When artificial intelligence (AI) started to change how the world operated, many of us were in love. As a team that’s worked with many businesses entering foreign markets, we can tell you: AI is a supremely powerful tool, but it’s not the full picture. If all the talk is about numbers, automation and efficiencies, global… Read more AI’s Limitations in Global Employment: Separating Facts from Fiction
When artificial intelligence (AI) started to change how the world operated, many of us were in love. As a team that’s worked with many businesses entering foreign markets, we can tell you: AI is a supremely powerful tool, but it’s not the full picture.
If all the talk is about numbers, automation and efficiencies, global employment is about people. It’s not something machines can do on their own.
The Role Of AI In Global Workforce Planning: Helpful, But Not Reliable
AI aids in recruitment, role-matching, and workforce allocation by reducing the time taken to assess decisions relating to the workforce by compiling large data sets. But AI has its built-in limitations, not the least of which is bias.
AI learns from the data it’s trained on, and without proper safeguards, it can repeat or even amplify unfair practices.
For example, hiring in Japan isn’t as simple as analysing data and assigning a role. Japanese workplace culture, with its emphasis on hierarchy, seniority, and job loyalty, imposes unique constraints that AI alone cannot navigate. Human oversight is essential — AI needs to assist decisions, but human judgment should be the centre of decision-making.
Can AI Remove Bias Without the Help of Humans?
There are many scary headlines about how AI can perpetuate bias, but what does that mean in practice? Hiring algorithms often score candidates lower because their resumes don’t reflect patterns found in candidates considered traditional success. It was not intentional, but this was the reality, and the bias was present in the data.
AI does not have bias on its own, it learns from what we give it. If that data is a mirror reflecting past inequities, so will the results. That’s why corporations need artificial intelligence and good people, experts to question outcomes, audit systems, and ensure decisions align with fairness and inclusivity.
Setting periodic reviews to assess the results of its AI-based systems. Thus, one well-known UK recruitment firm set up periodic reviews to look at the results of its AI-based recruiting engine. They didn’t accept the rankings at face value — they tested them, looking for patterns that would suggest bias. This manual process corrected the system so that it was fairer.
The best businesses using AI get the mix between the two exactly right, using AI to extract patterns and human insight to exercise fairness.
Professionals should regard AI as a helper, not a master. You need a human lens to counterbalance AI recommendations and ensure they align with company values and long-term vision.
Artificial Intelligence Can Only Take You So Far in Global Payroll
If you have been processing the payroll of a global workforce, you would recognise the complexity. The tax laws, social security contributions, tax residency rules, etc. can make the whole issue hugely complex.
It’s like trying to solve a jigsaw puzzle while the pieces keep morphing. AI can automate 1,000,001 calculations, but it’s the exceptions that cause the real headaches.
AI enables scaling, and is fabulous for automating repetitive tasks, but human international payroll experts and their domain knowledge are better suited for special cases. It’s the difference between automation that works in theory and solutions that work in practice.
AI is a tool, not the answer.
At Acumen International, we don’t just follow technology — we supplement it with the skills and knowledge of people who’ve worked in the trenches.
Where Are Legal and Ethical Boundaries of AI?
While AI can quickly answer questions, its output can be inaccurate or biased, largely due to data that is incomplete or biased.
AI can sometimes produce inaccurate or misleading outputs, known as hallucinations. Without human checks, these mistakes can create serious legal risks. In global employment, errors in contracts or compliance with local regulations can lead to costly issues across jurisdictions.
AI’s development, deployment and use span multiple sectors and cross-national borders, creating global opportunities and challenges.
That’s when human validation becomes necessary. Signing off on every AI-generated output may be tedious, but in practice, it’s a negligible price to pay to avoid even more costly mistakes. Companies need teams that understand the laws and the grey areas where interpretation matters.
With the growing need for AI governance, new initiatives aim to reduce risks and promote AI systems that are fair, trustworthy, and focused on human rights.
Trouble With Overconfident AI
If you were consulting a human expert, you wouldn’t be getting the response presented in such a confident manner that the AI models like to give—even if they’re wrong.
The issue comes in with how the AI processes information: it’s geared to respond to specific types of prompts rather than to truly understand the nuances of the user’s request. This can lead to overconfidence in the AI recommendations, especially on sensitive questions like cross-border payroll or tax matters.
That’s where human oversight is key — to validate AI-driven recommendations and bring a level of scrutiny appropriate for high-stakes decisions.
The Expanding Field of AI Regulation
The rise of AI platforms—spanning everything from art to speech simulation — has sparked important discussions about regulation. Governments are working to create frameworks that balance progress with responsibility.
These collaborations reflect an increasing come-together of the sharing consensus that AI governance needs to be global, inclusive and anticipatory. Nations are not only following the steps for ensuring innovation and competition, while also addressing the challenges to the digital economy, social well-being and public governance posed by AI.
OECD — Keep an Eye on What Happens Next
The Organisation for Economic Co-operation and Development (OECD) has curated a live database on national AI policies. The database contains details of over 1,000 AI policy initiatives across 69 countries, territories, and the European Union.
This database is continually updated, updated along with new AI policies and strategies, reflecting the important conversation around responsible AI governance as technology moves faster than ever.
Governments and local authorities around the world are starting to respond to the potentially pervasive impacts of Artificial Intelligence across all areas of society, releasing policies that regulate the use of this new and transformative technology – all of which are now documented in this database.
How Do We Create Explainable AI Decisions?
The truth is, most AI models function like a black box. They provide outputs without any transparent window into the reasoning process that led to them. That can be dangerous in areas such as global payroll or compliance, in which transparency is key.
Large language models, for example, provide answers through patterns without explaining their logic. This cannot replace human subject matter experts who must bridge this gap between transparency, accuracy, and explainability of AI-based decisions in high-stakes domains such as legal compliance or people.
When Does AI Require Human Adaptability?
AI systems — no matter how powerful they are — are generally not very strong. While AI can demonstrate great results with known data, but in new and complex real-world situations the output may either be limited, vague or completely incorrect.
Global employment is complex, with different laws, cultures, and individual circumstances. It takes human judgment to ensure decisions are both compliant and employee-friendly.
Why We Must Bridge the Digital Divide
AI has great potential to improve how we manage the global workforce. This is especially true for complex tasks like payroll processing, compliance tracking, and global talent management. AI can improve multinational employers’ decision-making and operational processes through its speed in analysing data and forecasting trends. AI promises efficiency, but it has no lived experience and can miss nuances of hiring compliance.
AI jobs are one of the fastest growing global sectors. But you have to frame it the right way. We should consider humans working with AI. Such practices can help us amplify positive impacts and minimise harmful consequences.
By understanding both the upsides and downsides of AI, businesses will be able to adopt AI technology properly while not eliminating the human touch in employed talent approaches.
Acumen International offers a balanced solution: technology and people. Combining technology with a human touch is key to tackling global employment challenges in 2025.
With laws around AI and governance frameworks constantly evolving, having a human touch alongside advanced tools has never been more important. We are here to support you on your global employment journey.
As 2024 nears its end, we want to extend our gratitude to the readers who have followed this newsletter over the past two years. This November edition brings you essential updates on employment-related changes around the globe. From evolving employer obligations in the UK and Poland’s new tax scheme for entrepreneurs to bilateral social security… Read more Global Employment Tax and Compliance Newsletter. November 2024
As 2024 nears its end, we want to extend our gratitude to the readers who have followed this newsletter over the past two years.
This November edition brings you essential updates on employment-related changes around the globe. From evolving employer obligations in the UK and Poland’s new tax scheme for entrepreneurs to bilateral social security agreements and innovative visa programs, these developments reflect the shifting priorities shaping global employment.
As always, we aim to equip you with the insights to stay ahead and make informed decisions. Thank you for your continued readership and trust.
Let’s close 2024 prepared for the opportunities and challenges 2025 will bring.
United Kingdom 🇬🇧: Budget 2024 Highlights for Employers and Employees
These updates have implications for businesses of all sizes, from higher National Insurance Contributions to increased wages for low earners.
Employers should take note of:
Rising costs for staff compensation due to changes in NIC rates and the National Living Wage.
Relief measures for small businesses, including the doubling of the Employment Allowance.
There are new requirements in payroll reporting with the mandatory inclusion of benefits-in-kind starting in April 2026.
A phased-out non-domiciled tax regime that could affect international recruitment and investment decisions.
The infographic below provides a detailed breakdown of these updates and their implications.
Czech Republic 🇨🇿: Proposed Changes to Taxation of Employee Share and Stock Option Plans
A parliamentary proposal aims to amend the Income Tax Act, allowing employers to revert to pre-2024 rules for taxing employee share and stock option income. The amendment is expected to take effect from January 2025.
Key Updates
Tax Deferral Option: Employers may defer taxation by notifying the Czech tax authority within specific timeframes. If not deferred, income would be taxed at the time of acquisition or exercise, as before 2024.
Aligned Contributions: Czech social security and health insurance contributions will follow the same timing as the income tax.
Transitional Rules for 2024: Employers can retroactively apply tax deferral for 2024 if notification is submitted within two months of the amendment’s effective date.
Employer Actions
Decide whether to defer taxation for employee share and stock option plans.
Notify the Czech tax authority to opt for deferral.
Review tax and contribution liabilities for 2024 and ensure timely compliance with retroactive provisions.
Ireland 🇮🇪: PAYE Settlement Agreement Deadline and Enhanced Reporting Obligations
The deadline for PAYE Settlement Agreement (PSA) applications for the 2024 tax year is 31 December 2024. Employers should review their records to ensure taxable non-cash benefits are correctly identified and reported.
Key Updates
PSA Overview: The PSA allows employers to report and settle income tax, Universal Social Charge (USC), and Social Security (PRSI) on qualifying minor and irregular benefits outside the payroll system. Liabilities must be calculated on a grossed-up basis.
Deadlines: Approved PSA filings and payments are due by 23 January 2025. Missing this deadline will nullify the PSA arrangement, requiring employers to handle liabilities through the PAYE system, with potential penalties for late corrections.
Enhanced Employer Reporting (EER): From 1 January 2024, EER requires the submission of real-time informational returns for certain tax-free benefits. This provides Revenue with additional data and increases the likelihood of compliance checks on previously unreported benefits.
Employer Actions
Submit PSA applications by 31 December 2024 and ensure filings are made by 23 January 2025.
Review processes for identifying and reporting taxable benefits under PSA and EER obligations.
Implement mechanisms to assess the taxability of benefits and ensure compliance with EER requirements.
Timeline
PSA application deadline: 31 December 2024. PSA filing and payment deadline: 23 January 2025.
Netherlands 🇳🇱: Updates on State Pension Age and Flexible Employee Contracts
1. State Pension Age Update
The state pension age in the Netherlands will increase to 67 years as of 1 January 2024, reflecting a gradual rise tied to life expectancy. Future adjustments will be announced at least five years in advance, providing certainty for employers and employees.
Impact Date: 1 January 2025 (no further increases planned for five years).
Employer Actions: To ensure compliance, employers should review employment contracts, especially for employees nearing the state pension age.
2. Legislative Proposal: More Security for Flexible Employees
The proposed “More Security for Flexible Employees Act” aims to replace on-call contracts with basic contracts, ensuring fixed minimum working hours. It also extends the break between consecutive fixed-term contracts from 6 months to 5 years, after which a new indefinite contract must be offered.
Impact Date: Not before 1 January 2026.
Employer Actions: Employers will need to transition from on-call contracts to basic contracts for non-student workers and maintain detailed records of employment terms for at least 5 years.
Key Considerations: Monitor legislative updates and prepare for significant administrative adjustments if the proposal is adopted.
Czech Republic 🇨🇿 and Brazil 🇧🇷: Bilateral Social Security Agreement Now in Force
As of 1 November 2024, the Czech Republic and Brazil have enacted a bilateral social security agreement.
The agreement simplifies compliance for cross-border workers and employers, eliminates double taxation of social contributions, and facilitates the claiming of pension benefits, promoting smoother mobility between the two nations.
The agreement applies to pension insurance but excludes health insurance, unemployment benefits, and social assistance.
Key Updates
Avoiding Dual Contributions: The agreement ensures individuals are only subject to social taxes in one country.
Equal Treatment: Workers are treated as nationals under the host country’s social security laws.
Totalisation of Periods: Social security periods accrued in both countries are combined for eligibility purposes.
Exportability of Benefits: Pension benefits, including old-age, disability, and survivors’ pensions, can be claimed across borders.
Coverage for Posted Workers: Employees on temporary assignments remain under their home country’s social security system for up to 36 months.
Employer Actions
Familiarise with the agreement’s terms to ensure compliance and prevent dual contributions for affected employees.
