The 5 Top Questions You May Have About Construction Payroll Services

May 18, 2022 | General Contractors, Payroll

Construction payroll can be a difficult thing to manage for a lot of small contractors and construction companies. Bigger companies don’t struggle with it any less, but because they often have dedicated staff members working on it every day, they are at least able to stay on top of it better.

When you’re the owner of a smaller operation, though, you often end up wearing multiple hats at the same time. And since you’re usually the one handling the money, you’re the one responsible for making sure the people on your payroll get paid accurately and on time.

When things go smoothly, it’s fine. But when they don’t…it’s a mess!

In this post, we’ll take a look at 5 of the top questions construction company owners have about using construction payroll services to take care of that part of their business for them.

questions about construction payroll

Top Questions About Construction Payroll Services

1. How is payroll for the construction industry different from other businesses?

Construction payroll gets the same end result as any other payroll process…making sure employees are paid. But the way they have to go about it is unlike any other industry.

In any business, payroll is a matter of calculating the time an employee should be compensated based on their pay rate, withholding applicable federal taxes and other items, and printing/depositing checks. When it comes to payroll for a construction company, you have to add in extra layers of complexity including, but not limited to:

  • Work done in multiple locations (even multiple states)
  • Variable salaries and pay rates
  • Workers’ unions
  • Certified payroll requirements

Any one of these additional construction payroll issues can create a lot of problems within your payroll office if you or your staff isn’t ready to handle them. That’s why it is almost always a good idea to let a qualified construction payroll provider do it for you.

2. Do I really need to use construction payroll services?

We get it. Many small business owners have a hard time handing part of their operation over to anyone outside of their company.

If you’ve built your business from the ground up, it’s more than a job…it’s personal. Trusting someone who isn’t an established part of the team with something as important as payroll is a scary thought!

And when financial margins get tight (as they often do in construction), it’s tough to imagine spending even more money for something like a payroll service. Why not save the money, avoid the risk of dealing with an outsider, and just do it yourself?

Ask yourself this, though: what is your time worth?

As the owner, an hour of your time is certainly more valuable than anyone else you hire. You’re the one bidding jobs, keeping a close eye on income and expenses, managing personnel, and trying to grow the company into something truly significant. You’re the one the company simply can’t afford to be without.

For you to be stuck behind a computer doing anything that someone else could do– in this case shuffling timesheets, calculating payroll, and trying to stay on top of all the details–actually costs you money! Every hour you spend on tasks that take you away from things only you can do is an hour that you are paying yourself less than you’re worth. And your business suffers for it.

A good payroll service can help you grow your business and make a lot more money in the long run simply by allowing you to take a lower-level task off your plate and focus on growing your business. And a good one is worth every penny!

3. What does a good payroll provider do for a construction company?

As we just mentioned, construction payroll companies make sure all of the unique challenges surrounding payroll within that industry are taken care of. They are singularly focused on getting construction employees paid.

So we’ve established that you need to use a construction payroll provider instead of an “ordinary” payroll service. However, what kinds of things should you look for to know if the construction payroll service you’re considering is a good one or not?

Here are a few things to look for:

  • Do they communicate clearly and often?
  • Are they proactively updating you, or do you have to seek them out first?
  • Do they understand certified payroll reports? (These are required for all federally-funded prevailing wage jobs you work on.)
  • Can they provide job-cost reporting? (Contractors need expenses broken down by job in order to assess expenses accurately, and that includes payroll on each separate project.)
  • Can they handle union requirements? (In most cases, contractors interact with multiple unions on a single job. Each has its own requirements, and it can quickly get overwhelming.)

4. Can they really help me with construction payroll issues?

A good payroll provider can help you with all of the issues we’ve just mentioned, and anything else that pops up. Since they’re laser-focused on that one aspect of your business, they’re in the ideal position to quickly respond to whatever issues come along.

5. What is the best payroll service for a small construction company?

In a recent post titled “The 7 Things That Make Payroll for Construction A Challenge”, we mentioned two construction payroll services that we think are a great fit for a small construction company. Both of them focus solely on the construction industry and have been working with construction payroll for many years.

Payroll4Construction – This company spun off of another one called “Foundation Software” which provides project management and accounting software for the construction industry. They are able to pull from decades of experience in order to provide excellent payroll for construction company owners.

ADP – While ADP is a payroll industry giant that might seem to be a little too big for a small construction company, their construction payroll division has done a great job of finding out what contractors really need and then combining that information with their long history of payroll expertise.

payroll for general contractors

Partner With A Personal Payroll Provider for Construction

If the thought of handing your payroll over to a distant company (regardless of how good they may be) still makes you a little nervous, we completely understand.

Most construction companies are built on relationships. One client at a time. One referral at a time. Face to face. Building trust and a dependable reputation.

That’s exactly how we built our accounting firm, and that’s exactly how we work with every single one of our clients.

We’ve been partnering with small to mid-sized construction companies for over 40 years to provide Payroll and HR Support (in addition to all the other accounting services you could possibly need).

To truly take the fear and guesswork out of your payroll, contact us today and see how we can personally help your business succeed.

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