I had great hopes to switch to Square Payroll as it would save me approximately $2,000 per year.
Unfortunately, it is lacking features that are important to my business and it took me a little while to figure this out. I am sharing this information in case it is helpful to others who are considering switching from another provider to Square Payroll.
First, there are positives that Square Payroll offers vs my current provider.
- Direct integration with shifts/timecards to eliminate rekeying and export/import process
- Integration with Team app my staff is already familiar with
- Better self service options for employees
- Employee access to pay sooner via Cash app integration
- Good pricing with no charges for off-cycle pay runs
Features that are important to my business that Square DOES NOT support, which are show stoppers in my case.
- Limit of 2 direct deposit accounts per employee and (per support) only 1 of those may be used per pay run. I currently have employees with up to 5 direct deposit accounts and switching them over would take extra effort and likely leave them unhappy with the change.
- No support for using ACH transactions to fund employee HSA and 401K accounts. Our chosen 401K Provider (Fidelity) and HSA provider (HSA Bank, and others) accept individual contributions using a unique employee deposit account within the ACH system. This allows contributions to be directly attributed to the employee without any additional reporting or uploads, etc. Square will support withholding contributions from employee pay, but then figuring out how to get these contributions to the provider becomes our problem and would more than offset the savings of not having to transfer timecard information.
- Generally, Square does not seem supportive of allowing businesses to establish their own insurance and 401k plans outside of their partnerships with SimplyInsured and Guideline, both of which have fees and are an additional revenue stream for Square.
- Workers' Compensation also appears to be another service provided by an external partner at a fee, but I didn't get past my other issues to understand this.
Separately, I found it difficult to contact Square Payroll support and was not left with a good feeling that my concerns were understood or important. Telephone support is available 6AM - 6PM PT Monday thru Friday, so no weekend or after hours coverage. No chat support.
I am not sure it is worth $2k/year, but with my local provider I have an assigned processor who is knowledgeable, reachable and responsive. I know she will resolve any of the issues that are bound to come up when paying people.
So, I will keep an eye on future developments with Square Payroll to see if it becomes a fit for my business, but it is not workable for my needs at this time.
I hope this helpful for others, and if your needs are different, Square Payroll may be a great solution for your business.
- John