Advise employees about eligibility and benefits under the agreement, including totalisation provisions.
Austria 🇦🇹: New Rules for Teleworking Agreements Effective January 2025
Austria has expanded its teleworking regulations under the Employment Contract Law Amendment Act (AVRAG). These changes extend beyond home offices to other remote work environments, such as co-working spaces, libraries, or relatives’ homes.
Key Updates
Written Agreements Required: Employers must formalise teleworking arrangements in writing, mirroring existing home office requirements.
Locations Covered: The new rules clarify that remote work can take place in various settings, offering employees greater flexibility.
Compliance Deadline: Employers must ensure all teleworking agreements comply with the updated framework by 1 January 2025.
Employer Actions
Update policies and contracts to address the broader scope of teleworking environments.
Ensure teleworking agreements are properly documented and meet the new legal requirements.
Turkey 🇹🇷: New Tech Visa Program for Foreign Technology Professionals
Turkey has introduced a Tech Visa program to attract foreign technology professionals and entrepreneurs. The program aims to support the country’s technological growth by creating opportunities for innovative individuals to work and establish businesses in Turkey.
Key Updates
Eligibility: Open to foreign technology professionals and start-up entrepreneurs with expertise in the tech sector.
Application Process:
Submit an initial visa application at a Turkish Consulate to receive a reference number.
Complete the Ministry of Labour and Social Security application using the reference number.
Upon approval, the Tech Visa is valid for up to three years.
Benefits:
Workers in R&D-focused companies are exempt from income tax, with the state covering half of their social security contributions, including universal healthcare.
A streamlined application process for tech professionals and their dependents.
Belgium 🇧🇪: New Minimum Salary Requirements for Non-EEA Employees in 2025
As of 1 January 2025, the Brussels, Walloon, and Flemish regions have updated their minimum salary thresholds for employing non-European Economic Area (EEA) nationals. Meeting these thresholds is mandatory for obtaining or renewing work permits or Single Permits.
Key Updates
Region-Specific Thresholds: Each region calculates the required salary differently. The Brussels region uses monthly gross salaries, while Flanders and Wallonia assess annual gross wages.
Categories Impacted: Specific thresholds apply to highly skilled workers, intra-corporate transferees (ICTs), management personnel, and EU Blue Card holders.
Age Consideration: Younger, highly skilled workers ( under 30 years) have lower requirements but must meet the standard thresholds when they turn 30.
Salary Thresholds for 2025
Employee Category
Brussels (Monthly)
Flanders (Annual)
Wallonia (Annual)
Highly Skilled Employees
€3,703
€48,912
€51,613
Highly Skilled (<30 Years)
N/A
€39,130
€41,290
Management Personnel
€6,647
€78,259
€86,110
ICT: Specialist
€4,511
€48,912
€53,390
ICT: Trainee
€2,611
€48,912
€33,370
ICT: Management
€5,460
€78,259
€66,738
EU Blue Card
€4,748
€63,586
€66,738
Consequences of Non-Compliance
Employers failing to meet salary thresholds risk penalties ranging from fines (€400 to €48,000 per infraction) to imprisonment in severe cases.
Employing a non-EEA national without meeting salary requirements may result in administrative and legal sanctions.
Employer Actions
Verify employee compensation aligns with the updated thresholds to maintain compliance.
Ensure that salary thresholds are met during initial hiring or permit renewal processes.
Consult immigration specialists to understand how regional rules may impact specific employment cases.
Poland 🇵🇱: New “Cash PIT Scheme” for Entrepreneurs Starting in 2025
On 30 October 2024, Poland enacted amendments to the Personal Income Tax Act, introducing a voluntary “cash PIT scheme” for small businesses and new entrepreneurs. This new approach simplifies tax administration and links income tax obligations to actual cash flow, offering greater flexibility for eligible taxpayers.
Key Updates
Eligibility: Available to businesses with revenue not exceeding PLN 1 million in the prior taxable year and to new entrepreneurs.
Tax Calculation:
Income tax is payable only after payment for goods or services is received.
Deductions for expenses are allowed only once payment is made for purchases.
Revenue must be recognised after two years, even if payment is still pending.
Administrative Requirements: Taxpayers must submit a written declaration to their tax office by 20 February of the taxable year or, for new businesses, by the 20th of the month following their start date.
Global Payroll Calculator – Your Precision Tool for Global Employment Cost Analysis
The Global Payroll Calculator (GPC) offers a solution for instantly calculating employment costs across 190 countries, streamlining your global hiring strategy and ensuring cost-effective decisions.
Key Features & Benefits for International Hiring
Instant Cost Calculations: Quickly determine total employment costs, factoring in real-time tax rates and benefits for local and foreign talent in 190 countries.
Precision & Clarity: Achieve precise payroll calculations with detailed breakdowns of all payroll variables, ensuring transparency and preventing unexpected costs.
Cross-Country Comparisons: Utilise GPC’s capability to perform instant comparisons between countries, helping you identify the most advantageous locations for hiring.
Core Capabilities of Global Payroll Calculator
Total Employment Cost Analysis
Monthly and yearly costs.
Gross-to-net and net-to-gross calculations.
Detailed breakdowns, including employer liability and employee taxes.
Full Tax Breakdown
Comprehensive coverage of social contributions, personal income tax, and automated tax caps.
Employer and employee tax splits with allowances and holiday entitlements.
Built-in HR Compliance
Ongoing validation against trusted government sources.
Updates in real-time to reflect the latest tax and labour laws.
The Global Shift to a Four-Day Workweek
The four-day workweek is moving beyond trials, with countries like Belgium, Japan, and Spain leading adoption efforts. While results show improved work-life balance and sustained productivity, challenges remain in sectors requiring continuous coverage across diverse cultural and legal frameworks.
Key insights
Global Examples: Iceland and the UK report reduced stress and improved retention after successful pilots, while Belgium and Japan implement flexible models.
Employer Considerations: Flexible schedules appeal to talent but may face resistance in industries like healthcare or manufacturing.
Opportunities: Companies adopting the four-day model can differentiate themselves in competitive labour markets while fostering better work-life balance.
This article explores the practical and cultural factors shaping this shift and offers insights for businesses considering its implementation.
How AI is Shaping the Future of Work
AI redefines global employment, creating roles like AI ethics officers while automating repetitive tasks. Businesses face challenges such as addressing bias, managing skills shortages, and adapting workflows.
The article highlights the need for ethical governance, effective reskilling programs, and a balance between AI capabilities and human expertise to remain competitive in an evolving workforce landscape.
The Hidden Dynamics of Employee Misclassification
Misclassifying workers is a growing risk for global employers, driven by cost-saving pressures, complex labour laws, and the demands for flexibility. This article examines why misclassification occurs and how businesses can avoid its pitfalls.
Key Insights
Common Drivers: Misclassification often stems from financial incentives, evolving contractor roles, and cross-border legal differences.
Industries at Risk: Technology, construction, healthcare, and gig economy sectors frequently rely on contractors, increasing their exposure to compliance risks.
Solutions: Businesses can mitigate risks by transitioning contractors into employees where necessary or ensuring compliant contractor management for short-term roles.
The Future of Global Employment: 15 Trends to Watch in 2025
Remote work is driving changes to tax policies, with updates in the UK, Germany, and the US creating new compliance challenges. APAC and LATAM are emerging as key regions for talent, while stricter contractor regulations globally are reshaping workforce strategies.
Tax Changes for Remote Work: Countries like the UK, Germany, and the US are adapting tax rules for remote workers, requiring companies to update compliance strategies.
New Talent Frontiers: APAC and LATAM are becoming promising regions for hiring. They offer skilled talent and competitive costs but require careful management of local laws.
Contractor Hiring Rules Tightening: Governments are introducing stricter regulations on gig workers, pushing companies to balance flexibility with compliance.
Custom Benefits Are Key: Personalised benefits, such as relocation support, are now crucial for attracting and retaining international talent.
Conclusion
This month’s developments showcase the dynamic nature of global employment and compliance, offering insights to help you stay ahead in 2025.
We’ll return next month with the December edition, providing the final updates of the year and reflecting on the themes shaping global employment strategies as we head into the new year.
The four-day workweek is no longer an experimental workplace trend. It has evolved into a serious consideration for governments, organisations, and workers worldwide. What began as isolated trials in countries like Iceland has now spread globally, with diverse approaches ranging from mandatory legislative changes to company-led initiatives. For multinational employers, this trend signals a potential… Read more Four-Day Workweek: Insights for Global Employers
The four-day workweek is no longer an experimental workplace trend. It has evolved into a serious consideration for governments, organisations, and workers worldwide. What began as isolated trials in countries like Iceland has now spread globally, with diverse approaches ranging from mandatory legislative changes to company-led initiatives.
For multinational employers, this trend signals a potential shift in how productivity, employee well-being, and work-life balance are prioritised in the modern labour market.
With countries such as Belgium, Japan, and Spain taking the lead, businesses operating across borders must navigate new employee expectations and the legal and cultural nuances associated with reduced working hours.
This article explores how the four-day workweek is being implemented globally, what employers need to know, and why this trend matters for companies competing in the international talent market.
Pioneering Countries: Leading the Global 4-Day Workweek Movement
Iceland
Iceland is widely regarded as a trailblazer in the four-day workweek movement. Between 2015 and 2019, the country conducted large-scale trials involving over 2,500 employees across public sector jobs such as social services, hospitals, and local government offices. These trials addressed two key challenges: high workplace stress and diminishing work-life balance.
The initiative was born from growing concerns about employee burnout and the need for more sustainable working conditions. By testing shorter workweeks while maintaining full pay, Iceland sought to evaluate whether such a model could balance productivity and employee well-being.
The results were striking:
Stress and Burnout: Participants reported significantly reduced stress levels and greater mental well-being.
Work-Life Balance: Employees found more time for personal interests and family, fostering overall satisfaction.
Productivity: Despite fewer working hours, productivity remained steady or improved, with teams adapting through prioritisation and better time management.
Following the trial’s success, 86% of Iceland’s workforce now has access to flexible or reduced-hour contracts, setting a precedent for other countries.
New Zealand
New Zealand’s role in the four-day workweek discussion began with bold moves by private companies. In 2018, Perpetual Guardian, a trust management company, conducted a well-publicised trial to test the impact of reducing working days while maintaining full pay.
The driving force behind this experiment was the company’s leadership, which wanted to combat rising stress levels, promote a healthier work-life balance, and boost productivity in a high-pressure industry. The trial provided clear evidence of its benefits:
Productivity: Despite working fewer hours, employees reported being just as productive, if not more, due to improved focus and efficiency during the reduced working week.
Employee Satisfaction: Workers reported greater satisfaction with their jobs and personal lives, leading to improved retention rates.
The success of Perpetual Guardian’s trial sparked interest across New Zealand, especially among businesses reliant on high employee engagement. Although not yet legislated nationally, New Zealand remains a reference point for company-led innovation in work structures.
Countries Adopting the Four-Day Workweek
Countries adopting the four-day workweek have taken bold steps toward formalising flexible schedules, demonstrating the viability of shorter workweeks through legislation or widespread adoption. Here’s how some key countries have made this shift.
Belgium
In November 2022, Belgium introduced legislation allowing full-time workers to request a four-day workweek. This move aimed to provide greater flexibility in work arrangements while maintaining employee salaries and benefits. Workers compress their 38-hour workweek into four 9.5-hour days, balancing shorter weeks and productivity.
Here’s a breakdown of its key aspects:
Adoption and Implementation
Employer Discretion: While employees can request a four-day schedule, employers have the right to approve or refuse the request. Any refusal must be accompanied by a written justification.
Trial Period: Approved requests are valid for six months, allowing employees and employers to assess the arrangement’s impact.
Current Adoption Rates
Despite initial enthusiasm, uptake of the four-day workweek remains limited. Contrary to earlier claims of a 56.5% adoption rate, a report from Acerta in October 2023 shows only 1.9% of employers have employees working a full-time four-day schedule.
Employer and Union Perspectives
Employer Concerns: Many businesses are hesitant, citing fears of organisational disruption and challenges in restructuring workloads.
Union Reservations: Labour unions have voiced concerns about the potential for increased daily workloads, which may lead to burnout or stress for employees.
While Belgium’s four-day workweek legislation introduces greater flexibility into the workplace, its adoption has been modest. Challenges around implementation, workload management, and employer acceptance highlight the need for more practical solutions and cultural shifts to make flexible work arrangements more accessible across industries.
United Kingdom
In 2022, the UK conducted one of the world’s most extensive four-day workweek trials. Over 70 companies from diverse industries, involving 3,300 employees, participated in the six-month pilot. The trial tested a model where employees worked reduced hours (typically 32 hours per week) without any pay reduction.
