Hiring international employees would help you to get the best talent. However, paying international employees might get tricky. Here’s how you can pay your international employees!
During the Covid-19 pandemic, most companies had to turn to remote working structures. It was quickly realized that remote working is beneficial to both companies and employees. Employees who work remotely report feeling less burnout and companies get the chance to hire the best talent globally. Thanks to remote and synchronized working arrangements, companies can employ from anywhere around the world and find the best fit between company culture, the company needs, and employee skills. Borders started to become meaningless. However, one question arises: How are you supposed to pay international employees?
You can hire independent contractors from different countries
You have three main options when it comes to paying employees abroad:
Setting up a local legal entity comes with risks and a big commitment. You would be required to handle a considerable amount of administrative work. This option is viable if you plan on hiring more than 25 people from that country. Requirements for establishing a legal presence vary depending on the country. If you are planning on establishing a legal local presence in another country, your best option would be to seek the guidance of a local expert. However, here are some basics of what you would need to do:
According to CXC Global’s article, “An employer of record (EOR) is a company that hires an employee on behalf of another organization. They handle traditional employment tasks such as payroll, tax, and the drafting of contracts. For tax purposes, an EOR is your employees’ legal employer.” EORs are one of the easiest ways to make sure you comply with the local laws and regulations when you are entering a new and foreign market. EOR system allows you to hire employees abroad without having to establish a local presence in that country, therefore it greatly diminishes your risk.
This last option gives you a lot of freedom and flexibility. Depending on your agreement with your contractor, you can pay them hourly rates, or you can choose to pay project based. In most cases, you wouldn’t be responsible for paying taxes for them or providing them insurance. Independent contractors are expected to pay their taxes and insurance. However, you need to be careful about how you classify them. Even though you hire them as independent contractors, depending on your long-term relationship with them, you might be required to classify them as full-time employees. In most countries, misclassification comes with serious consequences.
Check out our guide on how to pay your independent contractors through Remotify. Remotify is a platform in which you can create invoices. Remotify also allows you to pay your freelancers in over 30 different currencies, with a commission rate of a mere 4.5%.
You can pay international employees through Remotify
Lastly, we would like to discuss some factors that you should consider when hiring international employees.
During the Covid-19 pandemic, most companies had to turn to remote working structures. It was quickly realized that remote working is beneficial to both companies and employees. Employees who work remotely report feeling less burnout and companies get the chance to hire the best talent globally. Thanks to remote and synchronized working arrangements, companies can employ from anywhere around the world and find the best fit between company culture, the company needs, and employee skills. Borders started to become meaningless. However, one question arises: How are you supposed to pay international employees?
You can hire independent contractors from different countries
You have three main options when it comes to paying employees abroad:
Setting up a local legal entity comes with risks and a big commitment. You would be required to handle a considerable amount of administrative work. This option is viable if you plan on hiring more than 25 people from that country. Requirements for establishing a legal presence vary depending on the country. If you are planning on establishing a legal local presence in another country, your best option would be to seek the guidance of a local expert. However, here are some basics of what you would need to do:
According to CXC Global’s article, “An employer of record (EOR) is a company that hires an employee on behalf of another organization. They handle traditional employment tasks such as payroll, tax, and the drafting of contracts. For tax purposes, an EOR is your employees’ legal employer.” EORs are one of the easiest ways to make sure you comply with the local laws and regulations when you are entering a new and foreign market. EOR system allows you to hire employees abroad without having to establish a local presence in that country, therefore it greatly diminishes your risk.
This last option gives you a lot of freedom and flexibility. Depending on your agreement with your contractor, you can pay them hourly rates, or you can choose to pay project based. In most cases, you wouldn’t be responsible for paying taxes for them or providing them insurance. Independent contractors are expected to pay their taxes and insurance. However, you need to be careful about how you classify them. Even though you hire them as independent contractors, depending on your long-term relationship with them, you might be required to classify them as full-time employees. In most countries, misclassification comes with serious consequences.
Check out our guide on how to pay your independent contractors through Remotify. Remotify is a platform in which you can create invoices. Remotify also allows you to pay your freelancers in over 30 different currencies, with a commission rate of a mere 4.5%.
You can pay international employees through Remotify
Lastly, we would like to discuss some factors that you should consider when hiring international employees.
