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Top questions to ask your payroll provider to mitigate your risk

top questions for payroll provider

When it comes to payroll, quality, accuracy and thoroughness are of the utmost importance. Because there’s so much at stake, businesses are looking to reduce risk and must make sure their payroll is in very capable, trustworthy hands.


  1. What services should be provided to support compliance activities that are not supported by Workday?

    While compliance is owned by you, a great payroll provider should have colleagues on the team that review major changes in legislation and develop a point of view on how it should be administered. The payroll provider should bring to your attention legislative matters that they identify, as well as their point of view based on a view across their entire book of business. You, however, ultimately have the responsibility for interpreting the legislation and providing instruction on the actions you want your payroll provider to take.

  2. What quality assurance activities does the provider perform to ensure that the payroll results are accurate?

    A top payroll provider should have a suite of ‘point of view’ defensive queries that are run each payroll to identify employees pay that may require analysis and adjustment. Get a list of some of these key queries.

  3. What quality assurance activities should be performed regarding W2 generation?

    A payroll provider should have developed a suite of reports that look at the relationship of wage and tax data.  Some of these reports automatically make adjustments to resolve potential W2 errors while others provide output that requires research and ultimate adjustment. At year end, the payroll provider should also perform an independent audit of the W2 mapping to ensure that all earnings and deductions are properly mapped.

  4. How should a provider manage an employee’s state reciprocity and local tax set up specific to Workday?

    Your payroll provider should have the flexibility, based on your business, to recognize state reciprocity rules which will automatically check the non-resident box on the employee’s work state. For local tax, they should have the ability to identify the appropriate local jurisdiction which the employee is subject to tax, based on their work and home address and setup correctly and timely in your payroll system.

  5. How should releases, as well as the patch updates, be managed to ensure that quality is not impacted by the change? 

    Your payroll provider should monitor these updates for impacts and regression test accordingly. When updates are optional, they should be able to consult with you on what features you might want to uptake to benefit your overall experience. 

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