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What is international payroll software, and why is it important?
International payroll software (also known as global payroll software) is a tool that manages everything about payroll across countries. Simply put, it is used to pay those employees who reside outside the country where the startup is located. International payroll companies provide real-time feedback on a startup's payroll processes by assessing a Single Source of Truth (SSoT) that contains and manages diverse data and allows access to it on one single platform.
Global payroll software is essential because :
- Every country has its own set of financial regulations. Keeping track of them is an arduous task. Non-compliance with the financial rules of any country can lead to legal trouble for the employer. International payroll software can manage this quickly as it has assigned compliance officers to deal with diverse regulations.
- International payroll software does away with the need to approach different payroll service providers and multiple costs that have to be incurred for doing so by providing one unified platform to manage all payroll services for all the employees, regardless of their location.
- International payroll software eases the nitty-gritty of dealing with multiple employees globally by managing every aspect of payroll processing and facilitating remote work. This is particularly helpful as more employees now work from home.
- International payroll software allows employees to be paid in their local currencies. This enables them to access all the benefits of their country like local employees, such as health insurance, retirement benefits, etc.
- Managing payroll data across different countries is complicated. Inefficiency in managing such data can compromise insightful information that an HR professional needs to improve your company's dynamics. Global payroll software provides real-time data that is all-inclusive.
- Apart from streamlining the accounting process across countries for various employees, international payroll software also makes the global expansion of your startup possible since you no longer have to worry about dealing with employees or regulations.
What key criteria to look for when choosing vendors in this space?
Payroll requires collecting employees' most sensitive information like bank account details, PAN numbers, salary details, etc. The ideal international payroll vendor must have robust security measures in place to protect employee data. It would do good to look for features like two-factor authentication for login and compliance with International Security Standards, so you know that your employee data is safe. The onus of this security for their data lies with you. It should also allow you to customize in-house security by providing user role settings and module-based authorization, so teamwork around payroll goes on uninterrupted without compromising security.
2. Legal compliance across countries
The ideal vendor for international payroll management will be compliant with different local and state regulations for employees in other countries. It should automate the computation of Provident Fund, employee state insurance, income tax, Labor Welfare Fund, etc. It should be able to cater to changes in tax laws globally automatically.
3. Complete automation of payroll features
The ideal international payroll software will allow you to have everything associated with payroll processing at one click, such as revisions in salary, bonuses, records of leave, etc. Additionally, it should also automate sending payslips and tax-related documents to employees. An employee self-service portal is a good add-on.
4. Ease of making payments
Your payroll software for international employees must allow you to seamlessly cater to employees of different ranks based on the hierarchy of your business organization and the degree of work allotted to each employee. It should also allow you to make payments to your employees via direct deposit.
Top 5 Payroll Software for International Employees in 2022
Description: Global payroll software for remote teams that allows the hiring of and payment to employees easily and quickly.
Best for: Businesses of all sizes
Pricing: Monthly billing, no credit card needed to sign up. Charges will be levied only once you have paid a new team member. Pricing is as follows:
Hiring contractors: $49/contractor/month
Hiring Employees: Free. Contact Deel for more details.
Evaluation of key criteria:
- Security: Yes, GDPR compliance ensuring data encryption, Single sign-on to authenticate access to your Feel account, ISO 27001 framework.
- Legal compliance: Yes, localized contracts in over 150 countries for both employees and employers with constant renewal to stay updated with local laws, payment of local government fees, to name a few.
- Automation of payroll features: Yes, including automation of local tax filing process (as essential when working with US contractors), personalized support for employees, a self-service portal, to name a few.
- Ease of making payments: Yes, direct deposit, with efficient handling of payslips, collecting pensions, filing returns, reviewing salaries, and running payroll with one click with all global payroll data in one place.
- Provision for early withdrawals as seen against advanced pay cycles.
- Ease of use and excellent customer support
- Value for money
- Time-consuming resolution of user issues, although it is a rare occurrence
- An unexplained transaction fee in some cases.
Description: Cloud-based HR platform with integrated applicant tracking (ATS), simple onboarding tools, performance management, and more through a user-oriented mobile app.
Best for: Small and medium-sized businesses.
Pricing: Offers a free trial, but not a free version. Contact Bamboo HR for pricing details.
Evaluation of key criteria:
- Security: Yes, native multi-factor authentication, annual third-party SOC II security audit, frequent checks for vulnerability, compliance reports on request, encryption of information to be transferred.
- Legal compliance: Tax compliance is available, along with compliance tracking. For the availability of localized contracts, Bamboo HR can be contacted individually.
- Automation of payroll features: Provision of a self-service portal, sick leave tracking. Regarding complete automation, contact Bamboo HR.
