What Payroll Period Suits Your Business Best?

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Payroll periods are generally categorized into 4 types:

  1. Monthly: Payroll is generated and usually paid out on a monthly basis. It occurs 12 times a year
  2. Semi-monthly: Payroll is generated twice a month and paid out either on the 1st and 15th of the month, or 15th and 30th of the month. It occurs 24 times a month.
  3. Bi-weekly: Generated and paid out every two weeks, bi-weekly payroll sounds a lot like semi-monthly but runs 26 times a year. We’ll go through the differences further into the post.
  4. Weekly: Payroll is generated and paid out once a week, leading to 52 cycles a year.

Type of Business

Why are there so many different payroll periods? Depending on the type of business, employees and employers find it easier to keep tabs on over time, social security contributions and erratic work schedules if the payroll period is shorter than the usual one month period.

Generally, as a business owner or a payroll head at your business, you generate reports monthly so it seems practical to generate payroll on a monthly basis. However, this may not be suitable to employees, especially in the construction, F&B or retail business where work is valued on an hourly basis.

Type of Employees

Frequency of payroll depends on the type of employees in your business. Usually, full time employees are open to monthly salaries because they have a stable income.

However, part time workers with erratic schedules prefer a shorter pay period so they can manage their finances better. Since hourly workers are most prevalent in industries like F&B, retail and BPOs, markets that we work with very closely, we know that employees favour biweekly or even weekly pay in order to stabilize their finances.

For example, if an employee works 50 hours one week and 10 the next, she might want to be paid weekly in order to cushion the next week’s dip in work.

Costs of Generating Payroll

As a business owner, you also need to track how much it costs to pay all your employees, Many payroll vendors charge on the frequency of payroll generation, in which case, monthly payroll makes sense. But, if the costs are not too high, it may be prudent to generate payroll more often.

It is easier to calculate over time over a shorter pay period. You are less likely to make mistakes. Another cost that is important to look into is the opportunity cost of calculating social security deductions more frequently.

Usually, contributions are calculated monthly, so it is definitely a hassle breaking it down to a semi-monthly, bi-weekly or weekly basis. The most error-prone would be bi-weekly, with 26 weeks to account for where payroll may be generated twice or even thrice a month.

Finally, the frequency of payroll generation depends on a set of factors: the share of employees working part time versus full time, the costs of generating payroll and the kind of business that you own.

Weighing the costs and benefits and communicating with employees on what suits them best are the first steps to take before settling on a pay period. Do let us know what kind of pay period has worked best for your business!

4 Tips on Financial Practices for Business Owners

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As a new business owner, it can be tough to figure out what you need to prioritize to generate revenue and profits. If you are a chef owning a restaurant for the first time, and with no business experience, this can be a lot harder.

Luckily, we have some tips for you to refer to when it comes to dealing with finances. So let’s dig in!

1. Product costing

This is essential because you cannot run a business in a sustainable manner without knowing what your products cost. You need a break down of what each product is made up of and how much it costs to get it from your suppliers. This includes material, labour and overheads.

With the information about costs, you need to find your breakeven point: where revenue covers all costs (Revenue – Costs = 0). This is the minimum revenue you need to run the business.

2. Maintain a record of expenses

This is a good practice that is easier said than done. All too often, we start the year enthusiastically, taking not of expenses and filing them meticulously to find ourselves a month later struggling to keep up with our expense records.

It is easier with some help. Apps like Expensify or Mint help you keep track of your accounts, expenses and income. If you are a small business owner, these apps are a good place to start.

Of course, as you grow bigger, you will have to move to accounting software that can keep up with the growth of your business.

3. Understand your seasonal cashflows

This is imperative if you own a retail store or a restaurant. It ties back to points one and two. During the year, your sales will not be static. It will depend on factors like when people get their wages or special festivals and holidays. Sales could change on a monthly, or quarterly basis.

Most seasonal changes are calculated quarterly. This is important to monitor because you will have to manage inventory accordingly. It also helps in setting prices based on expected demand.

4. Inventory management

Like we mentioned in the previous point, seasonality affects inventory. A small business owner should keep close track of inventory in relation to seasonality because inventory costs can run up to exorbitant amounts despite the fact that it can be managed.

TradeGecko is an app that can help you with that. The cool thing about this app is that it gives you real time data on your phone. You can access your inventory data from anywhere in the world with a few clicks.

