When it comes to the disruption of the past two years, “I’m probably one of the first people to say we’re really thankful for that, because I think it led payroll to be the star,” says Danny Schulz, the newest member of our Global Executive Advisory Council and my guest for this episode of the #HRTechChat video podcast. He means payroll becoming the star at Kohler Co., where Danny is senior manager of payroll, systems, and taxes. So, naturally, we sat down to discuss best practices in bringing order to global payroll — something Danny and his team are well on their way to achieving.
“To me, payroll in general comes down to data and data flow. And the success of your payroll operation is really going to be dependent upon the success of your data. I’m a data junkie at heart. If you’re at a place where, from an organizational standpoint, you’re doing multiple data entry by humans […] you’re not going to get it right.”
It’s a scenario most global organizations encounter, before they ever set about to rectify the situation. This is because, once it gets to the point where leadership recognizes that global payroll needs attention, global payroll has almost always become exceedingly complicated.
Beyond the fact that it’s by-definition tough to solve for global payroll before you actually have global payroll, most organizations will wait till it becomes noticeably painful to process payroll globally. For some, it is then that they will look for a fix.
For others, and perhaps more often, “There’s some executive somewhere that wants the payroll data,” says Danny. The payroll teams (yes, plural) do their best to get this data from, let’s say, 16 different people, consolidate the data, and deliver it in a report. Suppose the process takes 26 hours to complete. The executive needs the information daily. A decision is made to make a change.
Depending on the size of the organization, it takes a lot of sleuthing to get global payroll right — figuring out who handles what, where, when, and with what system or systems. Think of it not unlike conducting discovery for a legal case. It’s to determine the organization’s current state.
There are, in fact, at least three best practices when bringing order to global payroll, according to Danny. One is to get your data right. Another is to corral executive alignment in your move to a strategy for global payroll. A third is to develop a roadmap and standardize processes.
Don’t worry. We haven’t stolen his thunder. Danny went into all this and much more during our chat. I encourage you to view the episode.
Our #HRTechChat Series is also available as a podcast on the following platforms:
- Apple iTunes: https://podcasts.apple.com/us/podcast/3sixty-insights/id1555291436?itsct=podcast_box&itscg=30200
- Spotify: https://open.spotify.com/show/0eZJI1FqM3joDA8uLc05zz
- Stitcher: https://www.stitcher.com/show/3sixty-insights
- SoundCloud: https://soundcloud.com/user-965220588
- YouTube: https://www.youtube.com/channel/UC6aDtrRPYoCIrnkeOYZRpAQ/
- iHeartRadio: https://www.iheart.com/podcast/269-3sixty-insights-78293678/
- Google Podcast: https://podcasts.google.com/feed/aHR0cHM6Ly9mZWVkcy5zb3VuZGNsb3VkLmNvbS91c2Vycy9zb3VuZGNsb3VkOnVzZXJzOjkyNDY0ODI1OS9zb3VuZHMucnNz
- Amazon Music & Audible: https://music.amazon.com/podcasts/7e7d809b-cb6c-4160-bacf-d0bb90e22f7c
- PlayerFM: https://player.fm/series/3sixty-insights
- Instagram: https://www.instagram.com/3sixtyinsights/
- Pocket Casts: https://pca.st/iaopd0r7
- blubrry: https://blubrry.com/1460785/
- Castbox: https://castbox.fm/channel/id4113025
- ivoox: https://www.ivoox.com/en/perfil-3sixty-insights_a8_listener_25914379_1.html
- Podchaser: https://www.podchaser.com/podcasts/3sixty-insights-1718242
- Pocket Cast: https://pca.st/iaopd0r7
- Deezer: https://www.deezer.com/us/show/3029712
- Pandora: https://www.pandora.com/podcast/3sixty-insights/PC:1000613511
See a service missing that you use? Let our team know by emailing research@3SixtyInsights.com.
Brent Skinner 00:00
Well, hello, everyone, and welcome to this episode of the HRTechChat video podcast. So happy to have you, all of you with us. We’re here today with Danny Schultz, who is senior manager of payroll systems and taxes at Kohler. Welcome, Danny.
