Concerned By Remote Payroll? You Don't Have to Be.

It is a well-known fact that remote working has been and continues to become the new normal across the globe. Companies are increasingly sending employees to work from home with no real end in sight, causing remote work environments to become an integral part of today's workforce. While most businesses today work remotely out of necessity due to COVID-19, employers see this work strategy's benefits.

The remote workforce allows businesses to have a smaller real estate footprint, significant cost savings, and increased employee productivity. While this is the case across most departments, remote managing payroll is significantly more complicated. If your department does not have the expertise to manage a remote payroll system, issues can arise.

The good news, though, they can be minimized or avoided through changes made regarding a company's payroll department functioning remotely. In this article, we will cover common pitfalls of running a remote payroll to prepare for whatever the future holds.

The Time is Now

Where to begin? Ask the question, what is our payroll process? In unstable times like these, preparation is vital. It may take time in the present but will save you time, money, and stress in the future. Adjust the payroll process so your company can go remote at a moment's notice. Doing so will help you and your employees handle any issues that may arise as effectively and efficiently as possible.

It is optimal for HR departments to consider how to implement new policies with careful planning. When drafting new policies for your remote workers, consider the legal issues, budgeting demands, and workforce management. Also, keep in mind the importance of maintaining workforce corporate culture and identity.

Remember, the payroll department's mission is to pay every employee correctly and on time with every payroll cycle. Consider the impact of your company transitioning from working in the office full-time to working remotely, and at a moment's notice! Your company needs to cover any weak areas. Work proactively, not reactive.

Employers, you must know the location of your remote employees, and you must have the ability to monitor their timecard from that location. This is the first step in making sure you are setting yourself, your employees, and your company up for success!

Setting Expectations

Set clear expectations for your remote employees. Managers must clearly communicate performance expectations, time, and attendance requirements to all remote employees.

Policies on health and safety requirements, requesting leave, and work hours availability must be updated as well. It is essential to differentiate between what is considered a personal expense and a business expense for remote workers and reimburse accordingly.

Implement new safety protocols, and appropriate storing and disposal of hard copy documents employees may be using at home. It is crucial for company compliance, especially in the payroll department, that your employees work from all company-issued devices. Verify that each device is loaded with all necessary security measures. Updated safety protocols and standards avoid an unwanted breach of sensitive information.

Speaking of security, the privacy of sensitive information can be challenging to maintain in a remote work location. Continually exchanged information over wireless networks can expose the company to unwanted vulnerability.

Ask and answer the following questions:

· Are the remote employee's files and equipment secure?

Are all computer and mobile devices password protected?

· Are these passwords required to be changed regularly?

· Is the employee's wireless connection safe from unauthorized persons?

Remind your remote employees of any company policies regarding confidential and proprietary information. They are obligated to protect and keep all sensitive information properly secure.

Classifications

Hiring remote employees is different from hiring employees to work out of the office. It cannot be obvious when hiring remote workers and figuring out how to classify them correctly. It can be easy to misclassify an employee as an independent contractor when they are in fact an employee. The reason for the differentiation in employee versus contractor is tax purposes. Taxes change depending on how you pay employees versus contractors.

Governmental Laws and Regulations

Hiring remote employees across state lines comes with a myriad of complications. Wage and hourly rates complicate things because different states have different wage requirements.

The Fair Labor Standards Act requires that an employee working in another state get paid according to those state labor laws, not the state laws from where the company is located. Some states have income tax while others do not.

The "physical presence rule" indicates that state income tax laws need to be followed per the employee's physical location. Some states require income tax for the state that the employee works in and the company's site. Some employees split work across state lines, between home and office. Make sure all the income tax information you have is appropriate for each location every employee is working. Some states have reciprocal agreements that alleviate tax burdens on employees and lessen filing requirements for employers.

It is imperative to keep up to date on state guidelines for each state where the employee works, not solely where the company is located. Employees are obligated to track their time spent working at their remote location and monitor tax withholdings on each paystub. When the time comes for employees to either remain working from home or return to the office, they need to communicate their planned timeframe with their employer.

Another issue to be aware of: accidental noncompliance. Laws change regularly, so it is crucial to stay up-to-date on all state laws where employees work. Failure to do so can result in the company receiving fines. Ensure that you follow all laws pertaining to correct pay, overtime regulations, and reporting deadlines in different states across the country.

Clear Communication

One of the most significant issues with remote working is the lack of communication and oversight. It is up to the employer to effectively communicate with all remote employees. Take the extra steps needed to communicate project deadlines, work assignments, and employee performance reviews. It is easy to overlook remote employees' output because they are not in the office every day. Those employees who needed extra supervision in the office will still need that time and attention while working from home.

Work out a plan with regularly scheduled communication opportunities and stick to that plan. Overall, it will be better for you, your employees, and the company.

Also, make sure that all remote employees receive proper, legally mandated training. As you would, your onsite employees, keep your remote workers informed of new job notices like workplace discrimination and harassment.

Grow Globally

While there may be many difficulties with employing remote workers, do not let these difficulties deter you from doing so. There are many benefits to keeping employees by sending them to work remotely and by hiring remote workers. Hiring remote workers makes it incredibly easy to scale your business globally. You gain greater flexibility in growth planning, and your talent pool stretches the globe, literally! You also do not have to pay relocation expenses when hiring outside your state or country, and your real estate footprint is smaller.

Help for Your Remote Payroll Department

Is it time to take your payroll remote? Have you done so, and now your payroll department is struggling?

We are here to help! At Cornerstone Payroll Consulting we have experts who can guide you through the process and get you up and running remotely. We have consultants with 20 plus years of experience who have worked remotely on many payroll projects over different time spans. Connect with us today at info@cornerstonepayrollconsulting.com to see how we can help you with all your payroll needs!