CIPP FUTURE OF PAYROLL REPORT 2019
Blockchain and pay on demand
What is blockchain? What is blockchain and how will it start to impact on payroll? The October 2018 edition of the CIPP’s magazine Professional in Payroll, Pensions and Reward includes an article that lifts the lid on blockchain. Please refer to this to deepen your knowledge of blockchain: https://online.flippingbook.com/view/351337/49/#zoom=z Have you heard of blockchain? Unsurprisingly, only 15.75% of the respondents have heard about blockchain and the potential impacts on payroll. For those who run international payrolls, the following may be something that you might be looking into (https:// www.balancepointpayroll.com/blockchain-will-impact-hr-industry/) “HANDLING PAYROLL OVERSEAS IS EXPENSIVE AND TIME-CONSUMING DUE TO THE CONSTANT CHANGES IN EXCHANGE RATES AND THE NEED FOR MULTIPLE BANKS. THE BLOCKCHAIN-BASED PAYROLL SYSTEM BITWAGE IS CHANGING THAT BY MAKING IT POSSIBLE TO PAY INTERNATIONAL EMPLOYEES WITH BITCOIN. THE FLEXIBILITY AND LOW FEES ASSOCIATED WITH USING CRYPTOCURRENCY REDUCES THE COMPLICATIONS AND COSTS.“ Blockchain being used as an alternative payment method in the future? Of the people who responded ‘yes’ to the above, only 13.7% saw this as a possible change whilst 50.68% stated that it might be a ‘maybe’. At this point in time this could go either way, but certainly there seems to be more and more evidence that it’s probably going to come in sooner rather than later in some shape or form; another one to watch. Certainly, 33.33% of the respondents stated a ‘maybe’ whilst the other response was a flat ‘NO’. What is pay on demand? As the name suggests, pay on demand is a service which enables workers to ask for payment as and when they ask for it, rather than on their contractual pay day. Currently more prevalent in the US, it is likely that pay on demand has arisen as a result of the increase in the gig economy where workers are paid as they complete each gig, or short-term contract. However, there is one important distinction that must be made here, and that is that under the gig economy, the workers are freelance contractors who can demand payment after each contract has been completed, rather than contracted employees, where their contract of employment will most likely include their payday and frequency. Although recent court cases may affect that employment status. There are several companies now offering this service in the UK, most describing how their services meet the growing change in approach to work amongst some workers, and their changing views on pay; these businesses also claim to offer financial education, awareness and wellbeing to employees. A true pay on demand arrangement would have a significant impact on payroll, which must meet the obligations placed upon it by legislation which requires a full payment submission to HMRC on or before the date payment is made to the worker. This would render pay on demand unworkable for payroll without a legislation change. Add For those respondents who haven’t heard of blockchain, you may want to investigate it further to understand the impact that it might have on your payroll.
Made with FlippingBook - Online magazine maker