Primer on Our Global Payroll Technology
Alex Margolin| Nov 03, 2020
The Papaya Platform is a complex combination of interconnected technologies that operate as a seamless whole. Working together, the platform automates global payroll, consolidates payroll data into a single view, standardizes data, and ensures compliance in over 140 countries, each with its own reporting style, language, and payroll system.
The Papaya Platform is an end-to-end solution to hire, onboard, manage, and pay employees across the globe – one solution for the whole process. It accomplishes all of it through a series of steps that employ a range of technologies.
Pulling Information from all Data Sources
The most fundamental challenge in generating a global payroll – and why there is no substitute for payroll automation – is the vast range of data that needs to be processed at the start of each payroll run.
Payroll does not look the same in any two countries. Each country has its own formatting, regulations, tax codes, language, and currency. The line items on every country’s payslip are different. It is deeply fragmented, and there are enormous variations from one place to another.
In addition, information is delivered through all different APIs and file formats. Managers need to report time and attendance for each employee, along with other relevant information such as expenses, commissions, and much more. There is no standard format for these reports. Some send Excel spreadsheets; others send Word documents or PDF files.
In order to “read” all of the data that goes into the payroll process, the Papaya platform uses Optical Character Recognition (OCR), a technology that converts images into text files.
OCR is sometimes referred to as the “eyes” in a technology suite because it “sees” the data in image formats such as PDFs and converts it to text that can later be processed. At Papaya, it serves as the first step towards taming the wild beast of data at the beginning of the payroll process.
Converting Data into a Single Format
After the OCR turns the incoming data into text files, those files are still a wide assortment of file-types and styles and need to be standardized into a single format in order for Papaya to process the payroll, make payments to tax authorities, and create a payslip for each employee across the globe.
The task of converting the files into a standard format is handled through Robotic Process Automation (RPA) a system that automates manual processes and improves workflows. RPA is capable of mimicking human action and is ideal for tasks that are repetitive, rule-based, and high volume, such as payroll.
Papaya employs RPA “bots” in a wide variety of operations including onboarding employees, integrating invoices, and processing payroll summary reports. In combination with artificial intelligence (AI), RPA bots can be taught to improve their performance and take on new tasks, freeing Papaya employees to focus on more essential operations.
The RPA converts the files into a single format, then the Papaya platform uses an Extract, Transform, Load (ETL) solution to translate the data into a recognizable format – the Papaya language standard. All of the information is sent back to the Papaya Platform to begin matching the data with the wide assortment of payroll items that need to be processed.
Consolidation into a Simple Ontology
When all of the data has been converted into a standard language, all of the payroll components need to be mapped into their proper place. Salary elements need to be separated from pensions and bonus payments, etc. Each item that appears on a payslip is separated for each employee.
This process is accomplished through the use of accounting codes. These codes make it possible for the system to distinguish the different elements. For example, in the UK, a popular pension scheme is called “Scottish Widows.” By the use of accounting codes the system recognizes it as such, not as insurance or any other payroll element.
Ultimately, the result is a simple ontology of all payroll elements broken down to their basic components. The ontology lets each employer know exactly how much is being spent on each payroll element.
It would be virtually impossible to process all this data manually, especially when there are multiple countries and hundreds, if not thousands, of employees involved.
Automated Data Verification
Once all of the payroll costs have been separated into their essential elements, the platform can run an automated verification of all the data. The verification ensures that the payroll amounts are correct and that every payroll is in full compliance with the local tax and labor laws.
The platform already has a built-in cost structure for each employee, constructed during the onboarding process, with changes updated each month during the “salary updates” step in the payroll run. The cost structure includes salary terms, benefits, and more. That allows the platform to verify the current data to ensure that it matches with the expected costs. If something is missing – for example, if the salary figures do not match – the platform will spot the discrepancy and send an alert.
The platform also generates a payslip for each employee and carries out an automated audit for each item. If all of the figures match correctly, the platform makes the payslip available for each employee in the local language, and uses the local currency.
Generating Reports and Notifications
Once the data is verified, it becomes available for analysis. The system provides a wide range of useful analytics tools to help companies stay in control of their payroll spending. Without these Business Intelligence (BI) reports it would be hard for companies to know how much they are spending on payroll at any given time, or even exactly how many employees they have overseas, not to mention the real costs for each one.
But with the advanced BI generated by the Papaya Platform, employers can see their spending in real time, and compare costs over periods, projects, or locations to identify the biggest expenses, discrepancies, and changes. Without Papaya’s real-time reporting suite, it would be impossible to stay on top of payroll spending, which often accounts for as much as 75% of a company’s expenditures.
The information collected in the database also allows companies to automate the notifications they receive from the Papaya platform. That way the employer is fully informed about every stage in the payroll process.
Delivering Cross-Border Payments
Once the payroll has been calculated and verified, the next stage is for the employer to approve the payment. Each company sets its own approval policy, creating a chain of approvals. Once the employer has determined the flow of approvals, the process can be automated through the platform.
When Papaya receives all of the approvals, it begins the final stage of the payroll process – payments to all global employees simultaneously in their local currency.
Payments are made through direct debit through a direct API integration with 3rd party payment providers. Since the Papaya platform is system-agnostic, it integrates with all Human Resource Information Systems (HRIS), Enterprise Resource Planning (ERP), Vendor Management Systems (VMS), Time and Attendance, and Expenses Management Systems.
By integrating with these workforce tools, Papaya eliminates the need for manual data transfer and the possibilities of double transfers. It saves time and keeps the data secure and confidential.
The payments are delivered in full legal compliance, and the payslips are accessible through Papaya’s special portal for employees, in compliance with GDPR and all related legislation.
Get the Papaya Experience
Papaya Global offers a total workforce management solution supporting all types of global workers (payroll, EoR, and contractors) in over 140 countries. The automated, cloud-based SaaS platform provides an end-to-end solution, from onboarding to on-going management and cross-border payments.
The platform integrates with all existing workforce management tools, provides real-time business intelligence, and eliminates errors. It gathers all employee information into one place, creating a highly visible system for tracking payroll spending. The platform ensures GDPR and SOC compliance to maintain the highest standard of security.
If your global payroll does not offer automation, data verification, and an RPA engine, you are not getting the most out of your payroll platform.
Contact us to learn more about our innovative offering and our groundbreaking platform for managing global payroll.