What Does Your Payroll Service Do For You?

What Does Your Payroll Service Do For You?

A few years ago our bookkeeping service used an outside payroll processor for our own payroll.  It was one of the big three payroll services.  Payroll on an enormous scale is what they should have called themselves.

With that huge super payroll processer came some advantages.

1. They were so large that they knew about changes to payroll law before the government even finished writing it into law;

2. They had the resources to be first in line and get special treatment with major payroll tax payment processing changes such as the Massachusetts department of unemployment online payroll tax payment system;

3. They offered a guarantee to pay the penalties and interest on errors and omissions.

With that huge super payroll processer came some super disadvantages too. For starters they were so large that one department couldn’t talk to the other and nobody knew who in there department had the authority to actually do something.  When there was a mistake with our transfer from one part of their company to the other you would have thought the two departments were the US and Russia during the cold war.  Once we worked our way into the correct department we then found that the tax deposit errors that were made by them during the transition would generate a string of notices and letters from the state and federal jurisdictions that I STILL receive.  Their guarantee just generated a series of “this isn’t our fault and we will start a file for your request” letters that filled an entire draw in my file cabinet.  Their response to our request to take care of their own mistake was basically “There is nothing we can do.  You can wait for the government to process the overpayment and when they do they MAY issue a return payment.  Your money has already been sent to the government so we can’t help you.”  When we wanted to know how much our payroll was going to be with taxes included the woman on the call in line had no way to tell us.  When the mail didn’t come because of the weather, neither did our payroll.

What did we learn from this experience?  We learned to request copies of all state and federal payroll tax filings that were not automatically forwarded even though we had access to them online because chances are that we would need them to sort out an issue later on down the road, bigger is not better and we started our own payroll service.  We needed something flexible, local, and comprehensive and we wanted a service where the guarantee meant something.  We couldn’t find it so we made it.  You may not be up for starting your own payroll processing service but you may be able to find someone small and local who will provide you great payroll service.

If you want to read more about payroll services check out the article at Entrepreneur Magazine online.


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