Your workforce in 2021: compliance in a changing world

High-performing organisations take it as a given that recruiting and retaining the best talent unlocks competitive advantage. But the challenges of Covid-19 have accelerated the demands on HR leaders: in a changing marketplace, the challenge is to equip the organisation with the agility that’s now essential for success while simultaneously delivering compliance.

This will be a key battleground in every industry. Research by McKinsey¹ found that employees who have relationships of trust with their employer are 24 per cent more effective in their jobs, 48 per cent more engaged and have a sense of wellbeing that is 45 per cent stronger. And a positive employee experience translates to an enhanced customer experience.

Strategies for growth

Harnessing that positivity calls for a holistic approach. HR must be ready to collaborate, establishing strong partnerships with functions such as finance to ensure that the workforce is ready to sustain the organisation’s path to scalable growth.

“Winning businesses are going to spend less time on manual tasks and more time strategising on how to drive growth,” says Cindy Yi, a vice president at Ceridian, a global leader in human capital management (HCM) technology. “The intelligent use of data and technology will be at the heart of those strategies, supporting modern employee experiences that deliver quantifiable value.”

Take the complex compliance challenges of worker status as organisations try to plan scheduling and payments. The pandemic utterly disrupted well-established scheduling patterns and trends such as the rise of the gig economy. And that disruption will continue post-crisis, requiring organisations to manage more complex pools of employees: staff may be paid in different ways to one another, be taxed according to different regimes and qualify for different benefits; and the detail may vary according to location.

“We are already beginning to see people think about work and pay differently. For example, gig economy workers may want access to real-time pay,” says Yi. “And this is going to be an issue for more and more employers, with knowledge-based organisations also now making use of gig workers; they are going to need to fill in the gaps in their compliance and workflow management processes.”

Rebooting benefits

Indeed, many organisations now need to face up to a full reboot of benefits and workplace access. Policies on leave are a good example. The traditional approach of supporting staff who need to take time off to look after children had to be expanded during the pandemic, when so many employees needed to care for parents or older relatives. The crisis also shone a spotlight on employees’ own health — both physical and mental — with wellness benefits now an important element of many employee packages.

Many employers are also looking to support the financial wellness of their employees. Too many people live paycheque to paycheque and have trouble dealing with unexpected expenses. On-demand pay is increasingly becoming part of a holistic financial wellness offering. In fact, the on-demand pay or early wage access market in the US grew from USD $6.3 billion in 2019 to $9.5 billion last year — a 51 per cent increase, according to research by the Aite Group. Beyond giving employees a stronger foundation for financial wellness, offering on-demand pay has contributed to lower employee turnover and better engagement in many industries. 

Another tough challenge for many employers has been managing staff reductions or furloughs. The imperative to upskill staff for alternative roles or to equip them for the labour market has never been stronger. Communicating with furloughed staff, not least to ensure they feel valued and connected, has brought further headaches.

Then there is the move to hybrid working. Organisations that have operated almost entirely remotely during the pandemic are now contemplating a permanent shift whereby staff return to the workplace but spend much less time there than before, working from home or another location the rest of the time. They may also want to work different hours. Research from Gartner suggests 94 per cent of organisations are allowing employees more flexibility over where and when they work.

Leveraging technology

Organisations that manage these issues adroitly will be in a strong position to accelerate out of the recovery. But the sheer number of moving parts that HR must manage makes this a tough challenge. A single, universal policy is likely to be out of the question, particularly for global organisations confronted by differing compliance regimes across multiple territories.

The solution has to involve increased use of technology. Intelligent human capital management platforms such as Ceridian’s Dayforce provide a means to automate much of the process of change. That might include anything from collecting notices of regulatory reform in international markets to tracking where and when staff are working so that benefits and taxes are calculated correctly. Such software can also support employee communications, from onboarding to keeping staff safe and healthy, to the process of departure. Indeed, many employers are now reaching out to staff, to better understand what they are looking for in this changing world and to support their efforts to become more diverse and inclusive.

Above all, suggests Ceridian’s Cindy Yi, the benefit of such a platform is that it provides a single source of the truth — a focal point for the collection and management of data across the organisation. “With so much unpredictability, we need to power collective sense-making,” she says. “Your ability as an organisation to make informed decisions will depend on the extent to which you can pull insight from your data.”