Danny Schulz 00:18
Thanks for having me, Brent. Yeah, it’s really good to be here. Excited to talk about payroll and all the all the fun stuff that goes with it.
Brent Skinner 00:25
Yeah, yeah, there’s, there’s so much more that goes to payroll than sort of, you know, the layperson might expect and, and I know, we want to talk today a little bit about, you know, best practices around Global Payroll, which I’m really looking forward to. But before we dive into it, if, if you wouldn’t mind, it would be great. If you could just share a little bit with our audience about your background, what you do today and where you come from?
Danny Schulz 00:54
Yeah, no, yeah, sure. Excited to do that. I started with color. It’s been about 10 years before that, you know, I have an accounting background, I spent a lot of time and, you know, I did my four year stint in public accounting, and realize wasn’t quite exactly what I wanted to do forever. So then I switched over to industry with my main focus was tax reporting. And so I landed a role with a company called wallraff and I did sales and use tax reporting and fixed asset reporting, color gave me a call and I was leading up their sales and use tax information, Indirect Tax Practice, and then payroll tax was part of that as at the time, had a great opportunity to come over and, and lead the payroll team here at Kohler, I’ve been doing that the last three years, I always say that the prior manager must have some crystal ball I haven’t yet found to exit right before COVID. COVID certainly provided a lot of great insights to help payroll operates, and really just how important it is to organizations. And so I’m probably one of the first people to say we’re really thankful for that, because I think it led payroll be the star and shining the light on a lot of things. So that was really great for us, at Kohler. And then yeah, it was promoted from from my efforts related to COVID. Really, and really, you know, from a global perspective, we’re early on our journey at Kohler, we’ve done a lot of research, we’re starting to get the org figured out. And right now the, you know, the US team reports up through me, the UK team reports up through me, we’re starting to branch out to some other ownership of other countries in Europe with the European team, and then super excited to do that. And we still have some Canadian processing that we’re doing in the US as well.
Brent Skinner 02:46
Yeah, yeah, I mean, this is, you know, Kohler, just hearing you describe it, I mean, this is, this is really sort of a great example of what Global Payroll can look like, and just how complicated and complex it can be. And I know that you’ve learned a lot, you knew a lot already. But you’ve learned a lot around, you know, what it takes to get Global Payroll in order. And I guess, I guess one of the first questions I have for you, kind of thinking about, you know, what the best practices of Global Payroll are? And in all of that, what is bad Global Payroll? What is a bad Global Payroll setup look like? Or, you know, or a suboptimal one, what are some of the headaches that come to mind?
Danny Schulz 03:37
But the real easy answer is one that the employees don’t get paid, right, or they’re not getting paid on time, there’s a lot of errors. You’re not tax compliant, and you have a lot of penalties as a result of that, that’s really going to get you in trouble fast. It’s going to put a spotlight on you from a jurisdictional and an audit standpoint. So you really want to stay clear of anything out, you know, there, I think, if you dig a little deeper, you know, this is where really, to me payroll in general comes down to data and data flow. And, you know, the success of your payroll operation is really going to be dependent upon the success of your data. I’m a data junkie at heart. But if you’re at a, you know, at a place where from an organizational standpoint, you’re doing multiple data entry, you know, by humans, and you’re doing a an entry into your payroll system, you’re doing an entry into your HCM system, you’re not going to get it right. And so, you know, those interfaces, is are super important. And it’s really ensuring really, at minimum, you have that one place for your system of record. And if you don’t have, you know, those interfaces built, I’d say there’s a good argument that your system records probably your payroll system because my bet is, you know, who’s ever doing your data entry is going to make sure your employees get paid first. Nobody nobody’s coming to work volunteering, that, that I see. Everybody wants their paycheck on the normal cycle, whether that’s weekly, bi weekly, semi monthly, once a year, whatever it is, and, you know, it’s really important that you get it as accurate as you can. And so that’s really that, that bad data is gonna get you far. And, you know, you want to make sure the employees get paid, and they’re paid. Right, but you can also pull reporting from the right spot, and that’s one of the hardest things.
