It may be hard to believe, but 2021 is quickly coming to an end. And as we head into the fourth quarter, now is a great time to reevaluate the vendors and technology solutions you’ll be using to run your business in the year ahead — your payroll system included.
Payroll is a critical component of your business operations. It’s how you pay your employees in exchange for the work they do and ultimately keep your business running. It’s critical that the tool you’re using empowers you to complete payroll on time and accurately. Otherwise, you risk facing hefty government fines or worse, losing employees due to a lack of trust.
But why reevaluate your system now? Here are 4 reasons:

You’re already setting business goals

With only three months left in the year, you’re likely strategizing for 2022 — setting goals and determining the tactics, people, and tools required to achieve them. And while it may not seem obvious, the right payroll solution can play a big role in helping you achieve many of your business goals. 
For example, if you’re looking to find ways to free up your HR team’s time so they can focus on connecting with candidates, a modern payroll solution can help do just that by automating much of a traditionally very tedious process. Or maybe you’re looking to enhance your employee onboarding process by getting new hires in the system and up-to-speed faster. A payroll system that’s built into your recruiting and hiring technology will seamlessly transfer new hire data, speeding up the process and reducing the risk of error.

It’s the start of a new tax year

By running your last payroll of 2021 on your previous payroll system and the first payroll of 2022 on your new system, you can make a clean switch to kick off the new tax year. With the new year, all payroll and other talent management-related numbers are reset, meaning you won’t have to go through the process of balancing payrolls from your old system year-to-date. But make sure you maintain a record of all payroll information from your previous provider before ending the relationship, in case you need to access the information in the future.
When it comes time to file 2022 taxes, pulling payroll records from one system will make the task easier on all parties involved, and ensure greater accuracy. And payroll accuracy is key to saving your business from costly fines, as approximately one-third of businesses face IRS penalties each year due to payroll errors. The right payroll provider will help you pay all employees with complete accuracy, and provide the necessary tools to maintain tax compliance, despite ever-changing compliance regulations.

PTO typically resets January 1 

Does your current payroll provider track paid time off? If your business tracks paid time off manually, it can be costly and time consuming – and you may not realize when an employee is approaching his or her time off limit for the year. 
By switching payroll providers and leveraging an integrated payroll and talent management system starting in the new year, you can get notified each time an employee approaches his or her paid time off limit – ensuring your business doesn’t lose money due to employees taking too much time off. Automated tracking and notifications can also help your business support a compliant PTO policy.

You’re setting your 2022 budget

The fourth quarter is also a time for annual budget setting, which often requires you to find ways to cut costs. A significant cost associated with payroll is the extra payroll fees that add up throughout the year. Most payroll providers charge per payroll run, for example. If your business runs payroll for certain roles every week, other roles twice a month, and once a month for sales commissions, you’ll face additional charges each time you process payroll. Other payroll providers have added charges for reporting and end-of-year tax forms.
To avoid such fees, partner with a payroll system that has a transparent cost per employee per month payment structure. This can ensure you don’t get nickel and dimed for each payroll run or other necessities, such as tax forms. The budget typically lost to various payroll fees can then be re-allocated to other areas of the business to help you continue to grow throughout 2022.
The right payroll system can also help you reduce excessive overtime costs. By running your payroll through an integrated talent management system, you can receive notifications each time an employee is approaching 40 hours to prevent costly overtime. While workload calls for overtime on occasion, you don’t want to end up paying far more in overtime costs than what’s absolutely necessary. This simple change can save your business thousands of dollars throughout the year.
Payroll-related costs can make up a majority of your business expenses, so it’s critical to ensure you’re paying employees — and tracking other talent management costs — as accurately and efficiently as possible. Using a payroll provider that is built into your recruiting and hiring tools can save you time and help you avoid manual re-keying errors. 
For more information on choosing the right payroll provider, read our resource, The Hireology Payroll Buyers Guide.