The 2024 “Getting the World Paid” survey conducted by PayrollOrg (PAYO) provides an inside look at the global payroll industry. The survey enables PAYO to gauge industry trends in the rapidly evolving global payroll landscape.
In the months leading up to Global Payroll Week (GPW), 29 April – 3 May, more than 600 global payroll professionals from around the globe shared their professional insights on several key areas of global payroll, including challenges, performance, systems, and service providers.
Global Payroll Challenges
Navigating the complexities of global payroll presents significant challenges, including varying compliance requirements and diverse tax laws across different countries. When asked “What are your biggest global payroll challenges?” 63% of respondents stated compliance is their biggest challenge. The second biggest challenge was managing multiple vendors, with 30% of respondents identifying it as one of their top three challenges. Third was designing the best operating model at 27%.
“Organizations operating in today’s borderless world of work are facing a complexity crisis,” said Amber Foucault, Vice President of Product, Applications at Dayforce. “The survey results show this is especially true for payroll teams trying to minimize the effort and risk of managing compliance across global teams. Focusing on strengthening payroll compliance and investing in data-driven technology can build efficiencies, while helping organizations engage the full power of their payroll teams through more meaningful work.
Each country has its own unique and complex set of labor laws and tax regulations. When asked which countries payroll professionals found to be the most challenging to pay employees, the United States, Canada, and the United Kingdom were the top three.
Global Payroll Performance
Standardizing payroll and maintaining performance remain ongoing challenges for many organizations handling international payrolls. The annual survey asked individuals “How do you track your global payroll performance against objectives?” In response, 41% of those polled stated they do not track global payroll performance.
“The benefits of having a global, unified payroll solution are clear,” said John Pearce, Chief Customer Officer at CloudPay. “One in three professionals surveyed for Global Payroll Week said that managing multiple vendors is their biggest challenge, but that hurdle is removed by adopting a more streamlined approach. A unified solution also enables more effective monitoring and measurement, and with a staggering 41% stating that they aren’t tracking global payroll performance, this could clearly have a major impact on wider organisational performance.
Global Payroll Systems
By choosing the right global payroll service delivery model, payroll professionals can ensure that payroll operations are not only compliant and efficient but also aligned with their organization’s overall strategic objectives. When asked “What is your global payroll service delivery model?” 38% of respondents stated they use a hybrid in-house/outsourced model. At 24%, the second most popular global payroll service delivery model was outsourcing to an in-country provider. At 15%, the third most popular global payroll service delivery model was outsourcing globally to one vendor.
“Flexibility in payroll systems is crucial in an ever-changing business landscape, where nearly 38% of organizations are adopting a hybrid approach and only 15% choosing to outsource globally to a single vendor,” said Richard Limpkin, VP Multi-Country Payroll Solutions at UKG. “This statistic highlights the need for adaptable solutions that can seamlessly integrate both in-sourced operations as well as those outsourced to multiple providers. However, there are very few solutions in the market that can address this complex requirement. By embracing flexibility, businesses can ensure efficient and compliant payroll processes and complete visibility of global payroll data, regardless of their chosen delivery model. A singular, truly hybrid platform that can meet these needs not only simplifies operations but also provides a competitive edge in managing global payroll complexities.
For those organizations that operate in numerous countries, it might make sense to have more than one single global payroll operating system. The annual survey asked, “Do you have one single global payroll system for processing payroll?” and in response, 57% of users indicated they do use just one single global payroll system.
“It’s really encouraging to see the increase in companies implementing ‘one single global payroll system for processing payroll,’ that’s up from 44% in 2023 to 57% on the 2024 survey,” said Tonya James, Vice President, Product Management at ADP. “This means more organizations are setting off on a global payroll transformation journey. Results show they are increasingly using a single global payroll provider to manage their long tail countries and working with their provider to integrate data analytics. A sign that global payroll operations are becoming far more strategically focused.”
Service Providers
Payroll service providers help organizations remain compliant when managing multiple payrolls worldwide. Often, multiple providers are necessary to ensure accuracy and timely processing. When asked “Do you outsource any aspect of time and attendance (T&A) for any of the countries or areas you are responsible for processing payroll?” 28% of respondents stated they do outsource aspects of T&A. Of these respondents, 40% stated they use one third-party payroll vendor, while 24% stated they use two to five third-party payroll vendors.
In addition to the areas highlighted above, the survey analyzed several other areas of the global payroll profession and industry, payroll standardization, and accuracy. Visit the GPW webpage of PAYO's website for more information and view the complete 2024 “Getting the World Paid” survey results.