Brent Skinner 05:29
Yeah, you know, I’ve heard elsewhere that this idea of, you know, touchless payroll, which, which is sort of that the, the, the ultimate, right, but this idea that the more the more hands that touch the payroll data, the more you know, the more the greater the risk there is for error, right. And you and you also have to worry about, from what I what I’ve heard and learned is that you have to worry about employees personal identifying information, PII, that’s it, it’s a big deal to the more people that are touching it in the organization, there’s, you know, even not even out of malice, really, but just just inadvertently, knowing that information or, or sharing it in improperly by accident, even it’s, you know, it can be, it can be a real ball of wax.
Danny Schulz 06:27
Yeah, gee, GDPR is something that, you know, we’re focused on heavily, and I’m really interested to see where it goes, you know, as far as the US, you know, there’s some California start in some states are starting to pick up pick up on it, but certainly over in the UK, there’s, you know, the sort of started the trends, and it’s, you know, the right to be forgotten, and really just keeping enough information on employees is, is, is going to be super important and protecting the information. And the last thing you want to do is, the last thing I want to see is a company that I’m at, there’s a data breach, and somebody got into our systems and all the social security numbers, or, you know, any of the PII gets out, that’s something I think that’s a payroll nightmare, whether it’s, you know, that information out, or all the wages that you pay everybody out, and there’s just so much information there, whether it’s, you know, you know, aligned with your benefit system, and, you know, potentially using health information, it’s, that’s that data is very valuable. And I know that, you know, people are trying to penetrate the systems all the time.
Brent Skinner 07:33
Yeah, yeah. And you’re and you’re looking at, you’re looking at more than just, you know, sort of a nightmare in terms of fixing it, right, repairing the situation in which you’d have to, and, but you’re also looking at a potential damage to the employer brand, right. And so you’re looking at retention, and this really cascades down where you can’t even really, necessarily measure all the potential, you know, deleterious effects to the organization.
Danny Schulz 08:02
Yeah, and in protecting that brand is something we try to do a lot. You know, thankfully, we haven’t seen anything like this yet. And anywhere I’ve been, but there’s, I can tell you that they’re trying, I got an email this week, from somebody to my personal email account, and I don’t know how they got me or they got, you know, an employee that I knew and sent an email saying, Hey, I can’t get, you know, my work computers locks, you know, I need to change my direct deposit, my bank account was closed, you know, send me the information and how to do that. And, you know, obviously, we, you know, we have means and procedures set up. So we, you know, totally fake, but you’re alert the employee, you know, you don’t let things like that go to waste. And those are scary things. You know, I’ve, you know, as every payroll manager has had, has seen the email from the CEO, or today, I need all the web tools, and then you’re just gonna see, you know, come, you know, the end of January, February, but, you know, you have to be diligent, we’ve got a great, you know, security team that does a lot of great phishing training for us. And, you know, I think that leads to us trying to protect the information as best we can. Yeah, yeah. Yeah. Yeah.
Brent Skinner 09:18
Just thinking about further what, what are, what are some of the challenges, just pivot a little bit here in terms of bringing order to Global Payroll? Maybe, maybe, here’s a follow on question, both of them at the same time. You know, are there any sort of basic or first, second and third steps is, is there sort of a common or a well thought out, you know, sort of cadence of steps that you should always take, when when you’ve just finally decided, you have buy in at the organization, you finally decided, hey, we need to bring order to our Global Payroll, bring it under, you know, Salford in a in a modern way, what are some of the first steps that you take?
