Global Hiring

Three ways to employ someone abroad

The recruiting part of global hiring looks familiar: source, screen, interview, offer. The hard part is the employment model, which you should settle before the first interview.

• Your own legal entity. You register a subsidiary or branch, run local payroll and act as the employer. It has the lowest cost per head once you have more than a couple of dozen people in a country, but setup can take months and needs local accounting, legal and HR support.
• An [employer of record](/glossary/employer-of-record/). A provider that already has an entity in the country employs the person on your behalf, runs payroll and handles statutory benefits, while you direct the work. Hiring can happen in days or weeks. Fees are typically a few hundred dollars or more per employee per month, so it suits small teams or testing a market.
• Independent contractors. Fast and simple, but only legitimate when the relationship really is a contracting one. Treat a full-time contractor like an employee (set hours, your equipment, your management) and many countries will reclassify them, with back taxes, benefits and penalties.

What changes when you hire across borders

• Work authorization. Candidates must have the right to work where they will be based. Relocating someone means visas and sponsorship; hiring them where they already live usually does not. See work authorization.
• Notice periods. Candidates in much of Europe and India commonly have one to three months' notice. A US-style two-week start date does not exist there, so plan around it.
• Mandatory benefits and pay. Statutory leave, pension contributions, health insurance and extra pay such as the 13th month salary required in the Philippines change the true cost well beyond base salary.
• Termination rules. In many countries at-will employment does not exist, and dismissal needs a valid reason, a process and often severance.
• Data protection. Recruiting candidates in the EU brings GDPR into the process: lawful basis, retention limits and candidate rights to access their data.

Laws differ widely by country, so get local advice before your first hire in a new one.

Global hiring versus remote hiring

The two overlap but are not the same. Remote hiring is about where work happens: someone works from home, possibly in the same state. Global hiring is about jurisdiction: the employee is in a different country with its own employment law, tax and payroll. A remote employee in another country is both, and the global part creates most of the compliance work.

Running international recruitment well

Set pay ranges by location before you post, rather than negotiating each offer from scratch. Decide which countries you will hire in and say so in the job post, because "remote, anywhere" produces thousands of applications from places you cannot employ people. Run interviews across time zones with self-scheduling and recorded first rounds where they suit the role, and keep the same structured scorecard everywhere so candidates are assessed on the same criteria.

For volume roles, such as a support team in a nearshore hub, companies often start with an EOR for the first 10 to 20 hires, then move to their own entity once headcount justifies it. Plan the switch early, because moving employees from an EOR to your entity is effectively a transfer of employment with its own notice and consent steps.

Common mistakes

• Hiring a full-time person as a contractor to avoid setting up employment.
• Assuming US benefits, at-will rules or probation norms apply abroad.
• Ignoring permanent establishment risk, where a company's activity in a country makes it liable for local corporate tax.
• Posting a single global salary that is far too high in some markets and uncompetitive in others.