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Thanks to the diversity of options and facilities in the market, many companies of various sectors and sizes are considering international recruitment and staff selection when developing an overseas presence to start their global expansion projects.
Remote work has boosted international recruitment and staff selection, as it affords greater agility when entering and exiting new markets as well as making the process easier when hiring global talent.
However, there are also certain disadvantages to hiring overseas. These range from cultural differences to the costs of searching for staff in unfamiliar territories or sometimes complex laws related to recruiting and paying taxes.
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Making the most of the pros and managing the cons carefully will help you make a better decision regarding international recruitment and staff selection options, of which there are three main choices: hiring directly, EOR services, and recruiting independent contractors.
Each of the possibilities, in turn, has benefits and risks, so it is best to design an international expansion strategy carefully, as you also need to think about how your staff will be managed, the tools you need to provide for them, and which channels of communication you want to use with your global team.
Serviap Global helps companies with international recruitment and staff selection solutions in more than 100 countries. Contact us to find out how we can help you.
The benefits of international recruitment and staff selection
Expanding a business abroad has multiple benefits, and doing so through international recruitment and staff selection is no exception. For example, developing economies can become accessible markets to conquer when you add employees from these countries to your teams.
Having employees of different nationalities and backgrounds will help you build diverse teams that will not only bring innovative ideas to the table but will also help you gain a broader understanding of the local market, work culture, traditions, and demographic data that will help you create a robust expansion strategy in this and neighboring territories.
Taking a business beyond your borders does not require a considerable investment of time and money. While it will depend on your international recruitment and staff selection solution, it is possible and more affordable than you think.
Plus, when you have a presence in different markets, whether near or far from home, you have an even more excellent opportunity to cover different time zones, improve your customer service and achieve your expansion goals faster than planned.
By having staff in different regions and working from home, your output will be even higher. As shown by a study from the National Bureau of Economic Research (NBER), companies in sectors such as IT and finance experienced an increase in productivity from 1.1% between 2010 and 2019 to 3.3% since the start of the pandemic.
Challenges of international recruitment and staff selection
Beyond the benefits of international recruitment and staff selection, you must consider the challenges behind this strategy, such as asynchronous working: no constant or fluid communication due to employees in different locations and with more than one time zone.
Also, although you can communicate in a common language with your global collaborators, you need to take into account the cultural and work-related differences that may exist between people in different countries. This way, you will avoid misunderstandings or inefficient communication.
Local labor and tax laws are also best understood and followed to the letter to avoid possible violations or even the termination of operations and, consequently, a bad reputation. In this sense, you must know how to correctly classify your employees to be sure of the benefits they are entitled to by law.
3 solutions for international recruitment and staff selection
For a successful international recruitment and staff selection process, consider these three options:
1) Direct hiring
Direct hiring is one of the international recruitment and staff selection solutions for expanding companies. However, it can be a complex process, although possible, as you will need to set up your legal entity in the country of your choice.
This way, you can ensure compliance with all legal obligations, including registering with local authorities and obtaining the necessary permits. Remember that it requires a significant investment of resources and that your entry into a new market will take longer.
Nevertheless, taking responsibility for international recruitment and selection is the best option when you are looking to stay in a country indefinitely and need to employ a significant number of workers.
To hire personnel directly, you must define the entity that best suits your business; these are usually of three types: a foreign representative agency, a branch, or a subsidiary. Your choice will depend on local laws and your expansion needs.
You can hire staff directly, but doing so with the help of a third party will make things easier for you. While you decide which type of entity is the most accurate, an EOR, for example, can source, hire and manage your future employees and assume legal responsibility for the entire international recruitment and staff selection process.
2) Via an EOR
If you prefer to have a third party completely take care of your international recruitment and staff selection, which means that you will not have to set up an entity to take part in your operations in another territory, it would be best to rely on an employer of record (EOR).
Also known as an international PEO (professional employer organization) for its co-employment services, an EOR is a third party that sources, hires, and manages employees on behalf of its clients, following local regulations and according to the needs and budget of these companies.
Besides having established entities, the EOR has recruitment networks, knows the local market, and is an expert in local laws, which helps to minimize any legal problems and possible financial penalties.
As part of its services, an EOR handles the paperwork necessary to recruit and select international personnel. It also manages its clients’ human resources, such as payroll, taxes, benefits, and contract termination, all in exchange for a percentage of payroll.
To work with an EOR, first, find the one that suits your needs and jointly establish the type of professionals you require. The EOR will screen profiles, interview the most qualified, present you with a selection of candidates, and, once you choose the next members of your team, make the job offers and sign the necessary contracts.
All personnel you hire through an EOR will report directly to you, so you are responsible for onboarding, assigning, and reviewing tasks and making them feel part of your organization.
3) As international contractors
International recruitment and staff selection can also be accomplished by working with independent contractors. These trained professionals provide their services on a freelance basis for a specific project or a particular period.
Also, these experts may work alone or in groups. Although they may appear to be full-time employees, they work for their own company, which provides services to their global clients.
As independent collaborators, they have their schedules, are more flexible, usually have their work tools, and can adapt to tight deadlines so that they can charge a little more than a regular employee.
Not being part of the payroll, these workers have different rights and obligations, so it is worthwhile to understand the risks of contractors misclassification that entails collaborating with these professions to avoid possible fines.
Employing independent contractors can be done directly through the websites where they offer their services. However, when working with an EOR, there are fewer complications, and compliance with the law is guaranteed.
Serviap Global offers international recruitment and staff selection
At Serviap Global, we help companies that want to expand overseas with a range of international recruitment and staff selection solutions in over 100 countries worldwide.
Our services include international PEO / EOR services, contractors, and global talent acquisition for finding direct hires.
Contact us to find out more.
You can also use our free salary paycheck calculator to get an idea of the costs of hiring global talent in different countries.
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