How to recruit and manage employees abroad?

More than ever before in human history has work been so remote. 2023 is a year where digital nomads can get back on the road again after the pandemic, whilst companies have adjusted to WFH solutions and are now considering the global labor market to boost productivity and reduce costs.

However, for all the benefits of having an overseas workforce, it comes with its own unique set of challenges. But fortunately for these companies, 2023 also has more technological solutions than ever before to aid the process. Through technology, local market experts, and traditional business solutions, it’s never been easier to hire a diverse, productive, and lower-cost workforce that is fully in line with the company’s vision.

Leveraging technology

The first and foremost tip for working with remote employees is to leverage technology. There are many practical examples of this, many of which are discussed later on in this article. However, the general advice here is to place a greater focus on digitalizing the company, along with keeping up to date with the latest developments.

The importance of this grows ever greater the more remote your workforce gets because technological innovations are your best chance at keeping your culture, communication, and workflow tightly knit. The latest developments in scheduling, eLearning and training, fintech solutions, project management, and collaboration, among many other areas.

Get the compliance right

The biggest threat to a company when working with overseas employees is non-compliance - the punishment for which can be very steep. When a person works in Germany but for a US company, it is not only US taxes, workers’ rights, and other employment regulations that matter - it will also be Germany’s. As a German worker, they will owe tax, and the US company will be involved in this responsibility… Heavily.

Now, imagine you have German, British, Indian, and South African employees. This is a minefield of legislation, keeping up to date with LAW changes, and administrative processes. However, it needs to be airtight, and if you’re concerned that you cannot cope, skip to the EOR tip below.

Use a reliable recruitment agency

Recruitment is, and will always be, one of the most difficult aspects of operating a business. Choosing the right candidate is even more difficult when communicating remotely with them, not to mention a lack of expertise within the local labor markets.

A recruitment agency can drastically cut the time and resources spent finding suitable candidates that fit your specific requirements. It may be possible to go at it alone if you’re already familiar with an overseas market and have your own screening process set up, but it’s almost always more costly and time-consuming.

Effectively manage your payroll and currency

One of the most difficult elements of managing employees from different regions is the payroll. Centralizing payroll can be difficult when considering that each employee may have different limitations over being paid, along with the appropriate payslips and other compliance. For example, currency fluctuations and high conversion fees pose a currency risk for the business, not to mention that this becomes difficult to automate.

Fintech payroll solutions for employees abroad are services that aim to solve these problems. Not only do they find better exchange rates and potentially even hedge the currencies for better risk management, but the centralized process makes management much easier, as well as data analysis, accounting, and data-driven decision making. This is also important to ensure all employees are treated equally, for example, when receiving benefits and timely payments.

Focus on communication

Communication will be key to running an overseas workforce. It’s very easy for a department or team to quickly become fragmented without fostering healthy communication channels. Regular check-ins and the use of video conferencing are crucial to this, as opposed to relying on emails and working in isolation. The use of Slack or Discord servers can also promote inter-department communication, and in general be a place for workers to get company news and direct lines of communication with other workers.

Adapt your company culture towards inclusivity

You’re going to have a diverse workforce, so your company culture needs to embrace this. Instead of trying to get everybody to adapt to your own ideals, cultural differences should be celebrated and supported. Don’t assume Christmas is the time for a collective break when the majority of your workforce may not celebrate it, likewise with New Year and other festivities. Furthermore, feedback and support sessions should be used to gain insight into how to make the company culture more supportive and inclusive.

Consider languages

Of course, an English-speaking company will require English-speaking employees. However, you may decide to opt for English-speaking (or partially English-speaking) nations such as India, Singapore, and Nigeria.

Furthermore, creating working teams that share a location, even if it is remote from the head office, could yield some benefits. For example, a mostly Singaporean marketing team will share similar work hours, a similar communication understanding and working culture, and may even be within close enough proximity to work together in a co-working space. Of course, there could be an emerging threat here that other team members, or the company as a whole, become detached from certain departments and sub-teams.

Outsource… Everything with an EOR

We can speak about getting help with payroll, compliance, and working with recruitment agencies. However, an Employer of Record (EOR) is a firm that will hire your chosen employee on your behalf. They become the legal employer, and they will have a department located within the employer’s location.

EORs take on the responsibility of compliance, taxation, and even payroll. This is an easy all-in-one solution to hiring abroad where you do not need to invest heavily into a legal department or worry about non-compliance. The only downside is the fee you pay them along with having less control over the relationship with the employee - it could potentially get in the way of company culture, for example, as there’s a barrier between you.

Help foster socializing

Expatriate employees and particularly those that are working from home can greatly suffer from a lack of socialization. Not having your morning chance encountered by the water cooler machine is something that you may need to replace.

One way might be to create a Friday Zoom call where everything but work can be discussed for half an hour. This way, employees can get to know each other without the pressure of feeling guilty about not working. Another idea for replacing office parties is to simply have Zoom parties, or organize online multiplayer games with servers where employees can chat through.

Think carefully about benefits

When hiring locally, it is easier to gauge what benefits are suitable. For example, a rurally located office may mean the majority of employees may benefit from a car - so leasing out a fleet of cars seems logical. Likewise, private healthcare insurance is much more valuable in the US than it is in most European countries.

These are considerations when looking at what employee benefits you wish to promote. Instead of striking a deal with a national gym, you may want to simply offer the reimbursement costs of a gym membership, understanding that these will differ in cost depending on the location of the employee.

Some more accessible benefits include online tools, such as language learning subscriptions and educational resources. Furthermore, international telehealth services like online therapy might be greatly valued among employees.

Final Word

Of the 10 tips above, the core theme is making better use of technology. However, there’s only so much that a small-to-medium-size enterprise can achieve with great technology - it may also need the benefit of Consultants, agencies, and other outside solutions to help aid them. Compliance and payroll are the key obstacles, along with recruitment, which is why an all-in-one Employer of Record company can be a simple solution to a complex problem.

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