Top 5 Global Strategies for Hiring Internationally

Top 5 Global Strategies for Hiring Internationally

Developing global strategies for hiring internationally is an exciting step in your company’s international expansion process. One of the primary reasons businesses seek global growth is to tap into new talent pools. That's smart because there are plenty of eager workers in foreign markets waiting for a challenge.

Before wrapping up your hiring plan - or getting too overwhelmed - read our list of five global strategies. These tools help you hire a compliant team with ease overseas.


5 Global Strategies for Hiring Internationally

When your company enters a new country, you should build a local team to take full advantage of the foreign market. If hiring internationally seems like a daunting task - don’t fret.

1. Establish a Legal Presence via Foreign Subsidiary

Many companies expand internationally and assume their only option for establishing a legal presence is by setting up a foreign subsidiary. This option is a huge commitment. In fact, it’s the largest commitment on this list.

Most foreign subsidiaries cost around $20K USD to set up. Plus, they have high maintenance fees and take nearly six months to complete. It’s also hard to tear down if things don’t work out in your new county.

Don’t worry - most small to midsize firms don't need to establish a foreign subsidiary to start hiring in their new market. We’ll talk about global expansion 2.0 options for a leaner startup method later in this post! Those may be the perfect solution for your team.

2. Hire Independent Contractors Overseas

Though it’s less of a commitment, companies that rely on independent contractors in their global strategies face many risks. With proper attention to autonomy, overseas contractors may be a good option for your business if you’re not ready to hire full-time employees.

We suggest partnering with an in-country expert to help you manage compliance and avoid labor disputes, which can occur with contractor relationships. An international consultant, or local attorney, will help you craft a proper agreement, which will meet the needs of your new country, cover IP protection, and clearly state autonomy.

Autonomy, autonomy, autonomy - we’ve mentioned this a few times. One of the most important aspects of a contractor relationship is making sure they work without any direct rules or supervision. Contractors are not protected by entitlements, which are vast and very regulated in many foreign markets. As a result, if for any reason a contractor acts as an employee, they can fight their status in labor courts and if they win, which they probably will, you’ll owe them all of their past-due entitlements. Learn more about contractor relationships in this post.

3. Manage Compliance

No matter how you decide to hire overseas, you’ll want to ensure that you’re managing compliance at all times. Tackling this battle alone is difficult. There are different rules and regulations in each country. If you’re moving into Brazil, your company will deal with different issues than a business that moves into Tokyo. It's overwhelming for HR managers of small to midsize firms.

A few of the areas you’ll manage include:

  • Benefits Withholdings
  • Taxes
  • Bonuses
  • Agreements

Not only are these requirements different in every country, but they’re also ever-changing. If you’re not an expert in the country’s local laws, you may miss an important requirement. For example, at-will employment simply doesn’t exist in most overseas markets. As a result, you need to provide employees with ample notice - which varies from country to country - before letting them go. If you fail to provide the proper notice, your company will probably owe a hefty severance payment to that terminated team member.

Luckily, HR teams have options to help with compliance management. Many companies use a global expansion 2.0 service with their global strategies. For example, International PEO (Professional Employer Organization) and Foreign Subsidiary as a Service (FSaaS) help international companies establish a presence overseas and give employers tools to hire compliant employees. These employer of record (EOR) services take care of a company’s payroll, entitlements, withholdings, and taxes. Using these resources, your company is still responsible for day-to-day management of responsibilities and employee liabilities - the EOR just keeps them compliant.

4. Timing Ensures You Keep Top Talent

If you’re interested in perfect global strategies, then your company is probably eager to get started up in a new market. You should know that it takes a few months to get a legal presence in your target country. Plus, it takes time to learn about the culture, recruit talent, and find trusted partners. You don’t want to rush the international hiring process.

One way to speed up the process and ensure compliance is using one of the EOR services we mentioned above. International PEO and FSaaS help companies enter new markets faster than if they set up a foreign subsidiary on their own. These services can also help you recruit and hire talent without losing their interest as you all wait for subsidiary approval.

5. Provide Competitive Benefits

Now that you know about establishing a presence and hiring talent overseas, you need to know how to keep them onboard. Attracting top talent in international markets is definitely a challenge. Especially as the global marketplace becomes more competitive.

One of the most efficient ways to retain team members is by offering supplemental benefits. These are particularly effective when working with expats that travel frequently and lack a home base.

A few supplemental benefits to add into your global strategy include:

  • Competitive Wages
  • Relocation Benefits
  • Housing Subsidy
  • Foreign Language Classes
  • Benefits for Employees’ Families

When hiring overseas, put your employees’ needs first. Pay attention to the market and discover what benefits you can provide to stay competitive in the hiring process. For example, if it’s difficult to find housing in your new country, partner with a local real estate agent that can assist your team members when it’s time for them to find a new home.

If you’re ready to start planning your global strategies and want an efficient method for hiring international employees, contact Velocity Global’s team of experts. We have a presence in over 185 countries and have options to help your team establish a legal presence in your target market while maintaining compliance.

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