Danny Schulz 10:01
Yeah, I think the first step is really knowing your landscape. I think if you look at, you know, you know, some entities and Kohler is certainly one of them where, you know, we’ve started identifying who owns what, where, and from a payroll standpoint, part of the organization flows up through finance, I report my team, we report up through tax, which rolls up through finance and, you know, other parts that rolls up through HR, and certainly HR and finance, top leadership might not always be aligned and how that all works, but it’s really getting your organizational structure, right. And then knowing where the employees are and how they get paid. You know, we we’ve a lot of entity is a Kohler, we certainly have a lot of people that Kohler and they get paid a lot of different ways. And so it’s knowing who using what systems, where are we leveraging relationships with, you know, multiple partners, and really knowing the landscape, you know, you might know that you have 15 employees in one country, and they gotta get paid, but you might not know, of those 15, you might have partnerships with three different accounting firms, because they might be with three different entities in the country. And so it’s a lot of times, you know, I’ve seen where, as, you know, through m&a, or whatever your population grows, and keeping up with everything isn’t always the easiest thing to do. It’s that full landscaping, knowing that it’s such a challenge in with, with large organizations, especially if they, you know, saw it, you know, grow up like Kohler, where you have different legs of the business, we you know, the power business, the plumbing, business, hospitality businesses, and then even with power, we have engines and generators, my pumps, really excited about that. And then really, it’s, you know, you gotta, you got to figure out the leader and be committed to the change, right? That’s, that’s important, you know, system changes in payroll are very stressful time. So you don’t want to go live with 38 countries at once.
Brent Skinner 12:03
Certainly, whenever you use crazy talk,
Danny Schulz 12:06
it’s crazy. I get it. I mean, it can be done, you just, you know, get the right partner or the right vendor. And she really just setting up your governance model is such a super important part, what part of the organs is going to flow up through if there’s problems, what is Treasury think what is, you know, tax and what is, you know, if you have a global mobility team, what they’re doing, obviously, HR is super important, but and then it plays such a big role, too, because, again, back to the data and setting up minimum requirements. As you know, you go down the road for new payroll systems, make sure those interfaces are there, it might cost a little bit more money to set up, but you get that back on less errors. And, you know, turnover, employees aren’t willing to take errors on their payroll, they’re just not. I think, you know, I’ve seen stats and don’t remember what they are certainly don’t have a pile of them right in front of me. But I think, you know, employees are willing to take one error on payroll, but I think if you mess up twice, I think I’ve seen stats up where I’ve 60% or greater that employers are just, you know, I’m done. I’m gonna go find a new job. And especially now in the academy, we’re out with a great, you know, you know, the resume work. Yeah, great resignation. Yeah. And that’s, it’s such plays such a big part. And so from a payroll standpoint, this is really we as professionals, we really pivot a little bit more from just providing the service of payroll to helping ensure that the employee experience is so important. And we’re not impacting that anyway. And then really looking for how can we leverage technology to really help the employee experience? Because there are certainly ways we can do that within payroll.
Brent Skinner 13:44
Yeah. I, you mentioned those, those stats that are out there, and there’s plenty, there are plenty of them around, you know, just how, how much of a, you know, how many mistakes are employees willing to tolerate with payroll? I’ve seen one, I think it’s from the workforce Institute, a UKG, I think is from the past year. And it’s, I don’t remember the exact number, but it’s, I think, employers are willing to tolerate just one mistake with their payroll. So right, so Joe, on the second one, they said, Well, okay, I’m out of here. And there’s a huge percentage of them that will, and you can’t really blame them, you know, that’s, you know, for all the talk about the employee experience and all, all the reasons that people work, you know, the meaning in work, the meaning of work and all that, at the end of the day, they, they’re not working to be paid, right. So, so, you know, I think that’s, you need to get the pay, right. And then, and that means, you know, the amount from a from a, some, from a more of an abstract standpoint, getting the pay, you know, getting them to feel right about how much of their being paid, but then the real concrete piece of it is actually delivering pay consistently in real life. verbally, every pay period, you’re absolutely right about that. I, I trying to think of the word and I can’t for some reason I’m having a mind cramp. But you described, you describe kind of like exploring the organization investigating who owns what you know, and just learning all the nooks and crannies. And just that big tapestry, that complex tapestry in a global organization of, you know, what entities are doing what and who’s owning what, you know, maybe you can do maybe conducting forensics, although forensics or, you know, have to do with something that happened in the past, I think, but, technically, but there’s another word that’s escaping me, but um, I wish I could think of it because it’d be a great way to describe this, I think, but, but that’s a huge undertaking.
