Author: soporte administrador

The increased adoption of remote work seen in recent years has led a growing number of companies to consider hiring contractors overseas.

These usually highly-experienced professionals offer their services on a project-by-project basis, thereby presenting a nimble solution to completing high-value tasks quickly.

However, it is essential when hiring contractors overseas to make sure the working conditions of those professionals meet local definitions for contractors. An increasing number of countries are cracking down on contractor misclassification, which can result in legal complications and financial penalties.

If you are currently employing contractors, or considering doing so, you can get an idea of your misclassification risk here.

For companies interested in hiring contractors overseas, it is generally advisable to work with a provider, who can help with choosing the best markets to source the professionals you need, and also help identify outstanding candidates for those roles.

SEE ALSO: Call center outsourcing: 5 great destinations to consider 

One such provider is an employer of record (EOR), which can hire professionals on your behalf — either on a contractor basis or directly through their own local entity — managing their payrolls and other administration in the process, while those professionals report directly to you.

Note that an EOR will sometime advertise themselves as an international professional employer organization (international PEO).

Contact us if you need assistance with hiring contractors overseas. 

What are contractors and how are they different to employees? 

A contractor is a person or company that signs an agreement to supply materials or provide a service for a specific project or period. When hiring contractors overseas, you are working with a person or group that offers its services temporarily and from anywhere in the world.  

On the other hand, an employee is a person hired by another individual or corporation to provide a service on a schedule during certain days of the week. In return, the employee receives a fixed salary set out in a written contract, which may be temporary or indefinite.  

While contractors may work full-time just like regular employees, they are not on the payroll but have a specific agreement for the work to be done. In addition, they have their own schedules and are largely autonomous, simply providing services to their international clients.  

With labor flexibility, an overseas contractor can work for several companies simultaneously since their delivery system is objective-based and established from the beginning between them and their client. Thus, the working relationship with the contracting company may be only for a few weeks and can be extended as needed.  

Companies hiring contractors overseas are not obliged to offer them the same benefits as full-time employees. Still, they must ensure that the rights of these independent professionals as workers are respected. 

Hiring contractors overseas: benefits and risks 

Anyone interested in hiring contractors overseas should know that working with these professionals means enjoying certain benefits. However, it is necessary to recognize the risks which should be taken into account in order to avoid unexpected fines and legal problems. 

Benefits 

One of the most important advantages of hiring contractors overseas is cost-effectiveness. Although these professionals usually charge a higher rate than a full-time employee for the same services, they are not on the organization’s payroll.  

As a result, temporary collaborators often do not receive benefits such as paid time off, annual bonuses, or health insurance. In addition, these professionals often have their own job-specific work tools, which saves money for the firms that purchase their services.  

International contractors offer expertise to their clients as well, as they often have specialized skills and knowledge in a field. This way, autonomous professionals can complete specific tasks in less time.  

Likewise, hiring contractors overseas brings flexibility to companies, one of the most important workplace trends of 2023. This is achieved because, in addition to working remotely, temporary employees do not operate a minimum number of hours per day or adhere to a specific schedule. 

Risks 

Just as companies can benefit from working with independent professionals, they must also consider that there are risks, especially those related to the classification of these workers. Misclassifying a contractor as a full-time employee can lead to penalties, fines, and even termination of operations. 

The main difference is that a self-employed worker may have several employers simultaneously. A full-time employee works for a single employer, has a more extended contract, and receives various benefits in exchange for following organizational policies.  

It is also necessary to consider that overseas contractors are not covered by the same legal protections as regular employees. However, companies working with them must take into account local regulations regarding the hiring of autonomous professionals – both in taxation terms and in things like hours worked.  

In terms of controlling their performance, monitoring and ensuring the quality of contractors’ work can be complicated, as these experts are subject to a different level of supervision than regular employees and have their own schedules. Critically, you have less say in how they do their work, as they are outside the usual hierarchy of the organization. 

Proper classification of contractors overseas 

The employment relationship established between an employer and a contractor overseas will be defined according to local regulations, but in general, specific criteria should be followed to classify these temporary employees correctly.  

For example, contractors may offer their services to more than one company at a time since they do not perform any essential activities for their employers and do not have a schedule or place of work determined by their clients.  

Contractors are not supervised like regular employees and do not receive training from the companies that hire them, in part because they should be seasoned enough professionals to complete the tasks they are hired for without much guidance.

They must generally also supply their own tools and equipment to carry out their activities. Payment is usually on a per-project basis, and the employer is liable for providing less benefits than regular employees.  

As individuals offering their professional services, these experts are responsible for their taxes and benefits, such as social security, and managing their calendars to have days off.  

The exact criteria for a professional to be classed as a contractor can vary according to the location in which they are employed, and the contracts you sign with them will need establish conditions that are in compliance with local regulations.

How a global contractor service can help with hiring contractors overseas

If you are interested in hiring contractors overseas, regardless of location or nationality, one of the the quickest and most hassle-free way is to rely on a global contractor service.  

An international contractor service has established legal entities, so you won’t have to invest significant resources and time to open an overseas office to work with these temporary professionals. 

The relationship you establish with these collaborators, from the project’s duration to their fees and payment method, should be set out in a written contract. If you want to change the employment agreement with the contractors and add them to your international team as employees, an EOR can help you.  

The EOR acts as a legal employer and handles its clients’ human resources following local regulations. Thus, this third party will manage your employees for a fixed fee, which does not compare to the expense of establishing an entity or opening a representative office. 

Serviap Global helps you hiring contractors overseas 

At Serviap Global we offer global hiring solutions in more than 100 countries, including international PEO / EOR services, contractor hiring, and global talent acquisition services to help companies find direct hires.  

Since starting out in Mexico in 2010, we have expanded worldwide and are now recognized as experts on recruiting top talent in emerging markets, as well as being the preferred provider in Latin America for many of the best-known EOR brands.

Contact us to find out more about how we can assist you in hiring contractors overseas.

The rise of remote work has revolutionized the way businesses operate, offering flexibility and access to international talent pools. While this trend offers many advantages, there are still some challenges of managing remote teams that leaders must overcome in order to make sure they are getting the best out of global hiring. 

Managing a global workforce demands some significant adjustments compared to office-based management, especially when it comes to organizing workloads and communicating within teams. But successful adaptation offers companies major opportunities to expand their international presence and improve output. 

SEE ALSO: Call center outsourcing: 5 great destinations to consider 

Key to a successful shift to remote working is the creation of a supportive and validating professional culture, in which trust and self-sufficiency are fostered among colleagues. By succeeding in this regard, the challenges of managing remote teams can quickly be turned into advantages. 

Contact us for more information on how we can assist you with global hiring. 

Challenges of managing remote teams: 7 considerations 

Adoption of remote work has exploded in recent years, with the global pandemic supercharging an already established trend. However, there are a number of challenges of managing remote teams that must be overcome, seven of which are outlined below. 

1) Productivity management 

Dealing with productivity levels is one of the most talked about challenges of managing remote teams. Many leaders fear that a distributed workforce makes it complicated to monitor their employees’ work. However, the benefits of working from home, such as flexibility and cost-efficiency, can improve productivity instead of lowering it. 

In such cases, adaptation is a crucial step to maintaining work rate levels high. Managers should focus on a results-oriented culture, establishing clear boundaries, but leaving space for flexibility and autonomy to team members. Also, it’s important to lead by example and demonstrate a strong work ethic, as well as offering training and resources to help colleagues improve their skills. 

2) Scheduling issues 

Time zone differences can lead to scheduling conflicts and delayed responses. Additionally, online colleagues may take a little longer to reply than in traditional offices, where you can just get up and reach someone working at their desk. Learning how to make the most of asynchronous working will help you deal with the challenges of managing remote teams. 

It’s advisable to have flexible work hours to accommodate the different time zones. To solve scheduling conflicts related to meetings and deadlines, you can use shared calendars and scheduling tools to help team members. Also, this can easily become an advantage when you foster an appreciation for diverse time zones, meaning your team will be able to cover unusual hours and facilitate deliveries. 

3) Effective communication 

Effective communication can be one of the major challenges of managing remote teams when members are spread across different locations.

Not only you may face various time zones, but also languages. This can create room for misunderstandings in daily work life, leading to a breakdown in collaboration and productivity. 

Try to employ a variety of communication tools, such as video conferencing, instant messaging, and email. Encourage team members to use the most appropriate channels for  each case. Set clear expectations on response times and languages to be used, embracing translation platforms if needed. Overall, create direct channels for open communication where everyone feels heard and valued. 

4) Cultural differences 

Working with team members from various cultures means you may deal with different work styles or even cultural expectations. This can be an issue if you’re not open to embracing diversity as a benefit to be brought to your organization. Remember that a big advantage of a culturally diverse workforce is the different viewpoints, networks, and approaches that can be merged within your team.  

People with distinct backgrounds can help you solve problems in new, innovative ways. Furthermore, diversity management is commonly linked to diminishing turnover rates, according to a report in the Journal of Business Economics and Management. To cultivate a diverse workforce, it’s essential to conduct research and develop targeted programs to support diverse talent in the company. 

