From a survey of African payroll experts and professionals, results showed that:
Mary Holland of the Global Payroll Management Institute (GPMI) said, “The results of the Global Payroll Complexity Index confirm that multinational organisations face a myriad of demands such as managing employee data, employment and taxation compliance, data storage and privacy, salary and benefit calculations, and a wide range of work rules, and time-off benefits.
“Many of these are mandated by statutory country laws, work councils, and collective bargaining agreements. Organisations are challenged with managing risk exposure, increased government audits, standardising processes, and steering governmental changes while ensuring the integrity of their company brands,” continued Holland.
Anne Clifford, senior director, Global Payroll Operations at NGA Human Resources, explained, “Zero tolerance on payroll non-compliance and the competitive emergence of new business economies means, without a doubt, that businesses must have robust payroll systems and processes in place.”
“In the countries where the 2017 Global Payroll Complexity Index reports a fall in complexity – notably the US and Canada - this is because the high-risk, high-admin payroll processes have been outsourced or automated to reduce the risk of fines and reputation damage,” concluded Clifford.
Managing employee data: All organisations must provide payroll related information to local government departments to determine the social security and/or tax contribution of each citizen. Globally, companies must include an average of 16 data items per employee to the government in the mandated reports and declarations.
Consistent with the 2014 study, Western Europe still requires the highest number of employee data items for a net salary to be correctly calculated. Germany, France, Italy and Spain are most complex, requiring an average of 17 items. This highlights the need for highly accurate HR source data.
Managing payroll data: An average of 14 employee data items affect a net salary – little change to 2014. Italy, France and Poland top the parameter ranking for complexity, contrasting sharply with Canada and Switzerland at the bottom. Benefits and attendance have replaced tax and social security as the biggest contributors to payroll complexity.
Payroll calculation process: The majority of employers run payroll once or twice a month. Globally, North America and Oceania run the most payrolls per month, while South America and Asia run the least. In Europe, France and Italy report the most payroll runs each month.
Government reporting and declarations: On average, 16 data items per employee must be reported; a decrease from 20 in 2014. In South America and Europe the number is notably higher at 35; Italy, the Netherlands and France require the most.
Geographical influences: Each country and business type has its own cultural, regulatory factors and union agreements that affect payroll. In 60% of countries, employee-specific contracts influence payroll. Additionally, multi-level rules, legislation and agreements are continually adapted to comply with economic factors and changing working practices.
Language complexity: In 60% of countries surveyed, more than one language is spoken, adding the need for multilingual payroll. Organisations in South America are most affected. Those in Australia and New Zealand are the least affected.
Europe
North America
Asia
South America
Review the study at my.ngahr.com/payrollcomplexity-2017/
