In order for multinational organizations to be efficient, accurate, and compliant, they must implement a global mobility strategy, a senior human resources executive said in the 09电竞手游娱乐正规 webinar "The Complexity of Maintaining a Global Payroll.”
Priya Adhikari Licht presented the webinar on behalf of Blue Marble, a cloud-based, global payroll management provider, during Global Payroll Week in early May.
A global mobility strategy includes three areas she called global compliance factors:
Employment law compliance
—local laws, contracts, official assignment letters, etc.
Immigration and work permits compliance
—visas, work permits, and relocation packages
Tax and social security withholding and payment requirements
—these differ greatly from country to country and might need to be covered in your home and host locations
“For the majority of global employers, the complexities of maintaining global payroll compliance originate mostly from a lack of understanding of tax and labor laws and inadequate documentation of payroll services,” Licht said. “Your success as a global employer in terms of payroll compliance depends on understanding the different rules and regulations as they apply to you in that particular region.”
She provided an overview of global payroll compliance by region.
Region with the lowest payroll complexity; only Russia is in the
most complex countries for payroll
Fewest potential legal/taxable/fringe benefits
Lowest number of payroll runs
Overall payroll complexity across several payroll aspects is the highest
Managing employee benefits is complex
Government reporting requirements are more than twice the average
Middle East and Africa
Payroll complexity is lower than average but increasing
Relatively nondependent on government
Higher than average number of languages that impact payroll processing
Overall payroll complexity is slightly higher than average
Regulatory reporting and data analytics are a challenge
No fixed pattern to tax changes
Overall payroll complexity is slightly lower than average
Employee data is easy to manage
Fewer legal/fringe benefits available compared to most other regions
Areas of Risk
Licht cited these five areas as the biggest potential risks to a global payroll operation:
Documentation of procedures and policies
Taxation policies of different countries
Dilemma of “long-tail” countries with few employees
Lack of visibility and control over the payroll processing chain
Attendees took surveys during the webinar, revealing they were split about evenly in handling their global payroll in-house, with individual in-country providers, and with a global payroll service.
Licht laid out options for global payroll compliance, including hiring local staff and engaging a global payroll provider.
“A global payroll service can provide HR and payroll teams priority over processes, a clear view of payroll deductions, and better integration with national tax and social insurance authorities,” she said. “This helps build employee trust in the accuracy of payroll and, hopefully, contributes to a happier and more motivated workforce.”
The webinar is
until April 2020.
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Kerry Cole is Senior Editor of Membership Publications for the American Payroll Association and the Global Payroll Management Institute.