5) Engagement management 

Assuring engagement management is fundamental for maintaining job satisfaction and all-around team cohesion. For remote teams, colleagues can start feeling disperse, as it may be harder to identify their purpose in the company’s processes. Sometimes, people can even find it difficult to recognize their professional growth when working remotely, which could make frustrated team members. 

So, as with many other challenges of managing remote teams, direct communication is vital for enganging colleagues and bringing them closer to their intentions. Managers can improve that with regular check-ins and practices of feedback and appreciation. Another valuable action is to offer opportunities for professional development, including support, mentoring, and digital networking. 

6) Work-life balance 

One hot topic from the challenges of managing remote teams involves physical and mental health in the workplace. When people work from home or are isolated from their team, they can feel lonely, anxious, and burned out. That’s why the relationship between remote work and mental health is something to pay close attention to. 

Managers of distributed workforce can support team building activities to reduce the distance between colleagues, as well as encourage the team to take breaks and maintain healthy limits related to their demands and work hours. The promotion of emotional wellness and clear boundaries between work and personal life is necessary for a productive and focused remote team. 

7) Hiring internationally 

Some companies still shy away from the opportunities of international remote work due to the belief that hiring foreign team members will be a complicated process with little advantage. Regardless, hiring internationally is a unique chance to tap into a global talent pool. If you’re employing from emerging markets, for instance, you can reach highly skilled professionals at very competitive rates. 

Although international recruiting can involve a range of different regulations, there are ways to streamline the process. Any business can enter international markets by setting up a legal entity in a foreign country and hiring employees directly, but they can also outsource this service to employers of record, or collaborate with independent contractors who offer freelance work through simpler and shorter contracts. 

An employer of record can help you manage remote teams 

One great option for overcoming the challenges of managing remote teams is collaborating with an Employer of Record. An EOR is a third-party services provider that can assist you from all stages of selection and hiring, up until managing payroll, ensuring legal compliance, and HR management. 

The EOR can assume a wide range of roles on behalf of your company, with the added capability of arranging physical workspaces if a collaborator’s position isn’t conducive to remote work. Their services encompass talent acquisition, onboarding, and ensuring local regulatory compliance for professionals who respond directly to your organization. 

Many times, hiring international workers is more cost-effective than local hires. Still, you will have to deal with plenty of distinctions in work laws and permits, which can be very time-consuming for companies with little to no experience in such areas. With established legal entities overseas, an EOR can make agile solutions in your global talent acquisition strategy. 

EORs are great for remote teams as they can adapt to changing workforce needs quickly. Whether you need to fill short-term or long-term positions, EORs can help scale your team up or down as needed. They can provide HR support, including performance management, to ensure that remote team members are engaged in the organization effectively. 

Serviap Global helps companies build international teams 

Serviap Global assists companies with hiring internationally, helping them to recruit and manage remote professionals without needing to set up local entities or worrying about unfamiliar regulations wherever those team members are based. 

Our portfolio includes international PEO / EOR services, contractor hiring, and global talent acquisition to assist companies with finding direct hires, and we are able to assist companies with hiring in over 100 countries worldwide.

Contact us to find out how we can assist you.

If you were interested in this article about overcoming the challenges of managing remote teams, read more of our coverage.

https://www.youtube.com/watch?v=pxLlwjtJuMY

Singapore is one of the world’s most prosperous and developed nations and home to many highly skilled local and international professionals. For anyone interested in hiring top talent in this Southeast Asian powerhouse, working with an employer of record in Singapore could be your best bet. 

An employer of record (EOR) in Singapore will hire professionals for you through its own local legal entity, and will have an established local recruitment network to help identify outystanding local talent, in turn allowing you to quickly establish a presence in this affluent city-state. 

As well as helping to find and hire those professionals, an EOR in Singapore will also handle their onboarding, payroll and other ongoing administration, as well as eventual offboarding, all in full compliance with local laws, so that you don’t have to worry about dealing with unfamiliar regulations.  

SEE ALSO: Call center outsourcing: 5 great destinations to consider 

That leaves you to focus in-house resources on other areas of your business, while enjoying the benefits of international hiring, including cost-savings, increased diversity, access to new ideas, and an expanded global presence.

When looking for an employer of record in Singapore, it is worth keeping in mind that some EOR providers may refer to themselves as an international professional employer organization (PEO) and advertise their services as international PEO. 

Contact us if you want to hire top talent in Southeast Asia quickly and compliantly. 

Employer of record in Singapore: country facts 

Singapore comprises a central island and 63 satellite islands located south of the Malaysian peninsula and north of the Riau archipelago (Indonesia). Together, they cover 720 square kilometers, making this nation the smallest in Southeast Asia. 

Although modest in size, nearly six million people live in Singapore, which is divided into five community development councils. English is and official language and widely used in business, with the country only sitting behind the Netherlands on 2022 edition of the the EF English Proficiency Index. There are three other official languages: Malay, Mandarin and Tamil. 

Education is compulsory until the age of 12, and students excel in areas such as reading, mathematics, and science, topping the world rankings after China according to the most recent report of the OECD’s Programme for International Student Assessment (PISA Report).  

In terms of higher education, Singapore has four universities focusing on technology, business development, business administration, and design, as well as offering training in fine arts. So it is not difficult to find highly skilled professionals to hire through an employer of record in Singapore.  

Multiculturalism is a way of life in Singapore, which retains many Western cultural traits even though it gained independence from the United Kingdom in the 1960s. China and Malaysia also heavily influence the country, due to their proximity, and the most widely practiced religion is Buddhism.  

This all contributes to Singapore being one of the most cosmopolitan nations in the world, as well as an important center for international business, and globally famous for its rapid development and growth. 

Of the five cities that make up this territory, the Central City is the largest and best known, and is home tomost government buildings. That also makes it one of the most likely place to find an EOR in Singapore.

Singapore’s market features 

Singapore is one of the most developed economies in the world thanks to, among other things, its stable political environment, openness to foreign investment, and famed success in cracking down on corruption in the 20th Century.  

That was part of a series of social and economic policies, known worldwide as the Singapore model, which were implemented after gaining independence and helped the country quickly move from being a developing country to one of the world’s most prosperous nations.  

Today, Singapore an international benchmark for education, health, housing, human capital, safety, and life expectancy.  

Local companies such as Singapore Airlines, ST Engineering, and MediaCorp play an essential role in the national economy, as do exports, mainly of electronics, chemicals, and services, as well as the purchase and refining of raw materials.  

Its privileged location in Southeast Asia facilitates international trade. Besides, Singapore is home to the second busiest port in the world in terms of container traffic throughput, after Shanghai in China.  

The local currency is the Singapore dollar (SGD), highly regarded in the region for its value and stability, which only fluctuated at a rate of between 1.45 and 1.31 to the US dollar in the five years up to September 2023.

Due to the limited land for agriculture and livestock, the primary and secondary sectors are dwarfed by the teritary sector in terms of the proportion of GDP they generate — although a range of foreign manufacturing companies have a presence in the country.  

Within the tertiary sector, the country’s financial services industry is enormous, with Singapore being one of the world’s leading trading centers, with a dynamic stock market and more than 150 banks maintaining a presence.  

Working with an employer of record in Singapore 

There are many reasons to hire professionals through an EOR in Singapore, a key one being that companies looking for personnel in this territory will not have to open a legal entity, which demands time and resources.  

Using its established recruitment network, an employer of record in Singapore finds, hires, and manages professionals on behalf of its clients, always in compliance with local regulations.  

Thus, by working with an EOR, expanding firms save on resources that they can use in other aspects of their business, plus they can enter and exit a new market in a streamlined and hassle-free manner.   

An employer of record in Singapore can offer various services, such as visa and work permit processing, international independent contractors sourcing, and global talent acquisition for direct hire, depending on its clients’ recruitment needs and budget.  

Whatever arrangement is established with an EOR, it will offer competent candidate selection, extensive knowledge of the local market, and minimize any legal issues related to hiring foreign professionals.  

In addition, as part of its services, the employer of record in Singapore will handle the administration of the companies’ human resources, such as contracts, payroll, benefits, work permits, and termination procedures. 

Regulations an EOR in Singapore will take care of 

Working with an employer of record in Singapore will minimize any risks related to the hiring of foreign personnel, as the legal employer will take care of, among other legal matters, the following regulations:  

Contracts: according to the Employment Act 1968, contracts for local and foreign employees can be fixed-term or indefinite, with a probationary period of three months.  

Working hours: working hours may not exceed 44 hours per week and nine hours per day. In case of overtime, the worker is entitled to time-and-half.  

Minimum wage: according to the Labor Law, there is no minimum salary in this country, so wage rates will have to be agreed directly between the employer and the employee through a written contract. 

Vacations: an employee is entitled to seven days of paid vacation after one year of service in an organization. These will increase gradually for each year of service. After eight years in the same company, the employee will enjoy 14 days of vacation. 

Holidays: in Singapore, employees have 11 public holidays. They must receive additional pay or compensation if their services are required during these days.  