Danny Schulz 15:47
It is a huge undertaking, you know, we’ve got, you know, hundreds of different companies and entities that Kohler, but I don’t even know the exact number, but you know, there’s certainly a lot under the umbrella. And then, you know, just a lot of different leaders and a lot of means that get paid and, and then it’s the cultural difference, too. We’re talking with, you know, a country. I think, actually last week, we were talking about taking their pay in and moving, you know, the part of the processing to the UK and this particular country, they’re like, well, we don’t really have a payroll calendar, like it’s as long as it’s before the end of the month, we’re okay. And I’m like, how does that flight back to me as a, you know, as a US based individual, where everybody were set on, you know, we get paid every Thursday, every Friday, you know, like, we want our pay now. And they’re like, yeah, just as before the end of the month is usually around the 25th is usually when we get paid. But yeah, just before the end of the month will show up on the first of the next month. If not, we will, you know, the culture plays so much a role in all of this and really getting it right. But it’s, you know, those diversified entities like Kohler, just, you know, laying out and understanding just, again, your data, who owns what, how’s the structure looks like, so important. You don’t get that right, like, you’re just, it’s not going to work and it’s the left and then it’s, you know, it has to be a living document, you can’t just do it once in you know, in 2022 and then look at it and leave it sit there and then come back in four years and reopen it because it’s going to be outdated, people are gonna turn you’re gonna have people turnover, you’re gonna have, you know, organizational change, you’re gonna have acquisitions and divestitures and all that stuff and or, you know, such a living and breathing thing they’re thinking
Brent Skinner 17:41
about payroll is that Global Payroll is when the or as an organization becomes global, right? It usually becomes sometimes it’s fast, but oftentimes, it’s kind of very gradual, you know, it just kind of happens sort of cumulatively, over time. And in, there’s no there’s some point where the organization realizes, Oh, gosh, you know, this is, this is getting pretty crazy with our Global Payroll, we should, we should maybe bring some what I love to say, bring order to it, right. And there’s modern technology for that and everything. But at that point, it just like you said, you know, you’re you have to investigate, investigate it, figure out who owns what, and whatever. It’s almost like you reverse engineering, how payroll, you know, evolved at the organization over time to really understand and map it out completely.
Danny Schulz 18:35
Yeah. And that inflection points probably around around data. So probably what’s happening is, there’s some executives somewhere that one wants the payroll data, and they want it to be accurate, and they want it timely. And the payroll teams doing their best to get it from the 16 different people, they need to get the information up at a consolidated level, but they want that report, you know, say it takes 26 hours to deliver that report, but they want it every day, or they whatever the cycle is, right. But that’s where, you know, at some point, the leader needs to raise their hand and go, do you understand what we’re asking. And in order for us to deliver this report how many systems we have to touch and there’s certainly, you know, ways to automate bad processes in there and you’re like, Oh, we pull this report from here, or we’ll use an RPA. And that, but that doesn’t mean that you need to accept a bad process. Sometimes you need to step back, look at it at a higher level, get the right people on board and, and help you get there that, you know, the data. The data and payroll is so rich, and it’s you know, making sure that it can be used in the org.
Brent Skinner 19:41
Yeah, absolutely. And maybe we can get to that in a little bit in terms of what that data can do for an organization. But I love what you said right there around the idea that there’s, you know, you can automate a bad process or an excessively convoluted process right, and you can get that data quickly. But you know, that’s definitely not the best way to do it. I think we might make some enemies here I’m thinking about German made car versus a Japanese car, right? You know, the classic German, you know, over engineering or making things. It’s great as complex as possible. It works great. But I do it that way, when you could do it the other way. Maybe that’s not the greatest analogy. But in any event, with this is actually good segue, because you mentioned to something else we want to talk about, because you mentioned, an executive might come in and say, hey, I want I need to know, A, B, and C from XYZ data, I need to know it, I need it. Now, you know, every day and Money takes 26 hours to get it? What are some of the other when you think about leadership at organization, the various members of the of the C suite? And what are their? What are their stake? What do these take? What are their stakes in the Global Payroll, you know, sort of ecosystem? What do they need from? Or what do they have competing needs conflicting? Where do they align in terms of their understanding? The need for a needs from Global Payroll? What kind of buy in do you need from these? From which members, you know, to kind of move forward with a claim global schema? Excuse me Global Payroll initiative?
