New Year, New Payroll: Why you should outsource payroll in 201814th Dec 2017
As we rapidly approach the New Year, businesses everywhere will be looking at ways to improve business processes and expand internationally in 2018. Payroll is at the heart of organisations’ HR departments and is essential to employee satisfaction. Because of this, payroll is a key process to consider, particularly with the General Data Protection Regulation (GDPR) due to take force on 25th May, affecting all organisations that process the data of EU citizens.
Here are three reasons you should outsource payroll in the New Year and beyond:
1. Compliance – Local vs Global
When operating in multiple regions, businesses need to be mindful that each country has its own local legislation. It’s often wrongly assumed that ‘global payroll’ is a solution with a one-size-fits all mentality. However, it is in fact a centralised business department, and HR and payroll professionals need to make clear that the term ‘global payroll’ incorporates both global and local market capabilities. A global payroll model cannot exist without local market knowledge and legislative understanding.
Payroll as a function is driven by local legislation: companies need to ensure that laws, including the impending GDPR, are followed in whichever regions they operate in. With an outsourced payroll provider, you don’t need to become an expert in every region when it comes to governance and compliance. Instead, you can rely on that provider to ensure you stay compliant, regardless of type of legislation or location.
Outsourced payroll providers recognise the importance of striking the correct balance between the local and global aspects of payroll, in terms of ensuring compliance with all local market legislation whilst optimising the benefits that a global offering can deliver. This can be achieved by building systems with a global outlook and local knowledge in mind: a bottom up, modernised approach to payroll services.
2. Cost control made easier
Many businesses look to save money in whichever ways they can, and expanding internationally is expensive. It goes without saying that organisations can’t afford to build up unnecessary costs elsewhere, or make mistakes in payroll departments. Combined with the savings which come from consolidation and automation, and a business will be far better placed to continue its global expansion journey,
In addition, as we’ve previously mentioned regarding compliance, outsourced providers can help companies to become GDPR compliant. This will in turn avoid further unwanted costs: non-compliant businesses will be forced to pay out hefty fines of up to 4% total global annual revenue in line with new GDPR laws.
3. Reliability, accuracy and security
By making mistakes in your payroll and HR department, you not only risk frustrating your employees, but also the authorities in the country you’re operating in. With a highly respected payroll service provider, however, you are far less likely to make any payroll errors.
Whilst your employees may be skilled to handle HR and payroll issues, there is always the chance that one of them or be away on holiday or on sick leave. The most minor change to routine can cause payroll departments great challenges. It’s crucial to ensure that organisational output remains unaffected always. Outsourcing payroll is a guaranteed way to ensure nothing changes, whatever happens in terms of illness or holidays. It also saves huge amounts of time and provide piece of mind, as you won’t have to help new employees get to grips with your payroll system.
Additionally, for businesses operating internationally, having details of personnel on file all over the world involves the potential security risk of exposure to a range of sophisticated cyberattacks. With financial details at the core of payroll and HR department records, it’s crucial that each element of your organisation is prepared and able to defend itself against breaches. To do so, companies must implement the right infrastructure, yet several simply don’t have the resources to keep records safe. Outsourcing to a payroll services provider means you’ll be reaping the benefits from industry specific technologies which are able to prevent attacks from taking place.
Looking to the New Year and beyond, organisations need to consider outsourced payroll services as an important part of their business strategy: outsourcing can be a great option to any company that is looking to expand international reach, reduce costs and improve overall processes. By outsourcing in 2018, you can relax knowing that you are in the right hands when it comes to achieving more efficient payroll, with local and global legislation always taken care of.
To learn more about what the Payroll Services Alliance can do for your business, please get in touch.
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