Payroll and employees are significant expenses for your business, but there are several ways to cut your payroll costs without limiting the growth of your business.
FOR EACH NEW EMPLOYEE THAT YOU ADD TO YOUR PAYROLL, THE COST IS TYPICALLY 1.25 TO 1.4 TIMES THEIR SALARY. (SBA)
As you look for ways to save money on payroll, here are a few options to consider:
OUTSOURCING
While some people are under the impression that outsourcing payroll is costly, it can actually save you money in the long run. According to the IRS, 33% of employers make payroll errors, which can be costly. In fact, payroll errors can end up being much more costly than outsourcing your payroll in the first place. With regulations in the HR space constantly changing, it is critical to have a set of expert eyes on your business; so you aren’t hounded by risky compliance fines and fees. To learn more about the benefits of outsourcing payroll, click here.
WOTC (WORK OPPORTUNITY TAX CREDITS)
If you have the WOTC program in place, you can save up to 40% of an employee’s wages in tax credits. If you don’t already have this program in place, you’re missing out. This program is only applicable to use only on new hires from certain targeted groups who have faced challenges with employment.
To learn more about this credit, click here.
DIRECT DEPOSITS
Establishing a policy where all of your payroll goes through direct deposit saves you money on delivery and check printing fees every single pay cycle.
PAY FREQUENCY
Payroll providers charge a fee for every employee at your company each pay period. Therefore, paying your employees weekly will cost more than if you were to pay them biweekly or monthly. Consider this factor when you’re looking to cut costs.
RESTRUCTURING
One way that you can save is by restructuring your team. The start of the year is a great time to reevaluate your team. If someone left your business recently, the best cost-saving option may be to restructure instead of backfilling. We have seen what works for other businesses when it comes to restructuring and we would love to help you determine what is right. Reach out to our team to discuss restructuring options.
To learn more about hidden HR cost savings, watch our coffee break here. If you want to discuss more about how your unique business can cut costs, reach out to our team here.
