unresolved compliance problems jeopardise this. For Payroll managers, wage compliance failures translate into overwhelming operational challenges. Addressing systemic errors requires revisiting years of payroll data, ensuring compliance with complex awards and agreements, and handling employee grievances - all under tight timelines and public scrutiny. Beyond these immediate challenges, the reputational risks tied to wage compliance loom large. The public exposure of wage issues can tarnish an organisation’s brand, making everything from talent acquisition to consumer sentiment harder to sustain. Financially, wage underpayments can create liabilities spanning many years. Finance leaders are acutely aware that the financial impact of correcting these issues - combined with interest and, potentially, penalties - can amount to millions of dollars.
These outdated approaches often missed hidden liabilities, leaving Payroll, HR, and Finance teams to deal with the fallout post- acquisition. However, heightened regulatory scrutiny, stricter laws, and public awareness of wage theft have changed the game. Why It Matters: Risks for Payroll, HR, and Finance Leaders The risks tied to wage compliance span multiple domains relevant to these leadership roles. Financially, wage underpayments can create liabilities spanning many years. Finance leaders are acutely aware that the financial impact of correcting these issues - combined with interest and, potentially, penalties - can amount to millions of dollars. Overstatements of valuation due to misjudged labour costs can further compromise profitability, leaving the finance team scrambling to adjust forecasts. For HR directors, wage compliance undermine morale and retention, while rectifying overpayments may anger employees, worsening post- acquisition challenges. Maintaining a stable workforce during the integration phase is critical, and is an employee trust issue. Historical underpayments
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ISSUE 8 GLOBAL PAYROLL MAGAZINE
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