The real cost of each payroll cycle

No matter the amount on any given employee’s paycheck, your organization is paying an additional $6.50 per paycheck to prepare and process that payment.

That’s the median cost per payroll payment, according to recent metrics from benchmarking firm APQC. Of course, there’s a wide range in between. In fact, the difference between the best-of-the-best companies and the lowest performers is nearly $5.

How can you get that figure down to the $3.80 companies at the top of their game enjoy?

Embrace these two payroll processing best practices:

1. Move the manual out of your time tracking. Are employees still marking their hours on a paper time sheet? That’s the first obstacle standing in your way to shaving time and expense from your process. Even if you’re not ready to spring for an automated time and attendance system, having employees enter their hours on a company intranet can lighten the paperwork burden attached to payroll.
2. Get as many employees as possible on Direct Deposit. Unless you’re at 100% participation, there’s room to go higher. Start with the lowest-hanging fruit: salaried employees tend to sign on at a faster rate than hourly folks. Then, once you can get some hourly workers on board, use them like a think tank: Find out what about Direct Deposit appeals to them, how it’s made things easier, and examples of when it helped them in a jam. A push from their peers will likely be better received than their boss explaining why its such a great idea.