Global Payroll Advisory
Published on 05 Jan 2023
Global payroll is a critical aspect of most businesses, as it involves the process of paying employees for their work and managing various tax and benefit deductions across regions and worldwide. While the last few years challenged the payroll industry in many ways, stabilising into the post-pandemic world the payroll industry as a whole is expected to continue evolving and adapting to the changing needs of businesses and, of course, its employees.
As we kick of the new year, there are several trends that are expected to shape the payroll landscape. We share some of the key trends below:
1. Digital payroll integrations
One trend that is likely to continue gaining momentum is the shift towards digital payroll systems. With the increasing adoption of cloud-based technologies and the proliferation of mobile devices, more and more businesses are opting for online payroll solutions. These systems allow employees to access their pay stubs and tax documents online, and enable businesses to process payroll, calculate taxes, and generate reports with greater speed and accuracy.
2. Investments in AI-based payroll software
Another trend that is expected to dominate the payroll industry in 2023 is the use of artificial intelligence (AI) and machine learning (ML) to automate and streamline various payroll tasks. For example, AI and ML can be used to analyse employee data and generate insights that can help businesses optimize their payroll processes. They can also be used to automatically process payroll transactions, such as direct deposits, and to flag any discrepancies or errors.
3. Increased emphasis on compliance
In addition to these technological trends, there are also several regulatory developments that are likely to impact payroll in 2023. One example is the growing trend towards paid leave policies, which are increasingly being mandated by state and local governments. These policies require businesses to provide paid time off for things like sick leave, family leave, and vacation, and can have significant implications for payroll management.
4. Compensation for a diverse workforce
Many organizations are now offering self-service portals for their employees, allowing them to access their pay stubs, request time off, and update their personal information. This trend is expected to continue in 2023, as it can help organizations reduce the workload on their payroll departments and empower employees to manage their own payroll-related matters. Subsequently, as gig economy continues to grow, this changes how global payroll systems especially, need to handle payment. Companies will need to be able to handle the payment of multiple contractors and freelance workers, whom are sometimes located in multiple regions as well as ensure that they are properly classified and taxed.
5. Increased employee engagement through payroll
Finally, there is the ongoing trend leaning towards greater employee engagement and satisfaction. As the war for talent intensifies, businesses are increasingly looking for ways to keep their employees happy and motivated. One way they are doing this is by offering more flexible payroll options, such as the ability to customize payment frequency or to choose between different benefit plans.
Overall, the trends shaping the payroll industry in 2023 are driven by a combination of technological advancements, regulatory changes, and a focus on employee engagement. As these trends continue to evolve, it will be important for businesses to stay abreast of them in order to ensure that they are able to effectively manage their payroll processes and meet the needs of their employees