These key factors can slow down your business expansion plans.
Setting up processes to manage the hiring, terminating and paying of employees is 'extremely' or 'very' complex in 42% of jurisdictions, according to a new business complexity survey of 76 locations across the globe.
The complexity lies in local labour laws, reporting requirements and significant difficulty for businesses wanting to hire personnel before being legally incorporated in a new jurisdiction, making it harder for them to hit the ground running.
The Global Business Complexity Index highlights the impact of frequent changes in human resources and payroll (HRP) laws. These changes occur 'very frequently' or 'quite frequently' in 45% of jurisdictions. Greece, ranked first in the Index for business complexity, has applied many of its recent changes retroactively, so businesses must move swiftly to meet new obligations.
For example, a decision published in March by the country's Independent Authority of Public Revenue completely changed the way companies need to submit their monthly withholding tax reports on a government reporting portal. The social security contributions calculation threshold changed and the minimum wage increased. It falls to payroll staff to retroactively administer these changes.
"Often, it takes local knowledge and expertise to truly understand and comply with labour laws in a particular country" says Anne Clifford, Global Head of HR and Payroll at TMF Group. "This is even more the case when payroll legislation continually changes."
"HRP environments across the globe that used to be deemed stable have become less predictable. Constant vigilance is needed because, when changes happen, you need the right speed and level of local insight to be able to respond quickly and deliver for your employees."
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TMF Group's wholly-owned local office network stretches across more than 80 jurisdictions. Our experts provide HR and payroll services in-country, in the local language and in line with local laws and regulations. Need more information? Contact us today.
Navigate the hiring, terminating and paying of employees in 76 jurisdictions worldwide – download the free report.
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