Three Key Points that Create Universal Payroll Compliance

As seen from the 2019 Global Payroll Complexity Index, data, particularly, the safe-guarding and security of information - is currently the main issue for the market. As the index states, “Payroll is the key to market success. It’s the value in payroll information which makes it incredibly high risk.” That payroll professionals are, therefore, concerned about securing this valuable asset is hardly surprising. A polling of payroll professionals discovered that:

On average, HR and payroll departments spend around 36 hours each payroll cycle on compliance-related iisues ranging from observing regulatory proposals to originating and communicating new policies – enough time for a dedicated full-time worker.
Group with less than 500 employees average 23 hours per week on compliance issues, while those with five hundred-nine hundred ninetynine employees average 31 hours each week. That goes up to 36 hours per cycle for organizations with 1,000-2,499 employees.

What are the three main issues of worry?

“The results of the Global Payroll Complexity Index confirm that in 2019, global companies are challenged by managing growing amounts of employee information, adhering to data privacy rules, and staying compliant in a world of unique employment and taxation compliance laws around 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 findings of the study would appear as no surprise. GDPR is a paradignm shift; the increasing volume of data brings with it more security risks, and the constant changing of new labor rules combine to challenge payroll managers with a giant job.

Let’s look at each of these areas in a little more detail and then examine how payroll professionals are working intensely to resolve every concern.
General Data Protection Regulation (GDPR)

GDPR and why it is changing Europe’s data protection laws may be possibly one of the most important impacts on the payroll market in the recent past. The law determines not just what data may be held; but also, location, by whom, and duration. What is additionally hugely significant for global operators is that GDPR applies not only to companies and organizations within the EU, but also to companies and organizations outside of the EU if they provide goods or services to consumers in the EU or if they observe 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.

Organizations that fail to comply with GDPR risk reputational damage and fines. Based on the recent report, data protection regulators have levied EUR114 million in penalties since 2018.
Information issues

The unique and sensitive matter of employee data reveals that organizations are in significant pressure to ensure they don’t fall victim to criminals. Such a issues creates possible problems for employees, and it additionally puts the company at risk of reputational damage and possible lawsuit.
One of the recent examples of such a violation occurred in April when American education technology company Chegg had a data issue where criminals stole 700 records containing both previous and present employee data like names and Social Security Numbers.

Legal compliance

Staying current with changing legislation is a great challenge faced by payroll professionals. Once again, this is hardly surprising provided the high occurrence of changes in the laws both local and international. From the 2019 Global Payroll Complexity Report, we know that since EU countries still top the list for most in-depth reporting, the growing economies of South America, Asia, and Africa mean countries in those regions are starting to create more changes to their regulations that will greatly affect the task of payroll.

How can payroll better handle those challenges?

One reply is to move to a unified international payroll service provider. While the several abilities of a single payroll platform extend past obtaining compliance, the fact is they can significantly alleviate compliance concerns.
GDPR

The foundation of GDPR compliance is securing the protection of your information. Payroll must be able to address the following questions:

Which information do you hold?

How do you manage this data?

Why are you holding onto this data?

How protected is it?

When reviewing various payroll service providers, take the time to discuss all of these issues with them to ensure each has the abilities to satisfy your data obligations. payroll system protects your data via several tasks which includes encryption and the capability to separate data from its subject so that the information is held separately providing another level of security and protection.

Data breaches

Protecting your data is critical. However, a global payroll platform that comes with an ISO level certification offers security. In particular, a ISO 27001 certificate as it is recognized as the international standard for information security management. Immedis are ISO certified, which means the company run monthly internal audits and perform twice yearly outside audits to ensure compliance. The company also implement a strong control scheme – every input on the Immedis Platform is user timed.

Legislation updates

Staying updated on payroll regulations can be a over-whelming job. The risks and financial consequences of failing to do so are just as immense. Deloitte presents the advantages of a global service provider: “An international service vendor offers a compelling solution for the tax and social security compliance-related tasks by offering payroll services for most countries around the globe.” An additional plus is getting updated data on changes – particularly about local laws – as well as synchronizing with multiple vendors is taken care of by a single vendor. Immedis has thorough global payroll expertise and provides ongoing feedback on local legislative changes and the impacts on employees.