The results were overwhelmingly positive:
Productivity: Most businesses reported maintained or increased productivity levels.
Retention and Recruitment: Employees appreciated the improved work-life balance, which led to higher retention rates and greater appeal in attracting talent.
Permanent Adoption: More than 90% of participating companies decided to continue the four-day workweek after the trial.
This trial has positioned the UK as a leader in flexible work experimentation, setting an example for businesses worldwide.
Scotland
Following in Ireland’s footsteps, Scotland has rolled out its four-day workweek trials as part of a larger strategy to improve worker well-being and reduce burnout. The Scottish government has strongly supported these programs.
Trial Design: Employees work 80% of their usual hours while retaining 100% of their pay, with participating companies committing to maintaining productivity.
Focus on Quality of Life: The trial emphasises how shorter workweeks can enhance workers’ quality of life, particularly in high-stress sectors.
Public Sector Involvement: Discussions are underway to extend the trial to public sector roles, further demonstrating Scotland’s commitment to the concept.
Japan
Japan, long known for its gruelling work culture, is cautiously moving toward flexibility to address overwork and its societal consequences.
The results were impressive: Microsoft reported a 40% increase in productivity, measured by sales per employee, compared to the previous year and a 25% reduction in days taken off.
The company limited meetings to 30 minutes to enhance efficiency and promoted online communication over face-to-face interactions. This initiative was particularly relevant in Japan, where long working hours have been linked to severe health issues, including karoshi (death by overwork). The success of this pilot highlighted the benefits of flexible work arrangements and encouraged Microsoft to consider further strategies to improve employee well-being and productivity.
The pilot’s outcomes were transformative:
Productivity Boost: Productivity increased by 40% due to fewer meetings and more focused work.
Energy Savings: The company also saw a 23% reduction in electricity use, aligning with sustainability goals.
While not yet legislated, Japan’s Ministry of Health, Labour, and Welfare has since encouraged companies to offer flexible schedules. The model has gained attention as a possible solution to the country’s chronic overwork culture.
Spain
Spain has taken significant legislative steps to trial a reduced workweek at the national level. In 2021, the Spanish government approved a two-year pilot program to implement a 32-hour workweek, primarily targeting small- and medium-sized companies in sectors such as manufacturing and technology.
The government allocated over €9.65 million to subsidise participating businesses to support this initiative, ensuring employees would not experience pay cuts despite the reduced hours.
The primary objectives of this program are to enhance work-life balance and demonstrate that shorter working hours can maintain or even boost productivity. This pilot represents one of the most substantial government-backed experiments promoting worker well-being while improving industrial efficiency.
Cultural Alignment: The policy was partly designed to align the UAE with international markets for smoother business operations.
Private Sector Influence: While the change is primarily in the public sector, private companies are increasingly adopting flexible models.
Portugal
Portugal is emerging as a key player in the four-day workweek movement, having launched pilot programs in 2023 with government funding. The government-backed initiative began in June 2023 and involves 41 private-sector organizations. 21 companies are starting a six-month trial of the four-day workweek while maintaining full pay for employees.
The primary aim of these trials is to evaluate the broader impacts on economic output and worker satisfaction. Participants voluntarily committed to reducing their working hours without financial compensation from the government, and they can opt out of the program at any time.
The program is being conducted in partnership with 4 Day Week Global, and researchers from Henley Business School and Birkbeck, University of London monitor its results.
Initial findings indicate positive outcomes, including reduced worker anxiety and fatigue and improved work-life balance. The initiative reflects Portugal’s commitment to modernising employment practices and enhancing employee well-being while assessing the potential for broader implementation across various sectors.
Germany
Germany has taken a more cautious approach, with smaller-scale trials by individual companies and unions advocating for reduced hours.
Union Involvement: The German Trade Union Confederation (DGB) has called for shorter workweeks to balance work-life priorities and improve mental health.
Industry Focus: Trials have been most prominent in tech and creative industries, where flexible working hours are easier to implement.
Challenges: Resistance from employers in manufacturing and engineering sectors, where strict schedules are required, has slowed wider adoption.
Common Benefits of Four-Day Week
Enhanced Work-Life Balance: Workers report improved mental health and satisfaction.
Productivity Gains: Across industries, shorter workweeks often maintain or improve output.
Talent Retention: Flexible schedules attract top talent and reduce turnover.
Energy Efficiency: Countries like Japan have seen reduced operational costs, such as energy savings, from fewer workdays.
Business-Led Innovations in North America
While some countries legislate shorter workweeks, the movement in North America is primarily driven by individual businesses experimenting with and adopting four-day schedules. These private-sector initiatives showcase how flexibility and innovation can bring tangible benefits in productivity, employee satisfaction, and retention.
United States
In the U.S., a country known for its long working hours and “hustle culture,” the four-day workweek is gaining momentum as progressive companies experiment with alternative schedules. While no federal legislation mandates reduced workweeks, forward-thinking organisations are proving their viability.
Key examples include:
Kickstarter: The crowdfunding platform implemented a four-day workweek in 2021 as part of a year-long trial. Kickstarter aimed to reduce burnout and boost creativity by allowing employees more personal time. Following a successful trial, the company permanently adopted the model, citing no loss in productivity.
Buffer: The social media management platform has operated on a four-day schedule since 2020. Buffer’s leadership found that shorter weeks improved employee engagement and retention, with workers reporting greater focus during reduced hours.
Basecamp: This software company embraced a seasonal four-day workweek, offering employees flexible schedules during the summer months. This hybrid approach balances workload demands with opportunities for rest and rejuvenation.
These examples highlight how U.S. businesses lead the charge by prioritising employee well-being without sacrificing operational efficiency.
Challenges and Future Perspectives
While adoption grows, scalability remains a challenge, especially in industries like healthcare or retail, where customer-facing roles require continuous coverage.
However, rising demand from younger employees for flexibility and work-life balance could push more companies to follow suit, creating pressure for broader adoption in competitive labour markets.
Canada
In Canada, employers across public and private sectors increasingly adopt the four-day workweek.
Why Are Canadian Employers Adopting the Four-Day Workweek?
A York University report found that 73% of employers cited the pandemic as a key motivator for trialling a shorter workweek. Amid shifts in employee expectations, organisations are using this model to tackle the following issues:
Competing for Talent: Labour markets are becoming more competitive, and a four-day workweek is a differentiator that helps employers stand out, offering improved work-life balance.
Improving Workforce Satisfaction: As precarious gig work and contractual roles rise, a shorter, stable workweek helps organisations address burnout and improve engagement.
Conclusion: Is the Four-Day Workweek Right for Global Employers?
The four-day workweek is more than a trending idea — it reflects what employees increasingly value: flexibility, balance, and respect for their time. For multinational employers, adopting this model could mean attracting top talent, reducing burnout, and fostering a culture where people work smarter, not harder.
AI is changing the way we work. Automating repetitive tasks frees up time for people to focus on creativity, problem-solving, and innovation. This shift supports shorter workweeks, making them more practical and allowing employees to achieve more in less time.
But it’s not without challenges. Some industries, like healthcare or manufacturing, may find it harder to adapt, and operating across borders adds complexity. Labour laws, cultural expectations, and local business practices can vary widely, making one-size-fits-all solutions unrealistic.
The key is thoughtful implementation. Companies that adopt the four-day workweek with careful planning can achieve happier employees and steady productivity.
AI is no longer a futuristic concept—it’s shaping jobs, workflows, and business strategies in real time. For businesses operating on a global scale, the challenge isn’t just keeping up with AI-driven changes; it’s staying ahead of them. Let’s move beyond broad predictions and focus on key trends already reshaping global employment—and what you, as a… Read more How AI is Shaping the Future of Work
AI is no longer a futuristic concept—it’s shaping jobs, workflows, and business strategies in real time. For businesses operating on a global scale, the challenge isn’t just keeping up with AI-driven changes; it’s staying ahead of them.
AI is not only replacing jobs; it is creating entirely new roles. Sectors like healthcare, finance, and tech are witnessing a surge in demand for AI-related expertise.
Trends to Watch
Emerging Roles: Jobs such as AI ethics officers, generative AI specialists, and automation strategists are now in high demand.
Data Growth: With the exponential growth of data, roles in AI-driven analytics and data interpretation are expanding rapidly.
Global Talent Gap: Companies are experiencing a skills shortage, particularly in advanced AI technologies and ethical AI development.
Insight: Businesses that prioritise building talent pipelines for AI-related roles will stay competitive.
2. The Reality of Workforce Displacement
While AI creates opportunities, it also displaces roles that rely on repetitive or manual tasks. According to the World Economic Forum, 83 million jobs may be automated globally by 2028, with industries like manufacturing and logistics being the hardest hit.
Examples of Impact
Routine administrative jobs, such as data entry, are being replaced by AI-powered systems.
Automation in manufacturing reduces the demand for manual labour while creating new demands for system monitoring and maintenance roles.
Action Step: Create structured reskilling programs to help workers transition into new roles.
Design: Tools like DALL-E are redefining graphic design by generating professional-grade visuals in minutes.
Future Outlook: Generative AI will likely become a standard in creative and analytical industries, requiring employees to adapt and collaborate with these tools.
5. Human-AI Collaboration is the Future
Rather than replacing humans, AI is enabling collaboration that amplifies productivity. Hybrid human-AI models are increasingly prevalent across industries.
Real-World Applications
Healthcare: AI-assisted diagnostics enable doctors to make faster, more accurate decisions.
Finance: AI-powered tools streamline investment analysis while humans focus on client engagement and strategic decisions.
Insight for Leaders: Redesign workflows to blend human creativity with AI precision.
6. Ethics and Equity in AI Adoption
As AI adoption accelerates, ethical concerns cannot be ignored. Bias in AI algorithms, data privacy issues, and inequitable distribution of AI benefits remain significant challenges.
Key Challenges
Biased algorithms can perpetuate inequality if not appropriately managed.
Widening gaps between workers equipped for AI-driven roles and those left behind.
Action Point: Governments and organisations must collaborate on policies that promote fairness and inclusivity, including reskilling initiatives and ethical AI governance.
7. Trends in Sector-Specific AI Applications
AI is transforming industries at different paces, with healthcare and finance leading the charge.
Industry Snapshots
Healthcare: From diagnostics to personalised medicine, AI is enabling life-saving innovations.
Finance: Automation is replacing routine data tasks while creating roles in AI-powered financial consulting.
Manufacturing: Smart factories driven by AI are reducing downtime and improving production efficiency.
Insight: Businesses should evaluate how sector-specific AI trends can offer a competitive advantage.
8. Preparing for AI-Driven Workforce Transformation
Adapting to the AI revolution requires bold, forward-looking strategies.
Actionable Steps
Build AI governance frameworks to ensure ethical and compliant usage.
Invest in reskilling programs that prepare employees for AI-enhanced roles.
Leverage predictive analytics to identify workforce needs and skill gaps.
Adopt hybrid work models that seamlessly integrate human and AI collaboration.
Key Insight: Leaders who embrace a balanced approach to AI adoption will ensure long-term success for both their organisations and their employees.
Conclusion: Embrace the AI Revolution
AI is a transformative force reshaping global employment. Businesses that embrace AI proactively — by investing in reskilling, redefining workflows, and addressing ethical concerns — will be better equipped to thrive in this evolving landscape.
From enabling hybrid human-AI collaboration to driving productivity gains with generative AI, the opportunities are vast for companies ready to act. At the same time, the risks of inaction—job displacement, widening skill gaps, and ethical pitfalls—require deliberate, strategic planning.
Global employment is ultimately about people, and at Acumen International, we never lose sight of that. While Artificial Intelligence is reshaping global hiring and workforce management, what sets us apart is how we combine advanced technology with a personal, human approach.
Whether your goal is hiring in one country or 190+, we simplify the complexities of global employment so you can focus on growth — without losing the human connection that makes business thrive.
Let’s make global hiring effortless — and truly personal.
As businesses expand across borders and remote work becomes the norm, the challenge of accurately classifying workers intensifies. The line between independent contractors and full-time employees often blurs—not just due to ignorance or oversight but also because of strategic decisions shaped by business realities. Whether intentional or not, misclassification arises from the tension between the… Read more The Hidden Dynamics of Employee Misclassification
As businesses expand across borders and remote work becomes the norm, the challenge of accurately classifying workers intensifies. The line between independent contractors and full-time employees often blurs—not just due to ignorance or oversight but also because of strategic decisions shaped by business realities.
Whether intentional or not, misclassification arises from the tension between the need for flexibility and the demands of compliance.
In this article, we explore the business scenarios driving worker misclassification, the factors behind these decisions, and how global employers can mitigate risks.
