Going paperless has numerous benefits for companies, from reducing administrative tasks, to controlling costs, to limiting environmental footprints. Yet one area that many companies are late to address as they move toward 100 percent paperless processes is payroll distribution. While most employees opt for the convenience of electronic payments, a few tend to exercise their right to the traditional paper paycheck and printed paystub. Employee paycards, also known as payroll cards, may be the option needed to finally convert your workforce to a paperless payroll model, as long as they are rolled out in compliance with state regulations. Here is a closer look at what business leaders need to know about taking the paper out of their payroll processes.
Understanding payroll options
Businesses are increasingly working with professional payroll providers. These relationships simplify administration, ensure reporting and tax withholding compliance, and provide companies with a wider range of options to pay employees. Typically, three pay options exist: direct deposit, issuing paper checks, or using employee paycards. An employee paycard is typically a prepaid debit card style where an employee's payroll is automatically loaded each payment period. Purchases can be made using the card as a credit or debit card, or cash can be withdrawn at ATMs. Some paycards offer no-fee pin and signature purchase transactions. Others even include reward programs. When determining your options for payroll, it's important to note that many states require employers to offer staff the option of a paper check. Ensure that your payroll offerings are in compliance with state regulations.
Paycards overcome employee objections
For companies moving toward paperless payroll, employees that want a paper check can pose a challenge. The reasons that employees want a physical check can vary. For some it is an issue of trust or fear of change, while others may not have a personal bank account. However, employee paycards may overcome most objections. For example, they don't require a bank account. Balances can be checked online and funds may be withdrawn from an ATM, at banks displaying the Visa or MasterCard logo, or at point-of-purchase with cash back. Employees benefit from immediate access to their payroll, while companies benefit from increased efficiency. One important note for employers considering paycards is that they must also offer direct deposit into an account of the employee's choice. A payroll provider or HR professional can help business owners understand what is required.
Launching an employee paycard program
Issuing employee paycards is one way that companies are finally able to go 100 percent paperless, saving significant time and costs. Cards today have very minimal associated costs, and are easy to use. Companies spend less money on printing, postage, and dealing with the fees associated with lost checks. Launching a company program can often be more successful if incentives are offered to employees to join. At a recent industry conference, for example, one large company shared that they have policy of fast tracking the replacement of lost checks for any employee who signed up for their paycard program.
Whether your company is looking for better, faster options to pay employees or you're simply ready to take the next step in going paperless, employee paycards may be the answer. Businesses save time and money, while employees get quick and flexible access to their payroll each pay period. Discuss your objectives with a professional payroll provider today to learn more about what option may be right for you.