Running payroll for international employees can be complex and tedious. Implementing a global payroll service can alleviate the challenges of paying workers in multiple locations worldwide through a simple, streamlined system. But no two global payroll services are exactly alike, so you need to evaluate whether they fit your needs.
Here’s a closer look into what these services entail and what you should look for when comparing global payroll companies.
What is a global payroll service?
Also known as international payroll services, global payroll solutions enable organizations to pay their remote employees, contractors, or freelancers distributed across the globe. They address the legal and logistical challenges that come with remote payroll.
For example, for every country where you’ve hired employees, there are local taxes, languages, currencies, time zones, working hour agreements, and employment laws to consider. While it may be manageable to pay compliantly if you only have employees in two or three countries, it becomes increasingly complex as you expand your workforce into more territories. In such cases, a global payroll provider is often the best solution.
There are two main options for global payroll management: in-house or outsourcing.
In-house global payroll requires the organization to establish legal entities for every country where they hire, and run payroll in those locations. Or the company could set up centralized payroll via in-house experts who will oversee compliance independently.
For most organizations, global payroll outsourcing is the more attractive alternative, as it alleviates the headaches of international payroll processing, compliance, and managing other important aspects of paying remote workers.
If you’re considering international payroll solutions for your company, here are a few questions to ask as you explore options.
1. Does the service operate in countries where you want to provide payroll?
The whole purpose of working with global payroll providers is to alleviate the administrative burden of managing payments for remote workers. Country coverage is, therefore, the most crucial factor to consider in international payroll companies. If they don’t provide services in countries where you have team members you want to pay, you’ll want to look elsewhere.
2. Can you trust that the service provider will comply with local laws?
A reliable global payroll service provider should deeply understand local labor laws, tax regulations, and compliance requirements in each country where your employees are located. Perform due diligence to ensure that the provider has a proven track record of success in global payroll compliance. They should be experts in payroll regulations and taxation in foreign territories.
3. Does the global payroll software have a good user interface?
The best global payroll software will be user-friendly, simple, and straightforward. Although it manages complex data and tasks, the system should be easy to navigate. For example, make sure toggling through different screens, menus, or dashboards is quick and seamless.
4. Is the service scalable and flexible?
Many growing organizations are seeking to expand their operations into multiple countries. Can the service offer payroll in all the countries you may want to expand into? The service should be able to handle your company’s growth, accommodating changes in the number of employees or expanding into new territories and making international payroll management more effortless in the process.
5. What are the data security standards like?
Payroll information is among your company’s most sensitive data. International payroll software must therefore have rigorous data security features in place. Ask whether the provider has implemented features that adhere to all applicable data security standards. Is the service SOC 2 compliant, for example? Can it handle GDPR? Choose a provider with robust security measures to protect sensitive employee and company information. Compliance with GDPR and other data privacy regulations is essential.
6. To what extent is the payroll automated?
The more automated the process is, the less work your internal team will face. The payroll service should offer automation features that streamline payroll processing, such as automatic tax calculations and deductions.
7. What’s the user experience like?
You and your colleagues need to feel comfortable using the software, so the user interface needs to feel slick and modern. It also needs to provide the information you need. Look for a service that provides real-time reporting and global payroll analytics, allowing you to monitor payroll expenses and make informed decisions.
8. How good is the customer support?
Leading international payroll providers offer unwavering support before, during, and after the initial implementation of their solution. A responsive and knowledgeable customer support team is essential for resolving issues and answering questions about the payroll process.
9. How many currencies can it pay out in?
Naturally, remote workers expect to be compensated in their local currency. A global payroll service should be able to process payments in multiple currencies to cater to your international workforce.
10. How much work do you have to do to pay your team members?
International global payroll is inherently complex, especially for companies with employees in several countries. But the right international payroll service should make the process virtually effortless. Poor global payroll software might require multiple payments and much work on the user’s end. Alternatively, with top global payroll providers, such as Oyster, you only need to pay one lump sum to cover your team’s salaries. We’ll ensure it’s divided and paid to every team member on time and in their preferred currency.
11. Does it support ad-hoc payments?
Payroll for international employees might sometimes go beyond traditional payments. Beyond their salary or compensation for hours worked, you might also need to deliver other types of payments to your employees, freelancers, or contractors. Ensure that the global payroll system can accommodate bonuses, expense reimbursements, and other forms of nontraditional pay while remaining compliant with local tax laws.
12. Does it integrate with your accounting software?
Global payroll processing goes hand-in-hand with accounting. To that end, the solution you’re considering should integrate seamlessly with your current accounting software. Seek out global payroll systems that offer flawless integrations with your existing HR and accounting systems to ensure accurate data transfer and minimize the risk of errors (and additional effort) that come with manual data entry.
13. What other services does the service provider offer?
The best international payroll providers should be able to offer more value to your organization beyond simply automating payments to a distributed workforce. For example, Oyster’s global employment platform offers multi-country payroll services alongside global hiring, onboarding, and more.
14. How long do payments take?
What are the payment methods used by the payroll provider? Multi-country payroll can sometimes be a slow process with the wrong vendor, but payment delays can be a deal-breaker when retaining top talent, besides being an administrative burden. Make sure your team members get paid promptly with good service.
15. What can you expect in terms of the employee experience?
Ideally, the global payroll service provider will also offer a seamless user experience on the employee’s side. Make sure that’s the case by inquiring about the employee self-service features. For example, can employees access pay slips and all necessary info? International payroll outsourcing must be able to support this and other employee inquiries if the goal is to alleviate the workload on your internal HR teams.
16. Can you pay global contractors using the service?
Many companies look to expand into different countries by hiring gig workers, such as freelancers or global contractors. If your global payroll strategy includes compensation for this type of workforce, be sure the solution is flexible enough to meet your needs.
Simplify global payroll with Oyster
There are many things to think about when exploring global payroll processing companies. Prioritizing the above factors will ensure a reliable, efficient, and secure payroll solution that caters to your international workforce and business growth.
If you’re seeking a multi-country payroll solution for your company, turn to Oyster. Our streamlined solution simplifies payroll for team members worldwide while prioritizing compliance. Find out more about our global payroll solution.