Medical leave: after six months of service with the same company, an employee can take 14 to 60 days of medical leave due to illness or hospitalization. Maternity leave is 16 weeks, provided both mother and child are Singapore citizens. Fathers, in turn, are entitled to two weeks of paternity leave.   

Payroll taxes: in this country, employers do not have to pay any payroll taxes but are obliged to contribute 17% of their employees’ salaries to the Central Provident Fund (CPF); employees, for their part, must contribute 20% of their income to this social security fund. Income tax depends on the employee’s salary; ranging from 2% to 22%. 

Employer of record in Singapore: 5 steps to recruit top professionals

Anyone looking to quickly and compliantly hire outstanding team members via an employer of record in Singapore will need to follow these key steps:

1) Define employee requirements 

Sourcing global talent requires clarity on what kind of professionals and how many you need to add to your team. With this in mind, finding an EOR in Singapore that understands your needs, fits your budget, and helps you find the personnel you require will be easier. Thus, by working with this legal employer, you will complete defining the profile of the most suitable employees according to your expansion objectives. 

2) Complete preliminary screening 

By defining the roles, experience, and skills of the workers you need in South Asian territory, the employer of record in Singapore will share the vacancies on its recruitment networks. It will pre-select the best profiles as soon as it receives job applications and resumes.  

3) Undertake interviews 

Candidates who meet the requirements indicated in the vacancies will be selected for a round of interviews, both those that serve as a first filter and those that help to check if they have the necessary knowledge and skills to be part of the company. These interviews can be conducted by the employer of record in Singapore or by your organization’s recruitment team.  

4) Send job offers 

The EOR in Singapore will be in charge of sending job offers to the candidates selected to fill the vacancies available in your company, negotiating salaries and benefits if necessary, and signing contracts with the professionals you have chosen. As a legal employer and expert in local regulations, it will minimize any risk of non-compliance related to recruiting personnel from abroad. 

5) Initiate employee onboarding 

As part of their services, an employer of record in Singapore will handle the administrative tasks involved in international recruitment, such as payroll. So, while this employer manages your human resources, you can start onboarding new workers, training them, and assigning the first tasks. 

Alternatives to an employer of record in Singapore 

Companies that want to hire staff without the assistance of an employer of record in Singapore have other options for adding the best local talent to their international pools.  

For example, if they have a budget that allows them to establish themselves in this Southeast Asian territory on a long-term basis and also require a considerable number of employees, a good option could be to open a legal entity.  

Even if this is the path chose, companies may find that working with an EOR in Singapore can act as a good stop-gap while they are going through the process of setting up the entity, allowing them to quickly hire local professionals, who will later be transferred over as direct employees of the entity.

Another option companies can can consider is seeking out and hiring contractors or other freelance professionals to hire directly. However, this involves the challenge of getting to grips with an unfamiliar job market if done without assistance.  

For firms looking to hire personnel for a specific project or period, working with a provider that will help with hiring international contractors abroad could be a more efficient choice, and one that an employer of record in Singapore will also generally be able to assist with.  

While contractors may charge a premium for their services, compared to professionals hired directly for similar roles, that is in part due to the fact they are not entitled to a range of benefits that direct hires do receive. An EOR in Singapore will be able to advise you on what those benefits are and whether contractor hiring is your most suitable choice.

Serviap Global can assist you with hiring in Singapore 

At Serviap Global, we assist companies with global hiring solutions in over 100 countries worldwide, including Singapore.

Our portfolio of services includes international PEO / EOR services, contractor hiring, and global talent acquisition to help identify candidates to hire directly.

Having started out in Mexico, we have grown during more than a decade of operations to establish a global presence, in the process earning a reputation as experts on hiring in emerging markets.

Contact us to learn more about how we can assist you.  

https://www.youtube.com/watch?v=pxLlwjtJuMY

The exponential rise of remote working seen in recent years has offered companies of all sizes the opportunity to consider hiring internationally. But one of thing that holds many back from getting started is the challenge of managing a global workforce.

Because, while there are many advantages associated with global hiring, tapping into international talent pools, communicating with a dispersed team and dealing with unfamiliar regulations can be daunting.

SEE ALSO: Call center outsourcing: 5 great destinations to consider  

However, thanks to the evolution of new technologies and the emergence of providers offering international recruitment solutions, companies that are interested in seeking out overseas talent have an increasing number of options available to make the process much easier.

One such solution is employer of record (EOR) services, by which a provider hires international professionals on behalf of another company, taking care of local compliance as part of the service, and also assisting with sourcing and onboarding talent if needed.

Contact us if you are looking for a reliable partner to help with setting up and managing a global workforce. 

4 advantages of building a global workforce 

Managing a global workforce can seem a big challenge for companies, especially for those not yet aware of just how easy global recruiting is today. The many advantages of working with professionals across borders include, but are not limited to: 

1) Access to global talent pools 

The most successful companies tend to be adept at finding great talent, which in today’s competitive world of business can mean looking further afield. 

By casting an international net when recruiting, firms can source highly skilled and experienced people, who often bring innovative ideas from the locations where they are based that can bolster efforts to achieve goals.

2) Cost benefits 

Hiring internationally often comes with the major advantage that skilled professionals are available at highly competitive rates compared to in the job markets where hiring companies are based. So even when you factor in the cost of working with a provider, you can still make significant savings.

Coupled with efforts seen among emerging economies in recent years to promote the study of tech and other IT-based professions, many countries in the likes of Africa, Latin America, and Southeast Asia are home to growing pools of strong candidates for a range of in-demand professions. 

3) Increased diversity 

Another major benefit of hiring internationally is the fact that by hiring and managing a global team, increased diversity is naturally built into the process. That is something that is increasingly important in today’s world of business, not least because of the advantages that greater diversity offers.

Because when your team includes a wide range of nationalities, cultures, and beliefs, you are able to tap into new ways of thinking and doing business that can can have a major enriching effect on your company culture and its understanding of different markets.

4) International presence 

Establishing an international presence offers a range of benefits beyond the simple fact that it provides insights into new cultures and markets that could be beneficial to the business in the future. Not least is the fact that it offers a greater level of authority to the company.

Beyond that, it provides the business with the opportunity to be more responsive to broader geograpical range of customers and potential customers, because when you have an international team, that means you have people working in different time zones able to quickly cater to the needs of clients operating in a similar time zone to them.

Managing a global workforce: challenges and solutions 

While there are many advantages to managing a global workforce, there are also some challenges that must be effectively overcome in order to reap the greatest rewards possible.

Perhaps the two biggest challenges are being effective in recruiting top international talent, and guaranteeing compliance with unfamiliar regulations in the locations they are based.

Recruitment 

The natural precursor to managing a global workforce is building that international team, and also deciding under what conditions to hire them.

When it comes to recruiting, working with a provider with an established recruitment network and a sound understanding of the local job market is key. That can be a dedicated recruitment company, or it could be a provider such as an employer of record, which in many cases will offer standalone recruitment services to assist companies with sourcing candidates to hire directly.

Of course, hiring directly will require you to have a local entity set up or go through that process before you can onboard professionals, representing a significant commitment to that market. This can be a good option if your expansion plans are long-term, involve hiring a significant number of employees, and you have the resources to operate an overseas office.  

However, opening an entity, subsidiary, or representative office takes more time and does not guarantee success when expanding a business. In addition, it is complicated, especially when organizations are unfamiliar with the local market and the requirements for operating a business in that territory.  

The second option is managing a global workforce via direct contracting, without intermediaries or entities of their own abroad. To achieve this, companies must search on their own and with the help of digital platforms or social media for professionals to offer their services.  

Although it may seem attractive, firms must guarantee that these workers enjoy the benefits indicated by local regulations according to the type of contract established with them. Failure to provide such benefits could result in legal problems and the payment of unnecessary fines.  

On the other hand, international independent contractors are professionals who offer their services for a specific period or project. They usually have specialized knowledge in a particular area, are flexible in their schedules, and use their own tools to operate.  

These experts can work full-time, although they usually collaborate for more than one company simultaneously, so monitoring their work may be more challenging than with regular employees. Also, they have a much greater deal of independence in their operation. 

Compliance 

Even if expanding companies decide to establish an entity or subsidiary, managing a global workforce means they must deal with local labor and tax regulations ranging from a minimum number of employees, federal registrations, bank accounts, and other basic operating requirements.  

When hiring direct employees, organizations will need to ensure that they enjoy all the benefits agreed upon in their contracts. It is also vital that these workers have their papers updated to offer services to international clients.  

Regarding working with international independent contractors, employers will need to be careful how they classify them when managing a global workforce, as they operate for their own organization, which provides services to the employers.  

In addition, contractors are not part of the payroll, but they have special rights, obligations, and benefits that their employers must grant them to avoid fines and even termination of operations. 

Communication 

Effective and fluid communication is vital to managing a global workforce successfully. For this reason, team leaders must use common communication channels with all their collaborators to share ideas, organize meetings, and exchange files that facilitate their work together.  

By having team members from different parts of the world, employers and managers will need to define a common language so everyone can express themselves clearly, both in writing and orally. 

