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Avoiding Payroll Complexity With A Global Provider

When the time comes for a company to expand into new territories and take operations global, it can mean a significant increase in workload for the HR and payroll departments. This is not only because the organisation will onboard new staff but also since payroll operations have to be managed continuously on a global scale but with a local attention to detail.

Maintaining a balanced focus on each can be like balancing two spinning plates – so, how can expanding businesses manage this transition with ease? Should they look to a global outsourcer or smaller local providers to help lessen the payroll workload?

    The lure of local providers:

    When looking to maintain this local focus on a global scale, it can be tempting for multinational organisations to turn to local providers for their expertise and knowledge of the local market. In today’s data focused world, with major privacy breaches making the headlines on a seemingly weekly basis, new laws and regulations are constantly being implemented around the world to help prevent this.

    Global payroll is non-stop, for example the UK recently introduced changes to how payslips are issued to improve transparency in the system. Additionally, with the recent one-year anniversary of the General Data Protection Regulation (GDPR), these laws have been the centre of attention of HR and payroll professionals around the world as they reassess their compliance processes and ensure everything is up-to-date. However, compliance is not merely confined to updating existing procedures – not always an easy process in itself. In fact, with new regulations come new processes in each region, each of which require a great level of focus from the HR and payroll teams. These processes not only affect the payroll itself, but how this data is transferred between departments and with third parties too – increased levels of security are constantly being implemented to protect employee data.

    Local providers are able to give the required expertise in their specific region in order to ensure that operations are always compliant as they specifically focus on a single region without being overwhelmed by the changing legislations around the world.

      The Pros of a Global Payroll Provider:

      However, when a business operates in multiple regions and continues to expand, the number of local providers can quickly escalate too. Suddenly, a system that was supposed to reduce workload and prevent the HR and payroll departments becoming too overwhelmed with their operations can become a disparate collection of local providers that need more attention than ever before. Obviously, this defeats the point and makes the job harder for HR and payroll professionals.

      Organisations working with multiple providers lack visibility, clarity and documentation within the payroll process and this only leads to knowledge gaps in its staffing and payroll. The solution to this disparity is to work with a single global payroll provider that can strike the perfect balance between global management and local expertise. This can drastically reduce the number of providers down to one that covers it all. Without multiple providers, the departments no longer have to worry about manually managing the collection of local providers around the world, collating their data as well as overseeing the payroll operations as a whole.

      Global payroll providers operating the aggregator model can end the disparate process of working with multiple local providers by standardising the payroll process across global operations. With this method, organisations can maintain the local knowledge of these providers whilst gaining more control and having quicker access to its data and still keeping some operations in-house. Alternatively, organisations may look to work with a Business Process Outsourcing (BPO) model, in which the payroll provider handles the operations with expert efficiency as it offers a fully comprehensive outsourcing service. The organisation can still control their payroll, but the experienced and knowledgable professionals within the payroll provider empower operations to new levels within the business.

      Regardless of which option is selected, a single global provider can maintain the local and global mix, sourcing expertise for each locality, expanding and contracting with the business and ensuring compliance is accurate on a local level and payroll is connected on a global scale. This way, the HR and payroll professional can rest assured that their operations are both compliant and efficient.

      To learn more about SD Worx and its Power of Payroll campaign, download its white paper on unlocking the power of payroll here.