There are a lot of ways you can pay employees these days. You can use direct deposit, checks, or even pre-paid credit cards.
As options expand, it’s a good idea to review current offerings and determine which method works best for your company. Read on for a brief guide on paying company employees:
How to Pay Company Employees
Before you start distributing wages, you will need to calculate employees’ gross wages, taxes, and other deductions. A free paystub generator will make the job easier.
Then, you’ll be ready to print paystubs and deposit funds using direct deposit, pay cards, mobile wallets, or other methods.
Take a look at the following methods and see which one makes sense for your business. Pay close attention to the cost and responsibilities of the employer too.
Pay Employees With Checks
Paying your employees with a check is one of the most common ways employees receive their money. You can handwrite a check or print paystubs and checks for your employees.
This method of payment doesn’t require the employees to have a bank account to receive their wages. Employees can use a check cashing service and receive their wages the same day.
Some employees do not like to share their banking information, and they enjoy the privacy that receiving a paycheck offers them. However, keep in mind employee paychecks can get lost or stolen.
Pay Employees With Direct Deposit
Direct deposit is another common method of paying workers. Eighty-two percent of U.S. workers receive their paycheck via direct deposit.
Direct deposit offers convenience. Workers don’t have to take a paycheck to their bank to deposit it or cash it. If a worker is off on payday, they won’t have to come into work to pick up a check. It will be sent to their bank account automatically.
It can take a while for direct deposit to process. Ask your business accountant how long it will take to process your company’s payroll with direct deposit.
Pay Employees With Payroll Cards
A payroll card is a prepaid credit card that employers use to pay a company employee with. The card can easily be loaded with the employee’s wages for the pay period, and they are ready for immediate use.
Employees do not have to have a bank account to be able to use a payroll card. They can withdraw cash at an ATM or use the card for payments.
Pay Employees With Cash
When all the previous methods do not work, you can always pay your employees with cash. If you do decide to pay employees in cash, keep a careful record of your cash accounting. Be sure to take out the correct amount of taxes before you give the employees their cash.
Paying in cash could make it difficult to keep track of your payroll records since it will not have a paper trail like a bank statement.
Paychecks Made Easy
Choose a payment method that works for you and your company employees. You don’t have to choose the traditional method just because it is what most companies use. Consult with your business account and consider one of these newer methods that make paying employees easy.
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