By understanding the motivations and pressures businesses face, we aim to offer practical solutions: transitioning contractors into employees where needed or managing contractor payments compliantly when short-term or project-based engagements are the best fit.
Why Worker Misclassification Happens
Misclassification often arises from a mix of cost-saving strategies, legal complexity, and evolving workforce needs. Key drivers include:
1. Cost Savings
Contractors are attractive because they cost less than employees. Employers save on:
Payroll taxes and contributions to social security or national insurance.
Employee benefits like health insurance, paid leave, and pensions.
Overtime pay, which contractors are often not entitled to claim.
This financial incentive encourages businesses to classify workers as contractors, even when their roles may legally align with employee status.
2. Complex, Varying Laws
Labour and tax classification laws differ widely across countries and even regions within countries. Navigating these legal variations is challenging for global companies. Worker misclassification often occurs unintentionally due to a lack of familiarity with local laws.
3. Flexibility Needs
Businesses in industries with fluctuating demand often rely on contractors to provide temporary or project-based support. Contractors’ ability to work flexibly without long-term commitments is particularly appealing.
4. Misinterpretation of Roles
Sometimes, employers misclassify workers due to misunderstanding the role’s nature. For example:
If contractors work set hours, use company-provided tools, or are subject to direct supervision, they may legally qualify as employees.
Businesses often fail to update worker classifications when roles evolve, leading to compliance risks.
5. Administrative Oversight
As contractors take on more responsibilities or stay on longer than intended, their work may align more closely with employee tasks. Without regular reviews, these shifts can go unnoticed, resulting in employee misclassification.
6. Cross-Border Challenges
Remote work introduces cross-border complexities. Companies may assume contractor definitions are universal, but local laws often differ significantly. A contractor in one jurisdiction might be classified as an employee under another’s laws, exposing companies to compliance risks.
Misclassification might appear cost-effective or efficient, but it’s a significant risk that can result in hefty fines, back wages, and reputational harm. Accurate classification is crucial, especially for global employers.
Industries That Frequently Rely on Contractors
Several industries frequently employ contractors due to the nature of their work, flexibility needs, and project-based demands. Here are key industries where contractor use is especially common:
1. Technology and IT
Roles: Software developers, web designers, cybersecurity consultants, and IT support specialists.
Roles: Graphic designers, writers, editors, videographers, and social media managers.
Why: Creative work often operates on a project basis, such as designing campaigns, producing videos, or writing content. Contractors offer flexibility and diverse expertise without long-term commitments.
Why: Construction work is inherently project-based, with fluctuating demand depending on the project phase or economic cycles.
4. Healthcare
Roles: Locum doctors, travel nurses, therapists, medical transcriptionists.
Why: The healthcare industry frequently uses contractors to fill staffing shortages, cover seasonal spikes, or provide specialist care in specific locations.
These industries benefit from contractors’ flexibility, specialised skills, and cost-effectiveness, but they must ensure compliance with local labour laws to avoid misclassification risks.
Business Scenarios That Drive Contractor Demand
Businesses often require contractors to address specific needs, overcome challenges, or take advantage of unique opportunities. Here are common business scenarios where contractors are in demand:
1. Project-Based Work
Businesses need contractors to complete one-off or temporary projects, such as software development, marketing campaigns, or construction projects.
Example: A tech company hires a developer to create a new app or integrate a specific system.
2. Seasonal Demand
Industries with peak seasons, such as retail, logistics, and tourism, rely on contractors to manage increased workloads during busy periods.
Example: E-commerce platforms hire warehouse staff and delivery drivers for the holiday season.
3. Skills Gaps or Specialist Expertise
Companies bring in contractors with niche expertise not available internally, especially for short-term needs.
Example: A legal consultant is hired for international compliance advice during a merger.
4. Tight Deadlines
Contractors are hired to accelerate delivery and meet pressing deadlines when in-house teams are overwhelmed or stretched thin.
Example: A publishing house hires freelance editors to prepare materials for a major launch.
5. Business Expansion
Companies entering new markets may use contractors to test the waters without committing to long-term hires.
Example: A multinational firm engages local sales contractors to establish its presence in a new country.
6. Cost Management
Contractors provide a cost-effective solution when budgets don’t allow for the long-term expenses associated with full-time employees (e.g., benefits, taxes).
Example: Startups hire freelance marketing strategists instead of employing a full-time marketing team.
7. Organisational Restructuring
During transitions like downsizing or reorganisations, contractors help fill gaps temporarily.
Example: A company hires an interim HR specialist to oversee workforce reductions while restructuring.
8. Rapid Scaling
Companies experiencing sudden growth or high demand need extra hands without the time to recruit permanent staff.
Example: A SaaS company hires customer support contractors after a major product launch to handle the influx of queries.
9. Temporary Absences
Contractors are brought in to cover employees on leave, such as maternity, medical, or sabbatical leave.
Example: A graphic designer is hired to replace a team member on a six-month parental leave.
10. Uncertainty or Short-Term Commitments
During periods of economic uncertainty, businesses prefer contractors to avoid long-term financial obligations.
Example: A consulting firm hires contractors for projects instead of increasing full-time staff amid market volatility.
11. Mergers and Acquisitions
During corporate mergers and acquisitions, contractors assist with due diligence, integration, or specialised roles.
Example: A business hires IT consultants to merge systems during an acquisition.
12. Regulatory Changes
Companies hire contractors with relevant expertise when faced with new compliance requirements or legal challenges.
Example: A financial institution engages a tax consultant to navigate new international tax regulations.
13. Workforce Diversity Initiatives
Contractors are hired to support diversity goals, such as recruiting professionals from specific backgrounds or regions.
Example: A firm contracts minority-owned businesses for marketing initiatives.
14. Research and Development
Businesses hire contractors to research, develop prototypes, or test new products.
Example: A pharmaceutical company hires researchers for short-term clinical trials.
15. Launching New Products or Services
Contractors are engaged to support product launches, including marketing, logistics, and sales.
Example: A startup hires content creators to generate buzz around a new app release.
16. Emergency or Crisis Management
During emergencies or crises, businesses rely on contractors for rapid support.
Example: A PR consultant is hired to manage a company’s reputation after a data breach.
17. Flexible Workforce Needs
Businesses with fluctuating workloads (e.g., creative agencies or event planners) use contractors to adapt to demand changes.
Example: A wedding planning company hires freelance photographers during peak wedding season.
18. Geographic Expansion
Contractors provide local insights and services when a business lacks expertise in a specific region.
Example: A fashion retailer contracts local experts to set up operations in Asia.
19. Testing New Roles
Companies use contractors to test roles or new functions before committing to permanent hires.
Example: A company hires a freelance data analyst to assess the value of creating an internal analytics team.
20. Technological Implementation
Contractors support technology upgrades, integrations, or training.
Example: An IT consultant is hired to implement an enterprise resource planning (ERP) system.
The Conflict: Taxes, Worker Protections, and Misclassification Risks
The root of misclassification risks lies in competing priorities between businesses, tax authorities, and local governments.
Governments rely on taxes to fund public services, infrastructure, and social programmes. Misclassified workers present a significant challenge:
Loss of Payroll Taxes: Employees typically contribute through payroll taxes like income tax, social security, and healthcare levies, often deducted at the source by employers. Contractors, on the other hand, are responsible for self-reporting taxes, leading to underreporting or non-compliance in some cases.
Cross-Border Complexity: Remote work further complicates tax enforcement. Workers operating in one jurisdiction while receiving income from another create ambiguities in tax obligations, increasing the risk of tax evasion.
Unclaimed Employer Contributions: Employers avoid paying contributions to national insurance, pension schemes, and other statutory benefits by classifying workers as contractors, depriving governments of critical revenue streams.
For tax authorities, misclassification translates to a direct threat to the financial ecosystem, making enforcement and compliance a top priority.
2. Governments’ Perspective: Protecting Workers
Governments are tasked with safeguarding workers’ rights, ensuring fair treatment, and providing access to social protections. Worker misclassification undermines these goals:
Loss of Social Protections: Employees are entitled to benefits like unemployment insurance, paid leave, and retirement contributions. Misclassified workers, treated as contractors, often lose access to these safety nets.
Economic Vulnerability: Misclassified workers face greater financial instability due to the lack of protections, such as severance pay or legal recourse for unfair treatment.
Bargaining Power Imbalance: Workers may struggle to negotiate fair wages without formal employee status, leading to exploitation in industries with high contractor reliance.
Governments seek to prevent misclassification to ensure workers’ rights and maintain the social contract: protecting individuals in exchange for tax contributions that sustain social welfare systems.
The Fundamental Conflict
The tension between governments and businesses over worker classification boils down to conflicting priorities:
Governments and Tax Authorities: Want to maximise tax compliance and protect workers to secure revenue and uphold societal stability.
Businesses: Seek cost efficiency and flexibility, often prioritising these over compliance with complex classification rules.
The rise of remote work amplifies this conflict. A contractor working from a different jurisdiction might not be subject to the same tax or labour laws as their client company. This creates a grey area that benefits businesses but undermines both the tax system and worker protections.
Why the Stakes Are High
Governments are tightening regulations and enforcement to address these challenges:
Cross-Border Tax Agreements: Authorities collaborate to share information and enforce tax obligations for remote workers.
Reclassification Campaigns: Many jurisdictions, like the United States and parts of the European Union, are cracking down on misclassification to ensure workers are treated as employees where appropriate.
Penalties and Back Payments: Employers found misclassifying workers face significant fines, back wages, and reputational damage.
Navigating these risks is critical for businesses to avoid costly penalties and maintain trust with tax authorities and their workforce.
How Acumen International Supports Businesses in Contractor Transitions
1. Transitioning Contractors into Employees: Simplifying the Shift in 190+ Countries
For businesses that find contractors increasingly resembling employees in their roles and responsibilities, transitioning them to formal employee status can mitigate misclassification risks. Acumen International, as a Global Employer of Record (EOR), simplifies this transition with comprehensive services:
Seamless Onboarding Across Jurisdictions Acumen ensures contractors are transitioned smoothly into compliant employee roles, handling everything from employment contracts to tax registration while adhering to local labour laws.
Local Compliance Expertise Our teams understand the nuances of employment regulations in 190+ countries, ensuring every transition meets the legal requirements specific to the jurisdiction.
EmployeeBenefits Structuring and Management Acumen helps design competitive benefits packages for transitioned employees, ensuring they receive statutory protections and additional incentives that align with market expectations.
Payroll and Tax Administration We manage all aspects of employee payroll, ensuring accurate tax and contribution deductions so businesses can remain compliant and avoid penalties.
By leveraging Acumen’s expertise, businesses can reduce the administrative burden of transitioning contractors into employees while safeguarding their operations from misclassification risks.
2. Managing Contractor Payments: Ensuring Compliance for Legal and Short-Term Engagements
When businesses need to engage contractors for short-term or project-based work legally, Acumen International provides tailored solutions to ensure compliance and smooth operations:
Legally Compliant Contractor Engagement We facilitate contractor agreements that meet local and international compliance standards, ensuring businesses stay within the law.
Cross-Border Payment Solutions We manage currency exchanges, tax withholdings, and regulatory reporting for remote contractors working in different jurisdictions to ensure timely, accurate, and compliant payments.
Risk Assessments for Contractor Engagements We thoroughly evaluate contractor roles to determine whether they fit the legal definition of independent contractors in the relevant jurisdiction. This helps businesses avoid unintended misclassification.
Transparent Payment Structures Contractors are paid through clearly defined, compliant channels, ensuring businesses maintain transparent records for audits and regulatory checks.
Acumen International provides these services, allowing businesses to leverage contractor expertise for short-term needs without worrying about compliance pitfalls.
3. Global Workforce Strategy Consultation: Aligning Business Needs with Legal Obligations
Acumen International goes beyond operational support, offering expertise to help businesses align their workforce strategy with their long-term goals:
Scenario Planning for Workforce Composition We assist businesses in determining whether roles are better suited for contractor or employee classifications based on the nature of the work, location, and duration.
Compliance Training and Insights Acumen educates businesses on global and local employment laws, helping them make informed decisions about engaging and classifying their workforce.
Scalable Workforce Models Whether scaling rapidly or managing seasonal demand, Acumen provides flexible workforce solutions that allow businesses to remain agile while staying compliant.
4. Global Payroll Calculator for Strategic Workforce Planning
Our Global Payroll Calculator is a powerful tool for supporting strategic decisions when transitioning contractors into employees or managing short-term engagements.
Instant Cost Transparency Global Payroll Calculator offers real-time insights into the total cost of employment across 190+ countries, including statutory benefits, employer taxes, and compliance fees. This empowers businesses to budget accurately and evaluate the financial impact of transitioning contractors into full-time employees.
