Debbie Gibson, Head of Sales and Partnerships, activpayroll
Compliance is now a key priority for organisations, with Chief Compliance Officers sitting at the board table and reporting directly to the CEO. The compliance landscape for businesses today is anything but simple. With new regulatory requirements frequently coming into force, businesses operating globally regularly come up against requirements in multiple geographies and different languages that need to be actioned.
Payroll processes are highly complex and when they go wrong, they can quickly cause challenges, not just for compliance teams, but most importantly for those at the coalface of payroll activities. Businesses must follow the laws of the countries in which they operate and failure to do so can result in legal implications and even criminal charges. With this in mind, it’s important to always keep a step ahead and consider what can be done to keep payroll headaches under control.
Compliance in International Payroll
Legislation is constantly evolving and it can be more of a challenge to stay ahead of changing policies whilst central business resources get to grips with numerous, new legislative regimes. Tax legislation is complex, and there can be several levels of rules and regulations to follow in a single country, let alone when you consider navigating across borders.
Compliance issues now go to the very top of organisations, with Chief Compliance Officers taking responsibility for ensuring that compliance is achieved while working with management teams to monitor the importance of payroll growth.
It is not a one-time concern, especially for those who employ staff outside of the UK, meaning compliance needs to be revisited frequently. In fact, some employment regulation changes are made every year regarding issues such as taxes, healthcare, employee classification, and safety violations. Non-compliance with these laws can result in fines and even a possible lawsuit for organisations, so it’s pertinent to focus on keeping up with the changing rules in all of the countries that a business operates in.
What’s more, regulators expect organisations to implement these new laws immediately, so it must be a priority for decision-makers. But with so much to juggle at any one time, keeping track of such changes can be an immense challenge, especially with employees working in multiple locations.
Refining the Payroll Process
Having a good payroll process comes as a result of the partnership that exists between the client and their provider. Change takes time, and businesses need partners who can manage them long-term, who are reliable and who can support them in the challenges that they face. When implemented well, partners should become an extension of their clients, enabling them to be on hand to help with their varying needs and offload many of their critical payroll and HR tasks, which makes the process more seamless in the long run.
The administrative burden can be enormous for payroll professionals and, as a result, human error is often unavoidable. Technology can greatly reduce room for error, but it’s only one part of the puzzle. What complements technology is adding the human expertise to overcome the hurdles that are associated with multi-country operations. Organisations can spend years trying to figure out how best to manage global payroll operations, but sometimes having the right partner is all that they need.
Neglecting HR and employment compliance can lead to disastrous consequences. Whilst on-the-ground support is always the best scenario, it might not be the most viable option for your business, especially if it is experiencing a period of rapid expansion. This is where HR outsourcing comes in, offering support for those with team members based in multiple locations, both nationally and internationally.
Outsourcing Payroll Services
Outsourcing all or part of your HR activity can be game-changing. Enlisting the help of a dedicated HR specialist can ensure that businesses stay on top of these changes and continue to comply with the ever-changing employment laws and regulations in each location without investing too much of their own time.
Some larger companies have multiple payroll experts, but many organisations that are looking to expand their international operations lack the expertise required. It’s expensive to hire an internal expert each time one is needed, so outsourcing the job to external specialists – such as Multi-Country Payroll providers (MCP) – allows for overall flexibility and increased levels of cost efficiency.
MCP providers can also help to consolidate solutions regardless of location, using centralised control and standard procedures. Using multiple providers means multiple processes, so it’s not easy to manage a payroll process, but using one provider ensures consistency when it comes to the processing of information, regardless of each country’s requirements.
Getting Payroll Right with External Assistance
Compliance headaches can be a consequence of poor payroll processes and in a world where the complexities of global operations are ever-increasing, it pays to get things right the first time round. Global expansions can be challenging enough without the added stresses of legislation and payroll operations, so outsourcing it to an experienced provider not only reduces the workload but also eliminates the stresses that go with it.
Compliance isn’t just an issue at the very top of organisations and can be highly time-consuming to deal with for those working at the coalface. External payroll providers thrive on helping their clients deal with the most complex of HR and payroll problems, and whilst complexities can’t be eradicated, they will add the right advice into the equation that can make all the difference to their customers long term.
