Those who believe that accounting is boring clearly never had to deal with payroll on a construction project, with thousands of workers, varying schedules, different hourly rates, contract workers, and full-time employees, and after all that, certain special union requirements, quickly turning this into a daunting prospect for even the most seasoned accounting professionals.
While the function of handling accounting and payroll for a construction project can easily be a specialized field on its own, in this article, we concern ourselves with the pay stubs for construction workers.
By implementing robust systems, transparent processes, and simple online tools, generating pay stubs for construction workers can often be a seamless, error-free process, with minimal effort.
The Challenges of Payroll In Construction
Construction companies have to deal with a lot in terms of complexity, arising from special union requirements, compliance with the FLSA Act, or the Davis-Bacon Act, various state, and local taxes, all of which can quickly devolve into a tangled mess.
1)Â Â Timecards, Tracking & Billing Woes
As construction projects grow in size, the ability to effectively track workers, their shifts, schedules, and hourly wages grows exponentially more complex.
Systems such as these often fall victim to lax supervision, and are often vulnerable to fraud, time theft, buddy punching, and more, that can not only impact the finances of a project, but even the morale of the workforce.
2)Â Â Shift-Differentials
The shift and scheduling differences at construction companies often go beyond what is normally witnessed in other sectors.
The differences in the shift pay, along with the effective tracking of shifts and schedules can give rise to lots of complexities, and without the right systems, plenty of errors.
3)Â Â Collective Bargaining Agreements
Given the dominance of unions in construction projects, developers often have to work with unions and agree to collectively bargained wage demands.
This, apart from increasing the overall cost of the project, gives rise to additional factors, rates, and specifications, which require a different approach, as against traditional companies in other sectors.
4)Â Â Compliance Requirements
Beyond the pay that has been agreed to by workers, their unions, and sub-contractors, there are certain legal compliance requirements that further add to the ever growing intricacies of construction accounting.
Mainly pertaining to the FLSA standards that set the maximum number of working hours, record keeping requirements, child labor laws, and more.
Effective Systems & Solutions For Construction Payroll Management
In recent years, there have been a number of innovative solutions, and tools, specifically aimed at addressing the problems in the construction industry. While none of these are turnkey solutions, and require extensive planning to work with your existing systems and processes, they can help tackle the growing complexity, without giving into errors and frauds.
Use Mobile Technology For Tracking
A significant problem in this sector, time tracking can be effectively dealt with using a mobile time card solution.
With time spent on the field, activities, and more, all tracked seamlessly with the help of a mobile application, which is then integrated to a project management solution, supervisors no longer have to deal with error-prone timesheets.
Creating Pay Stubs Online
A vast majority of construction sites still make use of manual pay stubs which give rise to a number of challenges, and create plenty of friction between the supervisors and the workforce.
Given the wide range of online cloud based services available in this regard, creating a proof of income pay stub remains effortless, and stands to add substantial value to both employers and workers, given its wide use cases for rental, borrowing, and job hunting purposes.
Final Words
Construction is the next big legacy sector that is poised for large scale disruptions. Even though it remains bogged down by archaic laws and regulations, technology started penetrating deep, and as always, the first shot is fired at accounting and financial management.
