Aug 26, 2020 8 min read

4 Reasons Payroll Software Is Essential for Child Care Centers

Procare By: Procare

There are a lot of things to keep track of when you’re running a child care business, from making sure your center is stocked with plenty of supplies to ensuring that you have enough staff to keep all your kiddos safe, cared for, and learning throughout the day.

Maintaining a high level of care is the most important element in running a child care center. But it’s certainly not the only element. Managing the administrative side of your child care center is a must to keep things running smoothly—and that includes payroll. 

Managing payroll can be a challenge, especially if you don’t have the right systems in place. For example, the last thing you want to be doing is spending your time chasing teachers down, trying to find the insanely narrow window of time they might be available to chat during the day about a past due timesheet, searching through stacks of paperwork to find W-2s, or trying to figure out how to issue a paycheck for an employee who may not have access to a traditional bank account.

That’s where a modern payroll solution comes in. Shifting to payroll software for your child care center can save you a ton of time, energy and hassle on your hiring and payroll processes (and potentially save you some money in the process).

Let’s take a dive into payroll software—and how it can make the administrative side of running your child care center easier, faster and more efficient:

What is payroll software—and what are the benefits?

First things first. Before we jump into how payroll software can help your child care center, let’s quickly cover what, exactly, this modern type of payroll platform actually is.

Modern payroll can be payroll software or cloud-based payroll. These are systems you can install on your computer or access through the internet, where your data is stored, managed and processed—and you can access it from any computer with an internet connection.

These systems can offer a number of benefits to your child care center, including:

  • Access anytime, anywhere. As mentioned, you can access online payroll from your phone or any computer with an internet connection—so if you have to deal with a payroll or HR-related issue after hours or when you’re not in the office, you can easily access the payroll platform from wherever you are. And bonus, employees can access their records from anywhere, too.
  • Fewer IT issues. When you’re using an internal payroll system, there are a host of infrastructure and IT issues that you have to deal with, from installation to troubleshooting bugs to managing upgrades. With cloud-based payroll, technical issues are handled by the provider; all you have to do is log on and access your data.
  • Digital systems automate processes. When you’re manually running payroll, there’s a lot of the legwork you’ll need to do on your own, from calculating payroll tax withholdings to managing retirement contributions to processing PTO. With digital payroll, those processes are automated—which saves you time, energy and significantly lowers the risk of payroll errors.
  • Online payroll easily integrates with other systems. With online payroll platforms, you can typically integrate payroll with other systems you use to more efficiently manage your business, like time tracking, bookkeeping, and productivity systems. (For example, Procare seamlessly integrates with Gusto, allowing Procare Connect customers to sync their time sheet data with Gusto’s payroll management system.)
  • Time savings. A cloud-based payroll platform can dramatically increase your efficiency with all things payroll. That results in major time savings—and the less time you spend on payroll, the more time you have for other tasks in your business (like coming up with fun new programs for your kids!).

4 payroll headaches digital payroll can eliminate for child care businesses

Clearly, digital payroll offers a lot of benefits to businesses in general. But how can shifting to an online payroll service help child care businesses specifically?

Online payroll can solve a variety of child care center-specific payroll headaches, including:

1. Digitized time tracking

Many child care centers are pretty busy places. Educators and employees have their hands full taking care of the children in their care. It’s easy to get sidetracked—and forget to keep track of their hours.

Many online payroll systems offer digital time tracking, which means your employees can clock in and clock out for the day (and for any required breaks), from a variety of devices, including their cell phones.

And because the vast majority of people have their phones on them at all times, it’s much easier for employees to clock in and out accurately than if they had to go to a specific location to do so (for example, your administrative office to fill out a paper timesheet or use a physical punch clock).

2. Compliance paperwork

Making sure a business has all the necessary paperwork and documentation for employees is always important—but it’s especially important when you’re running a child care center.

With a digital payroll system, it’s easy to collect, track and store your employee’s compliance paperwork, including tax forms (like W-2s and I-9s), licenses, background checks and any necessary medical records (for example, proof of a TB test). You can also help ensure that you’re withholding and paying the correct taxes for payroll, so you know you won’t run into any costly payroll penalties.

Having this paperwork easily accessible will come in handy if you ever run into compliance issues or need to submit relevant paperwork to your local or state government. Also, having all your paperwork stored via software or online—instead of physical copies—will prevent the hassle of having to redo paperwork if copies get lost or damaged.

3. Easily issue alternative payments to employees

Different employees have different payment preferences; some employees will want direct deposit, some will prefer paper checks, and some might want an alternative payment method that doesn’t require them to have a pre-existing relationship with a bank.

With payroll software, you have the flexibility to easily issue payments to your employees—no matter how they prefer to get paid. It’s easy to pay your teachers and other staff members through traditional methods like direct deposit, but what if you have a teacher that doesn’t have a traditional bank account? Not a problem! You can issue their payments to a cash card, which gives them access to their funds when they need them—no bank account required.

It is important to remember that traditional payroll methods offer fewer options when it comes to issuing payment. When you move to an online payroll platform, you can offer your employees flexible payment options—which, in today’s economy, where many people don’t have traditional bank accounts, is a must.

4. Easy and compliant staffing changes

In a perfect world, you would never have to furlough, lay off or terminate a staff member. Unfortunately, we’re living through a time where staffing changes are becoming increasingly common. Not only can staffing changes be hard on your child care center (no one wants to lose a great employee!), but keeping track of all the paperwork and logistics manually can be an additional headache.

With online payroll, you can easily make any necessary staffing changes, deliver the proper paperwork, and make sure the entire process is compliant from beginning to end. Best of all, even after you’ve made staffing changes, your employee’s information (including wages, dates of employment, and any relevant tax documentation) is still stored on the cloud or software—so if and when you’re able to rehire them or reinstate their hours, it’s easy to get the ball rolling.

How to prep your child care business to switch to online payroll services

Clearly, switching to an online payroll service can have a hugely positive impact on your child care center. But what steps should you take to prepare your business for the transition?

  • Talk to your employees. Your employees are accustomed to your current payroll process—and even though moving to a cloud-based system will make things easier (for you and for them), some may have questions or feel resistant to the change. Before you switch systems, make sure to talk to your employees, answer any questions, and make sure they’re comfortable and prepared for the change.
  • Create backups of your existing payroll data. Before you move to a new payroll system, make sure to back up any of your past and current payroll data for your records.
  • Choose the right cloud-based payroll provider. There are a lot of cloud-based payroll systems on the market, and you want to make sure you choose one that’s simple, affordable, and has all the options you need to run your child care center efficiently. Check out our guide on choosing the right payroll provider for your business.

Gusto comes equipped with a variety of features to make managing your child care center easier and more efficient, and the best part? It’s already integrated with the Procare Connect child care management platform. Learn more about how online, integrated payroll can change the way you do business.

2024 Child Care Management Software Industry Trends

2024 Child Care Management Software Industry Trends

Watch On-Demand Webinar



Procare provides comprehensive child care management software with the power to help you take control at every point of your business.