How can an outsourced payroll provider reduce the strain of GDPR?

The General Data Protection Regulation (GDPR) will apply not only to any company based in the EU, but also to any business that processes the personal data of EU citizens regardless of where they are situated. With GDPR less than seven months away, we all know it’s coming – but what does it mean for payroll departments?  Businesses need to carefully consider this question ahead of the May deadline, and look at ways to ease the strain on their organisations overall.

Here’s four key GDPR payroll challenges, and how an outsourced provider can help:

Soothing the compliance headache

Payroll is driven by local legislation, and businesses need to ensure these laws (for example those under GDPR) are followed in whichever regions they operate in, to ensure peace of mind. With an outsourced payroll provider, you don’t have to become an expert in each region in terms of governance and compliance. Instead, you can rely on that provider to ensure you remain compliant, whatever the legislation and in whichever region – GDPR or otherwise.

Outsourced payroll providers understand that achieving the right balance between the local and global aspects involved in payroll, in terms of ensuring compliance with all local market legislation—including GDPR—while optimising the efficiency benefits that a global offering can deliver, can be done by building systems with a global outlook and local knowledge in mind: a modern-day, bottom up payroll services approach.

Improving Accuracy and Reliability

Payroll mistakes can be extremely detrimental to any organisation. The pressure to avoid such mistakes increases with the strain of GDPR. Unless you have an automated system and fully trained, capable payroll staff, who are more than adept to deal with complex regulations in place, your payroll department will probably end up making the occasional mistake.

By making the mistake of failing to comply with GDPR, you risk angering not only the government but your employees too, who will be far from impressed to know you are handling their data incorrectly. In addition, you could be looking at fines of up to 4% of your total annual revenue. With a reputable outsourced payroll service provider, you are far less likely to become the victim of an error, including one related to GDPR non-compliance, than handling payroll processes in-house.

While your staff may be highly skilled, there is always the chance that one of them will fall sick or be on holiday. Even the slightest change to routine can cause problems for payroll departments: it’s essential to ensure that organisational output remains unaffected. Outsourcing payroll is a guaranteed way to ensure nothing changes, regardless of time off. It also saves huge amounts of time and provides peace of mind, simply because you won’t have to help new members of staff get to grips with your payroll system, or go through the processes of helping them to understand how GDPR affects payroll processes.

Staying secure

Organisations hold the details of personnel online in all offices, potentially all over the world, thus potentially exposing themselves to all sorts of sophisticated cyber-attacks. With financial data being a core part of payroll department records, it’s essential that every element of your business is prepared and able to robustly defend itself against attacks. To do so, your business needs to implement the right infrastructure: some companies simply don’t have the resources to ensure details are kept safe. Outsourcing to a payroll service means you’ll be benefitting from industry specific technologies which are able to prevent such attacks from occurring. When it comes to GDPR, organisations will have a 72-hour window in which to notify authorities of a breach: but with an outsourced payroll provider, you stand a much better chance of avoiding them happening in your payroll department altogether.

Minimising costs

It goes without saying that organisations look to save costs wherever they can, particularly if they are looking to expand globally (globalisation is expensive). With the risk of paying out hefty fines if they fail to comply with new GDPR laws, companies can’t afford to make unnecessary costs elsewhere, or make mistakes. By outsourcing, businesses can allow for the appropriate level to be paid in a lower cost location. Combined with the savings which come from consolidation and automation, a company will be much better placed to move forward with expansion, in addition to ensuring compliance with GDPR.


Organisations need to recognise payroll services as a key part of their journey to GDPR compliance: the regulation can appear daunting and complex; therefore, outsourcing can be a beneficial option to any organisation that is preparing for GDPR, and looking to improve overall processes. By relying on the expertise of a reputable payroll provider, businesses can ease the overall strain of GDPR by soothing the compliance headache and improving payroll accuracy, reliability and security. With the right provider, you can relax in the knowledge that you are in safe hands when it comes to achieving total GDPR compliance in your payroll department.

Advertisements