A survey of 251 payroll leaders in the UK and US by Vistra has shown regulatory uncertainty is slowing global payroll progress, with nearly two-thirds (61 per cent) of payroll leaders delaying or changing projects as a result.
The research highlights how teams are adapting to new technologies, compliance demands and workforce expectations, demonstrating the growing cost of compliance.
Payroll leaders surveyed spend, on average, 16 per cent of their time monitoring regulatory updates, which jumps to over 20 per cent in larger organisations. Nearly half (46 per cent) of respondents cite the cost and difficulty of upgrading technology as a major barrier to keeping pace with new requirements. Meanwhile, 44 per cent say the burden of staying up to date with legislative changes, alongside the challenge of training and resourcing payroll compliance teams, continues to hold them back. This time, ideally invested in strategic value, is instead absorbed by compliance demands, highlighting an urgent need for innovation and adaptive strategies in payroll management.
Despite only a minority of organisations fully integrating payroll with HR, time and finance systems (33 per cent) or achieving complete payroll automation (16 per cent), there is clear momentum toward smarter, data-driven payroll operations. The survey reveals a decisive shift toward AI and automation, with an overwhelming 95 per cent of leaders prepared to implement AI-powered anomaly detection and forecasting.
The digitalisation of payroll is transforming the function of payroll from a purely administrative one, with nearly all respondents (93 per cent) viewing it as a strategic enabler of growth. As businesses continue to expand across borders, 69 per cent of payroll leaders surveyed also plan to expand cross-border hiring in the next 12 months, highlighting payroll’s ongoing strategic importance.
When asked about the key benefits of payroll solutions, organisations most frequently cited improved workforce planning (63 per cent), greater financial visibility and cost control (63 per cent) and enhanced employee engagement (60 per cent). Employee experience stands out most in payroll’s new identity, with 97 per cent of respondents saying payroll experience is a key part of their employee value proposition, and 92 per cent plan to invest in improving it over the next year.
“Payroll has become central to how global businesses grow, adapt, and build trust,” said Curtis Holmes, Executive Vice President, Global Payroll, at Vistra. “It’s no longer a back-office job but one that drives strategic growth and employee satisfaction.
“While payroll teams still face significant challenges, in particular managing varying regulations across different jurisdictions, technology is making payroll less fragmented,” he added. “Payroll solutions are increasingly freeing up time for HR and finance leaders to focus on strategic planning, employee engagement, and financial control.
“As we look towards 2026, the future of payroll is about intelligence. As global workforces evolve, it’s no longer about paying people correctly, but enabling smarter decisions across the enterprise,” Holmes concludes.
