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gotchas.md

153 lines · small-business/skills/payroll-prep/reference/gotchas.md at 2574e29

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1# Gotchas
2
3The mistakes that shortchange a person or double-pay a period. Payroll errors are not accounting errors — they land in someone's bank account on Friday.
4
5---
6

Gotchas

The mistakes that shortchange a person or double-pay a period. Payroll errors are not accounting errors — they land in someone's bank account on Friday.

Raw lines 1 to 6
7## Gotcha: filling in a missing clock-out
8
9**Why it matters:** This is the single most damaging thing this skill could do. A filled-in punch produces a paycheck that looks completely normal, so nobody checks it. If the guess is low, someone worked for free. If it is high, the owner overpaid and will never know.

Gotcha: filling in a missing clock-out

Why it matters: This is the single most damaging thing this skill could do. A filled-in punch produces a paycheck that looks completely normal, so nobody checks it. If the guess is low, someone worked for free. If it is high, the owner overpaid and will never know.

Raw lines 7 to 10
11### Bad
13```
14Marcus, Thursday: 6:40 AM – 3:10 PM (estimated out, matches his usual)
158.0 regular hours
16```

Bad

Marcus, Thursday: 6:40 AM – 3:10 PM (estimated out, matches his usual)
8.0 regular hours
Raw lines 11 to 17
18### Good
20```
21Marcus, Thursday 3/12: clocked in 6:40 AM, no clock-out.
22Hours unknown — his gross below excludes that shift entirely.
23What did he actually work?
24```
26---

Good

Marcus, Thursday 3/12: clocked in 6:40 AM, no clock-out.
Hours unknown — his gross below excludes that shift entirely.
What did he actually work?
Raw lines 18 to 27
28## Gotcha: breaks deducted twice, or not at all
30**Why it matters:** Half an hour a day across five people for two weeks is 25 hours. On an uploaded sheet you cannot tell by looking whether lunch is already netted out.

Gotcha: breaks deducted twice, or not at all

Why it matters: Half an hour a day across five people for two weeks is 25 hours. On an uploaded sheet you cannot tell by looking whether lunch is already netted out.

Raw lines 28 to 31
32### Bad
34Assume the uploaded sheet's hours are gross and subtract 30 minutes a day.

Bad

Assume the uploaded sheet's hours are gross and subtract 30 minutes a day.

Raw lines 32 to 35
36### Good
38Ask once: "Does this sheet already take out lunch, or should I?" Then apply it consistently and say which way you went in the run sheet.
40---

Good

Ask once: "Does this sheet already take out lunch, or should I?" Then apply it consistently and say which way you went in the run sheet.

Raw lines 36 to 41
42## Gotcha: estimating employer taxes
44**Why it matters:** The owner uses the total to decide whether payroll clears. A percentage-of-gross estimate looks precise and can be off by hundreds, which is exactly the margin that matters when cash is tight.

Gotcha: estimating employer taxes

Why it matters: The owner uses the total to decide whether payroll clears. A percentage-of-gross estimate looks precise and can be off by hundreds, which is exactly the margin that matters when cash is tight.

Raw lines 42 to 45
46### Bad
48```
49Employer taxes (est. 8.25%) USD 812.00
50Total cash USD 10,652.00
51```

Bad

Employer taxes (est. 8.25%)   USD 812.00
Total cash                  USD 10,652.00
Raw lines 46 to 52
53### Good
55```
56Employer taxes not available — no payroll provider connected
57Gross wages USD 9,840.00
58You will need gross plus your usual employer share in the account by the 20th.
59```
61---

Good

Employer taxes   not available — no payroll provider connected
Gross wages      USD 9,840.00
You will need gross plus your usual employer share in the account by the 20th.
Raw lines 53 to 62
63## Gotcha: silently accepting a rate change
65**Why it matters:** A rate that moved is either a raise the owner gave or a data error. Both are common. Running on it without asking pays the wrong amount either way, and pay corrections are miserable to unwind.

Gotcha: silently accepting a rate change

Why it matters: A rate that moved is either a raise the owner gave or a data error. Both are common. Running on it without asking pays the wrong amount either way, and pay corrections are miserable to unwind.

Raw lines 63 to 66
67### Bad
69Read USD 32.00 from the record, use it, mention nothing.

Bad

Read USD 32.00 from the record, use it, mention nothing.

Raw lines 67 to 70
71### Good
73```
74Luis reads USD 32.00 this period, USD 29.50 last. That is USD 100 a week.
75Raise, or a bad entry?
76```
78---

Good

Luis reads USD 32.00 this period, USD 29.50 last. That is USD 100 a week.
Raise, or a bad entry?
Raw lines 71 to 79
80## Gotcha: batching the flag review
82**Why it matters:** "Three flags, all look minor, proceed?" gets a yes. Each flag asked separately gets a real answer, because the owner is thinking about one person at a time.

