There are three common types of payroll fraud:
Timecard falsification: can be easily caught through the reconciliation and employee review process.
Ghost employees: They are employees that do not exist. It can be paying themselves a duplicate paycheck through a false name, and having the money deposited in their checking accounts.
Misclassification and workplace: Self-inflicted by the employer through worker fraud. It’s the illegal practice of designating an employee as a non existing worker or an independent contractor. Some business owners do this to avoid paying payroll taxes, unemployment tax or workers’ compensation insurance and are therefore able to submit lower bids for projects, undercutting responsible companies. In the other hand, many other business owners may be misclassifying workers without even knowing it, such as if they designate tasks or set time with the contracted employee in all cases, it is simply not worth it.
Payroll fraud needs your attention; the key is catching it and minimizing the risk. Anyone can steal at any time. The best way in doing so is to reconcile your payroll at least quarterly with someone other than the person who runs your payroll. The reality is payroll fraud is not preventable, but is catchable. Yes, it is that simple.
There is much that goes into choosing a payroll company. While you may not realize the importance right now, this is a decision that will greatly affect your company’s financial future. With many options, you should be able to locate a service that is perfect for your company.
These advices can help you make an informed, confident decision:
- Make sure the service is experienced in handling the most important areas. This includes: paying your payroll taxes on time; paying your employees on time; and filing your payroll tax forms by the deadline.
- Know what you don’t need and know what you need. Payroll companies offer a huge variety of services. It is important to pay for what you need and to avoid signing up for something that does not pertain to your business.
- Monthly cost, based on the company you choose as well as the level of service you require and the number of employees you have. It is important to know exactly how much you will be paying, month after month, so that you can budget for this expense. Companies like payroll in chile, can adapt to your business with the services you only need.
With this information, you will find it easier to locate the right payroll company for your organization; avoid fraud, save time and money for focus in your business.