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Small Business Money Management
Small Business Payroll
In planning human resources for a small business, read Chapter
10 carefully. It’s easy to imagine a bunch of dedicated, flexible
workers who care as much about your dream as you do. And, if
you’re excited about your business, employees will probably be
inspired when you interview them. Ultimately, though, your
dream is not their dream—it’s just their job. They will expect
more stability than you may be able to provide and may be less
dedicated than you expect.
If you decide to offer flexible hours or benefits and goal-ori-
ented incentives, make sure that you hire people who appreci-
ate these alternatives and will respond well to incentives. Also
make sure that you design an incentive program you’ll be able
to afford no matter how poorly—or how well—your business is
doing.
Human resources management for a small business is best
delegated to a professional service. Small companies are too
small to have their own HR departments. Generally, you’ll want to
consider two services—a benefits service and a payroll service.
In planning employee benefits, you may simply want to find
a company that offers prepackaged plans and services, or you
may want to work with a small business financial advisor to set
up health, retirement, incentive, and benefits plans.
For payroll, it’s best to get a professional payroll service.
Payroll deposits, which may need to be made weekly or month-
ly, and payroll tax reports are very complicated and the rules
change often. The federal government monitors payroll
deposits, payroll reports, and payroll tax forms very closely. It
takes any errors very seriously and they’re difficult to correct.
You do not want to have a crucial business relationship with the
Internal Revenue Service depend on one employee who may
make a mistake, get ill on the day the payroll deposit is due, or
leave the company unexpectedly. In addition, the IRS knows
that professional payroll services such as Automated Data
Processing (ADP) and Paychex do the job right and spend less
time scrutinizing your payroll for errors.