Delegation and review of tasks 

In addition to remote communication, delegating tasks and reviewing them may be challenging for team managers, especially when temporary workers, like independent contractors, cannot be supervised like full-time employees.  

Using calendars and virtual task management platforms may be an intelligent solution: the employer can assign projects, follow up on them, see the chain of command, know which tasks are the most urgent, and if the workload is equitable between the staff. 

Time zones 

To make the variety of time zones less of an issue, employers should organize their delivery schedules in advance, set meetings at a time that works for everyone, and understand that often, they will not get an immediate response to their requests, as is the case with asynchronous working.   

While this time disparity can be a problem for companies in some areas, they can also take advantage of it, such as extending their service hours to their international clients through their distributed employees or developing simultaneous projects. 

Cultural differences 

The social and cultural characteristics of the global workforce can be a determining factor when collaborating as a team, from actions that may have a different meaning in a context to ways of expressing themselves that may be offensive to others. 

However, understanding and embracing differences can lead to richer conversations, more innovative conflict resolution, and first-hand knowledge of other markets for potential business expansion. 

Lack of commitment 

Although telecommuting is becoming increasingly normalized, some employees may feel they need more motivation to work from home because they are used to going to an office and interacting with their colleagues. Or they are simply not happy with the work they do.  

In this situation, employers must have more specialized recruitment processes to hire committed staff. They must also motivate employees by being flexible, encouraging work-life balance, and offering additional incentives to reward their performance. 

The important thing is that, even if the staff do not come to a physical office, they must be sure they are part of an organization and that their work matters. 

Managing a global workforce is easier with an EOR 

Managing a global workforce is easier when working with an employer of record. These third parties will not only be able to help you find outstanding professionals for your team but will take care of regulatory compliance by working as your legal employer. 

Their legal entities in each territory are knowledgeable and experienced in local regulations, which avoids legal problems or fines related to non-compliance, from respecting work schedules and wages to providing legally mandated benefits and classifying employees correctly.  

In addition, their recruitment networks make it easy to build workforces as well as managing a global workforce, whether with full-time employees, international independent contractors, or global talent for direct hire.  

They can also provide vital insights into local culture, traditions, and work habits. They have identified markets with specialized service workforces to find the right professionals for the best cost.  These companies are well equipped to work across borders and fully used to the complexities of cultural interchange.

An EOR works collaboratively with its clients, wherever they are located, understands their needs, and accompanies them through the entire process from recruitment to onboarding as well as eventual offboarding if that becomes necessary.

The legal employer will charge a monthly fee per employee hired, usually a percentage of each worker’s salary. Determining the most appropriate arrangement depends on each company’s expansion project and budget and the scope of the EOR’s capabilities and coverage.  

Whatever type of contracting is done through the services of an EOR, they will answer to the company for which they were hired and not to the legal employer since the latter will only assume the legal and human resources management responsibilities. 

Note that some EORs refer to what they do as international professional employer organization services, or international PEO. 

Serviap Global can help you with international hiring 

At Serviap Global, helping companies with setting up and managing a global workforce is what we do, with our reach extending to over 100 countries worldwide.

Our services include international PEO / EOR services, contractor hiring, and global talent acquisition to help source direct hires. 

Contact us to find out more about how we can help you.  

An international contractor (IC), also known as a global or independent contractor, is a person or organization that works for companies based in another country. While expanding a business, hiring independent contractors abroad offers many benefits, such as helping you easily navigate local labor regulations.  

However there are also some risks involved in hiring independent contractors abroad, including the possibility of misclassifying them when their working conditions mean they should be registered as employees. Contractor misclassification can result in legal complications and financial penalties.

SEE ALSO: Call center outsourcing: 5 great destinations to consider 

If you are interested in hiring independent contractors abroad, contact us to find out more about how we can assist you.

What defines an international contractor? 

When hiring independent contractors abroad, you may find them called an independent contractor, freelancer or consultant. Whatever name is used, they are self-employed people who operate independently according to an established contract.  

They may seem to be employees, but unlike a worker who performs for one employer, contractors run their own business. Different organizations hire them to work on specific projects, whether short-, medium- or long-term. While compensated for their services, technically, a contractor is not on the payroll. They also may work for several employers at the same time. 

When a company is hiring a contractor abroad, this autonomous service provider is known as a global or international contractor (IC). 

This type of provider can significantly bring a wide range of unique skills, experience, and services to companies when expanding into a new market. However, there are some key points to keep in mind before hiring an IC. 

1) How to hire an international contractor? 

There are three ways of hiring independent contractors abroad: freelancers, who work from their territories and without direct supervision; those who are hired through an agency and for specific projects; and those who are outsourced through umbrella companies, which are responsible for managing all compliance requirements, such as payroll, taxes, withholdings and employee benefits.  

Hiring independent contractors abroad through a legal entity 

Having a legal entity in the target country is the blue-chip option because it means minimum problems with local labor and tax regulations and therefore less risk for the expanding company.  

However, it is a time-consuming and costly process that can take months to years. It also involves recruiting someone with detailed local knowledge to set up the legal entity and keep everything firmly above board.   

Despite these costs, many companies with long-term expansion projects see this as the best option. Generally, this is when they already know the market and its potential and want to ensure greater stability as they grow their business.  

Establishing a legal entity to hire independent contractors abroad also facilitates the transition from contractors to employees, if necessary, and allows for great flexibility as the company grows. 

Hiring independent contractors abroad with an EOR

Companies that want to expand quickly into a new market and get the best talent as part of their workforce are more likely to engage the services of an employer of record (EOR) when hiring independent contractors abroad.  

These types of organizations, such as Serviap Global, are often considered the gateway to successful international expansion. Companies can retain control of the day-to-day activities of their employees and focus on their core business while their EOR manages everything related to human resources.  

This covers such areas as recruiting and hiring independent contractors abroad as well as eventual termination, payroll, and local compliance. Every country has different laws and standards in these areas, and the EOR will know how to best organize everything to ensure compliance. 

An EOR is the best option when a company sees potential in a new territory but wants to test the waters before establishing an entity or subsidiary. Professional employer organizations can also assist their clients in establishing a legal entity if and when that becomes necessary. 

Hiring independent contractors abroad directly

The third option is hiring independent contractors abroad directly. By not having an intermediary, the organization will need to know in detail the target country’s regulations, such as salaries, working hours per week, types of contracts, days off, and everything necessary to contract an IC.  

This contract helps avoid the fees associated with doing it through a third party. Still, it also represents risks, as hiring freelancers in another part of the world is a complex task.  

By hiring an overseas contractor directly, companies are fully responsible for any local compliance failures and potential fines that may result. To avoid legal problems, firms must know the differences between employees and contractors, which we will explain in more detail shortly. 

2) Understanding contractor misclassification 

When someone wants to expand a business abroad and is looking for the best talent, they must know the differences between hiring independent contractors abroad and onboarding employees. Misclassifying an employee as a contractor could result in penalties and fines, so it’s best to be clear about what distinguishes them. 

The main difference between an IC and an employee is that independent contractors usually have several employers and work on a temporary project basis. An employee, by contrast, has only one boss, a more extended contract, and receives all the company’s benefits in exchange for following its policies.  

Also, international contractors retain a certain degree of control and independence in their work and are not eligible to receive benefits provided by their employer(s), which can save money. 

Contracts and payment 

The contract and the payment procedure are perhaps the biggest differences between ICs and employees. For example, a worker may be hired on a probationary or indefinite period, is on the payroll, enjoys benefits, and will have deductions such as income tax and social security from their salary.  

Hiring independent contractors abroad, though, is done on a project by project basis. They receive a one-time payment according to their services and are responsible for paying their own taxes. In addition, they also pay for their benefits, such as social security. 

Autonomy  

In addition to compensation and the difference between their employment contracts, hiring independent contractors abroad gives them more independence and autonomy over their work than an employee. They will not need much supervision and can be hired or fired as a company’s needs change.  

An employee is hired for a more extended period to perform a specific job under the direction of an immediate boss. This prevalence means continuity of experience and loyalty on the part of the employee, who will value the development facilities and professional growth provided by their employer. Plus, firing a worker often represents a severance payment from their employer.  

Flexibility  

An IC and an employee also differ in their degree of work flexibility. While an employee has a schedule assigned by an organization and is subject to rules and obligations, a contractor can organize their time and work for one or several companies simultaneously.  

Work flexibility is a vital part of employee retention strategies when seeking a balance between personal and professional life. While an employee has to choose a job that allows them to find this balance, hiring independent contractors abroad means they can take time off whenever they wish, which may mean no income during that period. 

Onboarding and training 

Incorporating a temporary worker into a company differs from onboarding a full-time employee. As previously mentioned, hiring independent contractors abroad for a project means they only need the information necessary to perform that task. The contractor, moreover, does not need training because of their expertise in a specific service.  

Regardless of the duration of their contract, employees require a longer incorporation process to learn the company’s guidelines, the work culture, and the objectives they are expected to satisfy. And although an employee is hired because they meet the requirements of a specific vacancy, they need constant training to help them develop in the workplace. 

