It’s May, which means it’s time to celebrate. Why? Because it’s Small Business Month 2023! All of us at Real Check Stubs would like to congratulate small business owners on their contributions to society and for getting through the last few challenging years. May this year bring prosperity for all.
In the spirit of celebration, why not reward yourself and make your payroll processes easier using professional paystubs?
Payroll can be a complex and time-consuming task, especially if you're doing it manually. That’s where pay check stubs come in – these documents not only provide a detailed breakdown of an employee's pay but also help you stay compliant with the law.
This article will review how professional pay check stubs can improve your payroll processes and how you can start generating them now.
Why Are Pay Check Stubs Important?
Professional paystubs provide a clear record of an employee's earnings and deductions. Employees may need this for various reasons, such as when applying for a loan or renting a property. Likewise, employers need to keep accurate records of employee earnings and deductions for tax purposes and to comply with labor laws.
While providing pay stubs is not compulsory under federal law, it is required under state law in some states. Certain states stipulate that employees only need to have access to their check stubs, while others require stubs to be printed.
Also note that a pay stub is not the same as a pay check. A pay stub accompanies the pay check and provides a detailed breakdown of the employee's earnings and deductions for a particular pay period.
Manual Vs. Professional Pay Check Stubs
A professional paystub is a document – digital or printed – that shows the employee's earnings, taxes, and deductions in a professional and organized format. It is created using specialized software and provides a comprehensive overview of an employee's pay information.
In contrast, a manual paystub is created by hand or with a basic computer program, such as a spreadsheet. It may not include all the necessary information or be formatted in a professional manner, which can confuse both employees and employers.
Professional paystubs provide a consistent, standardized format for all stubs, eliminating the risk of variation caused by different members of staff doing things differently.
As the law requires businesses to report on specific information when it comes to auditing and filing taxes, standardizing the process is the obvious choice and will save a lot of time that could be wasted on correcting errors.
How Do Professional Paystubs Save Time and Costs?
Manually processing payroll can be a time-consuming task, especially if you have a large number of employees. Professional paystub services automate the process, reducing the time and effort required to generate accurate pay check stubs. Staff that would usually generate pay stubs by hand will then have more time available to work on more productive activities.
In addition, professional paystub services are designed to comply with federal and state regulations, which reduces the risk of errors that can result in fines and legal consequences.
Business owners that are managing payroll themselves and don’t have dedicated personnel to do it needn’t be spending a lot of time on admin – and with a pay stub generator, they can focus on growing their business instead.
Cost Comparison Between Manual and Professional Paystubs
The cost of manually generating pay stubs can vary widely depending on the size of the company, the number of employees, the frequency of pay, and the complexity of the pay stubs.
Pay stub software typically has a monthly or yearly subscription cost – and the cost of using this software is significantly less than the cost of generating pay stubs manually, especially when you consider the decreased risk of errors and the time spent correcting them.
Let's take an example of a small business with 20 employees. Suppose the business owner/another member of staff manually generates pay stubs for each employee and spends an average of 30 minutes on each pay stub. Assuming weekly pay periods, this would result in a total of 480 hours per year (20 employees x 48 pay periods x 0.5 hours per pay stub).
If the business owner/member of staff creating check stubs has an hourly rate of $25, the total cost of manually generating pay stubs would be $12,000 per year (480 hours x $25 per hour).
On the other hand, if the business owner uses a pay stub software, they can generate pay stubs for all 20 employees within a matter of minutes, saving hundreds of hours per year and slashing the cost dramatically.
How Do Pay Stubs Improve Employee Satisfaction?
When employees receive clear and accurate paystubs, they feel more confident that they're being paid fairly and that their employer is handling their financial information responsibly. This transparency leads to increased trust and loyalty, which ultimately benefits your business in the long run.
If an employee is paid incorrectly, they may feel undervalued and disrespected, which could lead to decreased productivity in the short term – and staff turnover and reputation damage in the long term.
This is the case whether employees are underpaid or overpaid. When underpaid, they will feel undervalued and neglected but if overpaid, the inconvenience of having to re-visit their personal budget or return money to the company is sure to be a big turn-off for any employee.
If you have dedicated staff that processes payroll, you can bet that their morale will also increase if they have an easy way to create check stubs online instead of doing it manually for every employee each pay period.
How Do Pay Stubs Improve Compliance?
Accurate pay stubs help you stay compliant with federal and state regulations. For example, the Fair Labor Standards Act (FLSA) requires employers to keep accurate records of hours worked and wages paid to employees. In addition, the IRS requires employers to keep detailed records of employee pay and withholdings, which can be used to prepare W-2 forms at the end of the year. (Having pay stubs to hand will also streamline the process of completing W-2 forms.)
By using professional paystub templates or payroll software that automatically generates stubs, you can ensure that you're providing accurate and compliant documentation to your employees and government agencies. The check stubs will contain all the details required by law, every single time.
More Benefits of Professional Paystub Generator Software
Professional paystub software offers several other key benefits for business owners. First, it generates detailed paystubs that include information on gross pay, net pay, taxes, and other deductions (voluntary and involuntary), as well as details on vacation, sick leave, and other types of leave. Other details that will be included are:
- Company information
- Employee information
- Rate of pay
- Frequency of pay
- Pay date
- Pay period (the date range shown on the check stub)
These details can help employees understand how their pay is calculated and provide transparency in the payroll process.
Second, an online paystub maker can handle multiple pay types, including hourly, salaried, and contract workers; this flexibility can help you manage different employee types and pay structures within one single program.
Professional paystub services can also integrate with accounting software, making it easier to manage payroll alongside other financial tasks. For example, if you were using another program to track time and attendance, integrating it with payroll software means you could import the data on hours worked for hourly employees so that their pay stubs could be generated automatically.
Our instant paystub generator lets you generate pay stubs fast and download or email them at the click of a button.
In conclusion, professional pay stubs are an essential tool for any small business. They help you stay organized and efficient, while also improving employee satisfaction and trust – and can save you thousands of dollars per year on labor costs.
In some states, paystubs are mandatory – and even if your state doesn’t require you to provide them to employees, they will make life much easier when it comes to tax season.
So, once again, happy Small Business Month – and remember to treat yourself by testing our pay stub generator!