Danny Schulz 21:19
Yeah, you really have to start with, you know, I think the easy answer, is there a finance and HR, right, HR is going to want to know, are they people are finances going to want to know how much we pay these people, how much a person costs, what’s, you know, what’s the medical benefits costs, and, and you’re going to eventually get down to attendance and how attendance plays in and all those other things. So plant manufacturing personnel are going to want to know marketing, it’s going to want to know if, you know, you’ve got, you know, some sort of issue with, you know, marketing analysts not coming to work, or excessive eutrophication, or whatever. And I really think, you know, as you know, depending on, you know, obviously, it’s entities specific. So some of those other things could have other drivers that are very much in there. But, you know, around the world, I think attendance is something especially in a manufacturing and, and hospitality business that we’re trying to get our heads around at Kohler is how can we drive greater attendance at plants, and how those things all play in but it’s, it’s really looking at, you know, what predictive tools can we use, and lay those on in the future to say, hey, we’ve got, you know, typically in the US, if we’ve got attendance running at XYZ, we’re gonna have, you know, issues in the following year with turnover coming, and you’re gonna be able to pull in some of those things, I think, you know, some of the, you see a lot of the AI usage and some more of those predictive things, and, you know, they’re starting to float and pick up and, you know, I think the IT arena is gonna play such an important part to all of this. And then if you’ve got, you know, a global structure for, you know, shared services, you know, those are going to play into, because there’s certainly areas in payroll that I think you could do some things within a global structure, it’s going, you know, at a global entity, shared service type level, but there are some difficulties there. And it’s, again, making sure that your data is right. And so it’s just payroll touches, everybody sort of touches every other thing. It’s, it’s one of these things where I think, nobody, there’s not a firm agreement as to where it sits. So, you know, is that does it should it be HR, should it be finance, should it be taxed, should it be it and how’s it roll up, it’s really something that it can stand on its own, but it’s, it’s one thing that it’s hard to stay at the 5000, you know, 50,000 foot level, you get in the weeds pretty quick, because you need 48 different interfaces to get your pay, right? If you’ve got, you know, benefits are going to come in and attendance is gonna come in and time is gonna come in, and obviously, general employee information has got to come in and comp and everything else is just so many players and they are eventually, you know, they want the same thing, they want good data, they want it on your, you know, the cost they wanted on the attendance they wanted on all those pieces. And, you know, what can we do with it? Can we what can we predict? Can we predict, you know, if you’ve got a plant in Alabama, and national championship day, and Alabama was, you know, the easy ones or maybe, you know, maybe the next day that you should expect some, some absences because, you know, the teams in the playoff every year and whatever and, you know, whether it’s, you know, predicting at that level or national holidays or whatever is the case. If you have the data, you can do some good predictive stuff later.