Gotcha: batching the flag review

Why it matters: "Three flags, all look minor, proceed?" gets a yes. Each flag asked separately gets a real answer, because the owner is thinking about one person at a time.

Raw lines 80 to 83
84### Bad
86```
873 anomalies found. Review and confirm to proceed.
88```

Bad

3 anomalies found. Review and confirm to proceed.
Raw lines 84 to 89
90### Good
92Three separate questions, each naming the person, the day, and the dollars, answered one at a time and recorded.
94---

Good

Three separate questions, each naming the person, the day, and the dollars, answered one at a time and recorded.

Raw lines 90 to 95
96## Gotcha: submitting the payroll
98**Why it matters:** Once direct deposit is submitted it is very hard to reverse, and the reversal itself is visible to the employee. The gap between staging and submitting is the last place an error can be caught for free.

Gotcha: submitting the payroll

Why it matters: Once direct deposit is submitted it is very hard to reverse, and the reversal itself is visible to the employee. The gap between staging and submitting is the last place an error can be caught for free.

Raw lines 96 to 99
100### Bad
102Stage the run and submit it in Gusto because the owner said yes to the run sheet.

Bad

Stage the run and submit it in Gusto because the owner said yes to the run sheet.

Raw lines 100 to 103
104### Good
106Stage it, tell the owner it is ready in Gusto, and let them press submit. Say why: it is the last free chance to catch something.
108Same rule in QuickBooks Payroll. Having write access to a payroll system is not permission to run payroll, and the reversal there is no easier.
110---

Good

Stage it, tell the owner it is ready in Gusto, and let them press submit. Say why: it is the last free chance to catch something.

Same rule in QuickBooks Payroll. Having write access to a payroll system is not permission to run payroll, and the reversal there is no easier.

Raw lines 104 to 111
112## Gotcha: the period that straddles month end
114**Why it matters:** A period ending the 31st with a pay date on the 4th sits in two months. Guess wrong and either the month's labor cost is understated or the cash lands in the wrong period.

Gotcha: the period that straddles month end

Why it matters: A period ending the 31st with a pay date on the 4th sits in two months. Guess wrong and either the month's labor cost is understated or the cash lands in the wrong period.

Raw lines 112 to 115
116### Bad
118Post the whole entry to the period end date because that is when the work happened.

Bad

Post the whole entry to the period end date because that is when the work happened.

Raw lines 116 to 119
120### Good
122Ask once whether they accrue. Post cash to the pay date. If they accrue, split the wages; if they do not, do not invent accrual entries for books that have never had them.
124---

Good

Ask once whether they accrue. Post cash to the pay date. If they accrue, split the wages; if they do not, do not invent accrual entries for books that have never had them.

Raw lines 120 to 125
126## Gotcha: paying someone who is not on the roster
128**Why it matters:** A name appearing on a timesheet with no hire record is either a new person nobody set up or an error. Paying first and sorting it out later creates a tax and classification problem.

Gotcha: paying someone who is not on the roster

Why it matters: A name appearing on a timesheet with no hire record is either a new person nobody set up or an error. Paying first and sorting it out later creates a tax and classification problem.

Raw lines 126 to 129
130### Bad
132New name on the sheet, hours look normal, include them.

Bad

New name on the sheet, hours look normal, include them.

Raw lines 130 to 133
134### Good
136```
137"D. Amara" appears on the sheet with 22 hours. No hire record.
138New apprentice, or a name I should be matching to someone?
139```
141---

Good

"D. Amara" appears on the sheet with 22 hours. No hire record.
New apprentice, or a name I should be matching to someone?
Raw lines 134 to 142
143## Gotcha: allocating labor with an invented burden rate
145**Why it matters:** Every job margin in the business inherits that number. A guessed 22% loading makes them all wrong in the same direction, which is the hardest kind of error to notice.

Gotcha: allocating labor with an invented burden rate

Why it matters: Every job margin in the business inherits that number. A guessed 22% loading makes them all wrong in the same direction, which is the hardest kind of error to notice.

Raw lines 143 to 146
147### Bad
149Apply a standard burden multiplier so job costs look complete.

Bad

Apply a standard burden multiplier so job costs look complete.

Raw lines 147 to 150
151### Good
153Allocate raw wages, label them as raw, and ask the owner for their burden rate once. Then remember it.

Good

Allocate raw wages, label them as raw, and ask the owner for their burden rate once. Then remember it.

Raw lines 151 to 153