Reviewing payroll facilitates fitness for the third phase of eSocial

Regardless the business size, being in good standing with all labor and social security obligations is an arduous task facing the volume and complexity of the standards in Brazil. The most committed employer is not free from committing mistakes, either by carelessness or by not being up to date with the evolution of the applicable legislation. To avoid problems or setbacks, hiring a payroll review service is a good solution.

Maintaining a preventive review routine may minimize risks of some social security proceeding or labor claim, and also may assist in the adjustment of existing processes.

The entry-into-force of eSocial has been demanding companies’ attention, since there are different deadlines to file information for periodic and non-periodic events that should be stated very close to the generating event. In this new context, resorting to payroll review as an adequacy instrument to eSocial assists in aligning practices and correcting procedures and inconsistencies, minimizing failures.

The eSocial service also involves data collection and system set-up, through redefinition of company’s processes, integration of the involved departments, and other issues. See an evaluation of the first deployment phase and important aspects of second phase.

eSocial Third Phase: A New Way to Provide Payroll Information

The eSocial deployment is moving towards to the third stage of the 1st group schedule, in which companies with annual revenues greater than BRL 78 million should file payrolls as of May 2018. Later, in November, this obligation will be extended to other companies, including opponents of Simples Nacional, MEI and individuals who have employees (see the complete schedule here).

It is important to stress that eSocial does change the legislation in force, but influences the way data are stated to government agencies. The measure automates the means to control irregularities and makes companies more susceptible to punishment when information is not provided according to tax, tax, social security and labor requirements.

Hence, payroll information should be filled out even more closely, as any failure to complete payroll may lead to some infraction.

In eSocial environment, the event "S-1200 - Remuneração do Trabalhador vinculado ao Regime Geral da Previdência Social" concentrates payroll elements, listing each employee’s data and remuneration. These entries should be basis for calculations such as FGTS, IRPF and social security contribution. The employer should have until the 7th day of the month following the reference period to file the payroll (the maturity should be anticipated to the immediately preceding business day, in case there is no bank time on the deadline).

Payroll Review: How is the process?

Usually, the main objective is to identify possible values calculated in disagreement with the current legislation and/or unduly discounted from employees. However, the focus may be broader, so that the analysis of the documents and established parameters may identify personnel management practices, internal policies, joining to the best market behaviors, standards linked to activity and legislation, being an important instrument support for company’s management.

Between the hiring of employee and a possible termination, there is a tangle of obligations present in company’s routine. The payroll review service consists of preferential preventive action, through review of procedures, development of solutions, preparation of valuation reports, and other services.

This consultancy consists of:

• Review of documents required by Ministry of Labor;
• Review of documents required by INSS;
• Review of payroll processing;
• Review of hiring and termination procedures and other routines;
• Revision and creation of preventive internal controls, when necessary;
• Prevention of tax liabilities related to the determination and payment of social charges;
• Information analysis and cross-checks related to notifications and inspections;
• Verify credits for compensation or future refunding or unpaid debits unidentified by the company.

These topics provide information related to periodic and non-periodic events in the employee's life that should be reported in the appropriate fields at system's digital environment.

As there is no room for error, it is recommended that the entrepreneur evaluate the possibility of leaving these vital actions to company’s operation, but not directly related to the main business’ focus. In addition, today, payroll-related activities must be in line with the eSocial domain as it is not possible to address labor and social security events without a broad view of system requirement.

Domingues e Pinho Contadores provides the payroll revision services in new clients' deployment process and in services routine (labor outsourcing), understanding that this process is utmost to minimize failures in this eSocial adaptation phase.