Compliance Risk Assessment With country-specific payroll data, businesses can identify potential compliance risks related to local tax and employment laws. This ensures informed decisions when managing global contractors or formalising employee status.
Scenario Modelling: The tool allows businesses to compare payroll costs for various workforce compositions—whether keeping contractors, transitioning them into employees, or scaling operations in new regions.
Conclusion: Smarter Approach to Global Talent Management
Worker classification decisions are increasingly under scrutiny as businesses adapt to remote work and global expansion. Misclassification risks, whether due to strategic choices or oversight, can disrupt operations and lead to costly consequences.
Acumen International offers tailored solutions to help businesses transition contractors into compliant employee roles or manage contractor payments legally and efficiently for short-term engagements. With expertise spanning 190+ countries, Acumen ensures businesses remain agile, compliant, and competitive while building sustainable workforce strategies.
Whether scaling rapidly, expanding globally, or addressing complex employee classification needs, partnering with Acumen International enables businesses to confidently build global teams while reducing compliance risks and focusing on their strategic goals.
The global employment landscape is anything but stable. Wars—both economic and military—are redrawing borders and priorities. Political instability in key markets complicates decision-making for companies expanding internationally. Simultaneously, conflicting trends pull in opposite directions: globalisation fosters interconnectedness, yet isolationist policies and protectionist legislation add barriers to cross-border hiring. Rising taxes and complex compliance frameworks deter… Read more The Future of Global Employment: 15 Trends to Watch in 2025
The global employment landscape is anything but stable. Wars—both economic and military—are redrawing borders and priorities. Political instability in key markets complicates decision-making for companies expanding internationally.
Simultaneously, conflicting trends pull in opposite directions: globalisation fosters interconnectedness, yet isolationist policies and protectionist legislation add barriers to cross-border hiring.
Rising taxes and complex compliance frameworks deter investment in some countries, while others actively court international business with simplified regulations and incentives.
Yet, despite these challenges, the global movement of human capital remains unstoppable. Remote and global work have become symbols of freedom, progress, and the future of employment.
As 2024 draws to a close, we take this opportunity to reflect on 15 of the most significant trends shaping global hiring. These insights, rooted in today’s realities, aim to help you plan your global expansion strategy for 2025 and beyond with clarity and confidence.
1. Evolving Tax Policies in the Remote Work Era
The rise of remote work has created a complex tax landscape, forcing governments to reconsider long-standing frameworks. This isn’t just a theoretical shift; it’s playing out in tangible ways that affect companies daily.
Take the United Kingdom. The 2024 budget increased National Insurance Contributions and reduced thresholds for employer payments, adding costs for businesses hiring domestically. However, changes to overseas workday relief simplified taxation for employees with non-UK duties, reflecting a dual approach: raising revenue while easing certain compliance burdens. Similarly, Germany’s clarification of “permanent establishment” rules for home offices has alleviated concerns for many employers—except for those with employees in management roles, who remain exceptions under the law.
Meanwhile, in the United States, the fragmented tax system continues to create headaches for distributed teams. State-level tax obligations often overlap, leaving both employers and employees navigating a maze of regulations.
The lesson? Companies must do the same as governments worldwide adapt to the realities of remote work. This means building agile tax strategies that ensure compliance and manage costs effectively in an era where flexibility is a non-negotiable demand from talent.
2. APAC and LATAM: The New Talent Frontiers
As the global economy seeks resilience, Asia-Pacific (APAC) and Latin America (LATAM) are rising as strategic regions for talent acquisition. These regions are not just emerging but becoming essential to global workforce strategies.
In APAC, tech ecosystems in India, Singapore, and Vietnam are thriving and driven by robust education and digital infrastructure investments. Meanwhile, LATAM is experiencing a boom in nearshoring, with countries like Mexico and Brazil offering North American companies cultural and time zone compatibility alongside competitive labour costs.
However, these opportunities come with challenges. In Mexico, recent outsourcing reforms have shifted hiring regulations, demanding businesses adjust quickly to avoid penalties. In India, new labour codes are redefining employment practices, requiring companies to rethink how they manage compliance. Success in these regions depends on a nuanced understanding of local laws, cultures, and talent market dynamics.
For companies willing to adapt, APAC and LATAM offer skilled talent and access to fast-growing economies. As demand for regional expertise intensifies, the organisations that invest in tailored strategies will secure a competitive advantage.
3. Fragmentation in Global Payroll: A Growing Challenge
Managing payroll across jurisdictions has become a labyrinthine task for global companies. The regulatory patchwork is expanding from Argentina’s withholding tax requirements to Indonesia’s mandatory local payroll systems—and so are non-compliance risks.
This isn’t just an administrative headache; it’s a strategic issue. Non-compliance can result in heavy fines, reputational damage, or disrupted operations. Data privacy regulations like GDPR, which dictate how payroll data must be stored and transferred across borders, compound the challenge.
To navigate this complexity, companies are turning to decentralised payroll platforms capable of handling multi-currency payments, integrating local tax rules, and offering real-time compliance updates. Effective payroll systems are no longer just about paying employees — they are critical to maintaining trust, efficiency, and legal alignment in global operations.
4. The Shifting Landscape of Contractor Classification
The gig economy has grown exponentially, as has scrutiny around contractor classifications. Governments worldwide are introducing legislation to ensure fair taxation and protect workers’ rights, forcing businesses to rethink their workforce models.
New gig economy regulations in Europe require platforms to classify contractors as employees, sometimes transferring tax and compliance responsibilities to employers. Latin America is also tightening contractor oversight, with Brazil and Chile leading reforms that formalise independent work arrangements.
This trend is reshaping how companies balance flexibility with compliance. Those relying on contractors must implement clear workforce strategies, blending traditional employment and contractor models while staying aligned with evolving legal frameworks. Proactive planning will separate those who thrive from those caught unprepared by shifting regulations.
5. Customised Employee Benefits: Winning the Talent War
Offering attractive salaries is no longer enough in a competitive global talent market. High-skilled professionals, especially those relocating internationally, now expect employee benefits tailored to their personal and professional needs.
Relocation support, spousal career assistance, and education allowances for children are becoming decisive factors in convincing talent to move.
Today employee benefits play a critical role in retention, ensuring employees feel supported long after their transition.
As inflation rises globally, the conversation around compensation is shifting. Employees feel the pinch of rising living costs and demanding wages that reflect their realities. For companies, this means walking a fine line between meeting employee expectations and maintaining financial stability.
Rather than universal inflation-linked pay raises, many employers are adopting creative solutions, such as retention bonuses, region-specific allowances, and more frequent salary reviews. These tailored approaches help organisations remain attractive to talent without overburdening payroll budgets.
In volatile markets, compensation is no longer just about fairness—it’s about strategy. Companies that approach pay planning with agility and creativity will be better positioned to retain top performers while managing their costs effectively.
7. Ethical Hiring Amid Tightening Regulations
Global supply chains and workforce practices are under intense scrutiny as governments and international organisations enforce stricter regulations targeting forced labour and unethical employment. This shift isn’t limited to specific regions; it’s a global movement reshaping corporate responsibilities.
Laws like the UK’s Modern Slavery Act and the EU’s due diligence directives mandate greater transparency across supply chains, particularly in high-risk sectors like manufacturing and agriculture. Companies audit suppliers, implement robust compliance frameworks and ensure ethical hiring practices.
The pressure isn’t just regulatory—investors and consumers hold businesses accountable for their labour practices. Organisations that proactively integrate ethical hiring measures safeguard their reputations and appeal to socially conscious stakeholders. Ethical hiring has become a non-negotiable corporate responsibility pillar, defining sustainable workforce management’s future.
8. Predictive Analytics in Workforce Planning
Predictive analytics is transforming how businesses approach workforce management. By leveraging data to anticipate talent shortages, turnover trends, and regional hiring needs, companies are shifting from reactive to proactive strategies.
Industries like technology and healthcare, where skills gaps can disrupt operations, are leading this shift. Predictive tools help organisations identify emerging talent hubs, forecast when critical roles might become vacant, and optimise recruitment pipelines.
The benefits extend beyond hiring. Analytics can reveal employee satisfaction and engagement trends, allowing businesses to refine retention strategies before issues arise. As talent markets grow more competitive, predictive analytics is emerging as a key differentiator for organisations aiming to stay ahead.
9. Digital Nomad Visas: Balancing Opportunity and Complexity
Digital nomad visas redefine global mobility, enabling professionals to work remotely from countries like Portugal, Thailand, and Estonia. These programs allow businesses to access a highly skilled and mobile talent pool.
However, the rise of digital nomadism comes with challenges. Residency requirements, tax obligations, and social security contributions vary significantly between jurisdictions, creating a compliance minefield. Companies must adapt their global mobility policies to align with these regulations, ensuring employers and employees meet local legal requirements.
Digital nomad visas highlight the evolving nature of work. By navigating these complexities, organisations can tap into a growing workforce that values flexibility and cross-border opportunities.
10. Retention as a Strategic Priority
Retention is no longer a secondary concern—it’s a central pillar of workforce strategy. In industries like technology and healthcare, where skills shortages persist, losing talent can disrupt operations and increase recruitment costs.
To address this, companies are investing in personalised retention strategies. Career development programs, mentorship opportunities, and flexible work arrangements are becoming standard offerings. In sectors prone to burnout, such as healthcare, wellness initiatives and mental health support are critical to keeping employees engaged and committed.
Retention goes beyond reducing turnover; it focuses on building motivated, high-performing global teams. Companies prioritising employee satisfaction and development are better positioned to succeed in competitive markets.
11. Sustainability and Green Workplaces
Sustainability is integral to workforce strategies as businesses align with growing environmental expectations. Remote and hybrid work models reduce carbon footprints, while industries with high relocation demands, such as energy and mining, are exploring carbon offset programs to mitigate environmental impacts.
Younger workforces, particularly in Europe and North America, drive demand for eco-conscious practices. For businesses, integrating sustainability into their operations isn’t just about compliance — it’s a critical factor in attracting and retaining talent in a values-driven market.
12. Compliance in the Spotlight
With governments intensifying labour and tax enforcement, compliance has become a strategic priority for global employers. From wage hikes in the EU to evolving tax policies in APAC, staying ahead of regulatory changes is essential to avoiding penalties and safeguarding operations.
Real-time compliance tools that update regional labour laws and tax obligations are no longer optional—they’re essential. Businesses that proactively integrate compliance into their global strategies can mitigate risks and ensure sustainable growth in an increasingly complex regulatory landscape.
13. Planning for Geopolitical Instability
Geopolitical instability continues to disrupt global workforce management. Events like the Russian invasion of Ukraine, tensions in East Asia, and shifting alliances between nuclear powers are creating uncertainty for businesses operating internationally.
Companies are adopting contingency plans to navigate these risks. Relocating employees from high-risk areas, diversifying workforce hubs, and strengthening real-time monitoring capabilities are becoming standard practices. Organisations can safeguard talent and maintain operational continuity in volatile and unpredictable environments.
14. The Rise of Skills-Based Hiring
Skills-based hiring is reshaping recruitment, shifting the focus from traditional credentials to demonstrated competencies. Industries like tech and healthcare are leading this trend, using AI-powered assessments and digital verification platforms to identify talent based on skills rather than formal qualifications.
This approach widens access to nontraditional talent pools, enabling organisations to tap into skilled professionals from underrepresented regions or backgrounds. Skills-based hiring isn’t just a response to labour shortages—it’s a strategy for fostering innovation, inclusivity, and long-term workforce adaptability.
This transformation highlights a growing divide. Advanced economies with robust digital infrastructures are reaping the benefits of AI adoption while developing regions risk being left behind.
Companies must address this disparity by investing in upskilling initiatives and balancing automation with human-centric roles, ensuring a workforce that thrives in an AI-driven world.
Conclusion: Preparing for the Future of Work
The global employment landscape is shifting rapidly, with every trend revealing a complex interplay of forces – technological disruption, regulatory shifts, evolving employee expectations, and geopolitical uncertainty – all converging to reshape the future of work.
At the core of these changes lies a paradox: while technology like AI is reshaping how we work, human decisions—ethical hiring practices, retention strategies, and investment in global talent—will define the future of work.
Businesses that thrive in 2025 won’t simply react to trends; they will anticipate them, embedding innovation into every hiring decision. Success hinges on a synergistic approach that integrates compliance, agility, and a deep understanding of the human element.
The human capital movement is not a passive force. Today’s choices—whether in compliance, ethical hiring, or workforce innovation — will define tomorrow’s leaders.
