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Key Terms of Global Payroll: All You Need to Know

Global Payroll

Navigating the intricate landscape of global payroll demands a comprehensive grasp of fundamental terms and principles. Whether you’re a payroll professional or involved in finance, procurement, or IT, acquainting yourself with the lexicon of global payroll operations is indispensable. This article aims to provide an overview of some prevalent key terms utilized in the domain of global payroll.

Key Terminology in Global Payroll:

Best of Breed (BOB):

“Best of Breed” refers to software solutions that excel in specific niches. In the context of global payroll, BOBs denote localized payroll solutions tailored to meet the requirements of employees in a particular country. These solutions prioritize adherence to country-specific rules, regulations, and needs.

Employer of Record (EOR):

An Employer of Record is a service provided by organizations that act as the legal employer on behalf of another organization in a specific country. The EOR manages tasks such as hiring, terminations, and payroll in that country, enabling organizations to outsource legal and financial responsibilities without establishing a subsidiary or legal entity.


“Expat” and “Inpat” refer to individuals working and residing in a country other than their home country. The distinction depends on the perspective of HR or payroll personnel. Expat payroll, or “shadow payroll,” records benefits, reports, and pays taxes to the home country without directly compensating the employee.

Global Payroll:

Global payroll involves a strategic approach to standardize and optimize payroll providers across multiple countries. Instead of opting for individual country-specific solutions, organizations seek to streamline operations by selecting one or a few global payroll providers with capabilities spanning multiple countries. The focus is on provider optimization, standardization, automation, data visibility, reporting, analytics, and payroll governance for the entire enterprise.

Global Business Services (GBS):

Global Business Services involves centralizing transactional services within an organization. Multinational organizations utilize Shared Services Centers (SSCs) to deliver services to internal clients, emphasizing Service Level Agreements (SLAs) and Key Performance Indicators (KPIs). GBS goes a step further, featuring multi-function SSCs serving the entire enterprise.

Global Employment Solutions:

Global Employment Solutions is a company offering staffing and recruitment services to job seekers and businesses. They provide a diverse range of job opportunities and a pool of qualified candidates to fulfill staffing requirements.

In addition to Global Employment Solutions, several companies offer global payroll solutions and services for international contractors. 

Seek the Services of Payroll Outsource Providers in UAE

It is essential for businesses to familiarize with key terms in global payroll to effectively manage international employee payments. Key terms cover various aspects, such as selecting country-specific payroll solutions, outsourcing legal and financial tasks, managing payroll for expatriates and inpatriates, standardizing global payroll providers, centralizing transactional services, maintaining a unified HR system, and addressing complexities in managing payroll for locations with a small number of employees. Staying informed about the latest developments and trends in global payroll is recommended through reputable sources, industry publications, and consultations with experts in the field. Thus, contact us today and we shall be glad to assist you.