How technology is supporting the trend towards greater globalisation of pay and benefits
Managing international pay and benefits is complicated, costly and time consuming. But it doesn’t have to be. An integrated global pay and benefits system can save you time and money by making your processes quicker, smarter and more secure.
Thanks to enhanced data collection and analysis capabilities, it will also make it easier to engage with your employees – wherever they are based. By failing to take advantage, you risk lagging behind your rivals with a more hi-tech approach.
As consultant Accenture highlights in its 2020 CEO’s Guide to Tech Investment: “Businesses cannot afford to continue processing benefits manually while digitising the rest of HR, neglecting the savings and employee engagement opportunities that technology offers. As more companies embrace this change, those who do not are falling behind.”
The power of centralisation
Despite most business travel being on hold for the moment due to COVID-19, having operations in more than one country has long ceased to be the preserve of mammoth multinationals.
Global assignments also remain a significant draw for younger employees, with those in the 23- to 38-age-range viewing overseas assignments as “a rite of passage”, according to PwC’s Talent Mobility 2020 report.
But whether you have people working overseas short or long term, managing their pay and benefits can be problematic. Not only do you have to pay salaries in different currencies, you must also adhere to a range of regulatory frameworks and tax regimes. And meet varying cultural demands.
Centralising your systems can dramatically reduce both the cost and the workload involved – making it easier to develop a global strategy that reflects local need.
Pay: streamline your approach
Staying on top of currency fluctuations and the local tax and regulatory requirements of every country in which you have employees is a full-time job.
In the past, many employers have therefore outsourced overseas pay to partners based in the country concerned. But taking on external support in each location can end up adding to the workload – especially if things go wrong.
With a fully integrated solution provided by a single partner, you can benefit from a better price, fewer headaches and less GDPR risk to boot.
It’s straightforward to manage as you only have one point of contact, and it ensures your employees get paid (and taxed, where applicable) the right amount at the right time.
Integrating payroll with a flexible benefits programme also has other advantages. These include sharing data more efficiently, improving the hit rate of your targeted communications, and simplifying the management of related benefits such as pensions.
Benefits: go global, stay local
When working on a global scale, you have to find a balance between ensuring consistency of benefits provision across the workforce, and providing a programme that is relevant to local needs.
The most popular benefits will vary from one country to another. Employees in the US, for example, may prefer comprehensive medical insurance, while their French colleagues favour flexible working conditions.
The terms imposed by suppliers will also differ. In one recent example, a company that wanted to move its Singapore operation to a four-day week due to COVID-19 found its local health insurance provider would no longer offer cover under those circumstances.
So, to provide the benefits your workforce wants and needs, and avoid pitfalls specific to each country, you need to work closely with experts in the field.
But beware: as with pay, relying on lots of different partners can cause problems.
You may, for example, face issues with consistency; when you have different programmes in place, people’s experiences will vary. Reporting on a range of solutions in different countries in a clear, concise way can also be challenging.
Centralised technology will do the legwork for you, making monitoring and reporting a breeze, and helping you to target communications – something that looks set to become even more vital to the success of a reward strategy in the post-pandemic world.
The author is Tim Brook, head of engagement & platforms at Equiniti HR Solutions.
This article is provided by Equiniti HR Solutions.
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