As global markets and regulations evolve, so do the complexities facing international employers. This month’s newsletter delivers the insights you need to stay informed and ready to navigate these shifts, from new directives in the EU to employer duties in the UK and growing opportunities in Kazakhstan’s emerging tech landscape. We aim to cut through… Read more Global Employment Tax and Compliance Newsletter. October 2024
As global markets and regulations evolve, so do the complexities facing international employers. This month’s newsletter delivers the insights you need to stay informed and ready to navigate these shifts, from new directives in the EU to employer duties in the UK and growing opportunities in Kazakhstan’s emerging tech landscape.
We aim to cut through the noise in every edition and provide clear, actionable updates and strategic guidance. Whether it’s the implications of the latest employment law changes or the best approach to market entry, our October edition equips you to make informed, resilient decisions as you grow your global presence.
European Union 🇪🇺: New Directive on Working Conditions for Platform Workers
The Council of the EU has adopted a new directive to improve working conditions for platform workers. Approved on 14 October 2024, the directive requires digital labour platforms to grant workers an employment status that accurately reflects their work arrangements.
Key Requirements
Employment Status Alignment: Platforms must classify workers according to their actual work arrangements, ensuring that platform workers receive the rights and protections aligned with their employment status.
Timeline: The directive is expected to enter into force soon, and EU Member States will have two years to implement the changes.
Action Required for Employers: Employers should prepare to review and, if necessary, adjust the employment status of platform workers to meet compliance standards as each Member State adopts the directive.
France 🇫🇷: Updates on Employee Saving Schemes and Diversity Surveys
Employee Saving Schemes and Pensions: A decree issued on 6 July 2024 provides detailed guidelines for the “value sharing” law from November 2023. Key changes include new cases for early use of profit-sharing funds, specific clauses for profit-sharing agreements, and a requirement for a public “country-by-country” declaration in the BDESE. Starting in 2025, companies with 11+ employees must implement a value-sharing scheme.
Diversity at Work: The French Data Protection Authority (CNIL) has issued draft guidelines for diversity measurement surveys. Recommendations include limiting data collection, excluding sensitive information (e.g., ethnicity, race), and ensuring anonymity and voluntary participation. CNIL also outlines GDPR compliance requirements, including legal basis, information disclosure, and third-party survey management.
Italy 🇮🇹: New Measures on Fixed-Term Contracts, Hiring Incentives, and Absenteeism
Italy has introduced several legislative updates impacting employment conditions, including compensation for unlawful fixed-term contracts, hiring incentives for young and disadvantaged women, and proposed rules on resignation due to absenteeism.
Key Updates
Compensation for Unlawful Fixed-Term Contracts: Under Law Decree No. 131/2024, published on 16 September 2024, if a fixed-term contract is deemed unlawful, it will be converted to a permanent one. If more significant damages are proven, the affected employee may also receive compensation for damages beyond 12 months’ salary.
Hiring Incentives: From 1 September 2024 to 31 December 2025, employers hiring individuals under 35 who have never held a permanent job will be eligible for a 100% social contribution exemption, capped at €500 per month (or €650 in specific southern regions) for up to 24 months. Similarly, employers hiring women unemployed permanently for at least 24 months will receive a 100% social contribution exemption, capped at €650 per month for a maximum of 24 months.
Resignation Due to Unjustified Absence: A draft law currently under review proposes that employees absent without justification for a period specified in their applicable NCBA or exceeding 15 days will be considered voluntarily resigned and thus ineligible for unemployment benefits.
Timeline: The hiring incentives are active until 31 December 2025, while other legislative changes are effective immediately or under parliamentary discussion.
Employer Actions
Employers should ensure compliance with the new rules on fixed-term contracts and consider the social contribution exemptions when hiring eligible individuals. It is also advisable to monitor developments on the absenteeism draft law.
Netherlands 🇳🇱: Lift of Enforcement Moratorium on Pseudo Self-Employment
The Dutch Tax Authorities will lift the enforcement moratorium on pseudo self-employment (schijnzelfstandigheid) from 1 January 2025. This change increases the risk for organisations that use self-employed individuals (zzp’ers) in roles that could be reclassified as employment under tax and civil law.
End of Moratorium: From January 2025, agreements with self-employed individuals may face reclassification as employment contracts, removing the previous tax-related protection from enforcement.
Employer Actions
Employers should:
Map Self-Employed Workforce: Identify all self-employed persons working within the organisation in the Netherlands.
Risk Assessment: Evaluate whether current contracts could be at risk of reclassification.
Review Contract Renewals: For high-risk contracts, consider renewal terms beyond 1 January 2025 and assess the contractual basis for continued engagements.
Timeline: The moratorium will end on 1 January 2025, with full enforcement resuming from this date.
United Kingdom 🇬🇧: New Employer Duty to Prevent Workplace Sexual Harassment
The UK has introduced legislation requiring employers to take reasonable steps to prevent sexual harassment in the workplace. If an employer fails to meet this duty, employment tribunals may apply a compensation uplift of up to 25% in successful claims.
Additionally, the Equality and Human Rights Commission (EHRC) is updating technical guidance on preventing sexual harassment, which is expected to take effect alongside the new legislation.
Key Requirements
Preventative Duty: Employers must assess harassment risks, strengthen policies, and prioritise effective prevention.
Updated Guidance: EHRC’s updated guidance on harassment prevention will replace the need for a standalone statutory Code of Practice with changes incorporated into the statutory Employment Code of Practice.
Employer Actions
Employers should conduct risk assessments, review harassment prevention policies, and implement comprehensive training by 26 October 2024 to comply with the new duty.
Non-Compliance Penalties
Non-compliance could result in compensation uplifts of up to 25% in tribunal awards and potential enforcement actions by the EHRC.
United Kingdom 🇬🇧: Expanded Family-Related Rights for Parents and Carers
New UK legislation introduces enhanced rights for parents and carers, providing additional protections and new types of leave. Key changes include extended redundancy protections, carer’s leave, neonatal leave, and a more flexible structure for paternity leave.
Key Provisions
Extended Redundancy Protection: Employees on maternity, adoption, or shared parental leave will have extended redundancy protection for up to 18 months after the birth or placement, including protection for pregnant employees who have informed their employer of their pregnancy.
Carer’s Leave: One week of unpaid leave per year for employees to provide or arrange care for dependants with long-term care needs.
Neonatal Leave: Parents of a child receiving neonatal care can take up to 12 weeks of leave (one week for each week the child is in care) with statutory pay.
Flexible Paternity Leave: Paternity leave can now be taken as a single period of one or two weeks or as two separate, non-consecutive one-week periods within the child’s first year. Notice periods for taking paternity leave have also been shortened.
Timeline: Implementation is expected to be phased across 2025, with carer’s leave and extended redundancy protection expected to take effect by 6 April 2025. Employers must update family-related policies and procedures to comply with the new rights as they are introduced.
United Kingdom 🇬🇧: Employment Rights Bill Introduced with Key Workplace Reforms
The UK government published the long-awaited Employment Rights Bill on 10 October 2024, just 100 days after Labour took office. This bill, accompanied by supporting documents and factsheets, outlines significant proposed reforms in employment rights. Many details will be further clarified through secondary legislation, which will undergo consultations.
Key Areas of Focus
Support for Low Earners: Consultation on replacement rates for Statutory Sick Pay (SSP) for low earners.
Collective Redundancy and Fire-and-Rehire: Proposed remedies for issues arising in collective redundancy and fire-and-rehire cases.
Zero-Hour Contracts: Potential application of zero-hour contract regulations to agency workers.
Trade Union Reform: Consideration of new measures related to trade union operations.
Timeline: Ongoing consultations began on 21 October 2024, with additional consultations and legislation expected in the coming weeks.
Qatar 🇶🇦: New Law Prioritises Hiring Qatari Nationals in the Private Sector
Qatar’s new Law No. 12 of 2024 mandates that private-sector employers prioritise hiring Qatari nationals and the children of Qatari women over expatriates. This applies to private companies, excluding Qatar Energy affiliates and petroleum firms.
Key Employer Requirements
Prioritise Qataris: Expat hiring is allowed only if no suitable Qatari candidates are available.
Qatarisation Plan: The Ministry of Labour will set quotas and oversee hiring practices, requiring employers to report job openings and new hires twice yearly.
Compliance: Penalties for non-compliance include fines, restrictions on immigration services, and public disclosure.
Timeline: Expected enforcement around March 2025.
Action Required for Employers Employers should monitor the law’s development and prepare to align recruitment and training practices with Qatarisation requirements. Early compliance could help mitigate risks and qualify for MOL’s incentives.
Saudi Arabia 🇸🇦: Key Labour Law Amendments to Enhance Worker Conditions
Expanded Definitions: New terms include specific definitions for resignation and manpower activities.
Compensatory Leave: Employers can now provide compensatory leave instead of overtime pay.
Resignation Process: New rules clarify resignation for employees on fixed-term contracts.
Contract Adjustments: Revised probation guidelines and updated employment terms for foreign workers.
Leave Entitlements: Enhanced rights for maternity, parental, and bereavement leave.
Contract Termination: Bankruptcy and a modified notice period for indefinite contracts are added as a valid reason for termination.
Disciplinary Rules: Updated guidelines on disciplinary actions.
Employers Actions
Review and update employment contracts, leave policies, and disciplinary procedures by February to ensure compliance.
Non-compliance with these new standards may result in penalties.
UAE 🇦🇪: Expanded Emiratisation Compliance and Timelines for Private Sector
Recent updates have expanded the scope and compliance timelines for employers in the UAE’s Emiratisation initiative, which aims to boost Emirati employment in the private sector.
Key Requirements
Increased Hiring Quotas: Private companies with 50+ employees must raise Emirati hires in skilled roles by 2% annually, achieved through a 1% increase every six months, aiming for a 10% Emirati workforce by 2026.
Extended Scope: As of July 2023, private sector establishments with 20-49 employees in 14 key sectors must hire at least one Emirati in 2024 and another in 2025.
Employer Actions
Review Recruitment Processes: Employers must ensure access to Emirati job seekers, enrol in the Nafis scheme, and leverage government support initiatives to meet targets.
Non-Compliance Penalties
Companies failing to meet quotas face fines of 7,000 AED monthly per unmet Emirati position and restricted MOHRE system access.
Smaller establishments in key sectors (20-49 employees) face fines of 96,000 AED for missing 2024 targets and 108,000 AED for 2025.
UAE 🇦🇪: New Health Insurance System for Private Sector Employees and Domestic Workers
The UAE Cabinet has approved a nationwide health insurance system requiring employers to cover private sector employees and domestic workers without health insurance. This requirement takes effect on 1 January 2025.
Key Requirements
Employer-Provided Health Coverage: Employers must ensure health insurance is provided for all registered employees and domestic workers during residency permit issuance or renewal.
EmployerActions
Employers should budget for and arrange health insurance for eligible employees by January 2025 to comply with the regulation. The new regulation does not specify penalties for non-compliance, but current fines in Abu Dhabi and Dubai range from AED 300-500 per month per individual.
United States 🇺🇸: Federal Ban on Non-Compete Clauses Awaits Enforcement
The Federal Trade Commission (FTC) approved a Final Rule on April 23, 2024, to ban non-compete agreements for workers, including senior executives, across the U.S. The rule, published on May 7, 2024, aimed to take effect on September 4, but enforcement has been delayed due to a court order issued on August 20, 2024, while the FTC considers an appeal.
Key Requirements
Ban on New Non-Competes: Employers who enter into new non-compete agreements with workers after the rule’s effective date are considered to be engaging in an unfair method of competition.
Existing Agreements: Non-competes with non-executive employees will become unenforceable, while those with senior executives—defined as employees earning more than $151,164 annually in policy-making roles—may remain enforceable.
EmployerActions
Employers should closely monitor ongoing legal developments around the rule and seek legal guidance to assess potential impacts and prepare necessary adjustments.
Timeline: The effective date is pending further legal proceedings.
People’s Republic of China 🇨🇳: Gradual Delay of Statutory Retirement Age and Extended Marriage Leave in Zhejiang Province
China has enacted fundamental changes in retirement and marriage leave policies, affecting national and regional employment practices.
Key Provisions
Gradual Delay of Statutory Retirement Age: Starting 1 January 2025, the retirement age will increase incrementally by one month every four months for most employees. For female employees with a current retirement age of 50, the delay will be one month every two months until they reach 55. The target ages are 63 for men and 58 or 55 for women, depending on their roles.
Minimum Pension Contribution Period: Beginning in 2030, the minimum contribution period for basic pension eligibility will rise from 15 to 20 years, with a gradual six-month increase annually.
Flexible Early and Delayed Retirement Options: With mutual agreement, employees meeting contribution requirements can retire up to three years early or delay retirement up to three years after the statutory age.
Extended Unemployment Insurance Benefits: For individuals within a year of the statutory retirement age, unemployment insurance benefits will extend until retirement age, with pension contributions covered by the unemployment insurance fund during the transition.
