they are coming tommorow from the Employment securitys department to audit my payroll
Can anyone tell me what they are looking for… The only thing i am worried about it that some employees have more hours in quick books than they do on the time clock for some reason. Not sure how i messed this up but for the year 2010 a new workers got paid more hours than they clocked on for
I hope they dont care about that, i could see them caring if they were shorted but overpaid should not be a issue
Not sure who Employment Securities department is but I have recently been through a workers comp audit by the state recently. As opposed to my typical workers comp audit from the insurance company that requires only a copy of my quarterly payroll reports, the state wanted my check register for three years with copies of all checks, P and L statements, payroll reports plus answers to a million questions regarding all of the above. The person I dealt with was easy to work with and seemed to respect the fact that i was timely getting him all reports and answering all calls to answer questions. As long as you have nothing to hide I doubt you will have any problem.
We had one a few years back from the Texas Unemployment. They just looked at my tax reports (941 and reports I had made to the state) and some of my Quarterly payroll records to make sure that the numbers all matched. They are usually in a hurry and if everything is in good order and you have everything organized, they usually don’t hang around long.
Been through my share of audits due to a small error which kept red flagging us(from the big ol IRS). (Our gasoline, driver reimbursment and natural gas were all being categorized under gas.) Of course they don’t tell you why you are getting audited so it took a couple of audits before I and I repeat I figured it out. Anyway the point is I run a legite business. (And from what I know of you so do you) so no need to worry. I was confident in my records. Make sure to have everything they have requested available. I am not sure if I have ever had an audit from Employment but all the audits are basically to see what is going on. Over the years my record keeping has only improved because I know who needs what and how I can best keep records through the years so I am not scrambling when work comp comes around or whoever else. Use it as an opportunity to grow or whatever.
You may have just made a small error, could be random. Who knows. Good Luck and be thankful during these times you run an honest place.
When I had that sort of audit, I believe they were mostly concerned with whether your time cards matched the hours you reported people working. They are looking for unreported, under-the-table type workers, so they are will look at your check register, looking for payments that might be for unreported workers. So, be prepared to explain why you paid (John Doe) money.
I realize a lot of folks here do their own payroll. However, the aformentioned reason is why I use a payroll leasing company. I have used one for over 6 years.
I have read and heard too many times where the payroll money was used for other purposes and when the quarterly pymt came due, there was no money.
Each person must dance to their own song, but for my quarter, the $50 fee each week is worth it for what they do and provide for me.
If you are truely using a payroll leasing company, you are paying a lot more than $50 per week. They also make a margin on the payroll. Perhaps you meant a payroll service? That would make more sense at $2500 per year… but that would still be high unless you have about 40-50 employees.
The leasing company I use charges an administrative fee that costs me about $100 every payroll. They then give me a slight break on state unemployment rates and a large break on workers comp rates. It turns out to be cheaper than doing my own payroll
A company I used to work for used leased employees for clerical and warehouse positions. Yesd, there was savings on unemployment and work comp, but in addition to a fee they also paid the workers less than we paid per hour… meaning that they were making a margin (10-15%) on the wages too. It was worth it to us for the screening and the immediate replacement of new hires that did not work out, but it was not free. In other words, we were paying, $14 per hour to hire an employee who was getting paid $12. (plus all the other employer extras)
Worth looking into, and it still might be a good way to go in some circumstances.
A leasing company “employs” your workers and does all of the administrative payroll work. You hire who you want, you train them to do the job you want, you fire them when they don’t do the job you want well enough but on paper they are employed by the leasing company. It is very common in the construction industry and is becoming more common in other industries. In all the leasing contracts I have seen, the leasing company makes its money on administrative costs and recently by self insuring for the workers comp. I haven’t seen one that marks up the labor but that seems more like hiring from a temp labor company. My current arrangement is set up so that my payroll is costing me wages plus just over 12% for restaurant employees and wages plus just over 15% for delivery drivers. The overage covers the employers share of FICA taxes, federal and state unemployment taxes, workers comp and administrative fees. When an employee reaches the earnings threshold that FUTA and SUTA taxes are no longer paid the overage adjusts to reflect the savings.