursement Forms. Expense reports for travel, mileage, etc.
Tax Documents. Federal, state, and local tax forms/returns, W-4, W-2 forms.
Employer Tax Information. Payroll reports and payment receipts

The Importance of Payroll Record-Keeping

Why are payroll records so important? Here are a few reasons.

Compliance with Federal, State, and Local Laws. Small businesses must operate within a complex maze of legal and federal, state, and local tax regulations. For example, under the Age Discrimination in Employment Act (ADEA), applicable employers are required to keep payroll or other records for all full-time, part-time, and temporary employees. EEOC Regulations require that employers keep all employment records for one year. If an employee is involuntarily terminated, personnel records must be retained for one year from the date of termination. Additionally, employers must keep on file any employee benefit plan (such as pension and insurance for at least one year after termination.

The Fair Labor Standards Act (FLSA) sets minimum wage, overtime pay, record-keeping, and youth employment standards and requires covered employers to keep certain records for each non-exempt worker. FLSA requires that records include information about the employee and data about the hours worked and the wages earned.

Link #1Link #1Link #1Link #1Link #1➡️➡️Read More: Most Common Payroll Mistakes (And How to Avoid Them)

And getting it wrong can have expensive consequences. Here are a few examples of hard lessons learned and why payroll records are so important.

⚠️A Nashville restaurant was required to pay $270,751 in back wages for requiring servers to share tips with dishwashers, neglecting to pay non-exempt employees the proper minimum wage for all hours in a workweek, failing to pay some workers overtime wages and failing to keep accurate records of some employees’ hours worked, as required.

⚠️A Washington state painting company knowingly violated federal overtime requirements and did not keep time records for all employees. The company was ordered to pay $114,000 ($57,330 in overtime wages and $57,330 in liquidated damages).

⚠️The Department of Labor Wage and Hour investigators found a franchisee in New York violated anti-retaliation provisions of the Fair Labor Standards Act when it pressured one employee to sign a document falsely claiming there were no violations and they had been paid in full. The company also required the employee to return the back wage payment to the employer, then later fired the employee. The employer also violated federal minimum wage, overtime, and record-keeping requirements by not compensating employees for training time, paying some employees straight time for all hours worked, and failing to keep accurate records of the total hours worked by employees. As a result, the company was required to pay $10,000 in punitive damages and $3,907 in back wages and liquidated damages to each of the 18 employees.

⚠️An Urgent Dental Center and an HR manager in Indiana were ordered to pay an employee more than $22,000 in back wages and damages for violating the FLSA when they retaliated against an employee who filed a complaint alleging wage violations.

⚠️A Pittsburgh home health agency owner was ordered to pay $208,004 in back wages and damages after misclassifying workers as independent contractors, denying full pay, and failing to maintain payroll and timekeeping records as required.

Timely and Accurate Payments. Proper record-keeping guarantees that employee hours, wages, benefits, and deductions are all accurately tracked, resulting in timely and accurate payments. This prevents disputes and legal issues stemming from payment discrepancies.

Budgeting and Financial Planning. Payroll records are a valuable source of information containing data about wages and taxes that can enable employers to create better budgets and manage labor expenses more effectively. By gaining insights into labor costs, business owners can allocate their resources more efficiently, anticipate cash flow fluctuations, make informed decisions, and adapt to changing circumstances.

Data-Driven Decision-Making. In today’s data-driven business landscape, small businesses can’t afford to make decisions without reliable information. Accurate payroll records offer valuable insights into employee performance, productivity, and costs. This data enables business owners to identify trends, make more informed hiring decisions, assess the effectiveness of compensation structures, and implement performance-based incentives.

Audit Preparedness. The possibility of audits, whether internal or external, is a reality for businesses of all sizes. Accurate and well-organized payroll records make the auditing process smoother.

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Employee Trust and Transparency. Employees value transparency when it comes to compensation. Accurate record-keeping builds trust between employers and employees, ensuring that employees can verify the accuracy of their pay and deductions.

Get it Right

Staying on top of payroll records helps to ensure compliance and accurate financial reporting. While it doesn’t have to be complicated, it does have to be right. And if you need help, just give us a call. Depending on the type of business and industry, your payroll responsibilities may be different and even more complex. By partnering with an IRS-certified PEO like Propel HR, you gain access to a team of experts to help you navigate the complexities of your year-end payroll as well as stay compliant.

