Global Payroll: All You Need to Know
What is a Global Payroll Solution and How Can It Benefit Employers?
Payroll defines the process of payment from employers to their employees and stakeholders. Human resources departments or financial experts often carry out payroll duties on behalf of their organisation, including payroll data processing, tax payments, labour laws, invoicing, and much more.
Payrolling duties for a whole workforce can be difficult to manage; however, there are more layers of complexities for payroll on a global scale, as each location enforces different regulations. Ensuring compliance in each employee and independent contractor’s country is vital – failure to comply with the local tax laws may result in serious penalties and, in some cases, shutdowns or imprisonment. To simplify the process and ensure compliance worldwide, employers can engage an Employer of Record to assist with payroll duties, allowing the company to focus on its core day-to-day tasks without the burden of payroll management.
How Does a Global Payroll Solution Work Through an Employer of Record?
An Employer of Record is an HR outsourcing organisation that legally hires employees on behalf of another company – in locations where their own entities are lacking.
If your business requires a global payroll solution, an Employer of Record such as Mauve Group can handle your payroll complications. Mauve can set up your employees on an in-country payroll system, send accurate salary calculations, transfer your workers’ funds with guaranteed compliant fund remittance, and provide ongoing advice on payroll management throughout the whole process.
The engagement of an Employer of Record eliminates the difficulties of setting up an office in each employees’ country whilst creating greater opportunities for business expansion. Not only does an Employer of Record assist with global payroll, but it also handles the local employment of workers and HR tasks – saving you time, money, and risk.
Click here to find out more about Employer of Record services.
What are the Challenges of Managing Payroll Without an Employer of Record?
To manage global payroll without an Employer of Record, companies should prepare for the time-consuming, expensive process that comes with handling a range of local tax laws and regulations.
One of the biggest challenges of managing global payroll is communication barriers. With employees located in various locations, companies that wish to arrange a consistent payment schedule should consider the time zone of each of their international employees and offices. Failure to meet payroll deadlines may result in a suspended or revoked business license.
Companies should also consider language and cultural differences to ensure efficiency and employee satisfaction, including variations in public holidays and cultural values.
Labour laws and tax codes not only vary from country to country, but they also differ between individuals. Each employee’s tax code is calculated on a range of factors, including salary, age, and family status. Companies must prepare for these factors whilst also ensuring they comply with the fast-changing legislations around the world.
Coordinating global payroll can be a challenging task for any organisation. From exchange rates to compliance obligations, local payroll regulations, expenses, and much more, but the assistance of an Employer of Record can simplify the extensive process. Mauve Group can take on the responsibility of as many staff members and locations as your organisation needs.
What Are the Benefits of Using Global Payroll Services?
Guaranteed Compliance – Payroll legislation varies significantly between countries – adopting global payroll services will keep your company up to date with the current laws and regulations in each of your workers’ locations. Additionally, with Mauve Group’s quarter-century experience managing payroll worldwide, we will ensure your company’s global payroll adheres to local banking, tax, and social security rules.
Time-Saving – Managing a multinational workforce’s payroll from a single source is time-consuming and overwhelming. The length of time taken to complete necessary tasks may put you at risk of missing deadlines and facing penalties. Mauve Group’s payroll solution significantly reduces banking delays and the time taken to transfer payments to each employee while also ensuring remittance of salaries within 1-2 days.
Reduced Fees – As a multinational organisation, you may find you require additional staff to handle the workload of global payroll. The use of a global payroll provider eliminates the need to spend money on extra staff members and research, as an effective services provider like Mauve Group will identify the most optimal solution to pay workers in a range of currencies at a reduced cost. Our partnership with a global FX company ensures funds are remitted with up to a 65% reduction in transfer fees and bank charges.
Clear Reporting – With the use of a global payroll provider, all data and important documentation is stored in one place. Obtaining a single, secure location for your salary calculations, monthly reporting, and payslips allows ease of access and transparency throughout the payroll process.
Want to learn more about Mauve’s global payroll services? Get in touch here and speak with our team of experts – we would be happy to help!