Compliance is an integral part of any successful payroll operation – but it’s far from simple to keep up with changing rules and legislation, especially during the current COVID-19 crisis. Maintaining compliance is key not only for the payroll team itself, but the entire business, too. Breaches of compliance can lead to costly fines, reputational damage, and a poor employee experience.
So, how should organisations approach payroll compliance to ensure they get it right – and continue to get it right – during these uncertain times?
We spoke to our Jaspal Randhawa-Wayte, our Director of Product Management, Payroll Solutions, and a Chartered Member of the Chartered Institute of Payroll Professionals (CIPP), to get her view.
What are the key considerations for a payroll team when developing a compliance strategy?
“Payroll departments need to look way ahead and focus on the political and regulatory changes that are likely to be introduced over the next few years, so that they are planned for in advance. Perhaps the most important part of this is having the right discussions with software suppliers to determine whether functionality will be built into their products to make compliance easier and avoid manual workarounds that can result in errors.”
“Organisations will have a higher chance of compliance success if these discussions take place sooner rather than later, especially in today’s environment where legislation is more complex than ever before, and the consequences of non-compliance can be severe for both the business and its employees.”
What are the best ways to track and measure payroll compliance?
“Payroll teams should create a thoroughly documented and strongly enforced framework for compliance. This then needs to be proactively reviewed to demonstrate its effectiveness to the Board and the appropriate regulatory bodies.”
“There are a number of tools that can be implemented for tracking and measuring compliance. A comprehensive checklist is an absolute must, stored digitally and securely to significantly reduce the chances that it will be deleted or lost. This checklist must be regularly reviewed and updated.”
“Compliance training should be an integral part of a learning and development programme across the organisation, with staff required to take an annual assessment. Additionally, external advisors should be brought in every so often to provide a more objective view, and to make absolutely sure all compliance and audit processes remain fit for purpose.”
How can organisations keep up with complex and frequently changing measures during COVID-19?
“It’s important not to underestimate the complexity of the new measures introduced due to COVID-19. Compared to normal circumstances, payroll teams have had very little time to fully understand and prepare for these changes, so they need to tap into platforms which can deliver to them the right information quickly and clearly. Now would be a great time for payroll teams to review which platforms they use for news and insights.”
“Social media platforms such as LinkedIn and Twitter can be particularly useful for obtaining succinct and easily digestible information, provided you are connected with the right experts. Another option is to subscribe to digital newsletters from consultancy and audit specialists as well as, of course, from professional membership bodies like the CIPP.”
“Don’t forget to look out for updates from your software providers, too. As a crucial partner in your payroll success, your provider should be in regular contact and providing useful content, such as webinars, to guide you through the complex changes – with specific reference to how to implement and utilise any important software updates.”
How should organisations that operate on a global scale approach compliance?
“International payroll can be challenging due to language barriers, country-specific employment laws, and administrative complexities. Non-compliance with local and regional labour regulations inevitably leads to fines and penalties, therefore all of them must be treated with equal respect and due diligence.
To avoid disasters, organisations need to develop a harmonised compliance strategy, at the centre of which is a combination of access to local payroll expertise and globally standardised systems and processes.”