The global payroll environment is evolving and a global payroll strategy is becoming more fact than fiction, Mary A. St. Cyr, managing director of advisory services at KPMG LLP, said Sept. 22.
Payroll used to be more aligned under multiple organizations around the globe and companies tended to decentralize, St. Cyr said. When payroll was outsourced, it was delivered either by different providers, a single provider with country-specific contracts or providers clustered around a subregion, all with divergent technology platforms, she said.
Now there is pressure to build global payroll solutions. With growing regulatory constraints, more specialized expertise is needed to reduce compliance risks, St. Cyr said.
However, enterprise resource-planning vendors have yet to deliver on costly global payroll systems, while single-sourced service providers lack the depth and scale across all geographies, said Jay Conforti, director of management Consulting at KPMG LLP.
St. Cyr and Conforti, who spoke at the American Payroll Association’s fall forum in Las Vegas, highlighted several trends in global payroll. Strategies for increased agility, cost, compliance and reporting purposes are becoming more global, they said. Outsourcing is growing in appeal while providers still work to refine the aggregator model, they said. And providers are heavily investing in data automation and integrated reporting.
As far as service-delivery models, hybrid delivery models are becoming the norm because aggregator models still have limitations on size and quality, they said. Automatic Data Processing LLC, CloudPay Inc., iiPay Ltd. and SafeGuard World International Inc. all represent hybrid delivery models, St. Cyr said. ADP also is an aggregator, as are ActivPayroll Ltd., Celergo LLC and Ceridian LLC, she said.
There are numerous implementation costs involved that payroll professionals need to consider when developing a global payroll strategy, including vendor implementation fees, intergration, data conversion, consulting support, training, communication, recruiting, bringing on new hires, and shared services, Conforti said.
To manage the global strategy, companies are starting to invest more in implementation of formal governance models to ensure sustainability, Conforti said. And the ownership of payroll governance is changing to support global requirements, he added.
Some may question the value of global payroll, Conforti said: “Why do it?”
Developing a global payroll strategy may help with risk management by avoiding financial penalties and can help professionalize the payroll function. A global initiative also helps to reduce the number of vendors, centralize relationship management and standardize performance metrics. In terms of data management, employers also may leverage human capital management as a system of record for employee data and improve real-time reporting, Conforti said.
Take a free trial to Bloomberg BNA’s International Payroll Decision Support Network. With more than 90 countries covered, this is your one-stop resource for reliable, up-to-date guidance and analysis in every area of global payroll administration and compliance.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)