In a joint webinar, Marc Moschetto, Founder and CEO of KickMotor LLC., and Mark Vickers, Chief Research Analyst & Data Wrangler at HR.com, presented a recap of the Payroll Security, Regulation, and Innovation Survey conducted in 2022.
The survey ran from May to September and returned 233 responses. Participants represented a wide range of businesses, with HR and payroll professionals responding from small, medium, and large organizations.
The webinar highlighted five significant findings from the survey:
- Remote work is making compliance harder for many organizations.
- Many businesses find complying with wage, hour, and taxation regulations challenging and time-consuming.
- Automation plays an increasingly important role in addressing compliance challenges.
- Security breaches can have devastating effects on a business.
- Many organizations are utilizing payroll-related add-ons to offer unique benefits to employees.
Watch the full webinar here.
1) Compliance Challenges with Remote Work
In a post-pandemic world, employees are more mobile than ever before. Even with the "all clear" to return to the office, many organizations maintained at least some of their remote work policies from the COVID-19 era.
Although workers are enjoying the benefits of mobile work environments, the burden is on employers to make sure they are complying with all payroll and tax regulations. This can be highly challenging, with rules varying widely from location to location. Multiple organizations indicated that remote work has impacted their ability to comply with regulations.
The Key Takeaways
In general, complexity appears to increase proportionally to the number of remote workers. Companies in which no workers are remote are twice as likely to find compliance very easy compared to those in which all workers can be remote. Organizations that allow remote and hybrid work options must assess their processes to ensure a high level of compliance in the coming years.
2) The Challenge of Compliance
Payroll compliance is becoming more difficult as regulations are changed and updated frequently. Staying up to date on all the changes at both national and local levels can be a significant challenge. Responses from the survey revealed that over half of organizations feel that maintaining compliance is challenging.
Interestingly, many businesses also indicated that they understand the importance of managing compliance, with a significant portion saying that compliance with wage, hour, and taxation policies is a core focus.
The Key Takeaways
Understanding the current compliance challenges, and formulating the proper processes to address those challenges, is fundamental to business success. Organizations must figure out how to stay on top of regulatory pressures, effectively manage change, and ensure their processes are as time efficient as possible.
3) Tackling Challenges with Automation
Organizations are discovering that utilizing automation is a great way to streamline some of the compliance challenges. The survey sought to understand how businesses are currently using automation in their processes and see if there is a connection between automation, capability, and confidence surrounding compliance.
The survey revealed that 32% of organizations utilize automated compliance processes to a high or very high degree, and 69% have at least a moderate degree of automation.
From there, the survey compared differences between organizations that use highly automated processes and those that do not. Organizations that incorporate more automation are more likely to believe compliance is easy and are more likely to say that compliance takes little time and effort. In addition, these organizations are more likely to say that they do an above-average job of tracking regulatory changes.
The Key Takeaways
Most importantly, automation can lead to greater confidence and an enhanced ability to comply with critical policies. However, organizations must find a solution to keep pace with changes and provide the necessary processes. Automated processes are often advantageous, but only if they function as expected.
4) The Impact of Security Breaches
Security breaches, phishing attacks, and other cyber security issues are becoming more and more frequent. The survey revealed that pay-system-related security breaches could profoundly affect employee morale, company reputation, and require significant attention. As such, employers must have plans to handle such occurrences.
Organizations are feeling the pressure to stay vigilant about their security protocols. In fact, 43% of companies say learning about another organization's security breaches led to an audit or review of their security. This is most likely because organizations that encountered a security breach experienced disruption in day-to-day operations.
The Key Takeaways
Security breaches can have significant repercussions across various business focus areas, from employee morale to legal challenges to damage to the reputation and brand. They can be a headache, but they can also be avoided. Organizations that understand the significance of a breach need to focus on ways to prevent and/or must consider creating or regularly revisiting plans for maintaining system security and ensure manage one if it were to occur. Businesses need to consider creating or regularly revisiting plans for maintaining system security and make sure the security procedures for any third-party software are known.
5) Advantages of Extending Payroll with Add-Ons
In a time of record inflation, workers are increasingly looking for more than just a paycheck. Many employers are offering additional services and solutions to drive deeper employee engagement and satisfaction. Payroll add-ons are a great tool to help workers financially in times of emergency and to advance careers. However, our survey revealed that utilization is currently mixed.
There are multiple add-ons currently being offered by organizations that have produced positive results in their workplace environments.
The Key Takeaways
Organizations should take advantage of additional solutions to increase employee morale and satisfaction in today's world. Payroll add-ons that can ease some financial burdens for workers are a great place to start. However, it is crucial to find add-ons that will be the most appealing and valuable to employees.
Earned wage access topped both the "already offered" and "most beneficial" lists, highlighting its prominence in today's payroll landscape. It has been estimated that as much as 60% of the workforce is living paycheck to paycheck, so earned wage access and paycards can ease some of the pain by allowing employees to access funds faster and easier than "traditional" means. (Greenshades has teamed up with Branch to deliver this functionality to our clients - click here for more information.)
What Your Organization Can Do
This webinar presented the reality of payroll getting more complex in years to come. As such, organizations need to stay ahead of the game. Our top tips for doing so are:
- Be diligent – Ensure your internal staff is keeping pace with changes or utilize a third-party partner to help you do so. In addition, make sure you have a way to learn about potential compliance issues as they arise, so your team is not surprised at year-end.
- Have a plan – When changes occur, ensure you have a well-defined course of action mapped out for implementing those changes.
- Automate as much as possible – As payroll and HR pros, you have a lot on your plate. By automating processes, you can increase the accuracy and efficiency of your payroll processes, and you will also have more freedom to be a resource for your employers and the workers they support.
Greenshades Software is a leader in payroll, HR, tax, and compliance software. Greenshades delivers a unified, cloud-based platform with personalized support from an experienced team to a diverse range of businesses. With 20 years of experience and over 4,000 clients, Greenshades has experience transforming your payroll, HR, and tax challenges into strategic opportunities.
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