Whether you are in Singapore, the Philippines or anywhere in the world, these tips are important to know as a business owner. Keep in mind that delegating traditional business practices to apps is a great idea because it frees up time for you to focus on your core business.

Also, keeping up with technology doesn’t just make you efficient, it prepares you for the inevitable conversion to tech-based apps that all business will have to make at some point.

Time Management Secrets for Busy Business Owners

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As the owner of a restaurant, retail business or startup, your priority is to move your business forward every single day.

Running your own business is different from working for a company because the line between professional and personal life is blurred. In this case, it is essential that you make the best use of your time and we have a few tips to get you started!

Cut down on meetings

Meetings can often be directionless and unreasonably lengthy. You may find yourself spending an entire day running from one meeting to the next and ending the day having done nothing significant at all. Whether the meetings are with your subordinates, potential clients or investors, it’s worth pressing the pause button, going through the goals for the meeting and deciding whether they warrant a meeting at all.

Meetings with your subordinates might occur too often, with no significant change in the status of their work. Meetings with clients may involve work that can be done on your own time. It’s important to cut these meetings down if most of the time is spent going back and forth on decisions that have already been made.

A good way to do this is to outline the goals of the meeting beforehand and go back to these goals at the end of the meetings and check if they have been met.

Going through emails

Through the day, you’re bound to get emails from friends, family, business partners, advertisers, clients and others. Keeping up with emails is one of the most time consuming tasks of the day. But this can be simplified.

There are a bunch of apps that help you. Gmail has a priority inbox folder that sifts through your mail and categorizes them for you. SaneBox is another app that cleans up your inbox so you focus on communicating with important people instead of missing out on their emails under all that spam.

Whatever you choose, make sure you are on top of it over the first few weeks as you get used to how the app prioritizes your mail.

Another important point on emails is to prioritize your replies. If your reply requires only two minutes, you should do so immediately. It saves time by preventing you to archive emails that really just require two minutes of your time.

If an email requires more time for you to think over your reply, you should move it to a whole new folder (maybe create a Priority Replies folder). This marks down the emails you need to go over again before you choose to reply.

Building a playbook

When you’re doing a task multiple times, you can write down the task step by step in a Google Doc and standardize the process. This makes it easier to delegate the task to someone else so that you can focus on more urgent matters.

Many CEOs and managers recommend creating a playbook because standardizing the task saves time, makes it fool proof and works as a guide for future reference. We do it at PayrollHero too and it helps getting new hires up to speed with how we work through tasks.

Advising your team

Many managers propose engaging with their team on a regular basis to find out what they need. They say that walking through your office and stopping by your employee’s table and asking them questions about their day really builds morale and productivity. Some of the questions you can ask are:

  1. What roadblocks are you facing today?
  2. How can I remove some of the roadblocks for you?
  3. What resources would help you move faster?

All these questions help the employee focus on moving forward by identifying barriers and removing them. By paying attention to your employees’ roadblocks, you can gauge what you can do to help them be more productive.

Altogether, these steps are simple to implement and quick to produce results. You should be able to free up you time to prioritize on core business activities that you can make the biggest impact on.

Hope this helps, and let us know if you have time-saving secrets that you would like to add on!

Biometrics VS Selfies – Which is Best for Your Business?

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Restaurants and retails stores usually generate payroll by multiplying their employees’ hourly rate with the number of hours worked by each employee.

The number of hours worked is measured by a time sheet that employees punch in, a biometric device or (if you’re one of our awesome clients) the PayrollHero app that lets your employees take selfies to clock in and out.

We get a lot of questions about why businesses should change from biometrics to anything else. Some say that the biometrics system is already ideal… that it’s fast and accurate. While all of this might be true, we have a strong argument for why biometrics may not be the best option for your business.

The PayrollHero app – an all in one solution

Biometric devices work as a standalone system. You need to get a whole new software for processing information from the device and integrating it into the software that calculates attendance. Often, you need another system to monitor scheduling, manage leaves and generate payroll.

On the other hand, PayrollHero’s TeamClockMyClock app records all the information you need to know about your employee on the cloud. It is an end-to-end solution that relieves you of the hassle of integrating multiple systems together.

The only device you will ever need is either of the following: iPad, smartphone (Android or iOS), or a computer (PC or Mac). PayrollHero’s apps are compatible with these devices so you are assured to have a streamlined process from start to finish.

