Payment on a Global Scale: Your Simple Guide to International Payroll Outsourcing

Outsourcing is a familiar term in today's business landscape. However, while the overall idea of outsourcing is well-known, there's still a fair amount of ambiguity around the specifics of payroll outsourcing, particularly on an international scale.

Over time, outsourcing has evolved to cover a broad spectrum of potential third-party support solutions. Remember, when your organisation opts for outsourcing, you're in control. You decide which functions to outsource and the terms on which to do so, such as whether it's short-term or long-term, on-site or off-site.

Here's a handy guide to the primary forms of payroll outsourcing:

Option 1: Managed Payroll Services 

In managed payroll, an external expert takes charge of your business's payroll operations. The service provider contractually agrees to provide one or more HR or Payroll services as per specified service levels and work volumes, taking on responsibilities and risks associated with processing, compliance, scalability, and the demanding administrative tasks that accompany these. This typically occurs off-site for a more extended period, making it a strategic choice for fostering long-term growth, including international growth.

Example scenario: As your business expands across diverse locations, maintaining an in-house payroll team becomes unmanageable, despite having a functional SaaS solution for payroll in place. The increasing complexity of payroll processes, due to varied contract types across different time zones, raises the risk of security and compliance issues. At this juncture, it's time to entrust your payroll to an external specialist.

Option 2: Comprehensive Payroll Services 

Comprehensive Payroll Services take the outsourcing approach a step further by assigning the full responsibility of your payroll to your outsourcing partner. In this scenario, your outsourcing partner will even handle direct queries from your employees.

Example scenario: Planning to focus on developing your recruitment and progression policies in the coming years? Fully outsourcing your payroll is the ideal route. Your HR partner takes over payroll, automates and optimises where possible, assists in crafting a comprehensive payroll strategy, and provides regular reports.

Concerned about your employees feeling left out of the loop with off-site outsourcing? Preparation and clear communication are key! Ensure you inform your organisation about the outsourcing decision, the reasons behind it, and provide the necessary contacts for employees to reach out to with queries.

During the implementation phase, your HR partner can conduct informative sessions and workshops to alleviate doubts and establish relationships within the business.

Option 3: On-Site Support

If your primary goal is to bolster your team during specific periods, you can leverage your HR partner's payroll experts and administrative staff, proficient in all HR areas. Acting as an extension of your team, they provide the required manpower and additional expertise to support your staff. They can assist during predictable or unforeseen workload spikes, ensuring you don't have to compromise on your objectives and timeline.

Example scenario: Your payroll employee is on maternity leave, and another HR colleague is unexpectedly ill. What do you do? You can simply bring a payroll specialist on board for a couple of days per week. Once things return to normal, the additional support can be halted. The added bonus? If urgent needs arise in the future, you can call on the same personnel who are now acquainted with your team and organisation.

Option 4: Payroll and Process Optimization 

Payroll, governed by strict rules and fixed calculations, should ideally be one of the most standardised HR processes. It's therefore easier to automate than, say, the recruitment process. However, many HR departments still partly rely on manual procedures, resulting in a loss of valuable time. Your HR partner can help address this issue by reviewing your payroll processes.

Example scenario: You're aware that your payroll processes could be more efficient, but you can't pinpoint the precise areas requiring change. In response, you request a payroll review from your HR partner to thoroughly evaluate your personnel, knowledge, systems, and procedures.

Following the revealing insights from the review, a more in-depth payroll audit takes place. Together with your HR partner, you decide to optimise several processes and start afresh.

A comprehensive analysis of your payroll processes is always enlightening and worthwhile. It provides a clear view of the intricate details of a complex monthly procedure. Thanks to the inventory and documentation of these processes, replacements can quickly step in if your payroll personnel are unexpectedly unavailable.

The ultimate outcome? Assured continuity of a crucial business process.