How to organize the payment of employees' 13th salary?

To ensure the company continues paying its bills and has the chance to grow smoothly, the business owner needs to keep everything well organized: from good customer service to financial matters.

Amidst all this activity, employee pay is a crucial issue. To avoid staff issues and avoid being stretched thin at the turn of the year, it's important that your management pays close attention.

In addition to the usual salaries and benefits included in every paycheck, paying your employees' 13th-month bonus is something you should always consider, not just when it's time to honor it. To help you with this commitment, we've put together some tips. Check them out!

1. Understand how the 13th salary payment for employees works

The first thing to do is understand how the 13th-month salary works. It's worth talking to your accountant about this topic, but to keep you from getting too lost, here's a quick summary.

Basically, 1/12 of the employee's monthly salary is set aside for payment. Typically paid at the end of the year, the first installment is due from February to November 30th. The second installment is due on December 20th.

2. Consider employee volume and tenure

Since the amount paid is proportional to each employee's salary and also the number of months worked each year, it's a good idea to organize yourself by remembering these details.

If you have hired a new collaborator in the middle of the year, he will still receive the 13th - and it cannot be forgotten when doing the math for payroll payments.

3. Make a cash provision during the year

The payment of the 13th salary to employees is an amount that every employee counts on at the end of the year, and failing to pay it or not being able to honor the full amount is something that will probably cause you a lot of trouble. headache.

To avoid the risk of being strapped for cash when it comes time to pay off this obligation, the best thing to do is to start building up a reserve throughout the year. Get into the habit of setting aside a monthly amount, and if you have a busy season, great sales, take advantage of it and reserve part of it to pay your staff.

4. Manage the provision for the payment of the 13th salary well during the year

Now that you know how to calculate, understand the importance and financial weight of paying employees' 13th-month bonuses, and are also careful to maintain cash flow throughout the year, our last tip is how to manage this extra cash.

With money "left over," you'll want to put it back into your business, whether it's buying products, making renovations, or something similar. However, this practice can be harmful, as you won't be able to get it all back at the end of the year.

The best thing to do is evaluate which investment guarantees you a minimum return on that amount of capital and allows you to withdraw at the right time: without losing interest, but also within your team's payment dates.

Don't be tempted to use this money on something that could leave you in trouble. a more complicated situation at the end of the year. Having to take out loans will end up being more expensive for your company!

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