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7shifts Payroll: Failed Funding Guide

Updated

When you submit payroll with 7shifts, your business bank account is debited to cover employee wages, taxes, and employer tax obligations. If this funding process fails, the bank notifies 7shifts, and immediate action is required to ensure employees are paid and to avoid account penalties.

This article explains why payroll funding failures occur, what happens when funding fails, and how to resolve a failed payroll as quickly as possible.

How Payroll Funding Works 

When payroll is submitted, Check Technologies (7shifts’ payroll processing partner) initiates an ACH debit from your business bank account.

If the debit fails, the bank typically notifies us within 1–3 business days.

Things to know

⚠️ Important: An account will be terminated if there are six failed funding attempts or if a failure remains unresolved for 90 days.

  • Tax payments related to the failed payroll are held until funds are recovered, which may lead to employer penalties or liens.
  • Unresolved funding issues can delay end-of-year tax filings, including W-2s and 1099s.
  • A $125 return fee is charged for every failed funding attempt.
  • You cannot resubmit a debit in 7shifts until the original funding attempt officially fails on payday.

Impact of Failed Payroll Funding

A failed payroll funding disrupts operations and changes how 7shifts Payroll processes future runs. The table below outlines the consequences based on your payroll timeline and history.Impact on Payroll Processing

2-Day Payroll

Scenario Impact on Payroll Processing Processing Notes
First Failed Funding 
Reason: NSF (Non-Sufficient Funds)		 Account is downgraded to 3-day processing. 
Learn more about payroll processing timelines here.

To return to 2-day processing:

  • Weekly and Bi-Weekly Pay Schedule: Successfully fund 10 consecutive payrolls on 3-day processing and wait 90 calendar days.
  • Semi-Monthly Pay Schedule: Successfully fund 10 consecutive payrolls on 3-day processing and wait 5 months.
  • Monthly Pay Schedule: Successfully fund 10 consecutive payrolls on 3-day processing and wait 10 months.

There are no exceptions or options to expedite this process. 
First Failed Funding 
Reason: Not NSF (ex. account closed, unauthorized debit)

You have 5 business days to resolve the issue. 
If unresolved, the account is downgraded to 3-day processing.

Learn more about payroll processing timelines here.

To return to 2-day processing:

  • Weekly and Bi-Weekly Pay Schedule: Successfully fund 10 consecutive payrolls on 3-day processing and wait 90 calendar days.
  • Semi-Monthly Pay Schedule: Successfully fund 10 consecutive payrolls on 3-day processing and wait 5 months.
  • Monthly Pay Schedule: Successfully fund 10 consecutive payrolls on 3-day processing and wait 10 months.

There are no exceptions or options to expedite this process. 
Second Failed Funding 
(Any reason)		 Account is permanently downgraded to 3-day processing. 
Learn more about payroll processing timelines here. 		There are no exceptions to return to 2-day processing after a second failed funding.

3-Day Payroll

Any Failed Funding 
(any reason)

Payroll is blocked until funds are recovered. 

Employees will not be paid until funds are recovered.

 Employer is responsible for resolving the funding issue and retrying the debit ASAP to ensure timely employee payments.

Common Reasons for Failed Funding

The table below describes why a debit may fail and the required action for the employer.

Reason For Failed Funding Employer Action

Non- Sufficient Funds (NSF)

Your bank account didn't have enough money for the payroll debit.
  • Deposit the funds needed in your bank account to fund payroll.
  • Follow the guidelines below to reinitiate the debit. 

Payment Account Closure

The bank account used for payroll has been closed.
  • Update your bank account information in 7shifts. Verification takes 1-3 business days.
  • Learn how to update your bank account here.
  • Once the new account is verified, follow the guidelines below to reinitiate the debit. 

Unauthorized Debit

The debit failed because Check Technologies has not been authorized to withdraw funds from your account.
  • Contact your bank to whitelist Check Technologies. Provide these ACH details:
    • ACH Company ID: 942875288L & 1209306000
    • ACH Payee Name: Check Technologies
  • Follow the guidelines below to reinitiate the debit. 

Resolve a Failed Funding

Once you've confirmed your payroll account is accurate and verified, contains sufficient funds, and/or you've whitelisted Check Technologies, you can proceed with retrying the debit. 

We offer two resolution options below. We strongly recommend using a wire transfer for faster settlement. Retrying the ACH debit within 7shifts is also an option, but be aware it may result in a payroll delay.

Option 1: Wire the Funds

⚠️ Important: For same-day settlement by 6:00 PM EST, the wire must be received by 4:00 PM EST on payday.

Important: These are unique wire transfer details generated for this specific failed payroll and must not be reused for any future funding, as this will prevent proper reconciliation.

Steps to Fund Payroll by Wire: 

  1. Access the Payroll Dashboard: 
    • Log in to the 7shifts web app as an Admin.
    • Navigate to the Payroll tab.

    • Click Review payment options on failed payroll banner. 

  2. Initiate Wire Transfer:
    • Select the Wire transfer (same day) option.
    • You will be prompted to check a box confirming your commitment to wire the funds.

    • Please note, selecting this in 7shifts does not automatically move the money; it just tells our system you'll be handling the transfer manually through the bank. 

  3. Retrieve Wire Details: 
    • Click Review payment details.

    • You will see your unique wire instructions, including the Account Number, Routing Number, and Bank Name.

      Important: Ensure the wire transfer matches the exact failed payroll amount displayed.

  4. Complete the Wire Transfer: 

    • Contact your bank to send the wire through your business bank account.

    • The wire must be sent within 24 hours of retrieving the details to ensure timely processing.

    • The payroll status will update to Regular - Payment by Wire once the funds are received and reconciled.

Option 2: Resubmit the ACH Debit

Note: Resubmitting the ACH debit can take 3-5 business days. Inform your employees of potential payday delays.

Steps to Resubmit the ACH Debit:

  1. Resolve the Funding Issue:
    • First, ensure you've addressed the reason for the failed funding (e.g., deposited sufficient funds into your bank account).
    • Verify that the required funds are readily available in your account.
  2. Access the Payroll Dashboard:
    • Log in to the 7shifts web app as an Admin.
    • Navigate to the Payroll tab.

    • Click Review payment options on failed payroll banner. 

  3. Initiate ACH Resubmission:
    • Select the ACH (3-5 business days) option.
    • You will be prompted to check a box confirming you have sufficient funds in your account.

    • Click Review payment details.

  4. Confirm Resubmission:

         

The Failed Funding banner on your dashboard will only be removed after you resubmit the originally failed payroll. Creating a new off-cycle payroll with the same dates will not remove the banner. In that case, the banner will remain until the original failed payroll moves to the second page of your payroll history.

Failure Notification Timeline

  • ACH transaction failures are typically communicated 1-3 business days after the debit is initiated.
  • This delay is due to the ACH transaction clearing process, where the bank confirms or rejects the debit.
  • You may see the failure in your bank account before our system receives the notification.
  • You cannot resubmit the debit in 7shifts until the funds officially fail on payday.
 

Browse our Help Center for self-guided resources on payroll reports, tip management, and more.

Didn't find the answers you were looking for? Log in to your account to start a chat with our Support team, or give us a call at 1-888-979-5877.

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