Contractor misclassification 

Correct contractor classification will avoid problems with local regulations and possible fines. Although this employment relationship is defined differently from country to country, the status of contractor or employee generally depends on the following criteria:  

• Employment relationship. An IC does not depend on a single company to perform paid work.  
• Integration with the company. An IC does not perform an essential activity for their employer.  
• Hours and place of work. An IC does not have a work schedule or location determined by its client company.  
• Control and supervision. An IC is not trained by the organization for which it provides its services, nor are they supervised.  

• Work tools. An IC uses their resources to perform the work they are hired for.  
• Payment. An IC is paid for a specific project and does not have benefits like an employee.  

Although all these clauses must be clear in a contract, local authorities may question the definition of the employment relationship between a company and an international contractor. In that case, employers could consult a local expert with a thorough knowledge of labor laws before hiring independent contractors abroad. 

Use our animated tool to get an idea of your contractor misclassification risk.

3) Benefits and risks of hiring independent contractors abroad 

Companies hire contractors when they need the specialized services of a professional who is also available for a specific period and will only be compensated for a particular job. This temporary employment relationship has many benefits but also involves some risks that may be worth considering.  

Benefits  

• Recruitment of self-sufficient and independent specialists who do not need training and are ready to work immediately. 
• Knowledge of the local market.  
• Contractors often have robust professional networks in case their clients need to acquire the services of other specialists for their projects.  

• No investment in tools and workspaces is required, as contractors usually have the resources to perform their work.  
• Cost-effective model for short projects.  
• ICs do not need constant supervision.  
• Companies do not spend money on payment of benefits, such as social security, vacations, days off, and even withholdings. 

Risks  

• With multiple clients simultaneously, an IC may not always be available.  
• International contracting laws differ from territory to territory, so overlooking important considerations can result in fines and other costs. 
• Companies lose partial control over the process by which they hire a contractor. 
• Company information can be breached, as these types of subordinates have a different level of commitment than an employee.  
• Intellectual property can also be infringed if there is no clause in the contract to protect these rights.  

4) Hiring independent contractors abroad: payment

Hiring independent contractors abroad means signing a contract setting out all the clauses of this purchase of services, such as deadlines, the product to be delivered, the protection of information, and the payment method.  

Payments are based on invoices sent to the client company by the IC. At the same time, organizations must have a separate account for this fee from their payroll account that compensates their employees.  

The payment could be a lump sum at the end of the project or an advance income. Here are some ways to compensate an IC for their services: 

Bank transfers 

Due to the uncompetitive exchange rates of some banks, this is often the most expensive way to pay an IC, but also the most convenient because of its speed. In addition, there is usually a service charge for each transfer and specific “hidden fees” or commissions from the receiving bank. 

Checks 

This form of payment could be less practical when hiring independent contractors abroad. Not only can there be a fee for the IC to cash a check, but they are at the mercy of the bank’s exchange rate. And depending on their client’s location, the check may take a long time to arrive. 

International money orders 

Although they were once convenient and became popular with companies such as Western Union, money orders are now largely obsolete. This is because they require one person to make the deposit and another to cash it physically. 

PayPal 

This platform is known for quickly making digital payments when hiring independent contractors abroad or other service providers from virtually anywhere in the world. The fees are low, but the employer and the employee must have PayPal accounts to transfer money. 

Money transfer services  

Depending on the country from which you want to make payment to an international contractor, various fintech platforms allow employers to set up multiple foreign currency accounts, are secure, instantaneous, and have no hidden fees. 

Do international contractors pay taxes? 

As independent workers, international contractors must pay all taxes on payments they receive from their clients abroad and report this type of income.  

While tax requirements differ between territories, companies must not withhold any tax from an IC when hiring independent contractors abroad. Contractors are temporary collaborators, so they do not enjoy the same rights and benefits as full-time employees.  

5) How to convert your ICs to employees: working with an EOR 

Hiring independent contractors abroad has advantages, such as acquiring skilled labor for a temporary project without calculating and withholding taxes. However, this employment relationship can be transformed, and companies will sometimes want to make contractors their employees.  

Again, this process will depend on the territory of the contractor, and there is a risk of misclassification. Thus, the easiest way to add contractors to a firm’s workforce as employees is through an Employer of Record (EOR).  

As a legal offshore employer, an EOR manages payroll and assumes responsibility for having workers in another part of the world by ensuring compliance with local regulations.  

The company will manage its new employees without establishing an entity. At the same time, the EOR will assume responsibility for hiring independent contractors abroad and personnel administration on behalf of its clients. 

Serviap Global can help with hiring independent contractors abroad

At Serviap Global, we assist companies with global hiring solutions in over 100 countries worldwide, including offering international PEO / EOR services, contractor hiring, and global talent acquisition to help source direct hires.  

Having started out in Mexico in 2010, we have since expanded globally and are today recognized for our unrivaled understanding of Latin America and expertise in providing hiring solutions in emerging markets around the world.

Contact us today to learn more about how we can help you wuth hiring independent contractors abroad.

https://www.youtube.com/watch?v=pxLlwjtJuMY

Recently, we had the pleasure of speaking with Tero Moliis, a Finnish-Mexican business developer, advisor, and author, about Mexico’s potential for business, his life as an entrepreneur, and his most recent book: Life is a Sandcastle.  

Moliis is passionate about entrepreneurship, from consulting for companies in various sectors to representing many firms, mainly European, in Latin America. As an advisor, he helps his clients visualize possibilities within their organizations and solve problems. He is currently the CEO in Mexico for Lenz, an innovative consulting firm. 

Tero Moliis has studies in Business Management but is passionate about disruptive innovation and technology, learning and unlearning, travel, books, board games, gamification, and literature.  

He is also the founder and host of the Café con autores, an organization and program that promotes Nuevo Leon’s local authors and literature in general. This is what he shared with us: 

1) Being based in Mexico and with a strong social media following, you are well-known in Latin American professional circles. For anyone meeting you for the first time in this interview, please tell us a bit about you and what you do. 

I consider myself a business advisor, –developer, mentor–, a learning enthusiast and unlearning passionate. I studied Business Management at Leeds Beckett University in England, but I’m also a graduate of the Glion Institute for Higher Education in Switzerland.  

For the past several years, I have led various Finnish companies in Latin America, including Claned, a LXP style collaborative learning platform for all types of organizations; and Seppo, a gamification tool for all types of processes and corporate training, among many others. I also form part of a few advisory boards worldwide. But currently, my main role is as CEO of Mexico for Lenz Projects, a Finnish company that creates value by finding and nurturing the maximum potential in people 

On a more personal level, I enjoy being a dad, reading, astrophysics, good food, traveling, and playing Ultimate [Frisbee] and all kinds of board games. 

2) Being originally from Finland but now a naturalized Mexican citizen, how did you first come to the country, and what made you stay long-term? 

Having multiple passports is very useful, but I consider myself a citizen of planet Earth. I came to Mexico originally as a kid, following my dad’s work, but later returned to see friends. I eventually fell in love and formed a family here, so I am staying for now, but the world remains my playground. 

3) As someone who promotes business and advises companies in Mexico, what makes the country such an attractive prospect for investors, businesses looking to expand internationally, and employers? 

Personally, I feel like Mexico is a place where there are still many opportunities available, not only to innovate, but to create and operate, and establishing and running a business is relatively easy (except perhaps for the ‘fun’ fact that usually, your first hired employee has to be an accountant).  

Mexican people are hard workers, especially the female workforce, which is highly talented and motivated. There is a fantastic pool of talent available. This is probably Mexico’s most significant asset: its people. This county is one of my favorite places to live, love, and work.  

4) When you are hired as an advisor on doing business in Mexico, what is your first question / what are some of the first questions you ask companies? 

I pride myself on being very direct and honest with my opinions, and therefore often also quite blunt. Usually, the first question I ask any company interested in doing business in Mexico is how much time and resources they are willing or able to invest in making their business a sustainable project. The second question is if they are eager to expect the unexpected and adapt to the often very different way of doing things professionally. 

5) As well as your work as an advisor, you are an entrepreneur. Can you tell us a bit about your entrepreneurial journey? 

I have always been entrepreneurial and have extensive experience taking ideas to real-life projects. My first business was importing and selling ciders to Mexico about 20 years ago. I have since founded multiple other companies, such as Maltapp, RAD.games, Valu8Right, etc., of which most have failed miserably. Some did OK, but the experience gained has been amazing.  

I have also invested in other projects and mentored a few more while starting and hosting multiple vblogs and podcasts, including The Unprofessional Show and Café con autores. One of my most recent new projects has been co-founding Alchemy Associates, an early-stage partner for small European start-ups. I also make sweet pickles for sale with a friend, but it definitely counts as being an entrepreneur. 

6) How did you come to develop your interests in EdTech and gamification? 

I have been designing board games for over 30 years already and have gotten a few of them published 

globally as well. Hence, gaming and game design are in my blood. The step to gamification was therefore easy, and as a kid-at-heart, having fun and turning processes into games comes naturally to me.  

I also have the great honor and pleasure of working as a creative partner with the Nordic Multiversity project, where we are developing the future of university education. Very exciting indeed. 

