Businesses with a regional or global presence often encounter payroll compliance issues when managing different country payroll processes. This can often hinder global expansion plans and deter effective payroll management. We explore how businesses can avoid these pitfalls.
When it comes to compensation and benefits, payroll compliance is probably one of HR’s biggest concerns, particularly when it involves businesses with plans for global expansion. For better understanding,
HR professionals generally define payroll compliance as the process of fulfilling regulations that govern how employees are paid.
Countries differ in their individual management of labour related laws, and this can lead to differences in the way payroll management and salaries are calibrated. The usage of workforce management tools can help streamline the standardisation of payroll management and help companies with business expansion plans.
Payroll compliance can be difficult because:
1. Individual differences between countries
Countries widely differ in the way they operate. Much like businesses, how each country provides for the individual worker can be different. This is probably the main reason why payroll compliance can be difficult for organisations looking for global expansion opportunities.
Some of the main key differences that involve payroll management are holidays, social security benefits and taxation laws.
2. Complicated laws
Individual countries have different laws that govern how they regulate worker wages and company taxes. Failure to comply with some of these laws may lead to workers or even the government suing for breach of these laws and companies may end up paying hefty fines to resolve these penalties. Businesses need to understand what laws apply to them on a federal, state and local level to be able to ensure compliance.
3. Changes to labour laws and employment policies.
When a country decides to adopt new labour laws like minimum wage policies, social security insurance or even maternal benefits, companies often struggle to be able to implement these changes rapidly.
Often these changes can be rather sudden and quick implementation of this can be tough when organisations don’t have the necessary expertise to implement them.
Solving the issue of payroll compliance
1. Leverage PEOs with workforce management solutions
PEOs are HR companies contracted by businesses to perform HR operations related to employee benefits administration. This scope of work generally covers all HR functions from employee benefits, payroll management, and employment taxes.
Coupled with workforce management solution tools, PEOs may be able to anchor all the HR administration needs of companies and ensuring complete HR compliance.
2. Adopt flexible payroll software with quick updates.
Payroll software providers are another option that businesses can consider to address the issue of payroll compliance. Payroll software providers may not be able to offer the comprehensive set of services a PEO company provides but they may be a more cost-effective option.
3. Develop a team of in-house payroll specialists
Hiring a team of in-house payroll specialists is perhaps the most traditional way businesses decide to tackle the issue of payroll compliance. While it allows businesses complete control of payroll management, companies may have to contend with human error and staffing considerations.
Achieving payroll compliance with AYP Global Pay
AYP Global Pay is a total workforce management solution catered to organisations with a regional presence in the Asia Pacific. With the help of our team of international payroll specialist and workforce management solutions, AYP Global Pay helps provide businesses in the Asia Pacific with fully compliant labour contracts and payroll administration services for its employees.
With a presence in all the countries mentioned in our countrypedia, businesses can be assured of embedded compliance through AYP Global Pay, our intuitive and user-friendly workforce management solution.
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