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How to Protect Your Business Against Fradulent Payroll Providers

How to Protect Your Business Against Fradulent Payroll Providers 0

Many businesses, small or big, are suffering from a different kind of pandemic today: payroll fraud. A record 27% of businesses the world over are currently under attack from this accounting fraud. While this fraud can be typically traced to workers with ill intentions working within a business, it is often advised to hire the services of a professional payroll provider.

Payroll providers are expert agencies that offer effective and safe payroll processing for businesses. While they are tasked with navigating all the intricacies involved in payroll systems, can they really be trusted with your company’s financing?

While there are reputable payroll providers like Consultants In-A-Box out there to entrust your business payroll processing, we can’t help to disclose that there have been a couple of bad eggs in the business, soiling the hard and success of good payroll outsourcing companies.

In this article, you will learn how these fraudulent payroll providers operate and how you can prevent your business from one.

Causes of Payroll Fraud

Fraudulent payroll providers cripple the finances of many businesses through the following methods:

  • Ghost employees - If your business is fairly large, it is tasking to know all your employees by name or the actual number of your staff size. Fraudulent payroll providers exploit this common flaw by creating a fictional worker(s) and inputting their information along with genuine workers on the payroll list. The company ends up paying that ghost worker’s salary which is collected by the payroll providers. In some cases, these providers may use the names and details of former employees to trick businesses into paying them.
  • Falsification of timesheets - Some fraudulent payroll systems deliberately increase the number of work hours by a staff (whom they must’ve connived with) to have a bigger paycheck.
  • Payroll impersonation - Fraudulent payroll providers may ask your employees to update payroll data through a phishing website made to look genuine. They’d steal this information and make alterations to it on the genuine website.
  • False commission - It’s commonplace to see some businesses giving commissions to employees. A deceitful payroll provider can deliberately increase the commission of workers to make them earn a larger pay. This stunt is pulled by illegally increases the target sales and other marketing bonuses.

With the aforementioned ways in which businesses can be affected by fraudulent payroll providers, how do you ensure your business is well protected?

How To Protect Your Business From Fraudulent Payroll Providers

The steps below will guide you on how to prevent payroll fraud from scandalous providers:

  • Properly vet payroll providers. This is the important step to make before hiring a payroll provider to handle your company’s payroll. Ensure that they’re adhering to the regulations of the SEC and can also provide proof of their liability insurance. Also, ensure that their customer service is top-notch. Your business deserves nothing short of the best.
  • Check out reviews. When selecting a payroll provider to work for your business, you should the internet for user reviews. Reviews reveal a lot about a payroll provider you’re planning to work with.
  • Request for further certifications. You need to request for further verification from governmental agencies before hiring a payroll provider.

We at Consultants In-A-Box take pride as permanent solutions to your business’ payroll problems. We combine professionalism with a wealth of experience to deliver the very best for your employees and business. Do reach out to us today.

Six Payroll Challenges For Small Restaurants

Six Payroll Challenges For Small Restaurants 0

Managing a small restaurant is no easy feat. One would be dealing with several things all at once; coming up with strategies to drive sales, training employees on great customer service, and implementing customer reviews, and a more pressing issue: payroll processing.

Many small restaurant owners are having a difficult time meandering through the complexities of managing payroll, unlike other small businesses. You can’t afford to make mistakes while managing payroll. Mistakes often led to paying penalties which may affect your business.

You don’t want that.

In this article, we discuss some of the various payroll challenges for small restaurants and cafes.

Minimum Wage and Overtime.

Since 2009, the federal minimum wage has remained $7.25 per hour. However, states, cities, and counties have implemented a much higher minimum wage for employees. If the state and the federal minimum wage is different in the state your business is situated, you’d have to pay your employees a higher rate.

In the event that an employee exceeds 40 hours per week, he or she must be paid one and a half times more than their regular pay per hour.

When it comes to overtime, a lot of restaurant owners get it wrong. For some employers, calculating overtime fees of workers is still a challenge. There’s a seemingly overtime wage difference between tipped and untipped employees.

  • For tipped employees. The overtime wages for a tipped employee is ascertained from the full minimum wage.
  • For salaried employees. The overtime wages for a salaried employee is calculated on how his or her salary is set up and how many hours they worked.

Meals as Fringe Benefits.

Most restaurants offer meals to their workers, especially kitchen staff, who are always on duty. The IRS regards this as a fringe benefit. As a restaurant owner, you have the ability to exclude these meals from your worker’s wages. As long as the meals are provided to your workers on the premises, and they don’t go elsewhere to look for food, you can deduct the meals.

Most times, restaurant owners get this mixed up and this poses a problem for their business. However, it would be unreasonable to place charges on doughnuts, coffee, or any other meals taken by employees working overtime.

Too Many Forms.

Another payroll challenge restaurant owners face is the number of paperwork piling up on their desks daily. Having to sort out of the onboarding process for new employees, processing payroll, and of course, staying on the side of the law regarding tax laws.

When you consider the different wages of workers, expenses made, and the revenue flowing in, this can pose a serious payroll challenge for owners of small restaurants. It is highly recommended that you use payroll software or hire the services of professional payroll providers to handle all the complexities of tax and payroll.

Possible Discrimination on Job Applications.

As an employer, there are certain questions you’re prohibited to ask a potential employee, in order to not face lawsuits. Some of them include:

  • Asking about previous arrests or convictions.
  • Asking about their age.
  • Religious holidays
  • Disabilities

Offering Parental Leave and Paid Sick.

One payroll challenge small restaurant owners face is the understanding of how sick and parental leaves work. An experienced payroll provider is what your business needs if you cannot handle this issue yourself.

Payroll Fraud.

Payroll fraud is one of the crippling challenges of small restaurants. If unchecked, your business could take a serious hit. Some employees with ill intentions may illegally log in time which they never appeared on their timesheets. Handing out this responsibility to a payroll provider will save your business in the long run.