PLEASE NOTE: This information is for general reference purposes only. Because laws, regulations, and filing deadlines are likely to change, please check with the appropriate organizations or government agencies for the latest information and consult your employment attorney and/or benefits and payroll advisor regarding your responsibilities. In addition, your company may be exempt from certain requirements and/or be subject to different requirements under the laws of your state.

Important Year-end Payroll Tasks

It’s never too early to prepare for your year-end payroll. Get ready for 2024 by taking care of these important payroll tasks.

Wrapping Up Year-end Payroll

From calculating employee compensation, updating records, filing taxes, and keeping up with changes in local, state, and federal employment laws, your payroll team has a lot to keep track of during the fourth quarter. While responsibilities vary from business to business, some of the most common activities include:

Review Your Business Information. Verify your business information on file for tax purposes, including the business name, address, and state and federal employer identification number (EIN).

Review and Update Employee Records. Inaccurate or outdated employee information can lead to costly delays, reprinting W-2s, and IRS-imposed penalties. Ensure employee records are accurate and up to date. Have employees confirm information, such as their full name, Social Security number, address, and additional contact information, to help streamline your end-of-year processes and ensure that important tax documents get to the right location.

Verify Employee Wage and Classification. Depending on job duties and pay frequency, employees can be classified as either exempt or non-exempt. Understand the difference in order to accurately report income, withhold and pay taxes, and manage overtime. Also, become familiar with local wage requirements to avoid potential legal action and penalties.

Verify Accruals and Paid Time Off. Reconcile employee accrued paid time off and other benefits. Ensure employees have used their entitled time off and any accrued time off aligns with your company’s policy.

Prepare and File Important Forms. Generally, most businesses are required to file the following forms:

Form W-2. Form W-2 reports employee wages and withholdings to the Social Security Administration (SSA) and must be filed for each employee. Review to make sure that employee wages, taxes withheld, and other relevant information are accurate.
Form W-3. Form W-3 summarizes the W-2 information and submitted together with Form W-2 to the SSA.
Form 1099-NEC. Applicable employers are required to file with the IRS annually to report non-employee compensation to contractors or companies over $600.
Form 941. Form 941 is due quarterly and is used to report wage withholding for income taxes as well as the employees’ share of Social Security and Medicare (FICA) taxes, plus the employer’s share of FICA.
Form 940. Used to determine an employer’s federal unemployment tax (FUTA), Form 940 is based on the employer’s annual payroll and filed with the IRS by businesses with one or more employees.
Form 1095. Under the Affordable Care Act (ACA), the responsibility for affordable healthcare coverage is on the employer, and reporting requirements depend on the number of full-time equivalent employees (FTEs). Employers with 50 or more FTEs last year are considered an Applicable Large Employer (ALE) for the current year and must file Form 1095. If your company is an ALE, verify that your health plan meets all ACA requirements for coverage and affordability.

Reconcile Payroll Tax Filings. Avoid potential penalties and legal issues by ensuring payroll taxes, including federal, state, and local taxes, have been calculated and filed throughout the year. Reconcile tax filings to identify discrepancies and resolve them before the end of the year. Remember that business tax responsibilities for year-end payroll vary by state, as well as by industry and the size of your business.

Perform Year-End Bonuses and Incentive Calculations. Ensure that all criteria for annual bonuses are clearly defined according to your bonus structure and that the calculations are transparent.

Remind Employees About Unused Benefits. Let employees know about benefits that expire at year-end, such as vacation, sick days, personal leave time, and flexible spending accounts (FSAs) for medical costs and dependent care and expenses for reimbursements.

Audit Payroll Records. Audit activity is expected to increase as part of the Inflation Reduction Act to modernize the IRS. These audits will focus on areas such as executive compensation, fringe benefits, and employment tax compliance. Prepare now by conducting a thorough audit and review to maintain accuracy and compliance for year-end payroll activities. Review payroll records, tax filings, and financial documentation to identify any errors, discrepancies, or irregularities.

Plan for 2024. While wrapping up payroll tasks, it is also important to plan for the upcoming year. Review and update payroll policies, employee benefits, compensation changes, and tax strategies. Evaluate any changes in regulations that may affect payroll and make necessary adjustments to ensure compliance.

