How To Implement A Successful Payroll Management Practice for Your Remote Team
Technological advancements over the last decade have allowed more people to work beyond the confines of fixed office space. As a result, recruiting, onboarding, and retaining employees are increasingly management challenges. Therefore, it would be best to find out how to implement a successful payroll management practice for your remote team.
Benefits of a remote team working from home
In addition, with the restrictions brought about by the pandemic, more people have also been limited to working from home. Above all, they have found the isolated working lifestyle more suited for them. In a 2020 survey by Growmotely, 74% of professionals surveyed say that they believe off-site working will be the new normal. Moreover, 63% of entrepreneurs and professionals prefer to work in a fully remote environment, even post-pandemic.As more people have experienced the benefits of working from home, companies have adjusted. For example, they have adapted company policies to different team dynamics and onboarding suited to remote work.
A remote working system allows having people from different states, foreign countries, and different time zones. Coordinating payments between your global team could seem daunting. Here are some tips to help you implement a successful payroll system for a remote team.
Challenges to consider implementing a successful payroll management practice
Having employees from around the globe who work remotely makes payroll management harder than having workers in one location. Consider taxes and other withholdings when managing a payroll system for a remote team. Additionally, regulations drive differences in currencies and frequency of pay for employees. You should also factor in international exchange rates and international bank fees for fund transfers. Paying high transaction fees may not be cost-efficient.
Identify the types of remote employees you have on your team
Classifying whether your remote employees work full-time or are independent contractors will dictate whether you will have to pay and withhold taxes, pay overtime, provide benefits, or provide insurance, among other liabilities. Correctly classifying your employees can also help you avoid paying tax fines and penalties during the tax filing season.
Complexity increases when employees are not working in one location and are not from the same state or area. You may have to register with the local state or country tax agency for employees who work remotely to ensure your company is compliant with local protocols and procedures. Compliance with regulations applies not only to tax but to local labor and employment regulations as well.
Have established remote working policies
Employers might be worried about limited control, including how employees track and report work hours, leading to payroll management issues. Establish remote working policies such as using timekeeping software, adding off-site working guidelines to your company handbook, and having employees sign an employment agreement. Clearly defined timekeeping and payroll provisions and consequences for not abiding by these can help assure employers that employees are productive. Further, policies, procedures, and automation reduce the risk of timekeeping fraud and help make payroll management more straightforward.
Outsource to a payroll or accounting partner
Some employers might find the task of coordinating payroll for employees worldwide a complex task. Therefore, you may want to consider an outsourced partner to help stay on top of payroll processing. Payroll management companies have established systems and processes for managing payroll in different locations. Further, accounting partners can sync with a company’s HR department to take over payroll management and taxes. In addition, an outsourced payroll partner can monitor tax and other regulations to make sure your company not only pays employees correctly but also remains compliant with remote working policies.
Payroll partners might use payroll programs such as ADP Run, Paychex SurePayroll, or AccountantsWorld Payroll Relief. These systems provide the payroll professional with capabilities to serve your remote team with portals, easy time entry, accurate calculations, and electronic payments.
Invest in payroll software or apps to support your remote team
Small businesses and startups can make use of various payroll software or apps to aid in managing payroll. These apps can help generate pay slips, calculate payroll and bonuses, holiday pay, and other expenses, and assist with tax compliance, among other tasks. Some software can also be linked with timesheets and employee records to make payroll computation easier as well. These additional features may be more expensive, so availing of these may also depend on your business needs.
Remote work is a factor more job seekers consider when switching or looking for a new place of employment. Working remotely can benefit both employees and the company since happier and more productive employees positively affect a company’s performance. In addition, a remote working system, partnered with having an effective payroll management system in place, reduces the risk of error and fraud. Most importantly, outsourcing payroll and HR can allow employers to focus on other tasks that improve performance and even growth.
In conclusion, you can understand that how to implement a successful payroll management practice for your remote team is critical to your success. Employees, in turn, are assured that their performance is well-compensated and can even start saving up for the future. Meanwhile, a remote team that is managed well and paid correctly can contribute to your success.