7) As a fan of disruptive innovation and tech, what do you think about the recent explosion of AI? 

I like to tell people that when it comes to artificial intelligence, at least the hype is real. Most people have the concept all wrong and confuse machine learning or algorithms (or algorithmic influencing) with AI. The recent explosion of AI tools and whatnot has mostly saddened me because I thought that AI was supposed to help us do the dirty work and leave the creation of art, music, and writing poetry to us humans, but the opposite is going on.  

Our basic parameters are flawed, and it scares me a little bit to think that we are often very flawed humans creating the supposedly perfect intelligence of the future. It would be a good idea to pause and think before moving forward, but unfortunately, that will probably not happen, and the AI we will create will be inevitably flawed and, thus, possibly even dangerous. 

8) For anyone who hasn’t had the chance to read your book Life is a Sandcastle, can you tell us what it is about, what inspired you to write it, and what sort of reaction you have had since its publication in 2020? 

Life is a Sandcastle is a book about happiness and purpose. It tells you why you should invest time, energy, and love in creating something –perhaps just a sandcastle or your life– when you know perfectly well that it will all be gone tomorrow. It is a practical, fun, and human guide to knowing yourself better and, thus, indirectly, a guide to mindfulness and happier life.  

My life experience and a will to share my discoveries with others was my main motivator for writing the book, and my reaction to the book has been utterly positive so far. The book was also translated and published by Editorial Urano in Spanish in 2023, so I am very excited to reach more readers. I hope everybody can read it to have more meaningful conversations and find more unity in our human diversity.  

9) About Café entre autores, the monthly event you organize in Nuevo León, can you tell us a little about it, what it consists of, how long it has been held, and how it has evolved? 

This is another little side-business I created about two years ago, and its premise was simple: to promote local unknown authors (like me) to help them sell more books. Little did I know that it would turn into a beautiful creative community where dozens and dozens of authors help each other, and the public is loving it too.  

We organize a monthly event where 3-5 authors present themselves and their books. Additionally, we organize book events, book markets, podcasts, and cultural events to promote literature in all its forms. We have inspired over ten people to write their first book this past year alone, which is fantastic.  

10) If you could go back and give the young Tero Moliis one piece of advice, which age would you go back to, and what would that advice be?  

This advice is also in my book; my 10-year-old self would have been pleased to receive it. I hope many of you are happy to receive it even now: 

“You are allowed to come up with your definitions and find the answers and solutions that work best for you. For we are truly unique and different, every one of us, and the way of looking at –or interpreting– things that might work for one person will not necessarily and most likely work for another.” 

Tero Moliis is a Finnish-Mexican business expert and entrepreneur based in Nuevo Leon, Mexico. He was speaking to Karen Alfaro.  

At Serviap Global, we help companies with global hiring solutions in over 100 countries worldwide, including international PEO / EOR services, contractor hiring, and recruitment. 

Contact us for more information. 

https://www.youtube.com/watch?v=pxLlwjtJuMY

The rise of remote work, evolution of technology, and emergence of new recruiting solutions has made hiring internationally an increasingly accessible option for businesses of all sizes that are interested in building a global team.

For companies looking to tap into international talent pools and wondering where to hire skilled professionals, the case for emerging markets has grown stronger in recent years.

Because beyond the obvious benefits of being able to secure top talent at highly competitive rates, governments in many developing nations and emerging markets have made concerted efforts to promote education and develop the likes of access to the Internet.

SEE ALSO: Best alternatives to hiring US tech workers

That means there are an increasing number of candidates available with the neccessary skills and infrstructure available to allow them to work effectively.

Contact us today to learn more about how we can assist you with quickly and compliantly hiring professionals in emerging markets without needing to set up local entities. 

Benefits of hiring internationally 

One of the most significant advantages of hiring internationally is the diversity of culture and knowledge. When individuals from various backgrounds come together, they mix a range of perspectives and approaches. Consequently, this gives a deeper understanding of local customs, preferences, and tendencies. 

In a globalized distributed workforce, team members will likely bring multiple languages as valuable assets, making it easier to navigate cross-border interactions. Another type of flexibility can be created as professionals work in different time zones, which can enable your company to operate around the clock.  

Jointly, these benefits make it easier for your company to expand its networking connections on an international scale. Employees from different countries often have useful local professional relationships. This can open doors to partnerships and international opportunities. 

Another alluring aspect of hiring internationally is the cost advantage. Even though companies have to deal with different local work regulations, they can save money in aspects such as office space. Also, many times with emerging markets, companies can access qualified professionals at a fraction of the labor cost due to different currencies and work scenarios. 

Additionally, hiring internationally demonstrates a commitment to diversity and inclusion. It enriches your company culture and makes it more attractive to potential employees and clients. It’s important to remember that diversity in the workplace is a standard expectation in today’s world, according to research by HR Director. 

Which emerging markets are good for hiring internationally? 

Emerging markets usually present a vibrant potential for a company’s success story. Beyond the unique talent, innovative ideas, and plenty of growth prospects, these regions will also likely offer high cost-efficiency, as labor costs in many emerging markets are notably lower. 

The case for emerging markets in Latin America 

Latin America is a popular destination for hiring internationally, as it fosters a reputation of diversity, resilience, and entrepreneurship. Many markets, like e-commerce, stay strong year after year. And, despite recent global tensions, all subregions of Latin America have been presenting positive GDP growth.  

Other benefits are location and communication. For U.S.-based businesses, the physical proximity and the similar business culture are major advantages. Additionally, English is widely spoken by many professionals in Latin America, so for example, there are opportunities for Indian companies in Latin America. Most nations speak Spanish, which can facilitate expansion and scalability in the region. 

Many Latin American countries are highlighted in high-tech fields such as engineering and IT. Skilled workers can be found in the region with graduate degrees and certifications in high-demand fields, and they can be hired for a fraction of the cost of U.S.-based talent with equivalent experience and aptitudes. 

The case for emerging markets in South and Southeast Asia 

South and Southeast Asia have many emerging economies offering cost-efficient possibilities for hiring internationally. With growing labor markets, strategic locations, and welcoming foreign policies, these regions offer a remarkable opportunity for businesses. Some of the most exciting industries include manufacturing, tourism, and tech economy. 

Labor costs are typically lower compared to Western countries, allowing businesses to access top talent without straining their budgets. This cost efficiency extends to various sectors. Countries in South and Southeast Asia have rapidly embraced technology, and their workforce is often well-versed in digital tools and platforms. 

The regions have major hubs of call center outsourcing, particularly popular when hiring remote workers in the Philippines, where English is spoken at a high level among the multilingual population. Other nations, like India, also produce many skilled professionals in fields, such as information technology, engineering, and healthcare. 

The case for emerging markets in Africa 

African nations are already establishing themselves as attractive destinations for hiring overseas developers or call center outsourcing. For Europe-based companies, the growing tendency of nearshore outsourcing has also contributed for hiring talent working in similar time zones. 

Many companies choose African talent because of the high levels of European languages found, including English, French, and Portuguese. Above that, many qualified workers in Africa sometimes struggle to find reliable employment, which created a pool of well-qualified talent with competitive salary expectations. 

Hiring internationally in Africa grants you access to a rather young workforce in expanding economies. For instance, you can find skilled professionals in energy power, the financial market, and pharmaceuticals in Nigeria, the continental leader in these sectors. Meanwhile, tech ecosystems such as the Silicon Savannah in Kenya open up many options. Headhunters in Africa can unlock the best talent available.

3 good options for hiring internationally 

1) Hiring via an EOR 

An Employer of Record (EOR) is a practical solution for hiring internationally. An EOR stands as a third-party service provider specializing in onboarding professionals through its global entities and affiliated partners. They are trained in local employment landscapes and can aid in talent acquisition and hiring procedures. 

Teaming up with an EOR ensures adherence to local regulations, mitigating potential risks for your company. The employer takes complete legal accountability, diminishing unforeseen legal complications or financial penalties. Furthermore, they can oversee payroll operations and general administration tasks. 

The EOR usually establishes a monthly charge per employee. While certain EORs concentrate on specific nations or regions, others offer a more extensive reach, presenting various alternatives. For an efficient collaboration in hiring internationally, you should consider the EOR’s competencies in accordance with your company’s needs. 

2) Working with independent contractors 

International independent contractors are freelance individuals or collectives who operate independently. Although they might engage in full-time work, their efforts are led by their own entities, delivering freelance services to one employer or more. This can prove advantageous for enlisting personnel for specific projects or timeframes. 

These professionals bring useful expertise to project implementation, frequently being available for adaptable schedules. However, misclassifying them can lead to legal complexities. Furthermore, the oversight and assurance of their work quality can prove more demanding than for traditional employees. 

Contractors are not covered by the same legal entitlements as employees, as they are not integrated into the company’s payroll. Still, they are safeguarded by specific legal provisions. Some employer of record providers also give assistance in contractor acquisition and recruitment, generating them a practical choice for hiring internationally in this option as well. 

