How to better manage your restaurant’s payroll in 2017

To prepare for new policies from a new president, start by fixing the bugs in your payroll processing and labor scheduling systems.



 

Q How can I prepare for possible changes to my payroll when the new president takes office?

 

A  Payroll is probably the biggest line item in your profit-and-loss statement, and you should expect more changes to this part of your operation than any other in 2017. If President-elect Donald Trump stays true to his “pro-business” theme and his pledge to repeal the Affordable Care Act (ACA), his policies could quickly impact your business in many ways.

First, don’t go overboard on ACA compliance or worry about developing a long-term compliance plan. Many payroll processing and third-party providers use fear tactics to get you to overcommit to ACA rules that might soon be repealed entirely. I recommend you comply for now at the minimum level and make sure you understand what you’ve committed to.

Meanwhile, make sure your payroll processing company will have your back during these uncertain times. The first quarter of any new tax year is the best time to look at your current processes, fees, measurement tools and results. I just assisted a restaurateur who discovered that his payroll reports did not list employee hours for an entire day for all three locations, resulting in no pay (regular or overtime) for nearly 50 workers for that day! To make matters worse, the company that operates the three restaurants was already undergoing a Department of Labor audit. Fortunately, the operator had started matching up the point-of-sale timekeeping system to the payroll reports generated from an independent third party, so someone spotted this discrepancy before the auditor found it. Systems are now in place to double-check the data generated between the two companies that contribute to this operator’s payroll processing system.

On a similar note, make sure your payroll system allows you to manage crew labor as a percentage of sales and provides you with fully loaded payroll costs, including salaried employees and payroll taxes. Many third-party systems do not allow for this measurement, invariably leading to confusion and arguments over the previous month’s labor cost percentage when you receive monthly financial statements from your accountant. You and your accountant need to agree on the exact payroll costs you intend to measure from week to week, and your accountant should reconcile the difference prior to submitting the reports. Then you can spend your time serving your customers and making profits rather than figuring out labor cost percentages!

You’ll also want to implement a labor scheduling program that’s tied to your daily sales, preferably based on each day’s history compared to the same day the previous year. Yes, another monthly subscription might be required, but it’s worth the cost. Most chains have this ability built into their franchise system procedures. As an independent, you should evaluate your POS and back-of-the-house third-party providers and make sure your system integrates with your daily sales.

Finally, implement a mandate requiring that your POS system captures the hours worked by waitstaff and sends the data directly to your payroll processor. Your processor should then process the payroll and electronically remit the summary results back to your platform of choice, providing you with daily analytics for your operations. With this approach, vital end-to-end data will be captured and transmitted electronically, avoiding human errors in data entry. Implement procedures to double-check the results along the way, and you will be on your way to profitability! 

 

Edit Module

Tell us what you think at or email.

Edit Module
Edit ModuleShow Tags
Edit ModuleShow Tags

Related Articles

NRA Show 2017: Best of Show

The PMQ staff reviews some of the best moneymaking products on display at the 2017 National Restaurant Association Show.

Recipe: Pizza Dough Twists from Nutella

Nutella puts a tasty new twist on pizza dough with this deliciously sweet post-meal treat.

Use a customized pizza calendar to sell more pizza every day

With a calendar from Menus for Less, you can provide year-round promotions and coupons to your customers without the expense of direct mail.

New mover marketing should be an integral part of any pizzeria’s marketing strategy

Our Town America explains why you should factor this program into your 2018 marketing budget.

Romans armed with scissors are creating a worldwide pizza sensation

It takes time, but anyone can learn how to make Roman-style pizza at the Roman Pizza Academy.

How to turn pasta-making into a crowd-pleasing exhibition

That’s Amore Cheese makes Quattro Formaggi Spaghetti with a giant wheel of Parmigiano-Reggiano—and crowds gather to watch.

What’s the best way to prevent pizza peel stick?

Tom “The Dough Doctor” Lehmann says it starts with choosing the right peel dust, but plain flour is not necessarily the best choice.

Chef Bruno’s recipe for Peasant Pasta Soup

This soup recipe, inspired by Mama Bruno herself, takes only about 30 minutes to make!

The rules of engagement: How to build a better relationship with your distributor

If you’re working with half a dozen distributors and pitting them against each other, you’re going about it all wrong, experts say.

When in Rome: Could Roman-style pizza be the next big moneymaker for your restaurant?

This fast-growing style may be the new Neapolitan, taking the U.S. by storm like Caesar’s troops tearing through Gaul.
Edit ModuleShow Tags
Edit ModuleShow Tags
Edit Module
Edit Module
Edit ModuleShow Tags
Edit ModuleShow Tags
Edit Module
Edit ModuleShow Tags
Edit ModuleShow Tags