Brent Skinner 24:47
Yeah, that that data I’m so glad you just dove into that right now because you know that that data is just absolutely absolute gold to an organization. You know, if you can really harness it and get it done. To get it to a point where it’s easy to obtain, and, and then you can slice and dice it and understand it through dashboard. What is some of the resistance that you that an organization might encounter? When it realizes, you know, when some of the stakeholders realize, hey, we need to, we need to do some of that better Global Payroll situation here? What are some of the, what’s some of the resistance? Or what some of the arguments you sort of find that an organization needs to make to, to really convince persuade some of the gatekeepers that, you know, hey, we need to do this
Danny Schulz 25:37
cost is always something that’s gonna come up when you ask that question, right? I mean, that that’s the, again, one of the obvious players is there’s some cost there when you’re trying to align GLOBALLY and what to do, change management’s key, and getting the change. Right. You know, if it’s not broke, why do a bunch of changes? Everybody’s getting paid? Everybody’s getting paid on time? And so why are we going through changes that we don’t necessarily, some people will see that we don’t need to do or maybe have that argument. And it can be a risk, you know, that if it fails, and you miss paying 4000 people in China by a few days, like that’s, you know, that goes back to protecting the brand, right, and making sure that that does, you know, stays out of anything. And so it’s cost is a big one, it and resourcing is big, even from a, you know, from an information technology standpoint, the RFP process to go to vendor, you know, and find a Global Payroll partner, five years ago, you know, the vendors in the space and the partners in the space, they weren’t as as good as they are now. And everybody’s getting better. You know, this is something where you’ve seen, you know, I think Pete Tilly caucuses, I think, as been on or seen some stuff on his Twitter feed, where he’s talking about the investment in that, that companies are putting in to Global Payroll, and the payroll engines is, is huge. And it’s, you know, billions and billions of dollars being poured in because they know that there’s a need and a desire. Now, I think this is where, you know, five years ago, there’s money obviously, being put in and invested. But it’s just changed so much. And it’s again, blown up. And I think maybe it’s a result that COVID is, you know, one of the outfalls of it, is you know, people needed to know more about payroll, and they couldn’t get it passed. And so it’s, it’s being put in through there. And I think, hopefully, you know, where you’re getting spots, and you’re in the right organization where you got, you know, the faith to build it out and get the data, right.
Brent Skinner 27:47
Oh, yeah. That’s, uh, I’m glad you brought it up. And, and I would actually be remiss to mention that, that both you and Pete Tiliakos are members of our global Executive Advisory Council. So thanks for bringing this name, because I wanted to mention that you, you talk about this, this sort of acceleration, massive acceleration of our increase in investment in global, you know, figuring out, you know, the technology for Global Payroll. Right. And I think you’re right, I mean, this in terms of what the what are the reasons? What are the factors driving that, you know, you have this this push to, to, to become sort of a borderless workforce, this is a new term that we’re seeing work from anywhere, is a
Danny Schulz 28:43
scary, it’s so scary to me from a tax guy perspective and a payroll guy perspective, right. I mean, I look at that and go, just the Nexus issues, you know, I grew up and tax right. And so if you’ve got employees tripping in other countries, and they don’t have tax treaty agreements, it sounds easy, right? I’m just gonna go work in a work hostel in Chile for three, three months. Right. Right. But does your Do you have an entity in Chile? Do you have, you know, all these other things? And it’s, how are we going to pay you? Does Chile have special regulations that you need to follow for, for paying you and what are the rules there? And if you don’t have an entity, like it’s really it gets my heart going. Actually legal consequences from that. And so, we do a good job at, you know, where I’m at trying to and from a payroll aspect. People are doing a good job, knowing and understanding how that all works. And you know, I think HR really wants to be able to deliver on any a lot of employees requests, but sometimes we have to say, well, actually, we, we can’t do that. Here’s why. And eventually you can do it but there’s you know the risk and You know, the investment and for the right employee might be worth it. But otherwise, it’s you got to talk to the employer. And sometimes you got to deliver the bad news that maybe we shouldn’t be allowing you to work from Antarctica for six months.
Brent Skinner 30:12
And that’s a good one. You know, it’s funny, as you mentioned, I couldn’t help but just think of, you know, the massive growth in EMRs employers of record as of late, you know, kind of filling in that need. And
Danny Schulz 30:32
I would argue, that’s part of the reason why right is in organizations are realizing the complexity around that. And so if you have a good partner and a great er, and, you know, that’s, that can help you right, and help you be, you know, more favorable for your employees to build those things out. But there’s certainly additional cost, it goes back to dollars and cents, you know, that employee no longer cost you x, it’s x plus whatever premium that is, whether it’s 3050, whatever the you know, the percentage is there. And it’s, again, the tax side of all that is so expensive, just the Nexus creating issues, and it’s, it’s complicated.