Navigate Your Year-End Payroll with Confidence

With a bit of advanced planning, small businesses can successfully wrap up this year’s payroll responsibilities with confidence and set a smooth transition for the year ahead. And if you need help, just give us a call. Depending on the type of business and industry, your payroll responsibilities may be different and even more complex. By partnering with an IRS-certified PEO like Propel HR, you gain access to a team of experts to help you navigate the complexities of your year-end payroll as well as stay compliant.

PLEASE NOTE: This information is for general reference purposes only. Because laws, regulations, and filing deadlines are likely to change, please check with the appropriate organizations or government agencies for the latest information and consult your employment attorney and/or benefits and payroll advisor regarding your responsibilities. In addition, your company may be exempt from certain requirements and/or be subject to different requirements under the laws of your state.

Advice To My Younger Self

What advice would I give my younger self? When thinking about the advice to give my daughters, I reflect on my career and the lessons learned.

This past week has been important in my household. My oldest daughter started her first “real” job after graduating this summer, and my youngest daughter had her first college tours as a high school junior. These are big moments in their lives, and as a mom, I am trying to navigate this time delicately. I desperately want to give advice, but I know that my opinion is not always wanted, and if I push too much, it will certainly be ignored. So, I tread lightly, trying to bring my girls to their own conclusions and praying that all my years of parental guidance will be remembered during these important times.

5 Lessons Learned

As I think about the advice to give to my daughters, I think back to the beginning of my career and realize how naïve I was. I think about all that I did not know and how many mistakes I made. I was a young woman in a man’s world trying to be stronger, smarter, and wiser than I really was. What do I wish I had known back then? What advice would I give my younger self?

Find Your Allies. Everyone needs friends at work and peers to encourage and develop them. I wish I had learned this earlier. As a young professional, I felt that I had to do everything on my own, and I didn’t find others to share my burdens. I kept my professional life and social life very segregated. As I grew, I realized that I needed allies along the way. I found friends through networking groups, industry associations, and women’s organizations, and even created peer groups with people in my industry with the same job. It is wonderful to have people I can talk to and reach out to when I need advice.

Show Up and Earn Your Stripes. Work is called “work” for a reason. It is important to show up, work hard, and demonstrate your value every day. Along your career path, you will have many tasks that are not fun and may even be dreadful. It would be nice if this were not true, but it is the case with every job, no matter the title. The advice I would give my younger self would be to dig in and just get it done. Mark the unpleasant tasks off your to-do list early each day so you can move on to the jobs you prefer. And if you see no value in what you are doing, ask others why it needs to be done. Once you understand the why, you may find the work more enjoyable.

Speak Up. As a young woman starting her career, it is easy to be quiet and blend into the background. This will not move you ahead. Over the years, I have learned that not only do I need to be at the table, but I also need to speak at the table. I once was told that if you don’t speak at a meeting, no one will remember you are there. Since hearing that, I make sure everyone remembers me by contributing and adding value to the discussion.

Ask for Help. I used to think asking for help was a sign of weakness. I was determined and obstinate to do everything myself, even if it killed me. And quite frankly, at times, it almost did. I now see the value of raising my hand and asking for help. It is not a weakness but a sign of strength to recognize my limitations and work with my co-workers as a team. Plus, if you do it all, you can never take a vacation, which is definitely not wise!

Be Authentic. As a woman in a male-dominated field, I often pretended to be someone I was not. I felt the need to wear a suit of armor under my business suit. The armor provided me with confidence, tenacity, and drive. Sometimes, it felt like the real me, but often, the armor hid my more feminine qualities of nurturing, kindness, and even laughter. As I have aged, the armor has become heavier, and now I am officially trying to shed it and lighten my load. If I could go back to my younger self, I would have never put on that armor to begin with. I would be authentically me smart, strong, kind – all on my own with no props.

Maybe by the time I retire, I will have figured out how to “be” in business. I doubt it, though; the human journey is all about continuing to learn. My experiences throughout my career have shaped me into who I am. Even if I had been able to advise my younger self, I probably wouldn’t have listened to it! My daughters may not either, but I pray that some of the lessons I have learned along the way may help them as they navigate their futures. Regardless of whether they take my advice or not, I will be here for them, and I will be their biggest cheerleader.

