Optimizing People Tech for 2026: Payroll & HR Compliance Insights
Optimizing people tech for 2026: Key payroll tax and HR compliance strategies and tools for leaders to future-proof platforms and drive innovation.
During the Optimize Your People Tech Platform for 2026 and Beyond webinar, Symmetry CEO Elizabeth Oviedo and Head of Client Experience Matt Ek explored what 2025 revealed about payroll infrastructure—and what forward-looking payroll teams must prioritize as they prepare for the next wave of compliance demands.
The core takeaway was clear. Payroll tax compliance is no longer a background function. It is a structural concern that shapes product strategy, engineering capacity, and customer trust.
What 2025 made impossible to ignore
The past year underscored how quickly compliance requirements can cascade across payroll systems. As highlighted by Oviedo, in 2025, 21 states and 48 localities raised minimum wages, affecting 9.2 million workers and triggering significant downstream updates for payroll platforms. Minimum wage policy is increasingly determined at the state and local level, requiring platforms to track and apply changes independently across jurisdictions. At the same time, payroll systems must account for more than 7,000 state and local tax jurisdictions nationwide.
In 2025 alone, Symmetry delivered more than 300 payroll tax changes and 150 tax form updates, a clear signal of how quickly regulations are shifting. For many teams, the challenge was not understanding what changed. It was keeping pace without pulling focus away from product innovation.
“If you’re maintaining this in-house, your team is essentially running a full-time research firm, just to stay compliant with the basics.”
The growing cost of compliance maintenance
One of the most resonant insights from the payroll webinar was the opportunity cost of compliance work. Payroll platforms reported losing over 1,000 developer hours annually to ongoing regulatory maintenance.
These hours represent delayed product enhancements, postponed AI initiatives, and slower response to employer needs.
“These errors don’t stay small. They can snowball into work eligibility issues, incorrect withholdings, and eventually audits and penalties that damage your reputation.”
Industry research supports this reality. Deloitte’s 2025 Payroll Benchmarking Survey found that 47 percent of organizations manage more than 1,000 active pay codes, each requiring accurate calculation logic and reporting.
As complexity grows, patchwork solutions create technical debt that compounds over time. Product and engineering teams are forced to choose between staying compliant and moving their payroll platform forward.
Looking ahead to the 2026 compliance landscape
The session also highlighted regulatory changes that will place sustained pressure on payroll infrastructure over the next several years. These include expanded federal reporting requirements, evolving retirement contribution rules under SECURE 2.0, the rollout of new paid family and medical leave programs, and growing expectations for transparency in how payroll calculations are derived and explained.
At the federal level, the IRS continues to revise draft Forms W-2 and 941 to accommodate new data and reporting requirements, signaling that payroll outputs will carry more compliance responsibility over time.
At the state level, statutory programs such as paid family leave are expanding, introducing new wage bases, contribution rates, and employer obligations that vary by jurisdiction.
Compliance is not accelerating temporarily. Regulatory change has become a standing condition of payroll system design. Platforms will be judged less on their ability to react to individual mandates and more on whether their architecture can absorb continuous change without operational disruption.
Reframing payroll tax compliance as infrastructure
Rather than treating compliance as a sequence of updates, the session emphasized a structural shift in how payroll platforms should be designed. Infrastructure that scales under regulatory pressure is built to absorb change continuously. It prioritizes automation, localized intelligence, and defensible audit trails over reactive fixes and manual intervention.
Payroll solutions like Symmetry Tax Engine support this model by providing a continuously maintained gross-to-net calculation foundation across federal, state, and local jurisdictions. By externalizing tax logic and keeping it current, platforms can respond to regulatory change without repeatedly reallocating engineering capacity.
Similarly, Symmetry Payroll Forms addresses a common source of downstream payroll risk: incorrect or outdated employee withholding elections. Automating form determination, validation, and data flow reduces manual handling while improving the reliability of payroll inputs that feed reporting and reconciliation.
These tools are foundational components that enable platforms to scale compliance without scaling operational complexity.
A practical roadmap for platform leaders
The webinar offered a practical, three-part roadmap designed to help payroll and HR tech platforms move from reactive compliance to durable scale.
First, error-proof employee onboarding by treating new-hire tax withholding forms as the critical entry point for payroll accuracy. That means validating data in real time, automatically identifying the correct federal, state, and local forms based on an employee’s home and work location, and ensuring clean data flows directly into payroll systems without manual re-entry.
Second, prioritize payroll tax accuracy with true local intelligence. Move beyond zip-code-based logic to geospatial determination of tax authorities, paired with automated nexus recognition and reciprocity handling for remote and hybrid workforces. Accurate local determination was positioned as essential not just for compliance, but for building defensible audit trails and reducing downstream corrections.
Third, unlock innovation by centralizing the compliance foundation. By offloading continuous tax and withholding form maintenance to a living, API-first infrastructure, engineering teams can step out of the compliance churn and redirect time toward AI initiatives, product differentiation, and customer-facing innovation.
Watch the webinar on demand
For a deeper look at the regulatory trends, real-world data, and strategic frameworks covered in the session, the full webinar is available to watch on demand.
👉 Watch Optimize Your People Tech Platform for 2026 and Beyond on demand and explore how forward-looking teams are preparing for the next phase of payroll compliance.