3) Hiring internationally directly 

Hiring internationally without external assistance can be a complex task. First, you need to establish a legal entity within each chosen country for recruiting. This means you will have to stick to all legal requirements, including registration with local authorities and obtaining the necessary permits and licenses. 

On the other hand, having a legal entity in a foreign country can be a good option if you plan to remain in this market indefinitely and hire many remote employees in the future. If your company is still inexperienced in a foreign region, an EOR can guide you through the process of establishing an entity in outside territories. 

If you decide to hire directly, you’ll need to engage in direct negotiations, finalize employment agreements, and oversee their administration. It’s also your responsibility to promote job vacancies, select possible candidates, account for language barriers, and offer support during the recruitment process. 

Serviap Global can help you hire top talent in emerging markets 

At Serviap Global, we assist companies interested in hiring internationally, with our reach extending to over 100 countries worldwide, with particular presence in emerging markets. 

We offer international PEO / EOR services, contractor hiring, and global talent acquisition services to assist companies with finding candidates to hire directly.

Contact us today to find out more about how we can help you.

In Mexico, one of the benefits employees receive is an annual bonus, known as the “aguinaldo,” which currently stands at 15 days of a standard monthly salary, but could soon rise to 30 days.

The initiative to double the aguinaldo in Mexico was presented by Deputy Manuel de Jesús Baldenebro Arredondo, who represents governing party Morena in the Mexican Chamber of Deputies.

The aguinaldo in Mexico is a right established in the Federal Labor Law, but has not been adjusted for more than 50 years since it emerged as a benefit in 1970.  

Baldenebro Arredondo, who is also president of the Labor Commission of the Mexican Chamber of Deputies, delivered the initiative to reform the first paragraph of Article 87 of the Federal Labor Law to the Permanent Commission of the Congress of the Union.  

That paragraph states: “Workers will have the right to an annual bonus that must be paid before December 20, equivalent to at least fifteen days of salary”. 

The proposed reform to double the aguinaldo in Mexico is under consideration for now and parliament will debate it before a vote. 

While doubling the aguinaldo in Mexico may seem a significant increase, it would actually only place the country on par with many other Latin American nations, including the likes of Argentina, Colombia, Costa Rica, and Guatemala, to name a few, where the statutory annual bonus for employees already stands at one month of a standard salary.

Visit the Serviap Global knowledge base to get a better idea of annual bonuses and other statutory benefits for employees throughout Latin America and elsewhere in the world.

Increasing the aguinaldo in Mexico is not a new idea

The initiative was presented on August 9 and aims to close the gap between the bonus received by workers in private industry and those in the public sector, who enjoy a 40-day bonus.  

According to prominent newspaper El Economista, this initiative to double the amount the aguinaldo in Mexico had previously been promoted by senators Gabriela Benavides, Alejandra Lagunes, and María Graciela Gaitán of the Ecologist Green Party of Mexico in February 2023.  

According to the senators, this increase would help the national economy to flow and benefit not only employees but also companies, because the increase in income would help boost consumption.  

A year before, in March 2022, Deputy Alfredo Aurelio González Cruz, also of Morena, had proposed to increase the aguinaldo in Mexico to 40 days’ salary. 

In December 2021, Deputy Reynel Rodríguez Muñoz, of the Institutional Revolutionary Party, had already presented a project to equalize the bonus for private sector workers with that of bureaucrats at 40 days of salary, in addition to incorporating gradual increases linked to seniority as is the case in other countries in the region, such as El Salvador. 

What happens next? 

To make the doubling of the aguinaldo in Mexico from 15 to 30 days a reality, the Congress of the Union, a committee made up of deputies and senators who create and modify the current regulatory system, must approve the proposal to amend the first paragraph of article 87 of the Federal Labor Law. 

The initiative must be submitted to a vote to enable private sector workers in Mexico to enjoy a 30-day annual bonus. Two-thirds of those present, both deputies and senators, must agree with the modifications or additions, and the majority of the state legislatures must approve them. 

How is the aguinaldo in Mexico usually paid? 

In addition to the fact that the aguinaldo in Mexico must be equal to at least 15 days of a standard salary for private sector employees, it must also be paid before December 20, according to Article 87 of the Federal Labor Law. Likewise, it cannot be exchanged for any other benefit, such as additional paid time off.  

The same legislative article indicates that even workers who have not completed one year of service, regardless of whether they are working or not on the date of payment of the bonus, will have the right to receive a payment proportional to the time served during that calendar year. 

Additionally, all subordinate employees, which related to anyone who works standard full time hours, regardless of their contract type, are entitled to receive a payment proportional to the time served during the year.  

In case of non-payment of the aguinaldo in Mexico, the Federal Labor Law indicates that an employer may pay a fine ranging from 4,811 Mexican pesos (US $280) to 481,100 MXN (US $28,000), an amount fixed by the Secretariat of Labor and Social Welfare after verifying the non-compliance. 

The aguinaldo in Mexico compared to other countries 

Mexico has one of the smallest statutory annual bonuses for private sector employees in Latin America, where this type of bonus is very common. At 15 days of a standard monthly salary, the bonus is also smaller than those enforced in other countries around the world.

Furthermore, according to the National Occupation and Employment Survey, four out of every ten workers do not even receive an aguinaldo, due to working in atypical or informal conditions.  

In Guatemala, for example, the annual bonus is not only mandatory but corresponds to a month’s salary paid at the middle and end of the year. In European countries like Austria, an extra month is offered as a 13th-month salary, typically as a Christmas bonus. In Asia, especially in China, the compensation may be paid as an extra month’s salary during the Chinese New Year (February) or spread evenly throughout the payroll. 

In the United States, bonuses are not mandatory. It is up to companies to offer a bonus to their employees, usually in the form of a Christmas bonus or gifts in kind, such as food vouchers, gasoline, or even travel. 

Annual bonus in Mexico compared to other selected countries: 

Country	Current statutory annual bonus for private sector employees
Argentina	One standard monthly salary
Austria	Two standard monthly salaries divided into two bonuses
Brazil	One standard monthly salary
China	One standard monthly salary
Colombia	One standard monthly salary
Costa Rica	One standard monthly salary
Guatemala	One standard monthly salary
Mexico	15 days of a standard monthly salary
United States	Not mandatory

Serviap Global offers global hiring solutions 

At Serviap Global, we assist clients global hiring in more than 100 countries worldwide, having started out in Mexico more than a decade ago. Our expertise in Latin America and other regions that we have grown into has seen us earn  a reputation as experts in helping companies to recruit talent in emerging markerts. 

Our services include international PEO / EOR services, independent contractor hiring, and global talent acquisition for companies seeking top talent to hire directly.  

Contact us to find out more about how we can help you. 

If you were interested in this article on the aguinaldo in Mexico, check out the rest of our coverage.

Or to get an idea of the costs involved in hiring in different countries, vist our free salary paycheck calculator.

As businesses have adapted to remote and hybrid work on a larger scale, there has also been a rise of new technologies operating with artificial intelligence. Using AI in the workplace has become an increasingly popular option for leaders who want to manage their distributed teams more efficiently. 

AI has transformed how companies deal with remote collaborators, as it can seamlessly improve operations and make them more accurate and automated, allowing workers to shift their attention from minor daily tasks to more significant areas. 

SEE ALSO: Call center outsourcing: 5 great destinations to consider  

It’s important to remember that AI in the workplace does not necessarily mean fewer jobs for people or that technology will simply make professionals obsolete. Instead, it calls for adaptation and offers plenty of new opportunities for growth in the work industry such as using AI recruiting tools. 

From virtual assistants to data analytics and cybersecurity, AI technology continues to advance and create new solutions for decision-making, customer experience, and workforce assessment. 

The rise of AI in remote and hybrid work 

Artificial intelligence (AI) technologies are computer systems that can perform tasks that typically require human expertise. These duties include problem-solving, learning from experience, understanding natural language, recognizing patterns, and making decisions. AI techniques use algorithms and large datasets to analyze information, extract insights, and even make predictions.

AI in the workplace can automate repetitive and time-consuming tasks and quickly process vast amounts of data. So, the rise of AI in remote and hybrid work is not just a temporary reaction, but it’s likely a glance into the future of work. As technology continues to develop, we can expect AI to play an increasingly central role in how we collaborate, and innovate in workteams. 

The development of AI has affected diverse industries, including companies with office teams or distributed workforces. But, for remote and hybrid scenarios, AI in the workplace can help us unlock numerous benefits, as it enables more effective information sharing, improves productivity, supports knowledge management, and ensures security and privacy. 

It also soothes one big concern of leadership in remote working, which is communication. For instance, AI in the workplace can enhance video conferencing, and personalize project management. It can improve video-adjusting factors and provide features for live transmissions, like real-time transcription, and captioning. AI-driven platforms can create a more interconnected remote workforce. 

Al in the workplace: 5 key options 

Artificial intelligence can be used in the workplace from the recruitment processes to streamlining daily tasks and helping with expansion. This technology can be used for multiple purposes within a company. Here are some of the most common ones. 

