Running a successful business involves increasing efficiencies, reducing costs, and focusing on core competencies. Many US firms opt to hire international workers on a floating basis for their expertise and availability to accomplish the latter. Workers in other countries also benefit from the flexibility that remote work provides and competitive wages and work/life balance.
While there are many benefits to hiring foreign workers, the legal process can be challenging. With the growing use of technology facilitating remote work more than ever before, it’s imperative that organizations understand how to properly hire and pay international workers.
Step 1 – Begin the interview process
Hiring any type of employee takes a significant amount of time, so it’s best to start early. You’ll want to get ahead by scheduling multiple Skype or Zoom interviews. It’s essential to ensure that candidates have the right technology and communication abilities conducive to remote work as a floating employee.
Step 2 – Payroll for International Workers
There are a few ways that you can handle the payroll for international workers, including:
Register the worker as a local affiliate: If you send a US worker to Spain, you can register them to an affiliate or business partner. However, most small US-based businesses will not have these options.
Put the worker on the home country payroll: If you send a worker from the US to Spain for a few months, you can likely keep them on US payroll. The host country may, however, still tax the employee and ask for a visa. However, for longer-term arrangements, the home-country payroll structure becomes a significant compliance risk.
Use a host country workaround: Some countries allow workarounds for US employers without any in-country presence or place of business, so check the local laws.
Make the worker a leased employee: A leased employee is one that works for company A but is technically employed and paid by the Employer of Record (EOR)
Pay the worker as an independent contractor: This is a risky method and one that we do not recommend. It’s all too easy to run into compliance issues due to the worker being considered an employee.
Avoid assuming that a US-based payroll company will handle the logistics of paying an international worker. Payroll providers offer administrative services like cutting a paycheck in your name, they do not ensure compliance with international laws.
It’s best to work with an employer of record (EOR) to mitigate compliance issues. When you partner with Nexus Contingent Workforce, we become Employer of Record for your floating workers, assuming all legal and administrative obligations. Additionally, Nexus can administer payroll across countries.
Step 3 – Onboarding
Once you have selected the best talent, you can begin the onboarding process. Onboarding includes pre-employment screening, offer letters/statement of work (SOW), new hire paperwork, and employment eligibility authorization.
At NexusCW, we make hiring international workers easier than ever. We provide you with the most effective options available to expand your global workforce to focus on your core business and leave the workforce management to us. Our extensive experience in international payroll means we know what to look for, how to advise you, and what steps to take to simplify the process. Contact us today.
