CDA members benefit from special pricing and expert support for the business side of dentistry through Endorsed Services that are vetted and approved by CDA. One of those service vendors, HR for Health, has launched a fully built-in payroll solution designed specifically for dental practices.
Using cash apps for payroll is legally complex
The convenience of peer-to-peer pay apps — like PayPal, Zelle, Venmo and CashApp —is appealing. Funds move instantly, most employees are already familiar with these platforms and paying one-off bonuses is almost as easy as cash. For small practices, this may seem like the ideal solution for payroll.
While these platforms are well-suited for occasional purchases and money transfers between friends and family, the compliance and record-keeping rigor required for payroll is missing.
Legally, California dental practices can’t afford payroll mistakes like:
- Wage and hour violations: Pay apps don’t track hours or overtime, so all calculations must be made separately.
- Tax errors: Unlike dedicated payroll systems, peer-to-peer platforms don’t automatically calculate or withhold federal and state taxes.
- Missing documentation: While transaction histories are documented in pay apps, detailed audit-ready records are not. In California, paystubs require itemized information that cash apps do not provide.
- Lack of wage payment options: In California, employers may not mandate specific payment channels, so using apps without explicit consent violates the state’s labor code.
- Transaction fees: Many pay apps offer basic services for free but charge small fees for premium services like instant transfers and business transactions. Imposing fees on employees’ access to wages is unlawful. If you choose to absorb these fees yourself, the costs can snowball.
- Insufficient data security: These platforms’ data handling isn’t as robust as dedicated payroll systems.
Why payroll clarity matters for your practice team
Managing taxes, reporting, and staying current with employment laws are manual processes. Multi-rate wages, bonuses, overtime and shift differentials are common in dental practices, and these nuances can make manual payroll a time-consuming task.
Employees also benefit from transparency around their compensation. Detailed pay information supports budgeting, tax preparation and income verification. A dedicated, automated system can improve these processes and reduce administrative effort for the whole team.
HR for Health payroll was built for compliance
To address these challenges, CDA’s endorsed service HR for Health offers a payroll solution designed specifically for dental practices. Practices using HR for Health can:
- Reduce administrative burden by using an all-in-one system that syncs timekeeping, PTO, multiple rates of pay, overtime and scheduling.
- Offer fast payments with direct deposit and next-day deposit options.
- Stay compliant with automatic updates as laws and guidelines change.
- Minimize tax errors thanks to integrated reporting, automated federal and state withholdings, and streamlined filings.
- Maintain relevant documents with a nuanced understanding of California dental practices’ needs.
Simplicity is a system
Money transfer apps can make compensation quick, but they simply aren’t designed for the complexities of running a thriving dental practice. HR for Health offers the streamlined processes of an app while helping you maintain compliance.
Schedule a call with HR for Health today to see how fast, accurate and compliant employee payments can be for your practice.