About Propel HR President Lee Yarborough

“My father, Braxton Cutchin, and I founded the company in 1996. After being in the PEO and HR world for 25 years, I have experienced firsthand the value we can provide to both the clients and the employees. It is truly a win for all parties. I’m proud to have helped establish Propel HR as an industry forerunner in the Southeast. There is nothing I love more than receiving phone calls from clients who seek my advice as a trusted advisor. This is a business where I feel that I can help others, and that is important to my own value.” — Lee Yarborough, President, Propel HR

Active in many professional and community organizations, Lee recently served as Chair of the Board of Directors of the National Association of Professional Employer Organizations (NAPEO), the trade organization for the PEO industry. As NAPEO Chair, Lee focused on diversity and initiatives to deepen member relations.

During her leadership, she created Women in NAPEO (WIN), an inspiring networking group designed to engage, empower, and encourage women working in the PEO industry. WIN embodies Lee’s commitment to empowering others to reach their full potential and has become a dynamic platform where women can connect and support one another. Recently, she honored with the prestigious NAPEO Michaeline A. Doyle Award. Each year, the award recognizes an exemplary member for their leadership and outstanding contributions to the PEO industry.

When she breaks from board meetings, client visits, and networking, most likely, you will find Lee reading, camping, or spending time with her family. She also enjoys volunteering at her church, staying involved with her children’s schools.

🎧You can learn more about Lee’s experience starting Propel with her father, her work on Women in NAPEO & NextGen, and the importance of having the “freedom to fail.” Listen HERE on Spotify or search People Pat Meets where you get your podcasts.

Most Common Payroll Mistakes (And How To Avoid Them)

From miscalculating pay to record-keeping errors, a simple payroll mistake can cost your small business. Here are some of the most common payroll mistakes (and how to prevent them).

According to a study by Ernst & Young, one in five payrolls contain an error, and many businesses make an average of 15 corrections per payroll period.

What causes payroll to be prone to so many errors? Payroll studies show that businesses of all sizes and industries face challenges in delivering accurate and on-time payroll. Common issues include:

Staying Compliant. Keeping up with new employment laws, changing deadlines, and constant updates make staying compliant an ongoing challenge.

Managing the Complexities of Multi-state Payroll. In addition to federal laws, employers must adhere to state laws where employees are working. These employment laws and regulations differ from state to state and can be complex, especially for multi-state employers.

Limited Tools and Technology. Without the right tools or technology required to process payroll or analyze data, employers have to process payroll manually, exposing employers to errors.

Your Payroll Could be Costing You

Payroll mistakes can be costly in terms of lost revenue, the staff time required to correct errors, and potential legal action and fines.

According to the Ernst & Young (EY)study, payroll mistakes cost, on average, $291 per error to remedy and that’s not including the added costs of potential compliance penalties and fines. In addition to hard costs, payroll errors also cost in terms of time. The study also found that, on average, it takes one full-time employee over half a year to resolve payroll issues – that’s valuable time that could be used to focus on other priority areas.

Among those surveyed, the most common mistakes include those related to time and attendance, and expenses, which occur on average more than once per employee per year. And the mistakes that proved to be the most time-consuming to resolve include missing and incorrect time, sick time, expenses, and mistakes related to setting up health savings plans.

8 COMMON PAYROLL MISTAKES

Miscalculating Pay. With overtime, commissions, deductions, and PTO, your payroll team has a lot to juggle when it comes to calculating pay. Without a reliable system for tracking employee hours or paid time off, the chance of making a payroll overpayment or underpayment error is inevitable.

Misclassifying Employees. Misclassifying employees can lead to tax penalties and legal issues. Not only can misclassification prevent an employee from receiving benefits and wages, but it may also mean taxes errors, resulting in fines, penalties, and potential back pay. Regularly review the IRS guidelines for employee classification and your workers’ status to prevent this mistake.

Processing Payroll Manually. Manual payroll processing exposes employers to human error and can consume valuable time to correct. Invest in cloud-based software or hire a payroll service provider to streamline the process and reduce the risk of errors.

