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Leavers and Payroll: Getting the Information You Need

Nov 17, 2014 

Payroll management is more than just ensuring employees receive their paychecks; it also encompasses all aspects of the employee lifecycle. And one area that is often overlooked is what happens when an employee leaves the company. There are often certain processes that a multi-national organization must perform to ensure those former employees are off-boarded appropriately and in full compliance with the local regulations of whichever countries in which they operate.

For instance, some countries, such as the U.S., have immediate pay policies; when an employee leaves, they must be paid off immediately. There are also different costs associated with leavers that vary across different locations. In other countries, such as Italy, the company is required to register a leaver with the government and file the necessary paperwork, creating additional costs and requiring more time to off-board the employee. Therefore, it is crucial that organizations leverage the right technology to ensure that they fulfill their responsibilities when an employee is terminated or resigns – and that they aren’t continuing to pay individuals who are no longer employed.

With an effective integrated cloud-based global payroll platform in place, with enhanced reporting capabilities, employers can do so much more than just gain greater control of the off-boarding process. The right solution can also use this information to enhance the talent management process. By collecting data around leavers, the company gains greater insight into its turnover rates across its various locations and can identify any potential problem areas if the rate is higher than it should be. As a result, management can refocus its efforts to retain current employees and attract qualified new talent. But without the insight into the number of leavers, length of tenure and the costs associated with off-boarding and finding new employees, management might never know there is a problem.

Still, one of the biggest challenges for multinationals, which can employ thousands upon thousands of people around the globe, is understanding how many employees they have at any given moment. Creating such reports can take the HR team a great deal of time. However, with an effective global payroll management system, the employer can access robust reports that take into account the leavers to provide an accurate, real-time glimpse of current headcount.

The challenges of managing employees around the globe are numerous, but understanding how many employees are in the organization at any given time shouldn’t be one of them. The right global payroll management system can collect this information in real-time, providing an overview of the number of leavers per country and the associated costs. Not only does this provide greater financial insight, but knowing where turnover is too high gives the insight to see how its talent management strategies impact business objectives. As a result, the company can use the data collected by the payroll system to identify potential problem areas, adapt its talent management processes and work to reduce the number of leavers.

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