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Wear and tear

The biometric device is subject to wear and tear. If you have hundreds of employees using a couple of biometric devices, you are more likely to face this issue. However, MyClock or TeamClock are is accessed within an iPad / smartphone (or computer),  which is less likely to undergo the kind of wear and tear that biometric devices are prone to.

Software updates

The PayrollHero app updates from time to time to give the user a better experience and introduce new features (for example, we have just introduced leave management! Check it out). The app is always improving and finding ways to make time and attendance easier for businesses, whereas the biometric device can only go so far in it capabilities.

There are other issues with the biometric device too. Biometric devices lead to manual calculations when there are minor infractions where employees come just a couple of minutes early or late.

We handle this problem by implementing thresholds within which these infractions are excused. This frees up time for your HR manager to do more important things, like finding the best talent for your company and managing employee relations.

Altogether, the biometric device may be faster in recording clock ins, but the time wasted by the HR manager in fixing the inefficiencies in the device is far more.

So if you’re ready to let go of your biometric device and embrace the selfie clock in, contact us at sales@payrollhero.com or visit our website to learn more.

Recap: SheSays Singapore Event

Screen Shot 2016-01-30 at 6.10.20 PMI had the pleasure of sitting on a panel at the latest SheSays Singapore event held at the amazing co-working space, JustCo.

The women’s only event was called – Make It Happen: Your Career – and was standing room only. The event was described as “Whatever stage you are in, job hunting, changing industries, looking for growth opportunities at work or wanting to finally take the plunge into building your own business, you want solutions and you want clarity. If you’re looking for direction, guidance and an answer to – “What do I do next?”, this session is for you!

Screen Shot 2016-01-30 at 6.09.44 PMThere were four panelists including myself. The other three were;

Mina Lee – Former Chief of Staff at Xiaome
Mina Lee was most recently Chief of Staff for Xiaomi Southeast Asia, helping them set up and expand in the region and was Acting GM of Xiaomi Indonesia.

Andrea Edwards, Director of Content Marketing & Training at Novus Media
Andrea is a globally award-winning communications professional with more than 20 years’ experience working all over the world, including 12 years in Asia Pacific.

Stanimira Koleva, Senior Vice President at Software AG
Stanimira, oversees the business of Software AG in the region of Asia Pacific and Japan. She joined Software AG as Senior Vice President in July 2015.

The event was a success, with lots of questions from the room and the moderators about career paths, finding your vision, personal branding, social media, and constant learning. Meera Jane Navaratnam, one of the SheSays organizers in Singapore wrote a great recap of the event.

SheSays hosts events every month. Check out their Facebook page for details of their next one if you are interested in attending.

If you are looking for a new role, we are always hiring. Join us!

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Why Assuming Payroll Is A Big Mistake

What is assuming payroll? Does your company do it? How much does it cost you?

Assuming Payroll

Assuming payroll is a term we use when a company pays employees in advance of the completed pay period, assuming the employee will make it to work between payment and actual calculation of payroll.

For example, Wayne Enterprises pays Bruce a whole month’s salary on January 25 assuming that Bruce will work the next five days. On January 27, Bruce had an emergency situation which led to him missing work. Since he already had been paid, Wayne Enterprises will have to deduct his salary in the next month, to make up for him missing work.

Why is it done?

Since this is clearly a complex way of paying employees, why is it done? Firstly, it gave companies time to go through the tedious calculations for generating payroll. Secondly, back in the day when Wayne Enterprises handed cheques to its employees, Bruce had to go down to the bank and cash it in. Since all companies paid their employees at the end of the month, employees would spend hours at the bank just to cash in a cheque. Paying them in advance solved the problem. The opportunity cost of deducting an employee’s salary next month was far lower than paying after generating payroll.

Today, in the twenty first century, that argument does not hold anymore. Wayne Enterprises uses GIRO and other electronic payment methods to pay its employees. The opportunity cost of deducting from the next month’s salary is now much higher.

Some companies still stick to the old way of doing payroll. When we dug a little deeper and asked our clients why they did it, they said it was because their board of directors had left the rule as it was made many years ago.

