The Primary Key Issues that Create Global Payroll CompliancePosted by Borch Munck on February 17th, 2021 As seen from the 2019 Global Payroll Complexity Index, data, especially, the protection and security of data - is now the primary issue for the market. As the index states, “Payroll holds the key to market success. It’s the premium in payroll data which makes it especially high risk.” That payroll managers are, therefore, concerned about securing this valuable resource is hardly shocking. A polling of payroll professionals found that: On average, HR and payroll departments use around 36 hours per payroll cycle on compliance-related activities which range from observing regulatory proposals to originating and communicating new policies – enough employment for a dedicated full-time employee. Companies with fewer than five hundred employees average twenty-three hours per payroll cycle on compliance duties, while those with 500-nine hundred ninetynine workers average 31 hours each period. It increases to thirty-six hours per cycle for organizations with 1,000-2,499 employees. Which are the three main areas of concern? “The findings of the Global Payroll Complexity Index find that in 2019, global organizations are challenged by managing increasing amounts of employee data, keeping to data privacy regulations, and remaining compliant in a world of unique employment and taxation compliance rules across the globe,” stated Mary Holland Global Director of Strategy, Development and Training at the Global Payroll Management Institute (GPMI) and the American Payroll Association (APA). To anyone working in international payroll, the results of the study may come as no surprise. GDPR is a paradignm shift; the growing amount of information presents with it more security issues, and the constant onslaught of new labor laws group to challenge payroll professionals with a giant task. Let us examine each of these issues in a bit more detail and then examine how payroll professionals are trying hard to tackle each concern. General Data Protection Regulation (GDPR) GDPR and why it’s changing Europe’s information security laws might be possibly one of the primary significant results on the payroll market in recent memory. The regulation determines not only what data may be held; but also, where, by whom, and for how long. What is also largely significant for global companies is that GDPR applies not only to businesses and organizations within the EU, but also to companies and organizations outside of the EU if they provide goods or services to people in the EU or if they monitor the behavior of EU data subjects. All companies- regardless of where they are domiciled- who process or store personal data on individuals residing in the EU are accountable and should be GDPR compliant. Companies that fail to comply with GDPR face reputational injury and fines. According to the recent report, data protection regulators have imposed EUR114 million in penalties since May 2018. Information issues The unique and delicate matter of worker data reveals that companies are in extreme pressure to make certain they do not become victim to hackers. That type of breach creates potential problems for employees, and it additionally puts the organization at risk of reputational damage and legal action. One of the recent examples of such an issue happened in April when American education tech business Chegg experienced a data breach where criminals stole 700 records that contained both past and current employee data like names and Social Security Numbers. Legislation compliance Staying current with changing legislation is one of the greatest challenges faced by payroll managers. Again, this is hardly surprising provided the high frequency of changes in the laws both local and global. From the 2019 Global Payroll Complexity Report, we know that since European countries still top the list for most in-depth reporting, the growth markets in South America, Asia, and Africa mean countries in these regions are beginning to create more changes to their regulations that will greatly affect the task of payroll. How may payroll best manage these issues? A reply is to head to a unified global payroll service provider. While the several capabilities of a single payroll platform reach beyond obtaining compliance, the fact is they can significantly alleviate compliance concerns. GDPR The foundation of GDPR compliance is ensuring the protection of your information. Payroll must be able to answer the following queries: What information do you have? How do you keep this data? Why are you keeping this data? How protected is it? When reviewing different payroll vendor s, use the time to discuss each of these questions with them to make sure each has the capabilities to meet your data obligations. The Immedis Platform protects your information from multiple measures which includes encryption and the capability to remove data from its subject so that the information is stored individually providing an additional level of security and privacy. Information breaches Protecting your information is critical. But, a global payroll platform that comes with an ISO level certification provides security. In particular, an ISO 27001 certificate as it is acknowledged as the international standard for information security management. Immedis are ISO certified, which means the company perform regular internal audits and perform bi-annual external audits to verify conformance. They additionally implement a strong control groundwork – every update on the Immedis Platform is user stamped. Regulatory updates Staying current on payroll legislation is a enormous job. The issues and financial consequences of failing to do so are equally immense. Deloitte presents the success of a global service vendor: “An international service provider creates a compelling solution on the tax and social security compliance-related tasks by offering payroll services for many countries around the globe.” An additional benefit is receiving updated data on changes – particularly about local laws – and connecting with several vendors is managed with a single vendor. Immedis has thorough international payroll expertise and provides ongoing updates for local regulatory changes and their impacts for employees.Like it? Share it! More by this author |