Ricochet News

Get ready for the top 5 global payroll trends of 2018

By Bruce van Wyk, Director, PaySpace - Feb 8, 2018
Get ready for the top 5 global payroll trends of 2018

New business technologies are transforming how multinational companies run their operations – including payroll. Not too long ago, international business expansion was hugely dependent on local service providers. Now, global payroll platforms are enabling greater business intelligence and efficiency.

Armed with real-time data and liberated from time-consuming administration, centrally based payroll administrators can deliver better business results – across multiple locations. And these technologies are changing and improving almost daily. In this piece, I’d like to draw your attention to the top five global payroll trends set to disrupt the industry in 2018.

Globalisation and the power of outsourcing

In the past, a multinational expansion plan typically involved the support of local service providers. Many international companies had to hire in-country payroll teams to ensure that their new offices ran smoothly.

However helpful, these additional suppliers and employees created a large administrative workload. The HR department had to manage complex employee and payroll needs, and procurement was tasked with sourcing trusted suppliers in each country.

Thanks to innovative technological developments, companies no longer need to oversee such a vast network of people. They can now manage their payroll for various locations from one home-base without setting-up in-country payroll teams or managing contracts with multiple service providers in each country of operation.

A team of outsourced payroll specialists has only one job to do: manage their clients’ payroll needs in each country in which they operate. This always-on expert support provides multilayer governance and is focused on keeping client payroll 100% compliant at all times.

Outsourced payroll doesn’t mean that in-house employees will become redundant. Quite the opposite; company staff will have less administrative tasks to carry out, freeing up their time to focus on more strategic work. As businesses continue to expand their operations, they will realise the benefits of global and outsourced payroll.

Evolution of the payroll administrator

The role of the payroll administrator is changing. Nowadays, payroll professionals have to do more than simply input data. With greater access to information and automated administrative assistance, they are now expected to analyse information, identify trends and patterns, and make recommendations for improvement.

Today’s payroll administrators are responsible for a global mandate in a very competitive world. It’s crucial that they understand the complexities of implementing and running a multinational payroll. This requires embracing new technologies and working closely with other departments.

Effective collaboration, strategic thinking and adaptability are key characteristics of an evolved payroll administrator.

Greater collaboration between service providers

To remain relevant and meet the ever-changing needs of global businesses, service providers will start collaborating more. Rather than each offering a relevant service, they will integrate their business models into one system and provide a holistic service to clients.

For example, a global business will be able to purchase a single software package to run its business that includes various functions like sales, finance, HR and payroll. In 2018, the emphasis will be on finding ways to make things easier for clients – hence the rise in new partnerships and integrations.

Increased importance of data protection

The General Data Protection Regulation (GDPR) is new legislation that comes into force in May this year. It will have a direct impact on how the payroll industry deals with personal information. While GDPR has a strong focus on customer data, it also extends to the data businesses keep on their employees.

GDPR is specifically geared at EU citizens. However, this means that multi-national businesses with expatriate employees are affected too. If, for example, a company has EU citizens based in its Nairobi office, it will need to make sure that their data is managed in line with both Kenyan regulations as well as GDPR legislation.

Protecting employee data used to be the sole responsibility of the employer. However, data encryption has to be of a much higher standard these days to ensure compliance, and employee records require a lot more detail than before. To meet all these requirements successfully, the job of protecting employee information now extends to the payroll software provider.

Enhanced employee self service

In 2018, global employee self-service systems will take a step up with mobile-friendly, visually appealing payroll systems becoming the norm. Supported by cloud technology, employees and managers will be able to access payroll and HR data from anywhere at any time – as long as they have access to an internet connected device.

These new generation ESS and MSS platforms offer users a variety of self-service functions such as visual dashboards, interactive team widgets, leave and claim statuses, and employee payslip information. They also include powerful employee directory and social feel search facilities, with intuitive grids that filter complex items easily. To ensure accurate data collection, form submissions come with built in validation elements.

This 24/7 accessibility will enable teams to work together seamlessly across multiple locations. With information available in real-time, teams can also rest assured that they’re always working on the latest data set.

Payroll services are also becoming increasingly available in different languages. Employees can create and manage their company profiles in the language of their choice. This will help eradicate language barriers for global businesses, making payroll and HR information far more accessible.

Multinational businesses face a challenging year. Meeting these trends head on will require a certain shift in gears – but the benefits will be well worth the effort. Global payroll managers need to choose their service providers wisely, and put modern technologies and teams to work.