Lack of a Reliable Record-Keeping Process. Not having a reliable record-keeping process can result in compliance issues and employee disputes. In addition, audit activity is expected to increase as part of the Inflation Reduction Act to modernize the IRS and will focus on executive compensation, fringe benefits, and employment tax compliance. It’s a good idea to prepare now by conducting an internal audit by reviewing payroll and employment tax administration practices to identify potential compliance risks. Also, conduct an employment tax audit to identify any issues with employment tax, tax information reporting, fringe benefits, and executive compensation.

Late or Missing Payroll Tax Payments. IRS (FICA) Form 941 and (FUTA) Form 940, Form 1096 Annual Summary, Forms W-2 and W-3 and Quarterly Form 941, are just a few examples of the many important forms your payroll team has to regularly manage. Missing tax deadlines and filing late leads to penalties, interest charges, and legal issues.

Failing to Keep Up With Changing Tax Laws. Tax laws are constantly changing and can vary from state to state. Many payroll errors result from payroll staff who are not current with the latest tax regulations for payroll compliance.

Not Verifying Minimum Wage Requirements. Under the Fair Labor Standards Act (FLSA), the federal law requires covered non-exempt employees to be paid a minimum wage of $7.25 per hour. Many states also have minimum wage laws. When an employee is subject to both the state and federal minimum wage laws, the employee is entitled to the higher minimum wage rate.

To Link #1learn more about applicable minimum wage laws in the states where you have employees working, visit the Department of Labor’s interactive map. Also, follow the DOL for updates on proposed minimum wage increase and submit public comments through the federal register by Nov. 7, 2023.

Ignoring Overtime Regulations. Failure to pay overtime correctly can lead to wage disputes and legal actions. Familiarize yourself with overtime laws where you have employees working and ensure accurate calculation and compensation for overtime hours. For example, the standard rule for overtime pay is 1.5 times an employee’s hourly rate for every hour worked beyond 40 hours a week. If your state’s overtime rules differ, you must comply with the regulations that are most beneficial to the worker.

Preventing Payroll Mistakes: The Solution

The good news is that by investing in the right tools and expertise, most payroll mistakes can be easily avoided. Many small and medium-sized businesses turn to outsourcing for help with tax filings and other complex administrative tasks related to processing payroll.

A study by Deloitte found that 73% of companies currently outsource at least one aspect of their payroll. More than half of businesses surveyed have worked with their payroll provider for more than five years, with the majority experiencing improvements in such areas as compliance, accuracy, time management, and cost savings.

Outsourcing your payroll to an IRS-certified PEO, like Propel HR, provides the assurance and peace of mind that your employees’ paychecks are always accurate and delivered right on time. And if you need more help, we can also handle your benefits, compliance, and other important HR-related tasks and recommend custom solutions based on your industry, size, and location. By taking care of all this and more, you can get busy running your business, not your payroll. For more info, just give us a call at (800) 446-6567 or visit www.propelhr.com.

PLEASE NOTE: This information is for general reference purposes only. Because laws, regulations, and filing deadlines are likely to change, please check with the appropriate organizations or government agencies for the latest information and consult your payroll specialist and/or employment attorney regarding your responsibilities. In addition, your business may be exempt from certain requirements and/or be subject to different requirements under the laws of your state. (Updated Oct. 12, 2023)

Accelerate Your Hiring NOW

Now Hiring for YOU! Introducing PropelHIRES. You’ve trusted us with your payroll and other HR needs, and now we are thrilled to help you find the right candidate. We’re excited to welcome, PropelHIRES, to the Propel team!

In today’s tight labor market, hiring the right person for the right position is even more critical. PropelHIRES considers the culture of the company and the demands of the specific position, along with the experience, qualifications, and personality, to find a fit that lasts. This means less turnover, higher productivity, and ultimately greater growth.

And when you are ready to take your business to another level, pair PropelHIRES’ recruiting with Propel HR’s concierge PEO services. We help you recruit new talent and then seamlessly onboard them. As a result, you can focus on your core business while we take care of payroll, benefits, technology, and human resources.

So let us do the heavy lifting and connect your business with top-tier candidates for consideration. To accelerate your next hire, contact Brent Deedrick at (864) 261-1901 or schedule a call or video conference HERE. Learn more at www.propelhires.com.