Much of Canada’s workforce is protected by provincial or territorial employment standards that cover an employee’s basic rights and beyond. While there’s been much debate around the importance of pay versus perks, there’s no denying the former is a crucial operational process that’s often overlooked and understated.
Employers are typically given a grace period in which to pay employees at the end of a pay period, but a recent TSheets survey finds 26% of business owners familiar with payroll admit to unnecessary delays, citing inaccurate manual time data and doing it themselves as the top two culprits. The more important takeaway from this statistic is how both challenges are absolutely preventable, yet the consequences linger long after the initial errors have been fixed.
Erroneous timesheets equal more work
To better understand the time tracking habits of Canadian employees, TSheets conducted a separate study and found nearly 6 in 10 employees still use inefficient, manual time tracking processes. To exacerbate the situation:
- 45% of employees confess to submitting incorrect timesheets.
- 31% of employees submit an erroneous timesheet at least once a month.
On the receiving end of these error-riddled timesheets is often an already spread-too-thin business owner who now has to play investigator to find what went wrong and where and fix it. But just switching to an automated time tracking app can help business owners reduce their payroll processing time by an average of three hours.
Bad payroll can hurt cash flow
By definition, cash flow is a business’ ability to pay its bills. Payroll, on the other hand, is money paid out by a business. As the leading (if not the biggest) expense for a small business, not having a spot-on insight into the money coming into and leaving your business is a bad place to be.
Consistently listed as one of the top challenges among small business owners, it’s no surprise that cash flow problems can force business owners into bad decisions. In a crunch, a business owner may be prevented from making good long-term decisions in the face of short-term cash flow issues, from lowering prices to delaying crucial hires or equipment purchases.
Help with more than just numbers
The good news is that business owners are quickly realizing they don’t have to do everything themselves. 20% of respondents say they are willing to pay for automated payroll solutions. But the help goes beyond an automated timesheet or balanced books.
Since switching to TSheets, Jen Skanes from Skanes General Contracting has been able to job cost and bill more accurately since the data is available in real time. “As soon as the crew clocks out, I have accurate data ready for processing into invoices. Before this, I’d have to wait until the end of the week for them to submit their physical timesheets, and more often than not, the information would be incomplete or inconsistent,” she summarizes.
Tanya Hilts from Cloud Bookkeeping offers a different perspective in serving her small business clients. “There are more than 200 regulatory requirements when it comes to payroll. That’s intimidating for anyone to tackle,” she said. “We help to fill that gap in knowledge by educating business owners about their Canada Revenue Agency responsibilities and their numbers for better cash flow and ensuring their operations are compliant.”
From growth and productivity to business insights and strategic planning, payroll touches multiple if not all of your business operations. It’s up to you whether it will contribute to or drain your current procedures and workflow.