Now is the time!!! Time to assess your year-end process and your W-2 distribution methods. With continuous advances in payroll technology, businesses large and small, look to their payroll department for more efficient ways of managing their administrative needs. Thanks to cloud-based technology, businesses can upgrade their payroll methods and offer their employees direct access to their payroll information. Streamlining efficiency and improving the employees experience simultaneously. Traditionally, businesses have been limited by manual paper delivery methods when it comes to paychecks and W-2s. Today, businesses have many more choices thanks to cloud-based technology. One simple upgrade is the electronic distribution of W-2s.
The traditional method of hand delivering or mailing a paper W-2 has its shortcomings. First you need to wait for the paper W-2s to be delivered. Employers have found that organizing and distributing paper W-2s can be a time-consuming process depending on the size of your business. If a W-2 is lost it takes additional time and energy providing a replacement. Then, there are the odd requests throughout the year by employees for copies of past W-2s to back mortgage and car loans, etc. Employers need to be on top of their accounting and record keeping systems when issuing paper W-2s.
The alternative to paper W-2s is electronic W-2s. One of the biggest advantages of electronic W-2s is the delivery method - it's instant and direct to the employee. There is no middleman – payroll/HR and managers are taken out of the equation - improving efficiency and effectiveness. Employees can access their W-2s as soon as they are available. It is securely stored in the Employee’s Self-Service (“ESS”) portal where they can access it for as long as the employer choses to have it available. If employees are given mobile access to their self-service portal, they can access their W-2 (1095s, 1099s) day or night, seven days a week. Employees will no longer have to keep track of a piece of paper. The W-2 may be printed as many times as needed. Should an employee leave the company, a paper W-2 will be issued by the payroll company and forwarded by the employer to the employee. In many cases, former employees can still access their partner portal and their electronic W-2.
Providing electronic W-2s to your employees is a relatively simple procedure for your payroll company to initiate. The first step is educating employees on the many benefits of electronic W-2s. Once your employees have agreed to electronic W-2 distribution, your payroll company can set up an ESS portal to store all the employees’ payroll information (including electronic W-2s). To set up an ESS portal, employees need to provide an email address and sign-off on electronic W-2 distribution once their portal is created. The rest is up to your payroll company to set up. Optimally, the employer would have their employees sign on during the hiring and onboarding process. Streamlining payroll procedures and freeing up managers/HR/payroll to concentrate on more important business matters.
Successful business operators are constantly reassessing their business infrastructure. Adapting and finding more efficient ways to manage their business. Fortunately, with the many advancements in payroll, you can streamline your payroll procedures allowing you to focus on your business goals. Providing your employees access to electronic W-2s is two fold – it saves the employer time and money distributing and maintaining records and the employees have access to their W-2 whenever they need it.