When it comes to global hiring, it really requires the expertise to get things done aptly because of the legal complexities associated with the process. Most US-based companies set up a legal entity in a country to hire a suitable employee from it. While it is a conventional method for recruiting foreign talents in the United States, a business firm can also explore other options to accomplish this complex task. And the best thing about such additional procedures is that they neither have a lengthy set-up process nor an initial financial requirement. Apart from hiring foreign employees through an entity, there are three other options for hiring employees from another country for a US-based company. This article will outline all these three methods in detail. Let’s take you through it and gain a better understanding.
1. Partnership with Employer of Record in the USA
There can be some differences between an international employee, whom you wish to hire, and your company. Due to these differences, there can be a gap between your business firm and the individual whom you wish to recruit. An employer of record in the USA can bridge this gap with its expertise in local tax and labor laws.
The hallmark feature of an employer of record is that it can virtually perform all those tasks that you expect to fulfill with the assistance of an international legal entity. Some such tasks include recruiting a candidate, taking care of their onboarding process, and initiating their payroll process. You can focus on your business so that you can grow it without worrying about managing these tasks.
In other words, you can rely on a US employer of record service provider to hire an international candidate in the United States without being concerned about the tax or legal risks in the country. Whether your objective is to hire an international employee or conclude their onboarding process on short notice, you can rely on a US-based EoR for both of these purposes. Also, you can rely on it if you wish to test a new market for launching your firm.
2. Direct Employment
Direct employment is another method for hiring foreign employees. Under it, another company will give your business organization its local presence without acting as a legal entity. Your firm can manage its onboarding process of international employees with it easily. However, it may take around six weeks for your firm to make this kind of arrangement. After arranging for it once, you can start hiring international candidates swiftly without worrying about spending a hefty amount of money. This way, you can hire candidates swiftly within your budget.
Direct employment is the ideal option for your firm if you wish to recruit international candidates without any plans of expanding your business to another country. Also, you will find it useful for recruiting several employees from a specific territory without setting up a legal entity. Direct employment is the cost-effective solution for both of these purposes.
3. Independent Contractors or Freelancers
Are you considering recruiting employees on an ad-hoc basis for a temporary project? You might want to think of a short-term solution instead of investing in a long-term plan for this purpose. Instead of hiring full-time employees on a fixed salary, you would want to hire a professional, or a group of professionals, whom you could pay specifically on the projects on which they work. Hiring independent contractors or freelancers is the best option for this sort of scenario.
As is the case with localized freelancers, freelance workers from other countries are also self-employed individuals. They work with their own set of equipment in their own schedule. The major benefit of hiring such individuals is that your company is not obligated to make monthly payments. They get paid only when they work on your company’s projects and that too for the projects on which they work. If your firm doesn’t get projects from a client at regular intervals, you can consider hiring the services of independent freelancers and contractors for it.
If you want a worker to work beyond your normal business hours, you can also consider hiring a freelancer. Besides, you can set flexible business terms and conditions with them while signing a contract based on the convenience of your business organization or its requirements. This is because freelancers do not have the limitations that an in-house employee may have.
The option of hiring independent contractors or freelancers brings a major benefit to the table for companies that need to scale up their business quickly without compromising flexibility. It is also beneficial for those enterprises or business firms that want to hire employees flexibly.
Why is It Important to Hire International Employees in the Right Way?
Global hiring comes with its own set of unique challenges which need to be addressed without delay. Being attentive won’t work alone and you need to join hands with a trusted partner or EOR company. There are many laws and obligations that you may not be aware of. An expert can extend his help and save you from getting into legal trouble and other hassles. Any non-compliance or violation of international labor law can be costly for a company. In the worst-case scenario, it may also lead to business losses for a company amounting to millions or even billions of dollars. For this reason, every company, regardless of its size, wants to avoid hiring an international employee on the wrong foot.
When it comes to hiring an international employee for your firm, you can either do it through a legal entity or also by exploring other alternatives to it. Recruiting foreign employees in one of the above ways would be safe for your business organization from the standpoint of tax laws and other international labor laws. Do not hesitate to consult an expert if you need professional assistance for hiring a foreign employee professional through the employer of record in the USA or the other two ways.