Let’s help fix the problem

Our client success head, Kieran Peppiatt, has seen through a number of companies changing their system of Assuming Payroll to the regular kind:

“Many of our customers have seen cost savings by changing from the assuming payroll method to the regular one. It’s more efficient, easier and more accurate.”

PayrollHero calculates deductions but we always advocate doing payroll the regular way. It eliminates any chance of inaccuracy and makes the payroll process smoother for your HR manager. When you have a high churn rate, it is even more important to adopt the regular method.

Download a one page Assuming Payroll info sheet below:

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Why You Shouldn’t Assume Payroll – PayrollHero

FREE Payroll Kit for All Employees

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If you’re an employee and you’re reading this, then you’re in luck!

The PayrollHero team prepared the Ultimate Payroll Kit that answers all your questions and concerns regarding the following topics:

  • How to Compute 13th Month Pay
  • How to Compute Holiday Pay & Rest Day Pay
  • How to Compute your BIR Taxes
  • How to Compute your Government Deductions (SSS, PAG-IBIG, PhilHealth)
  • How to Compute Night Differential Pay
  • How to Compute Your OT Pay

All these and more for FREE! Click here to download your FREE Payroll Guide in the Philippines.

Aside from providing smooth and efficient HR, Time, Attendance, and Payroll processes to businesses, we also provide a wealth of information for employees regarding matters concerning their payroll.

So if you always found yourself making a Google search on “How to Compute 13th Month Pay” or “How much is my SSS deduction”, then our free PayrollHero Kit will do wonders for you.

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You won’t have to Google about these payroll concerns in the Philippines ever again. Simply get the guide, keep it in a folder (It’s in PDF format), and consult it whenever you want to know something that concerns your payroll.

Not only do you get a more clear and defined answer to your questions; you also won’t have to bug your company HR with trivial questions anymore. You will be well-equipped with all the basic and necessary info about your payroll. Sounds awesome, right?

So download the free PayrollHero Kit now and learn everything you need to know about your payroll today!

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The Future of Work Conference | Singapore

I was asked to speak at The Future of Work Conference in Singapore that Microsoft and Questex put on at the Marriott Hotel the other day. The conference was dedicated to the future of; HR, offices, scheduling, sales, and marketing.

I was asked to speak on the topic of HR and how technology can be an enabler to maximize productivity as well as attract and retain talent. So, I spoke from our experience.

Here is a quick recap:

1. Reasons for Employee Turnover – most reasons employees leave are related to something the company has direct control over.

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2. Adventure Engineering – We talked about PayrollHero’s #AdventureEngineering program and why it came about. Basically, we were looking for ways to compete for talent in a highly competitive worldwide market. Here is the video that we made that explains the program:

3. We chatted about how we work to get feedback from our teams, how we have made some products to help our clients do the same and how transparency helps us build our company culture. Some of the tools we talked about were PayrollHero’s DailyPulse, Xray Insights and tools like 7Geese.

4. Finally, we talked about how our jobs page is laid out on our website. How it is very specific about each role, how the company works, the rhythms we follow as well as a few easter eggs that some applicants find and mention in their cover letters.

After I was joined on stage with a few HR professionals for a panel discussion about HR and the future of work.


 

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Improve Your Restaurant Performance with HR Analytics – FREE Webinar from PayrollHero

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Whoever said that nothing in this world is free was lying!

Because on December 8, 2015. At exactly 11 AM (UTC +8), Singapore Standard Time, we’ll be hosting an epic webinar that talks about leveraging HR Analytics to improve restaurant performance.

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In this webinar, restaurant owners will learn about the following:

  • Learn how to respond to business in advance using predictive analytics for HR
  • Improving organizational performance
  • Optimizing talent supply chain
  • Benefits of HR Analytics to your restaurant’s sales performance
  • Data-driven decision making

And many more! 

We don’t want to spill too much info, but we’d really love it if you could join our webinar

If you’re a restaurant owner, or an HR director / manager of a restaurant, this is a webinar that you definitely shouldn’t miss. 

We’re going to provide content that you can implement and leverage right after the webinar.

The best part about this webinar is that you will have instant learning in just 27 minutes of content!

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^ It’s really that simple. You’ll be able to implement your learnings immediately and make a direct impact to your restaurant’s positive performance.

So to all restaurant owners / HR personnel, do spread the word and save the date:

December 8, 2015 (Tuesday), 11:00 AM (UTC +8) Singapore Standard Time

This webinar will surely be worth your while. Save your seat below!

