How to Process Payroll More Efficiently


Processing payroll is an essential business task no matter what industry you operate in. However, it can also be time-consuming, preventing essential team members from focusing on other tasks that are equally important.

That doesn’t need to be the case. For example, you could streamline payroll processing by choosing the right payroll services provider. Click here to learn more about this topic.

You can also consider the following tips. If you’re trying to process payroll more efficiently without sacrificing accuracy, they’ll help.



Payroll technology is constantly improving. This has allowed payroll services providers to automate many aspects of payroll processing. Choose one that embraces automation wherever possible.

Stay up-to-date


Business tax laws are always changing. You need to be aware of relevant changes when they’re made. That said, making adjustments to payroll processes to ensure compliance with new laws can take a lot of time. It may also not be necessary.

Some payroll software solutions now feature built-in tax tables that automatically update to reflect tax law changes. While you should still check these updates to confirm their accuracy, if you’re using strong payroll software, you can typically rely on this feature to save you a lot of time.

Embrace self service


There are some instances when it’s appropriate for employees to make changes to payroll documents or profiles directly instead of coordinating with HR or your payroll department in order to do so. For example, maybe an employee’s bank account has changed, and they need to update their payroll information to reflect this.

Doing so could involve submitting a form to another department where a team member will then be tasked with making the necessary update. On the other hand, a payroll solution with employee self service features could allow an employee to make this update on their own, freeing up the bandwidth of the team member who would otherwise be responsible for addressing this task.



It’s ideal to use payroll software that offers a range of features to suit your needs. That said, some critical features of a payroll system may already be in place at your business in other ways.

Consider the example of timekeeping. A strong payroll solution will offer timekeeping functions to ensure hourly employees can easily indicate how many hours they worked in a given pay period. The system should also automatically calculate their pay accordingly.

However, you might already use a different timekeeping solution, and you don’t want to train your entire workforce to switch over to a new system. If you choose payroll systems that can integrate with your existing timekeeping systems, this isn’t a problem you need to worry about.

Keep records


This may be an obvious point, but it’s an essential one. Your payroll processes must involve proper record keeping. This isn’t just a matter of staying organized. It’s a matter of compliance.

Remember, state and federal laws require business owners to retain certain payroll records for certain periods of time. Take the time to ensure your approach to record keeping emphasizes compliance and efficiency.

Anticipate future needs


The various steps your payroll processes involve will likely change and evolve as your business grows. You could waste a lot of time adjusting your processes if you don’t predict what your future needs will be.

For example, right now, your business may be small, and you might not have any employees who would make the types of purchases they could expense. Therefore, reimbursing employees for such purchases may not be an element of your current payroll processes. That could change in the future. If it does, you want to be prepared to adapt accordingly.

This is another reason it’s wise to work with a payroll services company or software that offers flexible features, products, and services. You need to be able to make changes to your payroll processes quickly as your business grows.

On a regular basis, coordinate with other major decision-makers within the company to discuss potential future payroll needs. Anticipating changes and developments ahead of time will help you prepare accordingly.

Integrate benefits


Some business owners make the mistake of using separate companies and products to handle payroll and benefits. This can significantly reduce overall efficiency. Don’t make this error.

Instead, use a payroll system that allows you to integrate benefits. Doing so will save those responsible for payroll processing and similar tasks tremendous amounts of time.

Choose the right payroll schedule


This tip may not apply if your business is large and employs many hourly workers. In some instances, choosing a payroll schedule that satisfies both a business owner and employees requires choosing either a weekly or biweekly schedule.

However, maybe your business is small, and you thus primarily work with contractors and freelancers. If this is the case, a monthly payroll schedule may be acceptable. Quite simply, the less often you have to process payroll, the more efficient your business’ overall operations will be.

Use checklists

Once more, while using a payroll system with various automated features and functions is a good idea in general, you should still check the system from time to time to make sure everything from payment amounts to tax table changes are accurate.

You can reduce the amount of time it takes to review these details by creating checklists. When those responsible for confirming the accuracy of a payroll system have a list breaking down the various steps in the process, they can work much more quickly than they otherwise would.

Most importantly, don’t overlook the value of actually putting these tips into action. True, changing the way you handle payroll processing takes some time now, but in the long run, it substantially boosts your efficiency.

This will have very genuine and measurable financial benefits. The saying “time is money” is only a cliche because it’s true. In any business, the less time spent on payroll processing and other such tasks, the better. Businesses that don’t waste time on payroll processing simply have more time to innovate and remain competitive.