Let’s face it – how we work has changed excessively over the past couple of years. Now, we can throw meetings on Zoom, attend virtual events, and design new products from anywhere in the world.
There is one big issue though! Tools for paying and hiring global employees have not kept up in all countries. Things can get really messy when hiring globally. With complicated taxes, confusing local laws along with hefty fines if you don’t get it right.
HR managers can often assume that providing global talent with the same benefits as those in their home country is fair, but there are many instances where these are not appropriate for global employees. Managers must continuously review the local laws and customs before creating an international pay package.
What to Avoid When Hiring Internationally
Neglecting onboarding requirements
Getting started in a remote job role can be challenging. There is no office structure or co-workers nearby to guide one’s behaviour, so figuring out how to get started can be challenging. In order to alleviate employees’ uncertainty and make them feel more supported from the beginning, employers must design a comprehensive onboarding process.
Working remotely disconnects employees geographically and cracks the world open for companies to have access to an endless worldwide talent pool.
It is possible that companies overlook regulations that dictate how and when international employees must be registered with the government as they work to get their new employees prepared and set up for success. Onboarding international talent will require employers to plan for special circumstances that could suit each unique job profile and location where the employee will be operating.
When entering a new market, companies usually hire remote talent quickly, especially when a new business opportunity presents itself. But creating a compliant employee agreement or contract requires detailed attention to local laws.
Regardless of whether they are an independent contractor or a direct hire, employers need to carefully consider the legal implications of engaging a remote worker, especially if they are doing so internationally.
A growing company can benefit greatly from hiring remote employees as independent contractors. Legal definitions of independent contractors differ by country, therefore employers must be thorough and cautious when classifying the scope of the contractors’ work.
To avoid liability for employee misclassification, HR managers must clearly understand their contractor’s role, including expectations and responsibilities, and ensure that their work requirements will be legally recognized as contract work in the country they are situated.
Aside from the differences in identifying employee classifications that could put employers at risk, there are also a variety of different financial and tax laws to navigate when hiring remote employees in other countries.
When a remote employee isn’t located in the same country as the rest of the company, employers should never assume they can add them directly to the payroll.
Even more complex legislation exists when employers pay remote workers internationally. Employers might be tempted to pay international workers through international money transfers, but this could result in non-compliance with employment legalities and government regulations.
Complying with the legislation requirements for each job profile of every employee, their pay schedules, wages, and taxes in each country can become difficult. Both the company and the employee can be protected when local employment laws are followed and accurate documentation is provided. To ensure compliance and to ensure all the necessary paperwork is completed, employers will benefit from consulting with employment or legal experts from different around the globe.
Having virtual tools and processes in place is important, but they can only be as effective as the people using them. Adequate support to remote employees, including those working from home, requires setting expectations and boundaries.
The guidelines for working remotely must be specific, with clear descriptions outlining different types of work profiles that qualify for remote work, and clear performance measures to monitor employee compliance would need to be set up.
A thoughtful and well-designed work policy also provides clarity and addresses any cultural inconsistencies.
The solution for hiring remote employees in other countries
Onboarding internationally can be tricky but when done correctly, the benefits are greater than the challenges posed during the onboarding phase. These common HR mistakes, such as non-compliant employment terms, can be easily avoided when you have the right partner in your corner.
An employer of record (EOR) for international employees, like Playroll Global Solutions, helps navigate employers through all regulations, local labour and tax laws, and benefits, giving managers time to focus on ensuring their remote workers are professionally supported and culturally included within the organisation.