Early Retirement for Special Occupations: Employees in high-risk roles, such as high-altitude or physically demanding jobs, may qualify for earlier retirement.
Zhejiang Province Extended Marriage Leave: Effective immediately as of 27 September 2024, employees in Zhejiang Province are now entitled to 13 days of marriage leave, an increase from the previous three days.
Singapore 🇸🇬: SkillsFuture JobSeeker Support Scheme for Retrenched Employees
Starting 1 April 2025, Singapore will launch the SkillsFuture JobSeeker Support scheme to provide temporary financial assistance to eligible citizens who become unemployed due to retrenchment, business closure, or termination due to illness or injury. The scheme will expand to include Singapore Permanent Residents in Q1 2026.
Eligibility Criteria
Must be a Singapore citizen (or Singapore Permanent Resident from Q1 2026).
Unemployment must be due to involuntary reasons, such as retrenchment or business cessation.
Prior employment of at least 6 months within the 12 months preceding the application.
Active job-seeking efforts, including job applications, career workshops, or relevant training.
No prior payouts from the scheme in the last 3 years.
Financial Support
Eligible individuals can receive up to SGD6,000 over 6 months. Payouts begin at SGD1,500 in the first month and decrease over time, capped at the participant’s prior monthly salary. Support ends upon re-employment, and participants are restricted from reapplying within 3 years of their last payout.
Action Required for Employers: Employers may consider this scheme when advising retrenched employees on available financial support options.
100 Questions to Master Global Hiring: Your Guide to Smart Growth
100 Questions to Master Global Hiring by Acumen International is your toolkit for navigating the challenges of global expansion. This guide is designed to prompt the questions that matter most when entering new markets—helping you think through critical areas like compliance, market entry, and local employment laws before they become obstacles.
Instead of ready-made answers, this guide offers questions that reveal potential blind spots, encourage strategic thinking, and help you tailor your approach to each unique market. Whether you’re considering new regions or managing an international team, these questions will help you uncover the insights needed to build a compliant, adaptable workforce and ready to support your growth.
For anyone looking to expand wisely, this article provides a clear path through the complexities of global hiring, making it essential to read as you plan your next steps.
Local Entity vs. Global EOR: Which is Right for Your Expansion?
As global business becomes less about physical assets and more about talent, companies face a pivotal decision: Should they establish a local entity in each market or take a leaner approach with a Global Employer of Record (EOR)?
This article from Acumen International explores both strategies, providing insights to help businesses weigh costs, control, and flexibility. For companies looking to fully commit to a market, establishing a local entity offers advantages like deep local integration, eligibility for tax incentives, and direct operational control.
However, it demands a substantial investment and carries complex exit risks, especially in markets with strict labour laws.
On the other hand, the Global EOR model supports a faster, lower-risk entry. With a Global EOR, businesses can “rent” a compliant employment infrastructure, allowing them to quickly onboard talent across borders, test new markets, and pivot without the legal and financial complexities of a local entity setup.
This model suits companies seeking flexibility and scalability, particularly in uncertain or multiple markets.
The article’s checklist provides essential questions for choosing the right approach for any business exploring international growth. With clear, actionable insights, this guide is a valuable tool for leaders deciding how best to expand globally while effectively managing risks and resources.
Transforming Global Employment: Trusted Advisor Approach
Stuart Creasey explores how global employment solutions evolve from transactional services to strategic partnerships. Drawing from Acumen International’s over 20 years of experience, he highlights that successful international workforce management requires more than technology — it relies on human expertise and a nuanced understanding of each market.
The article outlines principles that guide Acumen’s approach to global expansion. It focuses on aligning closely with client goals, addressing local compliance challenges, and planning proactively for long-term resilience. These insights offer companies a path to establish and sustain a strong international presence, supported by thoughtful, hands-on guidance.
Kazakhstan as Central Asia’s Innovation Hub: A Guide to Growth Opportunities
Kazakhstan is fast emerging as Central Asia’s tech and innovation hub, with government initiatives fostering a pro-innovation environment to diversify its economy beyond oil and gas. Programs like “Digital Kazakhstan” and the establishment of the Astana Hub and the Astana International Financial Centre (AIFC) are paving the way for startups, attracting investment, and nurturing a digital economy.
Kazakhstan’s strategic location between Europe and Asia makes it a key player in the “Digital Silk Road,” enabling access to markets in China and nearby regions.
Major developments, such as Kaspi.kz’s expansion into Turkey, showcase the potential for local tech companies to grow regionally and globally. Sectors like fintech, AI, health tech, and SaaS are seeing increased investment, and government-backed initiatives like Tech Orda aim to build a strong tech talent pipeline.
Global Payroll Calculator – Your Precision Tool for Global Employment Cost Analysis
The Global Payroll Calculator (GPC) offers a solution for instantly calculating employment costs across 190+ countries, streamlining your global hiring strategy and ensuring cost-effective decisions.
Key Features & Benefits for International Hiring
Instant Cost Calculations: Quickly determine total employment costs, factoring in real-time tax rates and benefits for local and foreign talent in 190+ countries.
Precision & Clarity: Achieve precise payroll calculations with detailed breakdowns of all payroll variables, ensuring transparency and preventing unexpected costs.
Cross-Country Comparisons: Use GPC to instantly compare employment costs between countries, helping you identify the best locations for hiring.
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Kazakhstan’s startup landscape is emerging, with the country making significant strides to establish itself as Central Asia’s technological hub. While still reliant on oil and gas, Kazakhstan is actively diversifying into a knowledge-based digital economy. To support this shift, the government is creating a pro-innovation environment with funding opportunities that encourage early-stage startups. As the… Read more Kazakhstan as Central Asia’s Innovation Hub: A Guide to Growth Opportunities
Kazakhstan’s startup landscape is emerging, with the country making significant strides to establish itself as Central Asia’s technological hub. While still reliant on oil and gas, Kazakhstan is actively diversifying into a knowledge-based digital economy. To support this shift, the government is creating a pro-innovation environment with funding opportunities that encourage early-stage startups.
As the economy transitions from natural resources to digital innovation, Kazakhstan’s young and growing population offers a fertile ground for new business models. Companies can leverage the country’s digital infrastructure and supportive ecosystem to expand across Central Asia.
Though Kazakhstan’s startup ecosystem remains in its early stages, the country is committed to fostering entrepreneurship and digital industries to secure its economic future.
Where Continents Converge: A Digital Silk Road
Nestled in the heart of Eurasia, Kazakhstan occupies a pivotal point where continents converge physically and digitally. Its modernised railways and the expanding North-South corridor weave a modern-day Silk Road, facilitating trade and logistics between Europe and Asia. This strategic location is a magnet for businesses seeking access to markets in China and neighbouring countries and a burgeoning domestic consumer base with increasing purchasing power.
Kazakhstan’s connectivity transcends physical infrastructure. The country is cultivating a vibrant digital ecosystem, exemplified by the rise of companies like Kaspi.kz.
Kazakhstan’s Digital Leap: Where Evidence Meets Opportunity
Imagine walking into a co-working space in Almaty, where a local fintech startup processes international transactions through the Astana International Financial Centre (AIFC) while collaborating with developers in Dubai. This isn’t hypothetical — it’s how Kaspi.kz grew from a traditional bank into Kazakhstan’s first unicorn, valued at over $10 billion in 2023.
This fintech pioneer, defying expectations to achieve unicorn status with a valuation exceeding $10 billion in 2023, demonstrates the power of Kazakhstan’s digital infrastructure. Kaspi.kz’s ability to seamlessly process international transactions and collaborate with global partners through platforms like the Astana International Financial Centre (AIFC) paints a vivid picture of the country’s digital potential.
In a move that signals its ambitious expansion plans, Kazakhstan’s leading fintech company, Kaspi.kz, has acquired a majority stake (65.41%) in Hepsiburada.com, one of Turkey’s largest e-commerce platforms. The deal, valued at $1.13 billion, was announced on October 18, 2024, and marks a significant development in the Central Asian and Turkish tech landscape.
Kazakhstan: Economic Outlook
GDP Growth:The European Bank for Reconstruction and Development (EBRD) projects Kazakhstan’s GDP to grow by 4.0% in 2024 and 5.5% in 2025. This forecast revised slightly downward from earlier projections, reflects the impact of factors such as floods in certain regions and a slowdown in mining operations. However, public spending on infrastructure recovery and the planned expansion of the Tengiz oil field are expected to support growth in the coming years.
Digital Economy Contribution: While pinpointing the exact annual growth rate of Kazakhstan’s digital economy requires further analysis of official statistics, it’s undeniable that the sector is expanding rapidly. The government’s “Digital Kazakhstan” strategy aims to accelerate this growth by promoting e-commerce, digital literacy, and the development of tech startups.
Tech Talent Pool: Kazakhstan invests in education and skills development to build a strong tech talent pool. Initiatives such as the Astana Hub International Technopark attract and nurture startups, while programs like Tech Orda aim to train 100,000 IT specialists by 2025. This focus on human capital is crucial for sustained growth in the digital economy.
Government Initiatives Fueling Growth
The government has implemented multiple initiatives to create a supportive ecosystem for startups. These include establishing tech parks, innovation hubs, and accelerator programs critical in nurturing local and international startups.
The National Entrepreneurship Development Project (2021-2025) financially supports entrepreneurs, especially those in smaller towns and rural areas. Another key project, Business Roadmap 2025, targets emerging business ventures across priority industries.
Tech Garden, another major accelerator, provides a platform for startups to connect with resources, mentorship, and funding. This program focuses on high-impact sectors, helping local entrepreneurs gain the skills and support they need to launch and scale their projects.
AIFC as a Catalyst of Investment Growth in Kazakhstan
The Astana International Financial Centre (AIFC) is essential in attracting foreign investment and fostering financial innovation. Its regulatory framework, based on English common law, provides a secure and transparent business environment. The significant growth in cross-border payments through the AIFC indicates increasing investor confidence.
A Startup Ecosystem Blossoms
While relatively young, Kazakhstan’s startup ecosystem is growing. Over recent years, it has gained visibility and climbed in global rankings due to rising investment and increased tech-related ventures.
Despite a slight dip in global rankings in 2024, the country retains its position as the leading startup hub in Central Asia, a testament to its consistent progress since 2020.
According to Startup Ecosystem Report 2024 by StartupBlink, Kazakhstan ranked 74th globally in 2024, a slight drop from its 2023 ranking of 73rd. Despite this decline, Kazakhstan remains the leading startup ecosystem in Central Asia, demonstrating steady improvement since 2020, when it was 86th globally. The country’s progress underscores its ambition to become a competitive player in digital innovation within the region.
Investment Trends
Kazakhstan’s funding landscape has grown significantly, with total investments reaching USD 30.2 million in 2023. This is a substantial increase from previous years: USD 5.8 million in 2020, USD 9.7 million in 2021, and USD 7.9 million in 2022. This upward trend reflects heightened investor interest in the country’s tech and digital sectors, although the ecosystem is still maturing and may be more vulnerable to fluctuations than established markets.
Regional Challenges and Strategic Position of Kazakhstan
Kazakhstan’s ranking within the Central Asia Regional Economic Cooperation (CAREC) region slipped to 4th in 2024, indicating increasing competition among regional peers. The relatively small gap in ecosystem scores between Astana and Almaty highlights the need for further investment in innovation to maintain Kazakhstan’s regional lead.
The country’s strategic location and established financial centres, like the Astana International Financial Centre (AIFC), position it well as a bridge for companies aiming to enter Central Asia.
Astana and Almaty remain the key innovation centres. Astana is the only Central Asian city with a worldwide ranking in the payments industry, underscoring its growing influence in the fintech arena.
Kazakhstan’s Tech Scene Overview: Where Innovation Meets Investment
Kazakhstan’s technology sector is attracting increasing attention from investors seeking to capitalize on the country’s digital transformation. Several key areas drive this interest, offering significant potential for growth and innovation. These are the key sectors attracting investment:
FinTech
Kazakhstan’s burgeoning fintech sector is fueled by a young and tech-savvy population, a growing middle class, and increasing smartphone penetration. Opportunities exist in mobile payments, online lending, and personal finance management.
Artificial Intelligence
With a strong foundation in STEM education and a government committed to supporting AI development, Kazakhstan is poised to become a regional leader in AI applications. Investment potential lies in sectors like healthcare, agriculture, and logistics.
HealthTech
Kazakhstan’s healthcare system is modernising, creating opportunities for health tech solutions that improve access to care, enhance diagnostics, and streamline healthcare delivery.
Real Estate Technologies (PropTech)
As Kazakhstan’s real estate market matures, prop-tech solutions are gaining traction. They offer innovative ways to manage property, facilitate transactions, and improve construction processes.
