3 Key Points that Protect International Payroll Compliance

According to the 2019 Global Payroll Complexity Index, information, particularly, the protection and security of information - is currently the main issue for the market. As the report states, “Payroll is the key to market success. It’s the value in payroll information which makes it very high risk.” That payroll managers are, therefore, concerned about safe-guarding this valuable asset is hardly shocking. A survey of payroll professionals found the following:

On average, Human Resource and payroll departments use around thirty-four hours each payroll cycle on compliance-related activities ranging from watching regulatory proposals to creating and discussing new policies – enough work for a dedicated full-time employee.
Organizations with fewer than five hundred workers average twenty-three hours per week on compliance duties, while those with 500-999 workers average 31 hours per period. It increases to thirty-six hours per week for companies with 1,000-2,499 workers.

Which are the three primary areas of concern?

“The findings of the Global Payroll Complexity Index confirm that in 2019, multinational organizations are challenged by managing increasing volumes of employee data, keeping to data privacy rules, and remaining compliant in a world of unique employment and taxation compliance regulations across 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 employed in global payroll, the findings of the survey will appear as no surprise. GDPR is a game-changer; the increasing amount of information brings with it more security risks, as well as the constant changing of new labor rules combine to challenge payroll managers with a enormous job.

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

GDPR and how it is evolving Europe’s information security laws might be possibly one of the top significant impacts on the payroll industry in the recent past. The law determines not just what information may be held; but also, where, by whom, and for how long. What is also hugely important for global operators is that GDPR applies not merely for businesses and organizations within the EU, but also to companies and organizations outside of the EU if they offer goods or services to people in the EU or if they monitor the behavior of EU data subjects. All companies- regardless of where they are domiciled- who process or hold individual data of individuals residing in the EU are accountable and should be GDPR compliant.

Companies that fail to comply with GDPR risk reputational damage and fines. According to the recent report, data protection regulators have imposed EUR114 million in penalties since May 2018.
Information breaches

The unique and sensitive matter of worker information reveals that organizations are under extreme pressure to ensure they don’t become victim to hackers. That type of issues creates possible problems for employees, and it additionally puts the company at risk of reputational damage and possible lawsuit.
A recent example of such a violation occurred during April when American education tech company Chegg had a data issue where hackers stole 700 records containing both previous and current employee data like names and Social Security Numbers.

Legal compliance

Staying up to date with changing legislation is a great challenge faced by payroll managers. 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 while EU countries still top the list for most involved reporting, the growing economies in South America, Asia, and Africa mean countries in those areas are beginning to make more changes to their regulations which will greatly affect the role of payroll.

How can payroll best manage these challenges?

One reply is to head to a unified global payroll provider. While the many abilities of a single payroll platform reach past obtaining compliance, the fact is they can significantly minimize compliance concerns.
GDPR

The cornerstone of GDPR compliance is obtaining the protection of your information. Payroll should be able to answer the following queries:

What information do you own?

Where do you manage this data?

Why are you holding onto this data?

How safe is it?

When analyzing various payroll vendors, use the time to discuss each of these questions with them to make certain each has the abilities to meet your information responsibilities. The Immedis Platform safe-guards your data through multiple tasks which includes encryption and the capability to separate data from its subject so that the information is held individually adding an additional layer of security and privacy.

Data breaches

Protecting your data is important. However, a global payroll platform that provides an ISO quality certification provides security. In particular, an ISO 27001 certificate since it is known as the international standard for information security management. Immedis are ISO certified, which means they perform regular internal audits and complete twice yearly outside audits to verify compliance. The company additionally employ a strong control groundwork – every input on the Immedis Platform is user stamped.

Regulatory updates

Remaining current with payroll legislation is a behemoth obstacle. The issues and financial results of failure to do so are equally immense. Deloitte highlights the advantages of a global service provider: “An international service provider creates a compelling solution on the tax and social security compliance-related problems by offering payroll services for many countries across the globe.” An additional plus is receiving updated data on amendments – particularly pertainining to local regulations – and connecting with multiple vendors is taken care of by a single service provider. global payroll vendor has thorough international payroll expertise and offers ongoing feedback on local legislative issues and the impacts for employees.