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How To Maintain And Organize Employee Payroll Records
As your business grows from one employee to the other, you must keep up with the records before disorganization becomes the order of the day. Keeping records ensures your employee details are organized and can quickly be accessed for information retrieval whenever needed.
Moreover, the law requires payroll records in most jurisdictions, meaning you have no two ways about it. Thus, it’s only logical to master the art of maintaining and organizing employee payroll records. Below are helpful tips you could try out.
Choose A Filing System
Staff payroll records typically include details such as:
- Employee name
- Employee payroll deductions
- Wage and tax statements
- Withholding certificate
- Timesheets
- Tax documents
You must first decide on the filing system to use. For a small business, you may choose to store paper records, as they won’t be overly voluminous by the end of the day. But, for mid-sized and big companies, keeping digital records is more appropriate. Better still, take advantage of cloud storage, eliminating the need for high-capacity hardware and allowing remote and round-the-clock access.
In July 2019, the Australian government directed all small businesses to be Single Touch Payroll (STP)-compliant to facilitate the reporting of salary, pay as you go, and super information to the Australian Taxation Office (ATO).
You’ll need reliable Australian STP software for this purpose. The advantage is that STP saves time, given that all required information is automatically and simultaneously forwarded to ATO.
Separate From Other Records
As an employer, you’ll typically have the following essential records for your staff:
- Awards and achievements
- Training and development records
- Job details, including typical responsibilities, skills, and qualifications
- Employment details, including employee identification number, date of joining, and bank account number
- Contact details
- Personal details, such as name, age, gender, date of birth, and marital status
You shouldn’t keep all these records on the same file as payroll records.
Separating them helps you organize your files in an easy-to-retrieve manner. Separation is essential whether you use a digital or physical filing system, as it makes your work easier.
Know When To Discard Them
It’d be best to consider the time limits of keeping the files. Requirements vary from jurisdiction to jurisdiction, but the average falls to about three years. You can destroy any record older than this by shredding it into small pieces and trashing it. On the same note, you may need to do away with files of staff members who’ve already left the company.
Formulate Standard Company Policies
More often than not, you won’t be the one filing the payroll records. You’ll most probably have an assistant do it on your behalf. Thus, formulating standard policies on record-keeping is essential. It ensures everyone handling the payroll records follows a predefined procedure for consistency. Also, review the company policies regularly to ensure they reflect the current needs.
Label Your Files
Labelling files is essential to facilitate quick identification. You must use standard formatting to label your physical or digital payroll files. Such uniformity makes it easy for anyone in the team to understand the file contents at a glance. On the same note, organize the payroll records into files and folders. It might take several hours to trace a misplaced file, which can hurt your business. An excellent approach is to name and store your files according to the dates created and keep a separate folder for each staff member.
Secure Your Storage Point
You must store payroll records where no unauthorized person can access them. Using the digital filing system, you may need strong passwords to protect the folders. It’d be best if you also shared the passwords with only those who need them. Protecting employee information is paramount as any leak of crucial personal details may put the victim at risk of fraud.
For paper records, consider installing a password-enabled safe for optimum security. Keep the safe in a room not accessed by everyone in your company.
Conclusion
Your business must manage staff payroll records effectively to comply with workforce regulations and facilitate quick retrieval. Ideally, craft an applicable labelling convention and follow it to the letter. On top of that, organize the records into appropriate files and folders depending on the date created. You could also leverage modern tech tools to properly manage digital payroll records.
Furthermore, ensure you continuously train your human resource department on the best practices to follow in terms of record-keeping. Above all else, put in place appropriate security measures to prevent unauthorized access to the documents. You wouldn’t want fraudsters to steal critical employee details and use them in evil ways.
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