Done with losing money on payroll errors?
Construction payroll is one of the most complicated jobs any contractor will have to do. Multiple job sites. Variable pay rates. Union agreements. Compliance headaches…
Needless to say, it’s a nightmare.
The frustrating thing?
The vast majority of construction companies out there are still doing it manually. Spreadsheets. Paper timesheets. Systems designed for the last century.
Which is a shame, because construction payroll software changes everything.
What you’re going to learn:
- Why Construction Payroll Is So Complicated
- The Real Cost of Manual Payroll Processing
- Key Features That Save Time and Money
- How to Choose the Right Solution
Why Construction Payroll Is So Complicated
Listen…
Construction payroll isn’t like normal payroll. Not by a longshot. The challenges that construction companies have to deal with make payroll a complex and time-consuming job.
Take a moment to think about:
Workers at multiple job sites. Different pay rates from job to job. Union vs non-union workers. Prevailing wage rates for government contracts.
According to the U.S. Bureau of Labor Statistics, the construction industry employs over 7.5 million people. And with an army like that, you need specialized equipment to manage payroll.
So here’s what makes it so difficult:
- Multiple job sites: Payroll for employees who work different locations at different pay rates.
- Complex timekeeping: Odd hours and schedules makes timesheets a big headache.
- Worker classifications: Full-time, contract, temporary…all have unique tax implications.
- Compliance challenges: Layers of federal, state, and local labor laws all apply in different ways.
This is why this payroll software for construction company solutions are more and more necessary for contractors who want to stay compliant and profitable. Without the right construction payroll software, errors can quickly spiral out of control.
The Real Cost of Manual Payroll Processing
Want some eye-opening information?
The American Payroll Association reports that errors in manual time tracking can cost your business 1% to 8% of your total payroll cost. Let’s say you have an annual payroll of $5 million?
That means you’re losing up to $400,000 every year.
Scary thought, isn’t it?
But it’s not even the whole story. Manual payroll processing begets all kinds of other problems that drain resources and hurt your business.
Take a look at these hidden costs:
- Time lost: Hours wasted on error correction instead of value added activities.
- Employee turnover: Mistakes lead to unhappy workers and higher churn.
- Compliance fines: Late or incorrect tax filings trigger IRS penalties.
- Damaged reputation: Chronic payroll issues hurt your ability to recruit and retain talent.
The construction industry already faces a labor shortage of 500,000 workers. The last thing any contractor needs is payroll issues driving away talent they do have.
Here’s the thing too…
Many construction companies are still using spreadsheets and paper timesheets. These antiquated methods were never designed to process the complexities of modern construction payroll. They are riddled with errors, delays, and they are costly.
Key Features That Save Time and Money
So how is construction payroll software different from one-size-fits-all solutions?
Its design caters to the unique needs of this industry.
Generic tools were not created with the construction industry in mind. So they cannot handle multiple job sites, prevailing wages, or certified payroll reporting easily. Software that specializes in construction makes all of these aspects a breeze.
Automated Time Tracking
The days of paper timesheets and hours of manual data entry are over. Modern construction payroll software comes with mobile time tracking apps that allow workers to clock in and out of any job site. GPS verification ensures accuracy. And all of this data flows automatically into payroll calculations.
Say goodbye to guesstimating. Say hello to error-free payroll.
Compliance Management
Manual labor law compliance is a nightmare. Construction payroll software automates compliance by:
- Tracking prevailing wage rates for you
- Generating certified payroll reports (think WH-347 form)
- Calculating union dues and other fringe benefits
- Handling multi-state tax requirements
This removes the guesswork out of compliance 100%.
Job Costing Integration
Figuring out labor costs per project is essential to your bottom line. The right construction payroll software automatically allocates payroll expenses to specific jobs and cost codes.
This translates to:
- Accurate project budgets
- Informed financial decisions
- Ability to track profitability
Without the ability to see job costing in detail, contractors are flying blind when it comes to profitability.
Real-Time Reporting
Cloud-based construction payroll software gives you real-time access to payroll data from anywhere. No longer do you have to wait until the end of a pay period to get visibility into labor expenses. Instant reporting allows contractors to make informed decisions quickly.
How to Choose the Right Solution
Construction payroll software solutions are not all created equal. Picking the wrong system creates a problem instead of solving it.
Here’s what to consider when looking for software:
Industry-Specific
Payroll tools that work for everyone are just not going to cut it. Look for a solution that has all the features that are specific to the construction industry like certified payroll reporting, union management, and prevailing wage management.
Integrations
The best construction payroll software integrates with other systems like:
- Time tracking
- Accounting software
- Project management
Eliminating duplicate data entry and cutting the risk of errors.
Cloud-Based
Cloud solutions give you the flexibility that on-premise software just doesn’t. You can access payroll data from your office, from the job site, or anywhere with an internet connection. Updates are automatic, and data is secure.
Scalability
Construction businesses ebb and flow depending on projects. The right payroll software scales with your workforce up and down without constant upgrades or changes.
Support
Payroll issues don’t wait for business hours to happen. Support that is fast and with people who know construction industry is key. Find providers with the industry experience and understanding of what challenges contractors face.
Wrapping Things Up
Construction payroll doesn’t have to be a constant headache or labor of love.
The right construction payroll software turns an unnecessarily complicated, error-prone process into an operation that saves contractors time and money. It handles all of the complexity so contractors can focus on what really matters… construction projects and growing their business.
The point is this:
- Manual payroll costs construction companies thousands of dollars a year.
- Industry-specific software takes care of errors and compliance issues.
- Features like automated time tracking and job costing improve profitability.
- Cloud-based solutions offer flexibility and real-time reporting.
The construction payroll software market is booming for a reason. Contractors who make the investment in the right tools gain a significant advantage over the competition.
The ones who continue to use spreadsheets and paper timesheets? They are falling behind.
Don’t let payroll issues hurt your profitability. The technology is available to make construction payroll easy, accurate, and compliant. All that’s left is to implement it.