Advantages of Hiring International Employees and Contractors

One of the earliest dilemmas most entrepreneurs face is how to expand the workforce as efficiently as possible.

Gaining access to more skilled workers, or more employees is critical to keeping your operations growing, but at the same time, you’ll be working on a budget, trying to find a middle ground requires employers to think outside the box.

Avid entrepreneurs might consider hiring an international contractor, or even a team of international contractors, to save money and keep growing.

Let’s start by evaluating the benefits of hiring an international contractor:

No strings attached

When hiring an independent contractor, you’ll face far fewer restrictions and regulations than you would hiring a full-time employee. This can be useful if you’re trying to keep things simple; however, independent contractors in the United States can provide you similar advantages.

Inexpensiveness

International contractors are inexpensive, at least compared to conventional hiring options, for two reasons. First, they’re typically paid per-project, and will likely cost you less money than a part-time or full-time alternative. Second, there are many contractors available from countries with lower wages and weaker currencies, so even a small salary from your business can give them enormous spending power.

Modern travel possibilities

International travel for business used to be a hassle, but these days, initiatives like the Deel Program are making it much easier. If you need to meet with your contractors occasionally, or even just once to establish rapport, you’ll have to deal with far fewer hurdles and complications than you might have previously. 

Flexibility

You’re not limited to hiring one foreign contractor, nor does hiring a contractor preclude you from hiring someone else in the states. You can also let them go at any time or look for other opportunities to hire. Overall, there are more possibilities and more flexibility, which is vital for a young organization.

Here’s what you need to know when hiring international contractors:

The modern, connected environment brings many significant advantages for companies and startups around the world. Hiring independent contractors outside the US, as well as managing remote workers, has become a trend, if not the norm.

A US company can expand its pool of independent contractors to many countries around the world and start collaborating with freelancers in Argentina, Japan, South Africa or Spain. The possibility of finding the best workers than those closest to you is truly a breakthrough for many industries and companies around the world.

However, many business owners are unaware of the legal implications and risks posed by working relationships across borders. To be honest, this information is often hard to find. This guide can help you determine what your company needs to calculate to run a risk-free business.

Different arrangements for working with foreign workers

There are 3 settings to choose from when you want to hire people internationally:

1. Opening a subsidiary

When a company has many workers in another country, opening a subsidiary may be necessary. Basically, you need to hire people as local employees. You need someone to open a subsidiary locally which requires legal work, open a local bank account, etc. Which is quite complicated.

2. Professional Employer Organization (PEO) and Registered Employer (EOR) services

This arrangement allows you to contract with an outsourcing company that performs all HR services including international payroll, benefits, tax reporting and training on your behalf.

A registered employer (sometimes referred to as a global PEO) enters into a contractual collective labor agreement and becomes the employer on behalf of the company. This arrangement is necessary if there is no option to hire an independent contractor, and workers must be hired as full-time employees.

3. Hiring independent contractors

This setup is widespread across companies of all sizes. Hiring a contractor has many benefits: the possibility to hire foreign workers or short-term workers, cost savings per employee, and ease of contractor relations.

While the easiest to establish, this can lead to costs of tax evasion and IRS audits if local laws and different arrangements for contractors are not well understood.

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