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We’ll see you there!

Be a Better Manager in 10 Minutes or Less

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Many would like to believe that people quit jobs because of greener pastures such as better pay and greater benefits. In reality, employees leave because of their managers.

Not convinced? Survey results by the market research firm Gallup released last April revealed that half of the 7,200 respondents left jobs “to get away from their manager.”

As a manager, you may have failed to realize that your small yet talented team of employees are walking out the door not to pursue fatter paychecks, but because of management.

Put simply, it has to do with you.

Such sobering statistic should be treated as an opportunity for small business managers to build a team culture of supporting one another. Like most relationship issues, there is no one-size-fits-all formula to becoming an excellent manager.

The following tiny, yet meaningful gestures can certainly make a difference though. The best part is you can do them in 10 minutes or less!

Call everyone by their first name.

In this book How to Win Friends and Influence People, Dale Carnegie wrote:

Remember that a person’s name is, to that person, the sweetest and most important sound in any language.

Likewise, social experiments proved that calling people by their first name makes it more likely for them to comply to your requests.

Make an effort to get to know everyone in your team. Your employees are humans too. They have lives outside of work — they have a family that they deeply care about or hobbies and interests that keep them busy outside the office. Take the time to figure these things out and greet them by their first name the next time you are in the office. By doing so, you build rapport that will eventually lead to trust in the long run.

Dig deeper into each employee’s resentment.

Most employees have their own version of what they are currently bitter about in their jobs. For some, it’s working extra hours and not being able to spend dinner with their family. Or missing a few drinks with friends every Friday night. Perhaps, it’s the lack of flexible hours within the workweek.

It varies for everyone but the takeaway here is to check on these resentments regularly. Subsequently, ask your employees about an activity outside of work that they consider important and pry them for possible solutions (they can extend work hours the next day, shorten lunch breaks for a couple of days, or ask someone to cover for them temporarily).

Doing this quick exercise will prevent resentments from evolving into a full-blown mess of hatred and bitterness.

Ask your employees for advice.

Ha! Why would a manager do that? Isn’t it supposed to be the other way around?

Social psychologist and author of Influence: The Psychology of Persuasion Robert Cialdini offers one seemingly counterintuitive yet effective suggestion to making your employees like you: Ask them for advice. This could range from personal advice like book recommendations to professional advice such as asking their opinion about social media platforms that they deem are ideal for your digital marketing campaign.

By and large, this gives the impression that you, as a manager, value their opinions. Bonus points if you follow their advice and update them that you’ve done one of their suggestions!

Provide specific compliments and insert a negative comment in between.

The keyword here is specific. Sure, it’s easy to give out praise. “You’ve done a great job” or “Keep up the good work” are nothing but empty words of encouragement. Go out of your way to specifically determine the things that each employee has done well. Sincere forms of recognition are always appreciated.

Additionally, don’t be afraid to give out constructive feedback when an employee is obviously off track. In this Harvard Business Review article, the authors talk about the ideal praise-to-criticism ratio:

The average ratio for the highest-performing teams was 5.6 (that is, nearly six positive comments for every negative one). The medium-performance teams averaged 1.9 (almost twice as many positive comments than negative ones.) But the average for the low-performing teams, at 0.36 to 1, was almost three negative comments for every positive one.

The key point is to keep your negative comment as objective and rational as possible. Furthermore, consistently giving compliments ensures that you are within the ideal 5.6 to 1 praise-criticism ratio.

Offer one thing (no matter how small) to help an employee achieve a personal long-term goal.

Everyone has their own set of side-projects, long-term goals, and bucket lists. Say one of your web developers has been thinking about learning Python. Or someone from your sales team is keen about filling in one of the graphic designer posts.

Every so often, employees are interested in upgrading their arsenal of skills or learning things outside of their expertise. Why not do one thing to help them achieve these goals?

Offer to shoulder half of the paid online Python course to the web developer. Or ask the sales rep if he would like to shadow one of the designers for an hour each week? These little things will keep your employees motivated. The more they’re excited about their work, the greater the chance that they’ll work hard for you.

Final Thoughts

Tiny acts of appreciation and kindness are often overlooked, yet they have the biggest impact to becoming a better manager. Put them into action today and see what happens next.

Tell us about the results in the comments or join the conversation on Twitter!