Pay It on the Web


(Page 1 of 2)

By Dave McClure

Online payroll services are designed to overcome the major obstacles that prevent accountants from offering simple, profitable, and manageable payroll services to their clients.

Unlike PC-based solutions, online payroll systems require no downloads or updates, and provide a collaborative environment in which the accountant can provide oversight and services while enabling the client and the client’s employees to handle the data input and updating.

Partner Insights

By doing so, payroll Web sites open new opportunities to serve the 5.1 million businesses in the U.S. with fewer than 20 employees (89 percent of the employer market). And it provides a more effective solution to the nearly 80 percent of small businesses that currently process their payroll manually, as well as the 46 percent of accountants that currently refer clients to another service to process payrolls.

Online payroll processing is a robust and growing market, with a field of excellent products aimed at companies with 200 or fewer employees and the accountants that serve them. Our review of the industry for 2003 finds seven sites worthy of attention.


ADP is the oldest and most heavily referred payroll company in the United States, with 50 years of experience and more than 450,000 corporate clients.

The company offers multiple Web-based payroll solutions on two levels. For companies with from one to 49 employees, there is EasyPayNet, part of the company’s Emerging Business Services Web site.

EasyPayNet, Version 3.2

ADP's Emerging Business
Services Division
Parsippany, N.J.
(973) 952-7000
Price: $32.50 for filing 5 weekly employees, payroll tax filing and delivery.

Clean and graceful in its interface and navigation, EasyPayNet offers the standard features for online payroll plus many of the more complex payroll features-from suppressing direct deposit to handling multiple pay rates within a single pay period. Navigation is via a set of links from the index page that follows the standard format for payroll, employee data, company data, reports, and additional services.

What makes the EasyPayNet site a real standout is its exceptional support services for small businesses. In addition to a robust help system, EasyPayNet offers Frequently Asked Question resources on 180 searchable topics, as well as guidance on payroll and tax filing issues. Somewhat more modular than some competitive products, its enhancements to standard payroll services include the ezCheck module for generation of paper checks, reporting via ezReports, a Checkview feature that allows viewing of previously issued checks, full-service direct deposit, printing of electronic signatures, and downloadable year-to-date reports.

Also of note is the attention that ADP pays to the role of the accountant in working with small companies. In addition to allowing accountants access to payroll data and providing data export and general ledger interface, the EasyPayNet site is launching new services for MICR check printing and enhanced electronic reporting capabilities.

ADP does offer a product for midsized companies that wish to have an online payroll capability. The ADP Pay eXpert service provides secure, Web-based access for major accounts, with free translation of legacy payroll data and secure access to the system from any Web browser.

ADP offers an excellent resource for small companies through EasyPayNet, and a more robust product for companies with more than 49 employees or more complicated payroll scenarios. Pricing is again dependent upon a large number of variables, but the introductory package for EasyPayNet, combined with its features for accountants, should make it worthy of note to CPA and bookkeeping firms.


Paychex is a company that has garnered an impressive set of accolades in recent years both for its business performance and its products.

Founded by B. Thomas Golisano in 1971, it made Fortune Magazine’s list of the top 100 best companies to work for in America, while simultaneously earning kudos from The Wall Street Journal as one of the top 25 companies returning value to shareholders over a 10-year period. Forbes named Golisano personally as one of the top 10 bosses in the nation for the second consecutive year in 2003.

Paychex Online Payroll

Rochester, N.Y.
(800) 322-7292
Price: $31.40, average cost for weekly payroll, 10 employees.

Paychex has grown aggressively in the past three decades through both acquisition and internal development to serve some 475,000 clients nationwide-mainly small to medium-sized businesses with fewer than 200 employees.

The online service, Paychex Online, which debuted in November 2001, is a tightly integrated suite of Web-based services that encompass payroll, a paperless reporting service, online timesheets, and an interface to post payroll data into popular general ledgers. Supported ledger programs include Accpac, Creative Solutions, MYOB, Peachtree, and QuickBooks, in addition to manual integration with other accounting programs.

