8 February 2021 - Reading time: 4 Minutes
People choose to work for businesses for a whole host of reasons – it might be the company’s values, career development opportunities, or perhaps personal bonds with colleagues. But whatever it might be, this will quickly be forgotten if people experience problems with their pay.
Employee pay is the foundation of trust that all working relationships are built upon.
There is a reason why employees can become very emotional when it comes to pay, and isn’t just about money. If anything interferes with their remuneration it feels like an agreement has been broken, that there has been a betrayal of faith – and it can affect people deeply.
Of course, all companies want to avoid that scenario and ensure they have a smooth running payroll function – one that never falters and serves the needs of its employees impeccably. But in practice, this isn’t always the case.
While payroll leaders want the operation to be as robust as possible, they also face constant challenges – caused by limited budgets, changing personnel, evolving technology, new legislation, modern ways of working, etc.
That’s why, even with the most competent person in place, there will come a point when every organisation questions how they should manage payroll and whether an outsourced payroll provider is the safest option.
Sometimes that decision is triggered by an internal departure. What if a long-standing payroll leader decides to move on? Who then takes on the responsibility – the finance department or the HR department?
It’s unlikely that either leader in those departments will want to take direct control of payroll themselves, given the other priorities they have to focus on. But, because of the importance, they will need to be confident that it remains in safe hands. The usual question at this point is whether it’s better to recruit someone to operate an in-house team or outsource the function to an external payroll provider.
While some businesses prefer to keep this business critical function in-house, others see that an expert external provider can be the less risky option. And, when they evaluate the risk factors involved there are several reasons why they reach this conclusion:
The regulations surrounding pay are constantly being updated and the requirements placed on payroll teams continue to grow. Just consider what was involved in incorporating furlough schemes during the pandemic.
The challenge with new regulations is that they are rarely a box ticking exercise. UK legislation is often open to a degree of interpretation, with implications that can be testing for a small payroll team.
Dedicated payroll providers, whose role incorporates advising companies on the best course of action when new legislation is rolled out, simply don’t have the same challenges. They may even be involved in advising government at the early stages, when legislation is being drafted – and will have a firm grasp of the intentions behind any new HR regulation.
While technology has become a crucial enabler for payroll teams, helping to eliminate administration and the potential for human error, it still poses a risk – from both a financial and compliance perspective.
This is not least because the expectations we place on technology are changing all the time. In an era of digital transformation, for example, we are increasingly seeing a desire for different systems, be that HR, finance or payroll, to talk to each other.
The major concern is that technology will require ongoing investment. Knowing how best to future-proof the company can be a challenge for payroll teams, and one that has potentially costly consequences. But for large payroll services providers, which are developing payroll technology themselves, this is much less of a challenge.
Given the advancements in technology, payroll teams are also being asked to do far more with data. Larger organisations, for instance, are now required by law to analyse pay and bonuses to report any gender pay gap.
The desire for greater insight isn’t just coming from government, of course. There is a growing expectation that leadership teams should be able to access data and gather insights in an instant.
However, companies are also expected, by law, to protect sensitive data. With organisations wanting to access payroll information from anywhere, steps have had to be taken to ensure data remains secure.
With greater resources available in terms of legal knowledge, technical ability and a much larger payroll talent pool, this is another reason why external providers are often viewed as a safer, more cost effective way, to manage payroll.
Download the ebook: Unexpectedly simple: Outsourcing your payroll is much easier than you think
In an increasingly globalised world, there is a vast array of opportunities for businesses to explore. For companies looking to expand their international reach, payroll is one of the biggest consideration factors. Operating in multiple countries has its fair share of challenges: each region has its own local legislative requirements, and complying with these is crucial in maintaining both reputation and revenue.
Here are the five advantages why outsourcing your payroll should be your next move20 January 2021
Managing an international workforce involves various specialist tasks, such as declaring taxes to foreign administrations, monitoring complex labour laws and elaborating attractive reward systems. That’s why most companies outsource these error-prone tasks. Both local and global HR providers can make a big difference, but remember to make well-considered choices. If you’re looking to truly bridge literal and figurative language gaps, a global partner with vast local expertise is your go-to option. Here’s why.17 June 2020
The SD Worx team has been busy! Not only did the team exhibit and present at UNLEASH Paris 2019, but we also launched our brand new Global People Services offering for the mid-sized market across Europe.
Global People Services is the first integrated HR and payroll service focusing on the mid-market in Europe.
