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Payroll Specialist Interview Questions

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The first thing a business needs to do before it can begin operating is to hire employees, and the next thing it needs to do is pay those employees. While small startups may be uncomplicated and relatively free-wheeling when it comes to getting their employees paid, eventually, a company grows to a point where the owner can no longer manage the day-to-day timekeeping and payroll operations. 

At this point, it is time to hire a payroll specialist. This article will examine what a payroll specialist can do for your business, what to ask them in an interview, and how to do payroll for a small business.

What Are the Job Duties of a Payroll Specialist?

A payroll specialist pays people–how hard can it be? Well, a variety of factors such as the size of the company, the number of employees, which state or country the company is based in, and whether your company is publicly traded on the stock market can make a huge difference in the job duties of a payroll specialist.

First, let’s make sure you’re choosing the right kind of payroll specialist for your business–here are three different levels of payroll specialists in increasing degrees of difficulty:

The Small Business With Freelance Employees 

  • Make sure the hours and projects worked by the employees are correct
  • Ensure each employee’s hours or projects match the dollar amounts to be paid
  • Send out payments via bank transfer or another specified method
  • Give employees a pay statement
  • Provide weekly or monthly reports regarding employee payroll to management 

The Small Business With Full-Time Employees and Tax Responsibilities

  • Ensure hours worked are correct while making necessary corrections regarding paid time off, vacation time, etc.
  • Calculate tax deductions–which may be complicated as tax rates change based on income and must be calculated differently at each bracket; this may include federal, state, and even local taxes
  • Work with management and HR to ensure new employees are properly entered into the payroll system so they can be registered as taxable employees

The Medium or Large Business With Complex Benefit Packages

This job includes all the above but adds to the complexity of possibly hundreds or thousands of employees. These larger companies may require the payroll specialist to perform these additional duties:

  • Calculate 401k and retirement plan payments, as well as corporation matching amounts
  • Provide payroll to employees on disability or maternity leave
  • Deducting and depositing portions of payroll into other programs, such as a Health Savings Account (HSA)
  • Compiling specialized and complex payroll reports for general accounting purposes, as well as reports related to taxes and wages for outside accounting and audit firms, such as KPMG or PwC

Interview Questions for a Payroll Specialist

The goal of the interview should be to ensure that you have the best possible person for the job. Here are some interview questions tailored for a payroll specialist regarding their experience:

Do You Have Experience Working for a Firm of Our Size?

The person who worked for a small construction business is likely not the person you’re looking for if you have a 300-employee company that operates across three states. Make sure the person you’re interviewing is comfortable and confident working with an organization the same size as yours. 

How Familiar Are You With the Tax Laws in Our Country or State?

This is extremely important if your company will be responsible for payroll taxes on your employees, as just a few wrong decimals here and there can lead to serious consequences for your and your employees’ tax obligations. However, if an employee has experience with state income taxes in New York but not California, don’t count them out yet. Many of these states have similar systems, so the employee may only require minimum training in the new state’s laws. 

Can You Process Employee Benefits and 401K Payments and Deductions?

This is another area in which a sizable business needs to be careful. Missed payments to insurance companies and employee retirement plans can lead to serious headaches if anything needs to be retroactively corrected. Your new candidate should be comfortable with the types of benefits your company offers. As mentioned above, though, if they are familiar with one type, they can typically be trained on a similar system fairly easily–so don’t count out a sharp candidate just because they may be lacking in one area.

Final Thoughts

Finding an employee of any kind can be a real pain, but thanks to reliable freelancer hiring platforms like Guru, you can search a database of thousands of qualified specialists who can help your company fill any position–including that of an experienced payroll specialist.

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