How to Be Payroll Clerk - Job Description, Skills, and Interview Questions

Jun 20, 2020 / 4 Minutes Read / By Albert

How to Become

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When businesses are not careful with their payroll, they can face serious consequences: they may find themselves with too much or too little money in the bank, and they risk non-compliance with labor laws. This can lead to legal action, costly fines and penalties, and a damaged reputation. To prevent these issues, businesses should ensure that their payroll process is managed by a qualified payroll clerk who is familiar with the relevant labor laws and regulations. This will help ensure accuracy and compliance, which will save money in the long run by avoiding costly mistakes and legal repercussions.

Steps How to Become

Obtain a High School Diploma or GED. Most employers require payroll clerks to have at least a high school diploma or GED.
Take Relevant Courses. Many employers prefer applicants to have completed courses in accounting, bookkeeping, and business management. These courses can be taken either at a traditional college or through an online program.
Obtain Certification. Payroll clerks can obtain certification through the American Payroll Association (APA). The APA offers two certifications, the Certified Payroll Professional (CPP) and the Fundamental Payroll Certification (FPC).
Gain Experience. Many employers prefer applicants with some experience in payroll processing. This experience can be obtained through internships, part-time jobs, or volunteer work.
Submit Your Resume. After completing the necessary steps, submit your resume to potential employers. Make sure your resume highlights your educational background, certifications, and experience, as well as any specialized skills you may have.

In order to stay updated and competent as a payroll clerk, it is important to stay on top of the latest regulations and laws surrounding payroll. This includes staying informed with changes in the tax code, researching new payroll software, and keeping up with industry trends. Additionally, it is important to continuously review and update your skillset by taking classes, attending workshops, and networking with other payroll professionals. By taking these proactive steps, a payroll clerk can stay current and ensure that payrolls are accurate and compliant.

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Job Description

Calculate payroll taxes and deductions
Maintain accurate payroll records
Prepare and issue paychecks
Calculate and process bonuses and commissions
Record and reconcile payroll entries
Process employee benefits
Respond to employee inquiries regarding payroll issues
Generate reports such as timecards, payroll summaries, and payroll journals
Resolve discrepancies in employee time reports
File and maintain employee tax paperwork
Prepare and submit payroll taxes
Receive and process garnishments
Prepare and submit reports to government agencies
Monitor changes in applicable laws and regulations

Skills and Competencies to Have

Knowledge of payroll systems and procedures.
Excellent organizational and communication skills.
Proficiency with Microsoft Office Suite.
Ability to maintain confidentiality and handle sensitive employee information.
Ability to work independently and as part of a team.
Strong attention to detail and accuracy.
Ability to multi-task and prioritize workload.
Familiarity with federal, state, and local tax laws related to payroll.
Knowledge of benefits administration and payroll deductions.
Ability to troubleshoot payroll discrepancies and errors.

Organizational skills are essential for a successful career in payroll, as they allow the payroll clerk to effectively manage their daily tasks. In order to be successful, a payroll clerk must be able to plan, prioritize, and manage their workload in order to ensure accuracy and timeliness when completing payroll activities. They must also be able to maintain accurate records and master the payroll system.

interpersonal skills are required to build relationships with coworkers, management, and other external contacts, as well as to understand the needs and expectations of the business. Finally, communication skills are necessary for the payroll clerk to communicate effectively with all parties involved in payroll, as well as to explain payroll procedures and policies. All of these skills are essential for a payroll clerk to succeed in their role, but organizational skills are the most important.

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Frequent Interview Questions

What experience do you have in payroll administration?
How familiar are you with payroll software?
Describe a typical payroll cycle.
What methods do you use to ensure accuracy when processing payroll?
How do you handle confidential employee information?
What challenges have you faced while administering payroll?
What processes do you use to audit payroll reports?
How do you handle employee inquiries regarding paychecks or deductions?
How do you stay informed of changes in payroll legislation?
Describe a situation where you had to make a difficult decision while administering payroll.

Common Tools in Industry

Accounting Software. A computer program used to record, store and analyze financial data. (eg: Quickbooks)
Payroll Calculator. A tool used to calculate employee wages and deductions. (eg: Gusto)
Tax Preparation Software. A computer program used to prepare tax returns and other documents. (eg: TurboTax)
Time and Attendance Software. A program that helps track employee time off and hours worked. (eg: Tsheets)
Spreadsheet Software. A computer program used for creating and organizing data in a tabular form. (eg: Microsoft Excel)

Professional Organizations to Know

American Payroll Association
National Association of Certified Public Bookkeepers
Institute of Certified Professional Bookkeepers
American Institute of Professional Bookkeepers
National Payroll Reporting Consortium
Society for Human Resource Management
National Society of Tax Professionals
International Foundation of Employee Benefit Plans
International Payroll Professionals Association
American Accounting Association

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Common Important Terms

Payroll System. A payroll system is a software program used to manage employee wages and deductions, calculate paychecks, and generate reports.
Payroll Tax. A payroll tax is a tax imposed on employers or employees, or both, that is used to fund Social Security, Medicare, and other government programs.
Wage Garnishment. Wage garnishment is a legal action that requires an employer to withhold a portion of an employee's wages and send it directly to the creditor to satisfy a debt.
Payroll Calculations. Payroll calculations involve calculating employee wages and deductions for taxes, benefits, and other deductions.
Time Clock. A time clock is a device used to record employee arrival and departure times from work.

Frequently Asked Questions

What is a Payroll Clerk responsible for?

A Payroll Clerk is responsible for managing payroll processes, including calculating employee wages, preparing payroll documents, and administering direct deposits and other payroll-related payments.

What qualifications are needed to be a Payroll Clerk?

To be a Payroll Clerk, you typically need a high school diploma, as well as knowledge of basic accounting principles and familiarity with payroll software. In some cases, employers may require a degree in accounting or business administration.

What types of tasks are involved in Payroll Clerk work?

Payroll Clerk tasks include collecting and organizing payroll data, calculating wages based on hours worked, preparing payroll documents, ensuring accuracy of payroll information, filing payroll taxes, and communicating with employees about payroll issues.