Going global with payroll

There are some key steps HR can take to ensure global payroll operations run smoothly, says Nick Southcombe, CEO of Frontier Software

Going global with payroll

There are some key steps HR can take to ensure global payroll operations run smoothly, says Nick Southcombe, CEO of Frontier Software

What are the drivers for global HRIS and payroll systems?
Wherever organisations operate in multiple countries, effective leadership teams will always want a view of their entire workforce. At a simple level, workforce views capture and report total head count and its cost. However, as businesses embrace the notion of the global village, distributed teams and operations in multiple time zones, leadership needs a global view of talent to facilitate workforce planning.

This includes an understanding of both current competencies and skill shortfalls that may impact future strategies. A global view of recruiting, learning and development, career and succession planning within truly multinational businesses are also realities that must be embraced and addressed. Traditionally, such information has been captured in disparate systems, usually on a country-by-country basis. When a global head office wanted a consolidated view of their total workforce, each geographical region would produce their own reports, oftentimes in different formats. At head office the report data would then be reconfi gured and manually rekeyed into a spreadsheet or other reporting tool in order to derive the global view.

This time-consuming and error-prone process often diminished the value of the data due to its lack of currency. Such ‘shadow system’ reporting saw organisations applying changes to the global consolidated reports in arrears. At best the result was partially effective as the data on which decisions were based was not timely. An emerging trend is the incidence of regional and even single global payroll teams to execute payroll for multiple countries.

What type of software functions and service offerings should be expected of a global HRIS and payroll system?
A best practice global HRIS would enable organisations to capture all HR-related data into a single database. It will offer multi-country, multi-language and multi-currency capabilities. It will have a powerful user-friendly report writer. It will capture all fi nancial data in the local currency but be able to convert and report in any currency the user desires. It will have sophisticated workflow functionality to support global business processes.

From a payroll perspective, it would be rare to fi nd a single payroll offering that can service all required countries. Although many vendors say they can meet this requirement, they often do so by bundling disparate payroll solutions into their offering or by partnering with local payroll providers.

Technically, this can be made to work if the HRIS database has an easy-to-use data import function, often referred to as aggregator functionality. However, some vendors are developing a single payroll system for an increasing number of multiple countries out of a single database. Finally, ensure you fi nd out how a vendor of a global offering supports and services their solution. Is a help desk available 24 hours a day, anywhere in the world? How do they maintain statutory compliance? Do they fly in implementation and training support, or is it local, or online? A true global HRIS and payroll system is engineered as an accurate, single source of truth, supporting common business processes for all countries and providing up-to-the-minute information.

Fast fact
Single Touch Payroll means employers will report payments such as salaries and wages, PAYG withholding and super information directly to the ATO from their payroll solution at the same time they pay  their employees. For employers with 20 or more employees, Single Touch Payroll reporting starts from 1 July 2018.


Nick Southcombe

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