Beyond meeting deadlines, investing in accurate and timely year-end payroll support safeguards your organization’s reputation and budget, maintains employee satisfaction and sets the stage for a successful year ahead.
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Author: Jeff Garrand

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Year-end payroll represents far more than just another administrative task. Finalizing the year from a payroll perspective demands a complex process requiring meticulous attention to detail, compliance with ever-changing regulations and coordination across multiple departments.

The year-end payroll challenge

The stakes are high. Errors in payroll processing can create a poor employee experience, compliance-related penalties and unexpected costs to the business for rework and corrections — as well as reputational damage.

Challenges payroll professionals face during year end include:

  • Increased workload: From reconciling year-to-date payroll reports to preparing W-2s to January 1 effective changes, the sheer volume of tasks can overwhelm even well-staffed teams.
  • Compliance risks: New or expiring legislation can impact payroll practices, requiring teams to stay updated and adapt quickly.
  • Tight deadlines: Fixed deadlines for tax filings and employee documentation leave little room for error or delay.
  • Employee expectations: Employees require accurate and timely year-end reporting to complete their tax filings, making payroll precision and punctuality critical. Further, employees rely on the payroll team's seamless application of benefit updates and election changes at the start of the year.

The case for year-end payroll support

To navigate fourth-quarter payroll challenges, many organizations turn to specialized year-end payroll support to ensure a smooth and error-free process. Six essential ways outsourced payroll support can help during times of peak workload include:

  1. Increased capacity during peak periods: Year-end represents a peak payroll activity period and many teams simply do not have the bandwidth to manage the additional workload. On-demand support from experienced consultants can help bridge this gap, completing all tasks on time without compromising quality.
  2. Expert guidance and oversight: Year-end payroll involves numerous intricate processes, from balancing W-2s with quarterly 941s to reconciling year-to-date payroll reports. Guidance and insight from an experienced payroll consultant can significantly reduce the risk of errors and ensure compliance with regulations.
  3. Comprehensive reconciliation and review: Accurate W-2 reporting is a cornerstone of year-end payroll. Support services can include a full review and reconciliation of W-2s, ensuring that all data is correctly placed and balanced. An experienced consultant can identify and resolve any discrepancies before final submission.
  4. Legislative compliance: Because payroll regulations evolve constantly, employers must remain compliant. Year-end payroll support includes notifications of new or expiring legislation, helping you avoid penalties.
  5. Fringe benefits and employee data updates: Year-end is also the time to process fringe benefits and update employee data related to compensation, merit increases, 401(k) contributions and benefit deductions. Support services can handle these updates accurately and efficiently.
  6. Enhanced employee experience: Payroll errors can spark employee frustration and dissatisfaction. By ensuring accuracy and timeliness, year-end payroll support contributes to a positive employee experience, reinforcing trust and confidence in your organization.

Beyond meeting deadlines — safeguard your reputation and budget

Year-end payroll is a critical business function that requires precision, expertise and significant resources. For many organizations, the increased workload and complexity of this period make it difficult to manage without external support.

Investing in year-end payroll support is not just about meeting deadlines; it's about safeguarding your organization's reputation and budget, maintaining employee satisfaction and setting the stage for a successful year ahead.

Learn more about all of our outsourced payroll services.

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Author Information

Disclaimer

Consulting and insurance brokerage services to be provided by Gallagher Benefit Services, Inc. and/or its affiliate Gallagher Benefit Services (Canada) Group Inc. Gallagher Benefit Services, Inc. is a licensed insurance agency that does business in California as "Gallagher Benefit Services of California Insurance Services" and in Massachusetts as "Gallagher Benefit Insurance Services." Neither Arthur J. Gallagher & Co., nor its affiliates provide accounting, legal or tax advice.