What Are Virtual Employees?

A virtual employee is an individual who performs their work online and remotely from the company’s physical location.

A virtual employee, also known as a remote hire, might work from home, a co-working space, or a remote location with access to the internet to perform tasks, communicate with co-workers, and complete projects.

Some common jobs among virtual employees include the following:

Web/software/app development
Sales
Marketing/social media
Writing/journalism
Customer service
Graphic design
Data entry
Bookkeeping/accounting

Benefits of virtual staffing

Virtual staffing became a safety necessity during the COVID-19 pandemic and has since quickly grown into a common practice for many companies due to the following benefits:

Reduced costs

Virtual employees do not require desks or office space, enabling employers to downsize and save on building rent, utilities, and office equipment.

Larger talent pool

High-quality talent can be anywhere in the world. Employers can target highly qualified candidates with the specific skills and experience they need without the constraints of finding talent in one location.

Seamless scaling

Virtual employees are highly scalable because they are not limited to one geographic area and do not require office space or equipment. Employers can increase staffing quickly as they respond to business growth or opportunities.

Improved talent retention

Virtual employees have more flexibility to schedule their work around their lives, which improves their work motivation, productivity, and loyalty toward their company.

Diversity, equality, and inclusion

Opening the door to virtual employees with diverse cultures, skills, backgrounds, and perspectives leads to a more productive, engaged, and innovative workforce.

Challenges of virtual staffing

While there are many benefits to virtual staffing, employers must also consider the following challenges when hiring virtual employees:

Poor talent engagement

Virtual employees may struggle with isolation and become less committed to their team and role responsibilities unless they have clear communication systems in place that facilitate engagement.

Management difficulties

Onboarding new remote employees, building team cohesion, and motivating employees can be challenging in a remote setting. Managing a virtual team requires proper training and tools, and employees must be self-motivated, communicative, and comfortable working independently.

Cultural differences

Hiring employees from different locations presents cultural challenges. Communication may be more difficult when team members speak different languages and have varying work decorum. Cultural nuances are more susceptible to getting lost in translation in a virtual environment.

Collaboration hurdles

Team members operating on different schedules or in different time zones present challenges for scheduling meetings and working on projects together—especially if they don’t have the proper tools and resources to help streamline remote collaboration.

Qualities to look for in virtual employees

The following employee qualities help employers build successful and effective virtual teams:

Adaptability. Virtual employees must be able to adapt to change and work independently. Valuable virtual employees want to learn new things quickly and are comfortable working with different tools and technologies.
Accountability. Virtual employees must consistently meet deadlines and deliver high-quality work without constant supervision.
Reliability. Virtual employees must be responsive to communication from their managers and team members. They must also manage their time effectively, know how to prioritize their work, and be willing to jump in to help others when needed.
Integrity. Virtual employees should be honest and trustworthy, unafraid to speak up, and practice good work ethics.

How to hire virtual workers abroad

Employment laws vary from state to state and country to country, so employers interested in hiring virtual talent across borders must understand the compliance risks. To legally engage international talent, employers can take part in one of the following methods:

Set up foreign entities

Companies can hire virtual employees abroad by setting up legal entities in their target markets. Entity establishment allows companies to handle local hiring and employment logistics directly.

Employers typically consider setting up an entity in another country if they plan to hire a large team there or want to establish a long-term presence in the market.

However, entity establishment is expensive and time-consuming. It also requires extensive research of foreign employment laws, corporate requirements, and payroll regulations.

Partner with an employer of record (EOR)

If a company does not want to establish a foreign entity—or wants to engage talent while undergoing the long process of entity establishment—it can partner with an employer of record (EOR) to quickly and compliantly hire virtual employees internationally.

An EOR operates as the company’s legal entity and its talent legal employer, ensuring compliance with local laws and regulations and handling onboarding, payroll, benefits administration, and other HR tasks on the employer’s behalf. Meanwhile, the employer maintains day-to-day team management and operations.

Learn more: What Is an Employer of Record (EOR)?

Engage contractors

Employers may engage virtual talent abroad by working with global contractors, which allows a company to test a foreign market, target specialized expertise, and save money on full-time employees or entity establishment.

However, employers engaging contractors risk misclassification, which can lead to severe penalties, legal fines, back pay, and reputational damage.

Tips for engaging employees virtually

The following tips can help employers manage and engage employees effectively across virtual borders.

Streamline cross-team communication

Asynchronous, web-based tools help virtual team members communicate quickly and easily, regardless of their location or time zone. Set up easily accessible documentation and utilize collaborative working and video communication tools, such as Slack, Zoom, and Asana.

Ensure their home office is set up for success

Provide your virtual employees with the tools and equipment they need to do their job effectively—or provide stipends to allow them to purchase the supplies they need for their workspace, including high-speed internet. Provide tips on how to stay focused and productive while working remotely.

Schedule regular check-ins

Set up regular virtual one-on-one meetings to connect, provide support, and answer questions. Offer virtual employees opportunities to share feedback on remote work policies and plan team-building activities to strengthen relationships among virtual team members.

Recognize talent regularly

Find opportunities to publicly recognize virtual employees for their accomplishments and hard work. Regularly showing your appreciation boosts employee morale, motivation, and engagement.