The online payroll application is straightforward and easy to navigate, with capabilities to handle complex issues such as multiple rates of pay-though it could use an updated graphic look and crisper fonts. After the initial setup-which includes installation of Java into the browser and setting screen resolution to 1024x768-the input of employee data and generation of paychecks is a simple exercise of filling in the blanks.

As impressive as the core program is the array of additional services provided for small businesses-from assistance in electronic payment of payroll taxes to handling of 401(k) plans and worker’s comp. There are even referral sources for employee assessment, pre-employment screening, health insurance, and other small business services. As an added control feature, companies can give their accountants access to the online data at no additional charge.

Paychex Online is an excellent implementation of payroll processing over the Internet. The sheer flexibility, security, and processing power of the site are impressive and well suited to the target audience of companies with 200 or fewer employees.


PowerPayroll is a secure, Internet-based payroll and tax filing service from Paymaxx, the nation’s seventh-largest payroll processor. Aimed at companies with 100 or fewer employees, it is part of a suite of payroll and human resources services that has evolved since the company’s formation in 1991.

Major elements of the service are nationwide tax filing at the federal, state, and local levels, direct deposit, direct import of time and attendance information, online reports, multiple earnings and deduction codes, preparation of year-end W2s, and spreadsheet import and export.

PowerPayroll version 5.0

Franklin, Tenn.
(877) 729-6299
Price: $12 per payroll processing (weekly, bi-weekly, and semi-monthly); $10 tax filing per state (optional); $15 per payroll processing (monthly).

PowerPayroll features a sharp, attractive, and intuitive interface with eight major navigation tabs. These are PayDay, for submitting payrolls, checks, and voids; Employees, for adding or editing employee information; Company Info; Customer Corner, a support, contact, forms, and information resource; Reports, for managing checks and payroll reports; General Ledger, for exporting information to Excel, ASCII, or QuickBooks format; PayView, for reviewing check stub details and W-2s; and Employee Self Service, which allows the client company’s employees to edit and update their own information.

In addition, other links on the index page of the service direct the user to an online payroll guide, the Power401K service, and a payroll reminder service for payroll and tax filing deadlines. At the bottom of the page, a PowerPayroll guide to year-end processing provides information on closing out the previous year and setting up payroll services for the year ahead.

Pricing is competitive with other online payroll services, and is based on the number of employees, frequency of payroll, number of printed checks, and other variables. Pricing information is clearly spelled out on the site, as is the option to reduce costs by computing and managing the payroll online by printing and distributing the checks in-house.

In February, PayMaxx introduced its current iteration of the site, version 5.0. Among the new features included are a Web-based CheckPrint utility, multi-level security features, enhanced deduction control at payroll time, and new formats for report exporting. And the company is enhancing its offerings for smaller companies (from one to 10 employees) with a new Xpress Payroll online product next month.

PowerPayroll is designed to be sleek and straightforward, with other services-human resources, benefits, and others-drawn from its service bureau and PC-based products. With an award-winning design and powerful feature set, PowerPayroll is very appealing for companies that wish to scale their services upward as they grow.

PayChoice Online

PayChoice Online is a relative newcomer to the field, launched last year and offered today by about 75 service bureaus nationwide. The online implementation of the company’s PayChoice PC-based system, it is aimed at companies that want professional back-end services in addition to the timeliness and convenience of a Web-based management system.

This emphasis on service-bureau support makes PayChoice Online ideal for accountants who wish to offer payroll services to their clients. The Web site is hosted by Payroll Associates, with the service bureau’s name, logo, and choice of color scheme. Clients are able to view their company and employee information, make personnel changes and additions, enter their payroll information, settle their totals, run a gross-to-net preview (not required), and, when it is completed to their satisfaction, submit their payroll for processing. Helpful wizards make the processes easy and fast.

PayChoice Online

Comments (0)

Be the first to comment on this post using the section below.

Add Your Comments:
Not Registered?
You must be registered to post a comment. Click here to register.
Already registered? Log in here
Please note you must now log in with your email address and password.

Register now for FREE site access and more