Most companies hardly think of payroll as a contingency measure during a crisis because they are busy worrying about sustaining sales, marketing and delivery systems to cut down losses and debt. With wide-spread economic implications like the one brought out by the Covid-19 pandemic, organisations all over the world face a simultaneous onslaught, forcing CEOs to dash haphazardly over recovery strategies.   

Aon’s COVID-19 Pulse Survey titled ‘Setting the Stage for a Return to Work and the New Normal’ published on 6th May 2020 points out that only 7.5% of HR departments have been rated as sufficiently trained, equipped and ready by respondents in Malaysia and Singapore. While 58% trust their employer is taking actions to protect their health and safety, 67% are confident in their employer's financial resilience.

While the state of suspended economic activity continues, companies still find themselves legally responsible for paying their employees even during the office closure. Companies who have furloughed their employees for now will need to start paying them once the directive is lifted, as the end to the crisis is nowhere near in sight. This raises a common question: what happens to payroll during this time?

Although government bodies and tax departments are extending deadlines to ease financial burden on businesses and individuals, filing requirements and deductions will follow when one least expects it. Predicting the flow of events can be tough but minimizing the impact can be a great addition to every organisation’s risk management strategy. 

An article on on ‘Managing through Emergency and Disaster’ enlists employee compensation as a major obligation during disasters. The article states that employers will need to consider ways to deliver paychecks to employees and should consider state laws for timelines in doing so.

Many organisations are witnessing several payroll situations arising out of the lockdown. Companies are working at half their capacities with more employees embracing shifts and hourly work. Some departments are working from offices while others are contributing online. Payroll, in all these cases, has to be structured and well-documented despite erratic schedules and work hours.

Several firms are also engaging their employees to multitask and work simultaneously across departments. Many of them are faced with more tasks than the ones they have been doing before the outbreak took place. There are others who show up just for an hour’s work at the office and finish the rest from their homes.  

Global companies that have offices and expat workforce in other countries need to abide by labour standard laws in their country and provide full payment to their employees even if the worksite closes due to disasters or other issues. They also have to offer hazard pay, insurance claims and be mindful of wages linked to on-call services and volunteer work where employees are called in to assist employers, notes US law firm Duane Morris LLP on

With a great deal of structured payroll going into such sharp detail even during company shutdown, it is only wise to employee a payroll solutions organisation to ensure the employer is exempt from labour penalties. Payroll reporting by way of online payslips and cloud services should be a continuous service that is offered to all employees regardless of pay cuts or furloughing.

Liquidity and cash flow may be seemingly tight at the moment but even more important is the need to ensure proper accounting of the money that actually comes in and goes out. Maintaining payroll when times are tough will enable a smoother bounce back when the business gets back to its feet post crisis. It will also help employees have their confidence in the employer and boost performance in days to come. 

Professional payroll solutions agencies offer services that help to streamline pay on a case-to-case basis, depending on employees’ work hours and changing compensation. They also work to make sure employee taxes are paid on time and in accordance with crisis-led regulatory changes. As employee mobility experts, they are qualified to meet all expat employee needs with utmost care and caution. 

Having a payroll solutions partner simplifies day-to-day costs handling of the workforce and compliance concerns to a large extent. Companies can also transfer payroll-related queries and interactions to the cloud once they merge with an external payroll solutions provider. As direct HR handling of payroll ceases to function, availability of payroll data online is a welcome move for employees working from home and wanting to access their information.

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