Smooth Payroll Transitions: Strategies for Success

Businesses decide to switch payroll providers for various reasons. Whether it's the desire for better features, more robust customer support, or simply a more cost-effective solution, the goal is always the same: to find a provider that meets the unique needs of the business and its employees.

Firms often require clients to use their preferred payroll providers to ensure standardization and consistency across their practice. This can also increase profitability for firms through wholesale pricing, commissions, or revenue-sharing programs.

Regardless of why a business decides to switch, the transition requires thoughtful planning and attention to detail to avoid disruptions and ensure compliance with federal and state regulations.

Key considerations for a successful payroll transition

Evaluate client needs

Before switching to a new payroll provider, you must fully understand your client's needs. It’s not just about whether the new provider's features will meet your client’s payroll compliance needs; you must also consider whether the new system will integrate well with existing software. Understanding these needs will help guide the decision-making process.

Timing is everything

Timing plays a crucial role when it comes to payroll transitions. The start of a new year or the end of a fiscal quarter are often the best times to make the switch, as they align with tax reporting periods and minimize the risk of errors. However, a successful transition is possible at any time of year if advanced planning is done to ensure that all necessary information—such as federal and state tax IDs, pay schedules, and employee details—is in place.

Common pitfalls to avoid

One of the most common oversights during mid-year payroll transitions is failing to account for wages paid to former employees. This may lead to incorrect W-2 and other year-end forms and can be costly for a business in terms of penalties and interest. Another challenge is reconciling amounts due and paid, especially when dealing with multiple job sites, states, and municipalities.

Delivering a great client experience

Clear communication and project planning are critical to a smooth transition. A best practice is to designate a main point of contact with the client and the payroll service provider. Require and deliver regular updates to ensure that everyone is aware and working toward important deadlines to keep the project on track.

Partnering with the right provider

A successful transition also depends on the support of payroll providers. Choose a provider that offers robust resources and support to help you navigate the complexities of the switch. Knowing who to contact for help and clearly understanding the process will make the transition smoother and more efficient.

Join us for a fireside chat

To help you navigate the complexities of switching payroll providers, we invite you to join us for a fireside chat with Heather Satterley, CPA, and Valerie Heckman from OnPay. We will discuss strategies for making a seamless payroll transition, share best practices, and address common challenges businesses face during the payroll provider transition process.

Date: September 5, 2024
Time: 1-2 PM ET

This is a valuable opportunity to gain expert insights and ask questions that will help you and your clients make informed decisions when considering a payroll switch.

Don’t miss out on this chance to learn from the experts. Register now!