FEATURE INSIGHT
Sam Bennett, head of compliance and operations at Frontierpay, identifies barriers and provides advice Paying your international workforce
E nsuring that employees are paid in full and on time is crucial to the success of any business. However, as employing workers overseas continues to become more common, many companies are wrestling with the process of international payroll. We’re finding that this is happening for a variety of reasons. In many cases, it may be a case of struggling to get to grips with a foreign country’s financial laws and regulations, but in others, we are seeing some more surprising influences at work. ● Don’t pay African warlords – This is a scenario that most businesses won’t have considered. While it may sound bizarre, an unfortunately named company can cause major problems when making international payments. A leading global IT firm has inadvertently been a prime example of this. The company has previously run into difficulty when trying to pay its international workforce, as payments
have regularly been delayed by banks’ compliance departments to ensure there is no affiliation with a similarly named African warlord, who is prominent on global sanctions and watchlists. This may seem an extreme example, but to ensure your own business steers clear of similar difficulties, a specialist payments company will be able to provide expertise on formatting and anti-money laundering requirements. ● What’s in a name? – It’s not unheard of for the name of an employee, rather than the company, to be occasionally the factor that throws a spanner into the payroll process. For example, payments to employees with more common names (John Smith, Mohammad Iqbal) can be held by a bank’s compliance department whilst they are cleared as a false positive for other more unsavoury characters with the same name. For payroll managers to overcome this hurdle, having a copy of the employee’s passport on file will help
to ensure seamless delivery, as full names and date of birth can be required to clear compliance requests; pre-emptively providing these will avoid delays. ● Home for the holidays – Banks are often closed for public holidays and the majority of businesses will already be aware that they must take this into consideration to ensure that payroll isn’t affected. Where there is potential for businesses to struggle, is when public holidays don’t consistently fall on a set date each year. Ramadan, for example, is fluid and can change depending on the lunar cycle. Without adequate preparation, delays can easily happen if your staff are based in a number of countries where you might not be familiar with the local holidays. You can be sure however that they won’t let you forget about it again if their wages haven’t cleared because the bank was closed. I would strongly advise that payroll managers therefore keep a close eye on the global calendar. ● Tax and social security requirements – It should come as no surprise that different countries have different requirements when it comes to financial regulations, such as taxes, social security
...specialist payments company will be able to provide expertise on formatting and anti-money laundering requirements
| Professional in Payroll, Pensions and Reward | May 2017 | Issue 30 44
Made with FlippingBook - Online catalogs