- Ease of making payments: Yes, with the feature of direct deposits. Contact Bamboo HR for more details.
- Provision of different portals for users, such as allowing employees to manage their own records
- Ease of HR work
- Easy-to-navigate user interface
- The payroll features are not fully integrated.
- The system is not intuitive.
- Absence of updates for the UX/UI
Description: All-inclusive HR platform that eases the process of payroll, IT, HR through automated work, all at one click.
Best for: Businesses with 1-1000 employees.
Pricing: Pricing starts at $8/month/user. A custom quote can be requested individually according to the services you need. A free trial is available.
Evaluation of key criteria:
- Security: Yes, SOC II Compliance, GDPR compliance, transfer data managed via standard contractual clauses, CCPA Compliance (inbuilt CCPA employee notices).
- Legal compliance: Yes, local, state, and federal compliance concerning tax registration, payroll tax filing, ACA, COBRA, minimum wage laws.
- Automation of payroll features: Yes, leave tracking, payroll management, and reporting.
- Ease of making payments: Yes, automated payroll features, direct deposit. Contact Rippling for more details.
- With Workflow Automator, actions can be triggered to third-party apps like Slack and Zendesk. Automation is not limited to IT, HR, and finance systems.
- Single source of truth for all employee data
- Seamless integrations
- Rapid onboarding of employees
- Customer support is available by email and not call. Although this gives you room to have your questions answered, sometimes, an instant reply would be more beneficial.
- Employee relations is not yet a feature.
- More control in customizing the Employee Home is desired.
Description: Complete platform for payroll services with complete automation for tax filing, all in a few clicks.
Best for Startups of all sizes with varying needs and degrees of compliance.
Pricing: Four plans are available at different prices according to the complexity of features needed
Core: $39/month + $6 dollars/person/month
Complete: $39/month + $12/person/month
Concierge: $149/month + $12/person/month
Select: Contact Gusto.
Evaluation of key criteria:
- Security: HIPPA-compliant, SOC Compliance AES-256 key encryption for data at rest, Amazon Web Services (AWS) to host servers and to support services, multi-region set up for infrastructure, access to employees is limited based on responsibility, third-party vulnerability scanning, two-factor authentication
- Legal compliance: Yes, compliance with convoluted wage laws across jurisdictions
- Automated payroll features: Yes, with automatic deductions and filings, W-2s and 1099s, automatic savings, 401(k), a self-service portal, and more.
- Ease of making payments: Yes, direct deposit with complete payroll reporting and management, reminders of when the payroll has to be run, and provision for editing employee data for days off. Contact Gusto for more details.
- Stands out for assistance in the preparation of forms for SBA loans during the pandemic
- Efficient onboarding tool that ensures all state and federal requirements (E- verify) have been met
- Efficient handling of paperwork for tax, administration, and immigration through an excellent interface
- Some areas are not as flexible.
- Submission of a feature request takes longer than the time taken to implement
- Customizable Report options need to be developed further.
Description: All-inclusive online HR management platform that accommodates recruitment, payment, and managing employees.
Best for: Small businesses to mid-sized enterprises.
Pricing: No free version or trial available. Contact Pay Chex.
Evaluation of key criteria:
- Security: Multi-factor authentication (MFA).
- Legal compliance: Yes, with over 200 compliance experts
- Automation of payroll features: Yes, employee self-service portal available, "People View," effortless filing of payroll taxes, 401(k) tracking, W-2 preparation
- Ease of making payments: Yes, option to choose from three different pay entry alternatives, direct deposit
- Excellent customer service leading to ease of use.
- Easy to navigate and obtain W2s and pay stubs.
- The easy-to-use mobile application allows access to complete payroll data in one place and at any time, including tracking non-exempt employees' hours and direct incorporation into the payroll system.
- Entering particulars of employee payroll data, such as expense reimbursement or reimbursement for medical insurance, needs to be done individually.
- Customized access is difficult. Employees have access to all data that may not be relevant to their job duties.
- Simple features like employees being able to change their mailing addresses themselves are not available. Instead, they must fill out a form for payroll admin and then contact Paychex individually for such a simple change to be made.
Learn more with us
- What is the Payroll Process | AbstractOps
- The Best Payroll Processing Software for a Startup | AbstractOps
- Top 10 Payroll Software for Startups in 2021 | AbstractOps
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At AbstractOps, we help early-stage founders streamline and automate regulatory and legal ops, HR, and finance so you can focus on what matters most—your business.
We can help you decide which payroll software to use for international employees. Learn more.
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Note: Our content is for general information purposes only. AbstractOps does not provide legal, accounting, or certified expert advice. Consult a lawyer, CPA, or other professional for such services.