Compliance is a serious business-more and more multinational companies around the world are hiring dedicated compliance officers and senior officials to ensure they remain fully compliant on all fronts.
The reality is, in this day and age, there are serious consequences to compliance failure or non-compliance. These range from hefty financial penalties to serious reputational damage. compliance is mandatory and non-negotiable.
There are many cautionary tales out there in the media of companies who have taken an overly casual attitude towards compliance, an attitude they now deeply regret. Global payroll compliance is just like any other level of compliance, it is a regulatory obligation and there is very little in the way of middle ground or grey areas-you either get it correct or you don't.
Global payroll data can be highly sensitive and contain a huge amount of personal information pertaining to a globally dispersed workforce. It is very important that this data is protected to the highest industry standards and all compliance and reporting obligations are met in a timely manner when it comes to disclosures around tax, labor information and global payroll statistics.
Many organizations today are struggling with compliance in their global payroll departments-this is largely due to the complex nature of multicountry payroll, which involves local country laws and international payroll regulations-it can be difficult to keep track of everything, especially if you don't have a dedicated compliance person in the team or department.
In this article, we are going to examine a few steps you can take to achieving better and more consistent global payroll related compliance.
1 Automate your global payroll data flows
One of the difficulties that global payroll teams face when it comes to compliance is gathering all of the data they need into a single location for analysis and study. Legacy payroll systems and processes generally involve an over-reliance on manual data entry, spreadsheet work and e-mail data transfer.
If your payroll covers 15 or more countries, it is not hard to see how difficult it can be to keep track of data from multiple systems and countries. It often makes payroll data compliance virtually impossible.
Leveraging hyper automation technology and automating all of the data flows not only saves a huge amount of time by automating everything that was previously manual, it also immediately improves the accuracy of the data by removing the likelihood of human error. By default, this immediately enhances your compliance as access to fast and accurate data can only help the process, especially when it comes to meeting mandatory payroll reporting deadlines and obligations.
Automation can go further and even be applied to system alerts and notifications about upcoming compliance deadlines-you can automate compliance calendars so that you receive advance notice of specific deadlines in different countries, this is something that can really help with your time management and preparation.
If you manage your global payroll on a global payroll control platform, you can set up automated triggers and alerts at the start of the year for all the upcoming significant compliance calendar dates. This can really help you stay in control of everything and avoid unpleasant surprises and missed deadlines.
2 Consolidate all your payroll data into a single location
Multicountry payroll is complex and nuanced- it also relies on multiple different systems because payroll data is never located in just one location. Payroll departments require data from human resources systems, benefits systems, time and attendance applications as well as financial accounting systems.
Payroll is always local so there is a need to go out and engage with local country global payroll providers to ensure all of your international employees in all of your locations get paid accurately and on time. These providers need accurate data for country specific payroll calculations for the global workforce-and of course, all of this data needs to come back into some kind of centralized platform for review and analysis.
The best approach from a compliance perspective is to ensure that all of the data from all of the sources is transferred seamlessly into a single digital platform. This way, global payroll professionals can be certain that they have access to all of the relevant data they need to ensure payroll operations compliance on both a local country level and a global level.
Attempting to manage compliance on a system by system or country by country basis can be quite a challenge for a payroll team. A far better approach is to think on a global level and apply a Global Management framework to how you approach compliance. Consolidating all of the data from all of the countries and sources into a single digital platform will lend itself to the kind of accurate, detailed and comprehensive reporting and analysis work needed to ensure multi-country payroll compliance levels in 2023 and beyond.
3 Protect your employee data in the cloud
SaaS cloud-based technology tends to come with inbuilt data protection and security measures that ensure global payroll data from all of your countries is protected in line with the highest data protection regulation standards.
This kind of payroll system protection cannot be achieved in excel spreadsheets and e-mail transfers-manual work is subject to major risks and should be dispensed with. Global payroll delivery and management should happen inside a SaaS cloud environment, where digital tools are deployed to protect data. An example would be access and authorization restrictions so that only specific people have access to sensitive global payroll data.
Automatic audit trail reporting is another example as this can outline who accessed any data, who changed it, when and for what reason. This information can be very valuable when it comes to internal and external audit reporting.
A digital platform that is purpose built for global payroll management will have inbuilt security and information protection features that can protect global payroll data at all stages of the end-to-end payroll process.
There is no room for error or relaxation with global payroll compliance, it is 2023 and you need to be delivering and managing your multicountry payroll inside a secure cloud platform which delivers complete security, compliance, and governance.
4 Ensure reporting is real-time and consolidated
A basic principle of any compliance function is the reality that you cannot manage what you cannot see. Global payroll data needed for compliance obligations needs to be extracted into detailed, comprehensive and consolidated reporting.
This reporting also needs to be real time and easily accessed. Multiple stakeholders will be interested in global payroll data for compliance: HR managers, finance executives and the office of the CFO as well as the legal and compliance department. They are likely to require instant access to easily generated reporting that displays real-time data and helpful analytics.
For this reason, it is best to digitize the end-to-end global payroll process and manage everything on a global payroll control platform that comes with the kind of innovative reporting tools that help make compliance in 2023 a lot easier.
The ability to run a range of different reports to get a full understanding of labor costs as well as specific pay elements can be a major advantage when meeting compliance deadlines. The more specific and detailed the real-time reporting is the better as auditors today often have very specific questions. Limited or no reporting is not an option.
It is best to leverage a global payroll solution technology that ensures your reporting is real time and consolidated, covers different countries along with regions, continents, jurisdictions as well as the global view, while enabling stakeholders to drill down into the micro details that answer specific questions.
For more information about our Global Payroll Control Platform contact us today.