Global employment outsourcing is a solution that enables companies to hire, onboard, pay, and manage a global workforce without establishing local entities in each country they wish to hire employees.
Global employment organizations (GEO) provide global employment services and serve as a legal employer of record (EOR) of a company’s workforce. A GEO’s global employment outsourcing services handle payroll, benefits administration, compliance with local regulations, and other HR functions. At the same time, the client maintains operational control and day-to-day direction over the employees' work.
What are the benefits of global employment outsourcing?
Global employment outsourcing is an effective strategy for companies that want to grow their operations into new markets, access top talent worldwide, and gain more market share. Global employment outsourcing provides companies with some of the following benefits:
Quickly enter and navigate new markets
Businesses can use global employment outsourcing to test the viability of new markets and the potential for long-term growth and success.
Global employment outsourcing allows companies to expand into new international markets and quickly establish a workforce without establishing a legal entity in the countries where they want to hire employees. Global employment outsourcing expedites the process because a GEO service can quickly set up local HR processes and navigate local laws and regulations.
Hire top-tier talent regardless of location
Businesses can use global employment outsourcing to access a broader talent pool and hire international employees without the logistical challenges of setting up an entity. Global employment outsourcing also allows companies more flexibility to scale their workforce based on their fluctuating needs and demands.
Simplify global workforce management
Working with a GEO service allows a company to outsource human resources tasks and responsibilities to focus on its core competencies. Global employment outsourcing streamlines the HR process so companies can efficiently manage and support their distributed workforce.
Reduce costs and time constraints
While establishing a legal entity in another country ensures compliance with local laws and regulations, it is also a costly and time-consuming process that may strain a company’s internal HR and financial resources.
A GEO allows companies to save time and money on entity establishment. A GEO can also offer more cost savings by having established infrastructure and expertise in managing payroll, benefits, and global compliance in multiple countries.
Mitigate risk when hiring globally
International employment presents many legal and compliance risks because employment laws vary from country to country. A GEO provider specializes in navigating the complexities of various local labor laws, tax regulations, and other legal requirements. The GEO often assumes the legal risks and ensures the company’s global compliance when hiring international talent.
What services do global employment outsourcing companies provide?
While services vary per provider, some of the common global employment outsourcing services companies may provide include the following:
- Global payroll. Manages payroll and tax withholdings according to the employees’ local currencies and country regulations.
- Global benefits administration. Administers statutory benefits per local regulations and offers comprehensive supplemental global benefits.
- Global immigration services. Arranges work permits and visas for expats and employee relocation.
- Employment contracts. Drafts employment contracts in compliance with local labor laws.
- Contractor conversion. Helps companies convert contractors to full-time employees to avoid misclassification risks and build a long-term top-tier workforce.
- Local HR support. Provides ongoing local support that accommodates local time zones and languages to answer employees’ questions and onboard new talent quickly.
- Local legal counsel and compliance. Monitors and maintains compliance with local employment laws, including notice periods, severance, benefits, leave, and termination conditions.
What to look for in a global employment outsourcing provider
Finding the right fit in a global employment outsourcing provider requires trust and compatibility. Consider the following characteristics when selecting a global employment outsourcing provider to help you manage your distributed workforce:
- Tenured global footprint. A beneficial global employment outsourcing provider should have a broad reach and coverage across the globe. Find a GEO partner with a proven track record of expert knowledge and quick, reliable support.
- In-country expertise. A global employment outsourcing provider should have an experienced team with local expertise in the markets where you want to expand or engage international talent. A valuable GEO is knowledgeable and familiar with local labor laws and regulations to help you comply with your desired markets.
- Robust technology integrations. Choose a GEO partner that integrates with industry-leading applicant tracking systems (ATS), human resource information systems (HRIS), and Human Capital Management (HCM) solutions to ensure a streamlined management system of your globally distributed workforce.
- Total rewards advisor. Choose a GEO partner that can adequately address gaps in compensation and assist you in providing compliant, locally-specific supplemental benefits packages to your distributed workforce while removing the burden of benefits administration and governance.
- Transparent pricing. A global employment outsourcing provider should have transparent pricing and present every element of their costs upfront. Ensure there are no surprise charges, fees, or taxes on top of their initial quotes so you can easily stay within your distributed workforce budget.
- Accurate employer burden calculations. Look for a GEO provider that provides accurate quotes on employer burden costs, including payroll costs, social contributions, and value-added tax (VAT) requirements.
- Recognized industry leader. Select a recognized GEO leader in the industry that has been pre-vetted by third-party auditors and validation reports. Working with a global employment outsourcing provider with a proven track record ensures they can deliver on your requirements and needs as they change.
- Responsive and timely support. A GEO must quickly respond and support your team. Look for a partner with dedicated human responders to ensure you have someone with the expertise and availability to answer questions and provide timely support to your workforce in their local languages and time zones.
Learn more: How to Choose an Employer of Record (EOR)
Expedite global business success with an employer of record
When a company chooses a global employment outsourcing solution, like an EOR, to hire international talent, that EOR partner assumes all employer responsibilities on the company’s behalf. This partnership allows a company to enter new markets and hire globally while the EOR handles onboarding, payroll, benefits, and immigration needs and ensures ongoing compliance with local labor laws and regulations.
Velocity Global is an industry-leading EOR partner with tenured expertise and unmatched scale in over 185 countries.
Our full suite of EOR solutions offers a simplified and streamlined approach to enable you to grow your business and engage with international talent. Our team of experts can guide you through strategic market assessment, regulatory considerations, and cultural nuances to help you compliantly hire, pay, and offer competitive benefits to your global team.
Contact Velocity Global and learn how to enter new markets with peace of mind.