What will Brexit mean for the social security rights of UK nationals currently working in other EU states, and of nationals of the remaining 27 member states now in the UK? Will these cross-channel workers benefit, for example, from state pension contributions they made in the UK and vice versa if they return to their countries of origin?22 October 2019
In addition to the launch of Global People Services, we’ll also be running two sessions of our own at this year’s conference – and trust us, they’re too good to miss!21 October 2019
One of the highlights of our UNLEASH calendar is certainly the launch of our one-stop solution for core-HR and payroll’s current and future needs: Global People Services. The offering opens a new category for the mid-size market, with an integrated single source of truth for HR & payroll, rolling out for the 15 countries in Europe.18 October 2019
What happens when you combine payroll and core-HR together with new technologies? The potential insights into business operations become greater and more valuable than ever when informing business decisions across all areas of the business.25 June 2019
September: the month that children dread as they make their return to school after the freedom of the long summer months. But for adults, especially those in the payroll industry, after the quiet summer period September should be a time to be motivated and to adopt that ‘back to school’ thinking. It’s important for teams not to be stagnant. In the ever-developing payroll industry, adaptability is key and so learning shouldn’t stop just because you’ve left school—in payroll and HR it’s all about continuous learning.18 September 2018
The multinational payroll industry is set to be worth 4.8bn by 2021, yet, despite the evident power of payroll, only a third of multinational organizations have a global payroll provider. Instead, they rely on a disparate selection of multiple local providers and therefore have no access to collated data or a clear insight into their employee attrition, engagement, or retention.30 August 2018
Is your HR and payroll team feeling the heat this summer? With the weather heating up, most of us want to get out and enjoy the sun or escape on a holiday. However, with more staff members out of the office, this can mean that the payroll team might be running on reduced numbers. And, typically, less team members results in a higher workload for those in the office. This is where HR and payroll technology can help, giving HR teams a well-deserved summer holiday.3 August 2018
The HR and payroll industry is in a constant state of change. New laws and regulations are introduced around the world, some of which—including GDPR—change the way the whole organization handles its processes and services.26 July 2018
Summer is finally here—and before long it will be over. HR and payroll teams face various challenges over the summer months, from increased staff holiday to keeping track of summer interns and flexible working.16 July 2018
Payroll data. How often do we stop and think about how important it is to a business? Although payroll is often viewed as a back-office function, it is an essential part of any organisation, and is much more than just payslips.5 July 2018
The multinational payroll market is growing at an impressive rate, with the entire payroll services market expected to reach 4.8 billion by 2021. The demand for international payroll services are increasing, due to the heightened need for compliance to local laws and legislations, and a demand for more comprehensive technology. However, even though the payroll market is growing, many organisations still aren’t unlocking the power of payroll.3 July 2018
The results of SD Worx’s recent international survey are in! With 1,500 respondents from nine European markets, the survey reveals that up to 87% of business leaders are now asking for employee data to inform business decisions—HR and payroll data is now being regularly used by business leaders.11 June 2018
Payroll is a vital part of any organisation, whether it’s a local business or a multinational corporation. A simple payroll error can cause a large amount of damage, so getting it right is essential.
30 March 2018
With more and more employees relying on technology and flexible working than ever before, the world is becoming increasingly connected and globalised. However, with this new reliance on global working, what do HR and payroll teams need to consider when implementing payroll for multinational companies?7 March 2018
Technological advancements are helping to turn a vision of digitally accessible, automated payroll processes into reality. Here’s five predictions for the future of payroll:5 December 2017
A recent survey carried out by SD Worx revealed that out of 4,000 European employees surveyed, 44% had been paid late by their employers and 48% of those that had been paid late had also been paid incorrectly. The research exposes several risks for businesses associated with not paying their employees correctly: let’s explore the top three.13 November 2017
Businesses in every industry have been affected by the way that we now rely heavily on technology. Technology is now a part of everything we do – both at home and work—and in order to stay relevant in today’s world, all industries must continue to be innovative and remain up to date with technological advancements, especially in the workplace.19 October 2017
Big data and analytics have now entered numerous industries, including healthcare, financial services and retail. Despite many HR and payroll providers now using big data as part of their services, the industry has predominately been slow on the data uptake, in comparison to adoption within others. HR and payroll is largely an industry that relies on human intuition, rather than data and statistics, however, providers have started to see for themselves benefits of big data and analytics, and thus are beginning to implement these into their services.10 October 2017
If someone was to ask you how much your payroll operations cost, would you know the answer? It seems like a straightforward question, yet the answer for many HR professionals is often hard to pinpoint. Understanding – and therefore being able to make future projections – about how much your payroll costs requires a clear appreciation of various business components.10 October 2017
It’s a well-known fact that businesses need to continually adapt in line with macro-environmental changes in order to maintain and grow their competitive advantage, but in the fast-moving retail sector, this is especially true. The advent of technology has clearly had a huge impact on retailers across the globe in recent years, with online retail purchases catapulting tenfold and the industry as a whole riding high.10 October 2017
The objective for payroll professionals used to be simple: all they had to worry about was paying employees accurately and on time. As organisations increasingly look beyond local domestic boundaries, the complexity of payroll operations has expanded and evolved so that the level of payroll sophistication has increased As a result, the needs and requirements of organisations globally have become more complex.6 August 2017