Is your business ready to go international? If so, you've probably started thinking about expanding your workforce by hiring team members outside the US. Hiring natives to regions you're interested in conducting business in has many advantages. For starters, you won't have to pay for relocation or travel expenses. You'll also have people on your team who can identify with international audiences, which can be ideal for cultivating strong relationships and increasing sales.
Although a diverse workforce is ideal for international expansions, global hiring comes with various issues you must address to prevent financial or legal repercussions. Continue reading to learn more.
Foreign Labor Laws
The US state and federal governments have implemented rules and regulations for employers to protect employees' health, safety, and well-being. While most employers know and comply with US labor laws, they're often unfamiliar with the requirements in other countries.
Some common differences in labor laws include paid time off, probationary periods, and termination. Failure to identify, review, and implement these practices when hiring and managing international employees could result in legal problems.
Compensation And Payroll
Compensation expectations vary by region. What is suitable for a US team member may not be ideal for someone in the UK. You must consider factors such as an individual's cost-of-living and tax obligation based on their geographic location. Overlooking these factors can cause conflict within your organization and result in financial hardship for underpaid staff. More importantly, low and uncompetitive compensation will make hiring and retaining quality talent difficult.
The payroll process is also different when working with international employees. You must ensure you're collecting the right amount of taxes and reporting to the proper authorities. You must offer adequate benefits for team members and their families. Lastly, you'll need to understand how to use international payment systems and utilize the appropriate conversion rates to pay them in their native currencies.
The Hiring Process
Most businesses hire remote, out-of-state, and international employees using digital platforms to avoid the need to complete the process in person. While online hiring saves time and money, there are a few challenges employers and candidates could experience. For instance, not every country has quality internet connections or access to job sites that are popular in the US. Other issues include language barriers and varying time zones.
Businesses must develop an efficient plan to successfully scout, assess, interview, and hire international team members. Employers must consider everything from time zones to native languages to accommodate applicant needs throughout the job search and hiring process.
International PEOs
Building an international team is challenging. It's an involved process that requires a wealth of knowledge and experience with diverse cultures and labor practices. As such, businesses interested in expanding their operations consider outsourcing their needs to an international PEO. These are professional employment organizations that assist US organizations in hiring global team members.
While it would appear that an international PEO would be a practical solution for US employers, this co-employment process doesn't work. In this arrangement, the PEO and their clients share responsibility for international team members. The PEO handles the hiring and payroll while the business is accountable for accommodating the employee's daily needs in the workplace. It also requires US businesses to have a registered entity in every country they choose to hire. As you might imagine, this is an involved and expensive process.
GEOs Offer A Better Solution
Fortunately, there is a less-complicated and more affordable option - global employment outsourcing. A GEO is a one-stop shop for employers interested in international expansion. They assist companies with hiring team members, managing onboarding, distributing payroll, and handling workplace needs. GEOs ensure that their clients have access to the best talent while eliminating international business, tax, payroll, and labor law compliance pressures, saving them time and money.
Expanding into international waters has the potential to take your business to new heights. Of course, your success depends on your ability to locate and hire the best talent to join your team. As international hiring is a tedious and expensive process, global employment outsourcing offers an effective and affordable way to build and manage a team worldwide.
