Running to the Cloud: Why Enterprise Companies Need a Cloud-based Payroll

Why Enterprise Companies Need a Cloud-based Payroll

As businesses re-examine how they operate in a post-pandemic world, it is increasingly evident that any agile, forward-thinking enterprise operating in a global marketplace must embrace the cloud.

Whether it’s the easy scalability, portability, or access, using cloud-based services and mobile technologies instead of fixed systems and infrastructure can deliver several benefits to the modern global business.

At the same time, as cyber security continues to be a risk factor from enterprise companies to SMBs, the data of individuals and organizations becomes an increasingly valuable commodity. Therefore, it is essential that the most data-rich aspects of your business, such as global payroll, are as secure as possible and that you are operating in accordance with all relevant data laws.

Why running a global payroll can be prone to data security issues?

Any company’s payroll contains a great deal of highly sensitive and private data. Protection against theft or accidental loss through a cybersecurity breach is therefore essential. Some 38% of businesses in the UK were subject to a cyberattack in the 12 months to March 2022.

At the same, the necessity of ensuring that you are adhering to the specific data protection requirements of the various jurisdictions in which you operate can be both a burden and a challenge, with severe repercussions for any breaches of regulations. For instance, violating the GDPR (General Data Protection Regulation) can lead to a fine of up to 4% annual worldwide turnover.

Ultimately, no matter where you operate, all enterprises not only have a responsibility to safeguard employee data and privacy, especially the sort of sensitive material it is necessary to gather and store for the effective delivery of global payroll services but also to understand, implement and adhere to local legislation in terms of ensuring privacy and data security.

At the same time, international companies need a payroll system that is sufficiently flexible to meet both their needs and those of employees in terms of pay rates for permanent workers and contractors, pay cycles, retention of information, access to data, etc. And which can also support your business when it comes to ensuring compliance with local tax rates and the privacy regulations of different jurisdictions where you have employees.

In short, the challenge for global companies is striking a balance between having ready access to the necessary personal data needed to deliver efficient payroll services and ensuring that data used and stored are secure and compliant.

How the cloud can provide secure payroll solutions

Cloud-based payroll offers global companies solutions for these and other issues connected to the safe delivery of payroll services.

Different countries and regions have separate tax and withholding rates, so when companies have employees in multiple locations around the world, ensuring that you are fulfilling these requirements in every place and for all employees can be challenging.

However, cloud-based payroll software can be configured to automatically carry out functions such as withholding tax or other amounts as required, ensuring that you are always meeting your obligations in this regard. In this way, neither employees nor the organization is at risk of failing foul of taxation authorities.

Automated cloud-based payroll also delivers additional security in terms of protecting personal data and managing GDPR compliance. For instance, it can ensure that all consent forms around personal data are secure or that it only shares information via the platform itself and with those who have secure access, rather than through email or other messaging services (one of the primary ways in which hackers can access confidential data).

In addition, using a cloud-based accounting and payroll package means that any software updates are taken care of for you, as a matter of course, as are security upgrades. This means you avoid downtime, time-consuming manual upgrades, and the need to house expensive servers and other technology on your premises.

The overall benefits of a cloud-based payroll solution

In summary, several significant benefits can be derived from moving your global payroll to a cloud-based platform:

  • The system supports your team in ensuring that you comply with all relevant local data protection laws for any jurisdiction where you have staff or contractors.


  • A cloud payroll system can be configured so that tax and other withholding amounts are automatically adjusted, especially in countries with multiple tax codes or where the regulations are constantly being changed.


  • You have greater payroll flexibility and can respond to the different needs of groups or regions, e.g., when shorter pay cycles are required, when workers and contractors are paid at different rates and times, etc.


  • Ensuring that valuable data is being kept secure and that your cyber security is up to date and up to the job is made more accessible by the fact that you are not required to undertake updates and upgrades manually; your cloud service provider automatically applies these.


  • As your data is stored on external servers, rather than on your own servers or individual team members’ laptops or desktop computers, you have more flexibility as to where and how your team works and can be more responsive to changing circumstances while still ensuring high levels of security for your payroll data.

Utilizing the cloud, therefore, gives you greater flexibility and agility while always ensuring that you have the most up-to-date security protocols in place and that these are protecting your valuable data 24/7.