1) Assisting with innovation and collaboration 

Generative AI tools, such as ChatGPT and Dall-e, have become very popular as they can help humans streamline creative tasks by turning code into realistic content. This has revolutionized the process of content creation and allows remote workers to develop projects entirely from their homes, without having to access professional studios to record video, audio, and so on. 

AI in the workplace is also enhancing collaboration tools, making them more intuitive and efficient. Real-time language translation and intelligent content recommendations are some of the ways AI is streamlining communication and partnership among remote teams. Thus, as remote connection becomes easier, this can also improve a team’s wellbeing and innovation rates. 

2) Streamlining recruitment 

AI programs can help you source professionals, from publicizing job vacancies to selecting candidates and managing communication with them until they are singled out for interviews. This way, recruitment can be more reliable on the candidate’s merits, avoiding human biases. AI-based tools can easily personalize the process according to your hiring needs. 

AI in the workplace may also provide valuable data to recruiters, who can use it to reduce risks related to other new hires in the future. Some metrics obtained are candidate engagement, time and cost of hire, as well as employee skills, experience, and preferences. Analyzing this information will help recruiters identify patterns and improve remote and global talent acquisition. 

3) Improving daily accuracy  

One of the main benefits of AI in the workplace is reducing human error in data analytics. Technology can enhance accuracy when analyzing text or codes, as well as interpreting the data and identifying possible biases in the work that can sometimes get overlooked by human workers. AI can learn using algorithms and automatically flag typos, missing values, and procedural errors.  

This can save you time because software is not affected by subjectivity when interpreting data, which can naturally happen with humans. So, for instance, AI-based chatbots can analyze feedback from a customer’s experience and filter what information is important for solving an issue. This way, the manual time needed to complete such tasks can be reduced drastically. 

4) Enhancing performance management 

For managers, AI in the workplace can improve performance assessment, which can be especially interesting for distributed workforce management. AI makes it easier for leaders to better organize and oversee remote workers’ productivity, which is one of the main concerns for the work-from-home model. They can use software such as Timely to automate time tracking and get precise daily records. 

Additionally, there are also AI tools that can send alerts when an employee doesn’t log into their workstation at the right time or doesn’t complete certain tasks. This allows managers to get involved and solve issues before they get out of hand. With AI in the workplace, technology can help you ensure that your colleagues are fulfilling their responsibilities. 

5) Guaranteeing cybersecurity 

The shift to remote work opens up new safety challenges because it can more frequently involve ransomware, unsecure Wi-Fi connections, and file or password leaks. Thankfully, AI in the workplace can help prevent cyber threats. Algorithms can analyze anomalies in network traffic, protecting sensitive information and maintaining a secure remote work environment. 

Furthermore, artificial intelligence can employ data encryption and implement regulations to protect confidential information. This is especially important for sectors dealing with sensitive data, like finance and healthcare. AI can guarantee that remote employees will still be able to securely access and exchange corporate assets, without compromising the system. 

Serviap Global assists you with distributed workforce 

At Serviap Global, we support many companies using remotely distributed workforces. We offer international PEO / EOR services and contractor hiring in over 100 countries worldwide. 

We can help you develop your global expansion strategy and administer international professionals, without you needing to set up a local entity or worry about unfamiliar regulations. 

Contact us to learn how we can help you with your remote or hybrid workforce. 

Global recruiting has emerged as a transformative option for many companies worldwide, and both businesses and skilled professionals are increasingly tuned into the growth opportunities in the international market.

SEE ALSO: Call center outsourcing: 5 great destinations to consider  

Thanks to evolving globalized markets, the increase in uptake of remote working, and the emergence new technologies and hiring solutions, international recruitment is now more feasible than it has ever been, with companies of all scales able to benefit.

If you want to know about how we can help you with global recruiting, contact us for more information. 

The benefits of global recruiting 

One of the main advantages of global recruiting is demonstrating a commitment to diversity. When organizations contribute to a more eclectic industry, they are viewed more favorably by customers, investors, and employees. According to research by Forbes, 76% of employees say a diverse workplace is important, and their companies need to work harder on increasing inclusion. 

Hiring talent from different regions also improves a company’s cultural competence, allowing them to navigate global markets with greater ease, as it requires an understanding of international cultures and preferences. Multilingual colleagues, for example, can bridge communication gaps and facilitate easier connections with foreign clients. 

Global recruiting often results in teams composed of individuals with diverse language skills. This linguistic variety facilitates smoother international collaboration and reduces the risk of miscommunication. Cross-cultural groups can generate creative solutions by incorporating perspectives from different parts of the world, which can boost innovation. 

Finally, global recruiting can help you with overcoming talent shortages, as it offers the opportunity to search for suitable candidates in regions where the required skills are in abundance. Taking such opportunities in emerging markets helps businesses fill critical positions and promotes the transfer of knowledge across borders, enriching the entire organization. 

6 considerations that facilitate global recruiting 

If you want to seize the benefits of expanding your team internationally, now is the time. Here are some reasons why global recruiting has never been easier and more stimulating. 

1) Uptake of remote work  

The recent accelerated global shift towards remote work has transformed our relationship with labor. As a result, companies have realized the benefits of hiring remote employees, irrespective of their location. This new work culture has broken down traditional barriers, making it easier for companies to source talent from anywhere in the world without the need for physical relocation. 

2) Digital connectivity 

Widespread access to the internet and the rise of digital platforms are two factors that have revolutionized how we communicate. Businesses can now easily recruit workers in different countries through online job portals, social media platforms, and professional networking chats. Digital connectivity has made it simple to share job openings globally and improve global recruiting. 

3) Asynchronous working 

More companies are moving from the traditional 9-to-5 model, considering the benefits of remote working with people in different time zones. With team members spread across the world, asynchronous work allows colleagues to engage without the constraints of overlapping working hours. So, embracing this work method has enhanced efficiency and inclusivity in global recruiting. 

4) Virtual collaboration tools 

The rise of digital teamwork tools and project management software has further eased the process of distributed workforce management. Virtual meetings, online document sharing, and real-time communication platforms enable seamless collaboration between team members. These tools have become essential for fostering effective partnerships and ensuring that global recruiting efforts are successful. 

5) Growing international talent pools 

As the world becomes more connected, businesses can tap into a diverse pool of skilled professionals from different places. Companies can identify individuals with unique perspectives that may not be readily available in their local markets. This also makes it easier to find more cost-effective global recruiting, as well as connecting with niche and emerging expertise, such as software development and AI technology. 

6) Employer of record assistance 

An employer of record is a third-party provider that uses their own international entities, partner organizations, and regional knowledge to assist companies in hiring professionals. Beyond recruitment, an EOR can also help in managing payroll or other legal obligations. This makes global recruiting quicker and smoother, as businesses can outsource complex legal processes. 

Global recruiting via an EOR: no foreign entity needed 

Hiring personnel in foreign countries involves many challenges of international expansion, such as dealing with new market research, guaranteeing legal compliance, and even learning about cultural differences. So, working with an Employer of Record (EOR) is likely the most practical option when it comes to global recruiting. 

An EOR assumes full legal responsibility for your company, eliminating legal issues or fines. They can take care of general administration, and reporting obligations related to your foreign employees. This guarantees compliance with specific labor laws in the countries from which you will be hiring personnel. 

They can also contribute with extensive knowledge on local culture, language, and work habits. They can utilize the online platforms and social networks that are most common in the region you will be employing to find adequate candidates. If you need to hire international employees in a range of locations, an EOR can also point out specific markets for certain attributes. 

These services are typically agreed on a monthly fee-per-employee basis. The payment structure can be a simple fee or a percentage of the employee’s salary. Determining the most suitable arrangement depends on the company’s needs and the extent of the EOR’s capabilities and coverage. Some EORs focus on specific countries or regions, while others have a broader global recruiting reach. 

Two other options for global recruiting 

The most known alternative to working with an EOR in global recruiting is hiring full-time employees directly, without assistance. However, this can prove to be a multifaceted endeavor, because you must establish a legal entity in the desired country. This entails complying with all legal requirements, such as registering with local authorities and acquiring the necessary permits and licenses. 

Once the legal groundwork is set, the recruitment process can commence. You’ll have to share your job openings through diverse media channels, both locally and internationally, to attract a diverse range of candidates. Be mindful of language barriers and provide appropriate support to candidates. Additionally, engaging in direct negotiations and finalizing employment contracts will be essential tasks in this process. 

But, if you don’t want to employ full-time collaborators, you can still hire international independent contractors. They work independently, offering their services to employers while operating under their own company. This arrangement makes them an attractive choice for engaging workers on specific projects or for limited durations, even though these contractors won’t legally be a part of the company’s payroll. 

They can be recruited directly as well. However, misclassifying them as contractors when they should be considered employees can lead to legal complications and potential penalties. Moreover, overseeing and ensuring communication may require extra effort compared to managing regular employees. Alternatively, some EORs extend their support to assist with recruiting independent contractors. 

Serviap Global offers global hiring solutions 

At Serviap Global, we are able to assist companies with global hiring solutions in over 100 countries worldwide, including EOR services, contractor hiring, and global talent aquisition to help you find candidates to hire directly.

Contact us today to find out more about how we can help you with your global recruiting needs.