The Payroll Operations Survey summary of results - Deloitte US

[Pages:27]The Payroll Operations Survey summary of results

December 2014

Deloitte LLP is pleased to present the summary of the results from the 2014 Payroll Operations Survey. As the second survey of its type conducted by Deloitte, this year's survey continued to evolve the questions associated with U.S., Canadian, and Global organizations' payroll in the following areas:

? Payroll operations ? Technology ? Workforce management

? Outsourcing ? Compliance and taxation ? Quality and continuous improvement

The survey was completed by experienced professionals in a wide range of industries who are directly involved with the payroll function at their respective organizations. Fifty-eight companies participated in the survey representing both global and domestic organizations. The companies ranged in size from fewer than 200 active employees to over 300,000.

The approach taken with the payroll survey was to dive deeper into the systems and service delivery models within each of the global regions: North America (NA), Asia and Pacific (APAC), Europe, Middle East, and Africa (EMEA), and Latin America (LA), providing insights into the similarities and differences among them. One of the observations included the fact that some global organizations do not have full transparency into their global payroll operations.

Many of the results were analyzed by the number of employees within an organization, which revealed several trends associated with shared service centers, outsourcing, and payroll technology.

Some of the findings and trends identified from the survey responses include:

? The majority of organizations centralized payroll into a shared service center located in North America

? 90% of organizations utilize online payroll self-service

? There is growing interest in cloud-based applications, but global payroll solutions are limited at this time

? Time and attendance systems are the prevalent workforce management technology with 84% of the respondents utilizing

? 74% of organizations have fully documented pay policies, but 68% feel that they are beginning or still developing their workforce management strategy

? Full payroll outsourcing is more common outside of North America; however, satisfaction with the payroll outsourcing arrangement is higher in North America

? Organizations with business travelers continue to be challenged to track and manage mobility for U.S. state and global taxation reporting

? Payroll departments are utilizing a variety of tools and techniques to monitor internal and outsource vendor service quality

We hope you find the results of this year's survey useful. If you have any questions regarding the survey or specific payroll operations or tax challenges, please do not hesitate to contact the payroll and employment tax specialists listed at the end of the report, or me directly.

With best regards,

Beth Shanton Director Human Capital HR Transformation Deloitte Consulting LLP Tel: +1 404-631-2336 Email: bshanton@

As used in this document, "Deloitte" means Deloitte LLP and its subsidiaries. Please see us/ about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.

The Payroll Operations Survey summary of results 1

Survey highlights

Section 1: Company demographics ? Payroll generally reports to Finance in organizations

with less than 10,000 employees and to HR or Shared Services in organizations with over 10,000 employees

Section 2: Payroll operations ? 60% of respondents have a Payroll Shared Service

Center with 91% having one located in North America

? 33% of respondents manage responsibility for global payroll processing regionally while 27% manage by country

? 88% of employees are paid via direct deposit, 6% receive live checks, and 5% receive pay cards

Section 3: Technology ? In North America, PeopleSoft, SAP, ADP, and Ceridian

are the most common payroll solutions in use

? 26% of respondents are considering cloud-based technology to support payroll functions, while 14% are already using cloud-based services

Section 4: Workforce management ? Time and attendance, labor scheduling, and budgeting

are the most common systems in place as part of a workforce management strategy

? 75% of respondents feel their organization's work and pay policies/procedures are fully documented

? 68% of respondents are beginning or still developing their strategy for workforce management

Section 5: Outsourcing ? North America continues to outpace other global

regions in terms of scope of payroll services outsourced

? Organizations that outsource payroll services outside of North America tend to be less satisfied with their current outsourcing arrangement

? The majority of respondents are not considering changing their scope or services or geographic scope of payroll service outsourcing

Section 6: Compliance and taxation ? 33% of respondents utilize travel and expense data to

track U.S. domestic business travelers, but 40% do not track or were not sure how or if they track their U.S. domestic travelers ? 21% of respondents utilize travel and expense data to track global short-term business travelers, but 43% do not track or were not sure how of if they track their international travelers ? Year-end processing, defining withholding responsibilities, and reporting income locally were the greatest challenges or risks facing organizations with a mobile global workforce ? 50% of respondents outsource tax reporting to help mitigate the risks associated with global mobility payroll processing

Section 7: Quality and continuous improvement ? 63% of respondents reported having governance

policies covering the Payroll function ? 81% of respondents conduct periodic reviews of their

payroll process ? 82% of respondents have Service Level Agreements

(SLAs) established and track and monitor them

Throughout the report, the following abbreviations are used for the four global regions: ? APAC: Asia and Pacific ? EMEA: Europe, Middle East, and Africa ? LA: Latin America ? NA: North America

The Payroll Operations Survey summary of results 2

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16%

Government and

9%

public sector

Section 1:

21%

5% 3%

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9%

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What is your company's primary industrTye?chnology, media, and How many active employees are on your payroll?

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75%

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40%

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40%

60%

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23%

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< 1k

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77%

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organization

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No, one already exists

5k- ................
................

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