Brent Skinner 31:10
Yeah, the taxes can get incredibly complicated. You know, I know, for instance, in Pennsylvania, every, every county or, excuse me, locality, I think, is it locality or county, one of their
Danny Schulz 31:23
local taxes in Pennsylvania, hundreds of jurisdictions, right, and it’s making sure that, hey, you hired a new employee, and they live in a new spot, and or the employee moved across the, you know, township border, well, now you’re filing another tax return. And if you’re outsourced, and you’re not doing a business in house, well, maybe you’re paying on a per tax return basis. And so now you’ve increased the cost, and it’s, you know, marginal at that point. But, you know, if you’re used to file in 12, and now you file in 113, well, if you’re doing that in house, you might need another headcount and payroll or in tax who’s ever running your payroll tax to, to comply, and that’s, you know, same thing, you know, run in other countries as well. And that global complexity is just crazy,
Brent Skinner 32:10
you know, what really fascinates me about this is just, you know, sort of the, the, the opportunities, that change can produce in business for, for employees or for individuals, right? And how you juxtapose that with the, sort of the very slow formation of a regulatory frameworks that are very iterative in terms of how they’ve developed and, and, and you just can’t expect those types of, you know, the, called a gauntlet or something, right, you know, that you can’t expect it to just kind of adapt on, you know, on a dime, right. So this is, this is a, this is his idea that, um, you know, but there needs, there needs to be conversations probably, you know, with between the various stakeholders at play to kind of say, hey, look, let’s, you know, we understand the need for these, these compliance related issues as let’s work together to kind of look at what the future might look might be like, and, and just to ease some of these things, but at the same time, at the same time, looking at all the money that’s been invested into Global Payroll from the solution providers side, maybe, maybe they will build, or they already are building a better mousetrap that can kind of adapt to that in real time.
Danny Schulz 33:34
I think I think they’re spending a lot of time and effort trying to figure that out. I think this is something that isn’t gonna go away. I think employees really liked the freedom it, it gave them like, you know, I’ve, I certainly am not someone, you know, I’ve got two young kids and a family, you know, we’re living that life. But I’ve got friends who have no kids, and they’re working remote. And they used to drive an hour each way. And so they may have worked in a different state, you know, and in done that, and they’re like, Oh, I’m just gonna go to Florida for a month in the winter, because it’s cold in Wisconsin. It’s nice in Florida. And I’ll have an Airbnb and it won’t be too bad. And they did it. They had a great time. And when we came back for golf season, he was a lot happier than I was right. It worked out for him. And I made sure I’m like, Hey, tell your you know, make sure you tell your payroll team
Brent Skinner 34:33
you seen this
Danny Schulz 34:34
all the time and employees move around and but yeah, I’m, I’m hopeful that you know, this er space is something you certainly see. I think Miyamoto just spent the night I think they did sat in on a presentation with them. And the APA is Congress and they talked about it a lot. And, you know, the last time we were at Congress, I don’t think they talked about that. Right. And so it’s, it’s certainly more visible than it used to be and I think it’ll, it’ll be in Interesting to see where that’s at and, you know, 1218 months even and just the amount of change that’s gone through there.
Brent Skinner 35:05
Oh, lots of really interesting developments in iOS or, you know, Yamo Yeah, they’ve moved into the EMR space or players like omni present, which I believe is Ireland based. I believe they’re in that area. And they are, er, er, and more from what I understand, we just moved by them recently. And, of course, globalization partners and deal and all these players,
Danny Schulz 35:29
so many players, and let’s face it, just planning to and that’s, again, the investment that goes in, right. And seeing and, you know, just gotta be careful, you got to make sure you pick the right people, you do your RFP, right, you go through the compliance questions, and you make sure that they know what they’re talking about. And it’s a good fit for your org. That’s, that’s important, too.
Brent Skinner 35:50
Yeah, yeah. I’m looking at the time and realize we’ve gotten a little bit long it’s been very interesting, but we should probably wrap it up. It’s been a real pleasure having you Danny on the on the podcast. Thank you so much.
Danny Schulz 36:04
Yeah, no problem. Right. My pleasure. Anytime. It was always a good conversation. I’m, I’m talkative guy. So probably my fault we went over.
Brent Skinner 36:11
Now. It’s just as much mine but it’s all good. Thank you so much. Thank you. No problem. Thanks.