The Main Key Issues that Ensure International Payroll CompliancePosted by McQueen Rocha on February 17th, 2021 From the 2019 Global Payroll Complexity Index, data, particularly, the protection and security of information - is currently the main concern for the industry. As the report states, “Payroll is the key to business success. It is the premium in payroll data which makes it very high risk.” That payroll managers are, therefore, worried about safe-guarding this valuable asset is not shocking. A questioning of payroll professionals found the following: On average, Human Resource and payroll departments deploy nearly 35 hours per week on compliance-related activities which range from tracking regulatory proposals to originating and communicating new policies – enough time for a dedicated full-time employee. Group with less than five hundred workers average twenty-three hours each period on compliance issues, and those with five hundred-nine hundred ninetynine employees average thirty-one hours each week. That increases to thirty-six hours per cycle for companies with 1,000-2,499 workers. What are the 3 primary issues of concern? “The results of the Global Payroll Complexity Index confirm that in 2019, multinational organizations continue to be challenged by managing growing volumes of employee information, adhering to data privacy regulations, and remaining compliant in a world of unique employment and taxation compliance rules around the planet,” 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 date would appear as no surprise. GDPR is a paradignm shift; the growing volume of information brings with it more security issues, as well as the constant onslaught of new labor laws group to offer payroll managers with a enormous task. Let us examine each of these issues in a bit more detail and then see how payroll professionals are working hard to conquer each concern. General Data Protection Regulation (GDPR) GDPR and why it is changing Europe’s data security laws may be arguably one of the most important impacts in the payroll industry in the recent past. The law determines not just what data may be stored; but also, location, by whom, and duration. What is additionally hugely important for global operators 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 actions of EU data subjects. All companies- regardless of where they are domiciled- who process or hold individual data on individuals residing in the EU are accountable and should be GDPR compliant. Organizations that neglect to comply with GDPR face reputational damage and fines. Based on the recent report, data protection regulators have levied EUR114 million in fines since 2018. Information issues The unique and sensitive nature of worker information reveals that companies are in significant pressure to make certain they do not become victim to hackers. That type of issues creates possible problems for employees, and it additionally places the organization at risk of reputational damage and possible lawsuit. One of the recent examples of such an issue happened during April when American education tech company Chegg experienced a data issue where criminals stole 700 records containing both previous and present employee data like names and Social Security Numbers. Legislation compliance Staying up to date with changing legislation is a great challenge faced by payroll professionals. Again, this is hardly surprising given the high frequency of changes in the laws both local and international. From the 2019 Global Payroll Complexity Report, we realize that since EU countries still top the list for most complex reporting, the growth economies of South America, Asia, and Africa mean countries in those areas are beginning to create more changes to their laws that will further affect the task of payroll. How may payroll better manage these challenges? One response is to move to a unified international payroll service provider. While the many abilities of a single payroll system reach beyond obtaining compliance, the truth is they can significantly mitigate compliance concerns. GDPR The foundation of GDPR compliance is ensuring the protection of your data. Payroll should be able to answer the following queries: What data do you own? Where do you keep this data? Why are you keeping this data? How safe is it? When analyzing various payroll service providers, take the time to explore all of these questions with them to make certain each has the capabilities to satisfy your data responsibilities. The Immedis Platform protects your information by multiple measures including encryption and the ability to isolate information from its subject so that the data is held separately adding an additional layer of security and protection. Data breaches Securing your data is critical. However, a global payroll platform that provides an ISO quality certification offers security. In particular, the ISO 27001 certificate as it is known as the international standard for data security management. Immedis are ISO certified, which means Immedis perform frequent internal audits and perform twice yearly outside audits to ensure compliance. The company also employ a strong control structure – each process on the Immedis Platform is user stamped. Regulatory updates Staying updated with payroll regulations is a over-whelming task. The risks and financial consequences of failing to do so are also enormous. Deloitte presents the advantages of a global service vendor: “An international service vendor offers a unique solution for the tax and social security compliance-related issues by providing payroll services for many countries around the planet.” An additional benefit is receiving updated information on changes – especially pertainining to local laws – as well as connecting with several vendors is managed with a single service provider. local payroll has thorough international payroll expertise and offers continuing feedback for local legislative issues and their impacts for the workforce.Like it? Share it! More by this author |