How Does Franchise Payroll Work?
Payroll management plays a pivotal role in any business, and understanding how it works within the franchise model is essential for your success. When evaluating franchise opportunities, assessing the level of support and resources the franchisor provides for payroll management is crucial. A reputable franchisor should offer comprehensive training and ongoing assistance to help you effectively handle payroll.
Read on to get a full understanding of how franchise payroll works, including who pays franchise employees.
Who Pays Franchise Employees?
Employees of a franchise are paid by their employer, typically the franchisee. In some cases, such as with the premier staffing franchise AtWork, the franchisor handles payroll funding. The franchise disclosure document (FDD) lays out the payroll management structure.
You can handle your franchise payroll in various ways, most commonly being paychecks or direct deposits. Another option is pay cards, which usually come with extra fees you’ll have to pay.
No Payroll Experience? No Problem.
If you lack experience in payroll management, don’t worry! Many franchise systems provide training and resources to help you navigate this critical aspect of your business. Seek support and guidance from the franchisor to understand their recommended practices and procedures for handling payroll.
Consider attending payroll management workshops, enrolling in online courses, or partnering with payroll experts who can guide you through the process. By investing in education and training, you’ll gain confidence and ensure the accuracy and compliance of your payroll operations.
Ensuring Timely Employee Compensation
One of the fundamental responsibilities of a franchise owner is ensuring that your employees are paid accurately and promptly. Depending on the franchise agreement, you may have some flexibility in setting the compensation structure for your staff. However, it’s essential to comply with local labor laws and regulations while determining wages, overtime rates, and benefits.
To streamline the payment process, you’ll need to collect relevant employee information, such as hours worked, wages, deductions, and tax withholding. Franchise payroll systems or dedicated payroll software can help automate this process, reducing errors and saving time. Maintaining accurate records and adhering to legal requirements will build a positive work environment and foster employee loyalty.
Franchise systems might have an agreement with a payroll software company and require you to use it. They typically receive some type of discount for bringing a significant number of users to the software. Plus, the franchisor probably vetted different payroll programs to determine which one works best for their needs.
Let AtWork Work with You
If you’re still worried about managing and funding staffing payroll, then franchise with AtWork. In the thriving staffing industry, where clients sometimes don’t pay you before you need to pay your employees, it can become difficult to have sufficient cash flow for payday. But if you franchise with AtWork, they’ll take that off your plate and handle payroll funding and processing for you.
Their in-house accounting services go beyond payroll support. They also manage your accounts receivable, invoicing, and processing. All of this is at no extra cost to franchisees. With their affordable initial investment ranging from $153,500 to $210,500 on top of their additional services and support, your investment can pay for itself more quickly than you might think. Here’s how that works:
Their entire suite of support, including payroll funding and accounting services, costs just 8% of your revenue, which is made up of a 7% royalty fee and a 1% marketing fund contribution. Compare that to the 15.5% independent staffing agencies typically pay for just payroll funding and tax processing alone. Additional support includes ongoing training, marketing and IT support, and a dedicated in-field performance team. Plus, as an AtWork owner, you’re eligible for significant tax credits, such as Work Opportunity Tax Credit and Employer Retention credits, that also offset the investment costs.