Companies looking to grow and expand into new markets often benefit from hiring international talent. From providing insight into customs and culture to offering skills and qualifications that aren’t available locally, a global workforce can be instrumental in your company’s success overseas.
Hiring global employees is not without its challenges, though. Not only are U.S. employment laws related to foreign workers complex, but compliance with international laws can also create challenges when hiring across borders. Understanding these challenges and preparing to meet them is the first step to recruiting and hiring a diverse, dynamic, and qualified global team.
The struggles of global talent hiring
Businesses hire global talent for a variety of reasons. Some of the most common include:
- Expanding into new markets: Companies looking to grow in new markets can benefit from the knowledge and insights of local team members. At a minimum, these workers can help eliminate language barriers.
- Improving service: Hiring individuals from around the world ensures that clients and customers can contact a company representative at any time, without concern for time zones.
- Saving money: Average salaries and costs of living vary considerably throughout the world, and companies can often attract top talent willing to work remotely at lower costs. Maintaining a presence in a country with more favorable tax laws can also benefit corporations looking to manage expenses.
- Attracting qualified talent: Hiring global talent can help companies overcome challenges related to local skill shortages.
Despite these advantages, a global workforce can also create some challenges. Compliance is one of the most daunting. Every country has individual employment regulations, and they change frequently. U.S. employers are required to follow applicable local laws related to worker benefits and responsibilities, including wages, taxes, insurance, subsidies, leave, and working hours.
Hiring global talent as freelancers or contractors solves some compliance challenges, but it can create issues related to misclassification and liability. Other options include hiring international employees to work in the U.S. under a visa sponsorship or establishing overseas entities to become employers of record. These options also present significant challenges and may not be feasible for small or midsize businesses with limited resources.
One way companies overcome these obstacles is to work with a global PEO (professional employer organization), which becomes the Employer of Record for international workers. Although the individual works for your company, the PEO handles payroll and human resources functions. This arrangement simplifies the process of hiring and managing international workers, but there are still points to consider.
Hiring global employees
Employers hiring a global workforce need to consider a few important elements and take critical steps to ensure success.
1. Consider international expectations
Before recruiting international talent, create a job description and listing that will appeal to overseas candidates. Different countries have varying expectations surrounding work culture, so it’s important to know what prospective international employees are looking for and demonstrate your understanding of workplace culture in their country.
2. Know the legal requirements
Hiring an employee in another country means complying with that country’s laws regarding employment. Every country has its own rules regarding pay periods, bonuses, and leave, and some countries can be strict about compliance. You may find that certain countries even require employers to provide stipends for benefits like equipment and housing.
3. Acquire certifications
Your business may need to hold certain certifications to be eligible to hire international applicants. The Department of Labor may require you to certify that hiring international applicants does not affect local workers, for example. You may also need credentials to legally hire international candidates for permanent positions.
4. Create an onboarding plan
Any new employee should benefit from a thorough onboarding that includes an overview of policies, procedures, benefits, and legal requirements, as well as training in systems and processes. Including a cultural awareness element in the onboarding process helps establish better understanding within your team to reduce miscommunication and possible turnover.
5. Discuss plans with legal and financial teams
Before hiring global talent, meet with your legal and finance teams to discuss your plans and any potential pitfalls. There may be additional paperwork to complete before moving forward to ensure you’re complying with all labor, wage, and tax laws both in your country and where you’re hiring.
6. Document everything
Keep meticulous records of all company activities related to hiring and managing a global workforce. In the event of a regulatory audit or another review, thorough documentation will streamline the process.
Working with a global PEO can help you manage many of these processes, providing the insights and guidance you need to make the international hiring process as straightforward as possible. Contact Oyster today to discuss your global hiring plans and learn more about how Oyster can help you expand your team.
Oyster is a global employment platform designed to enable visionary HR leaders to find, engage, pay, manage, develop, and take care of a thriving distributed workforce. Oyster lets growing companies give valued international team members the experience they deserve, without the usual headaches and expense.
Oyster enables hiring anywhere in the world—with reliable, compliant payroll, and great local benefits and perks.