B2B SaaS
Businesses in Kazakhstan are increasingly adopting cloud-based solutions to improve efficiency and productivity. This creates a growing market for B2B SaaS providers offering solutions like CRM, cybersecurity, and more.
Prominent Startups in Kazakhstan
Kazakhstan’s startup ecosystem has already produced notable companies across various sectors. For example:
QGames (Software & Data), a leader in game development in Astana, is enhancing digital entertainment locally and regionally.
1Fit (HealthTech) offers a subscription-based fitness app that promotes accessibility to fitness services across Kazakhstan.
Naimi.kz (E-commerce and retail) is a digital platform that facilitates on-demand services to streamline users’ daily tasks.
Auto.kz (E-commerce & Retail) provides a comprehensive automotive product and service platform.
Parqour (Hardware & IoT) specialises in smart parking solutions, supporting urban mobility with digital parking management tools.
Business Roadmap 2025: Aspirations and Realities
To stimulate economic growth beyond major urban centres and support entrepreneurship, Kazakhstan has implemented the Business Roadmap 2025 program. This initiative has been praised for focusing on regional development and aims to help small and medium-sized enterprises (SMEs). However, the program’s impact on business creation and growth remains unclear, highlighting the complex challenges facing Kazakhstan’s entrepreneurial ecosystem. Key issues affecting the program’s effectiveness include:
Bureaucratic Hurdles: Entrepreneurs, especially outside major cities, face significant administrative challenges that impede business formation and expansion.
Limited Access to Finance: Many entrepreneurs struggle to secure funding to start or grow their businesses, particularly in more remote regions.
Regional Disparities: The program’s benefits may not be equally distributed, with urban areas potentially benefiting more due to existing infrastructure and resources.
These challenges underscore the need for continued refinement of policies and programs to support entrepreneurship effectively across all regions of Kazakhstan.
Kazakhstan: Weighing the Risks and Rewards of Market Expansion
Regulatory and Bureaucratic Hurdles: Despite improvements, Kazakhstan’s regulatory environment can still be complex and time-consuming, with bureaucratic processes that may slow down business operations and increase compliance costs.
Political and Economic Risks: While Kazakhstan’s political landscape is relatively stable, it has been marked by occasional unrest and power shifts. Any instability can create uncertainty for businesses. Additionally, the country’s dependency on oil and gas makes it vulnerable to fluctuations in global commodity prices.
Corruption and Transparency Issues: Corruption remains a concern in specific sectors, creating challenges for foreign businesses using more transparent processes. Navigating these issues can require a deep understanding of local customs and business practices.
Currency Volatility: The Kazakhstani Tenge can be volatile, especially given the country’s reliance on oil exports, which are susceptible to global market shifts. This can lead to currency exchange risks for foreign businesses.
Geopolitical Tensions: Kazakhstan’s location between major regional powers places it in a sensitive geopolitical position. Shifts in international relations can influence Kazakhstan’s economic policies and occasionally result in sanctions or trade restrictions that may impact businesses operating within the region.
Infrastructure Gaps Outside Major Cities: While infrastructure in significant hubs like Almaty and Astana has improved, rural areas and some regions may still lack adequate transportation and logistics infrastructure, which can be a hurdle for companies needing nationwide distribution networks.
Limited Domestic Market Size: Despite growth, Kazakhstan’s domestic market size is relatively small compared to other emerging markets. The limited population of around 19 million for consumer-focused businesses may not provide the same growth opportunities as larger neighbouring markets.
Cultural and Language Barriers: Kazakhstan’s cultural landscape blends Central Asian heritage with Western influences, which can present challenges for companies unfamiliar with the region.
Legal and Contractual Challenges: Legal systems in Kazakhstan can differ significantly from those in Western countries, and contract enforcement may be more complex. Intellectual property rights, for instance, may not be as robustly protected, which can be a concern for technology and creative industries.
Streamline Your Kazakhstan Entry with Acumen International
Entering Kazakhstan’s market can be a high-stakes move, with regulatory and economic factors that catch even seasoned companies off-guard.
Labour laws change regionally, foreign worker quotas are strict, and currency volatility is often tied to global oil prices. For businesses without deep local knowledge, these factors can add hidden costs and compliance risks that disrupt operations.
Acumen’s global employment solutions address these complexities head-on, allowing employers to tap into Kazakhstan’s talent pool, manage compliance with shifting regulations, and maintain flexibility in a market where long-term commitments are often risky.
This approach enables a practical, scalable entry, freeing companies to test the market without heavy upfront investments or permanent setups.
Here’s how a strategic Global EOR approach clears the path for seamless, compliant HR operations in Kazakhstan.
1. Navigating Foreign Worker Quotas Effectively
Strict quotas limit the number of foreign hires, particularly for roles where local talent is available. Exceeding these limits can result in fines or forced team restructuring. Strategic workforce planning helps companies meet talent needs while staying within legal boundaries.
2. Managing Industry-Specific Tax Obligations
Tax regulations in Kazakhstan are complex and vary widely across sectors. Errors in compliance, especially across diverse industries, can lead to unexpected liabilities. Streamlined, sector-specific tax management reduces the risk of costly oversights, keeping operations smooth.
3. Testing the Market Without Overcommitting to Entity Setup
Forming a local entity in an emerging market requires heavy commitment and significant investment, which may not align with a company’s long-term plans. Flexible market entry options allow businesses to operate locally without the burden of entity setup, so they can focus on testing the market before full-scale expansion.
Kazakhstan’s currency, the Tenge, often fluctuates due to its reliance on global oil markets, which can complicate payroll budgeting. By handling payroll processing locally, an Employer of Record ensures that employees are paid accurately in the local currency, reducing administrative friction for companies facing these fluctuations.
5. Facilitating Market Entry Without the Need for Entity Setup
Kazakhstan’s strict work permit and quota systems can be a costly barrier for companies looking to establish a presence. By acting as the legal employer, a Global EOR enables businesses to enter and test the market in Kazakhstan without setting up a local entity. This interim or long-term solution reduces the upfront costs and risks of market entry, allowing companies to onboard talent efficiently and exit smoothly if needed.
6. . Meeting Local Benefits Standards with Ease
Kazakhstan requires employers to offer specific benefits, like social insurance and pensions, which can differ by industry. Acumen’s Global Payroll Calculator provides real-time insights into local payroll costs and benefits requirements, helping companies stay compliant while creating competitive packages that attract top talent. This tool simplifies payroll planning. It ensures full alignment with Kazakhstan’s regulations from day one.
7. Building Strong Teams Through Local Expertise and Cultural Insight
Success in Kazakhstan goes beyond compliance; it demands a deep understanding of local workplace dynamics. Acumen’s in-country experts bring the insights needed to shape HR policies that respect local values and align with cultural expectations, ensuring a more cohesive and engaged team.
By providing hands-on support and adapting swiftly to local developments, we keep your HR operations in sync with Kazakhstan’s unique business environment, fostering trust and alignment within your international team.
8. Ensuring Full Labour and Immigration Compliance
Kazakhstan’s contractual requirements for employment terms, notice periods, and termination processes differ from international norms. CustOperating in Kazakhstan requires attention to specific employment standards, covering everything from contracts to ongoing compliance with local labour and immigration laws.
Acumen’s expertise and human support ensure that every aspect of employment — from customised contracts to labour and immigration compliance — is managed seamlessly. This reduces the risk of fines or legal issues and allows companies to focus on their strategic goals.
9. Scaling Operations Flexibly to Respond to Market Conditions
Emerging markets require adaptability, as demand can change unexpectedly. Flexible workforce solutions allow companies to adjust staffing based on performance and growth potential without the restrictions of a permanent establishment.
Kazakhstan holds vast potential, and entering the market doesn’t have to be complex. With the right support, companies can move quickly, stay compliant, and adapt as needed. Ready to unlock new opportunities in Central Asia? Contact Acumen International to start your journey with a seamless, risk-free market entry.
By Stuart Creasey Enterprise sales have always been complex, especially when dealing with global employment. These deals require managing long approval processes, balancing the interests of multiple stakeholders, and providing personalised, expert guidance. This model of trust-based advisory relationships is well-established in industries like luxury goods, the energy sector, and technology solutions. However, we now… Read more Transforming Global Employment: Trusted Advisor Approach
By Stuart Creasey
Enterprise sales have always been complex, especially when dealing with global employment. These deals require managing long approval processes, balancing the interests of multiple stakeholders, and providing personalised, expert guidance.
This model of trust-based advisory relationships is well-established in industries like luxury goods, the energy sector, and technology solutions. However, we now see this approach extend beyond those traditional sectors, reshaping how global employment solutions are sold.
The Shift from Transactional to Strategic Partnerships
Businesses today expect more than basic services. The bar has been raised. This shift reflects the movement from purely transactional engagements to long-term, strategic partnerships.
Clients expect partners who are invested in their long-term success and offer foresight, adaptability, and a holistic approach to workforce management—solutions that evolve alongside their global needs.
Positioning ourselves as consultants elevates our standing with clients. They’re no longer just coming to us for services but for advice and guidance.
We cultivate trust by becoming deeply embedded in our clients’ expansion strategies and providing insights beyond surface-level solutions. Incredible collaboration and results happen when we help clients make complex expansion decisions, not when they are treated as one-time transactions.
Evolving Client Expectations in Enterprise Sales: More Than Just a Footprint
Expanding into new markets requires more than just setting up operations; it involves making strategic choices that drive long-term success. Selecting the right country for expansion requires a deep understanding of current opportunities and future implications.
Beyond compliance, businesses must factor in total employment costs, tax regimes, and the availability of skilled labour.
Clients need people, experts more than technology to handle employment challenges. They need someone to talk to and to understand what local legislation truly means for their business.
Technology is great for streamlining processes, but human expertise is crucial for navigating complex markets.
Holistic market evaluation means considering financial and legal elements and workforce strategies that align with long-term goals.
As global employment consultants, we help clients by providing insights that ensure profitability and sustainability while aligning market entry and talent hiring with their broader strategy.
In the era of globalisation, choosing the right market entry strategy—whether through a local entity or a Global EOR—can make all the difference between swift, scalable success and a slow, costly venture.
The Consultant’s Role: Managing Global Workforces
Global workforce management is an evolving challenge that grows as the business expands. Each country presents its own distinct legal and regulatory landscape.
Successful international workforce management requires compliance and the agility to adapt to ongoing changes in tax policies, labour laws, and employee expectations.
With over 20 years of experience at Acumen International, we know exactly where things can go wrong. This deep knowledge allows us to guide our clients, helping them avoid pitfalls.
Some may say experience makes us old-fashioned, but in reality, it equips us with the foresight to prevent significant mistakes.
Consultants play a crucial role in guiding clients through market entry and workforce strategies, ensuring alignment with the company’s overall strategic objectives.
Tax Equalisation and Workforce Costs
Workforce costs aren’t static—tax laws change, and companies must adapt. Consultants help structure tax strategies that deliver immediate savings and prepare businesses for future talent acquisition challenges.
By aligning tax planning with long-term international workforce needs, companies can scale efficiently while avoiding unexpected regulatory challenges.
The risks of getting compliance wrong can be serious, leading to penalties and operational setbacks. That’s why it is crucial to work with experts who are constantly up to date with the latest legal and regulatory changes, helping clients understand these risks early on to avoid surprises down the road.
Global Mobility and Immigration
Global mobility has become a strategic necessity in global expansion. Moving key personnel across borders requires navigating complex immigration regulations, in-country quotas for certain professions, and local labour market tests.
In some countries, strict quotas limit the number of work permits for specific job categories, and we need to anticipate these issues to avoid delays or rejections.
Early workforce planning is essential. As consultants, we help businesses anticipate these barriers, plan for immigration timelines, and ensure that immigration and onboardings are smooth, compliant, and timely.
Tailored Employee Benefits for Retention: Market-Specific Approach
Retaining talent also requires a market-specific approach to designing competitive and attractive employee benefits packages. Employees in different regions expect different benefits, and what works in one market may not resonate in another.
For instance, while housing allowances may be crucial in certain emerging markets, health benefits and pension schemes might be more valued in developed regions.
Designing benefit packages that appeal to local needs while maintaining company-wide consistency is challenging but essential.
Retaining employees means tailoring incentives to align with local expectations while ensuring they fit within the company’s global framework.
We help businesses craft competitive benefits packages and meet local regulatory requirements, especially when expanding across multiple jurisdictions.
Mitigating Risk: Preparedness Over Reaction
Global expansion presents inevitable risks — changes in tax laws, shifting employment regulations, and geopolitical shifts.
At Acumen, we don’t just react to risks; we anticipate them. We guide clients through potential issues from the very start, ensuring they’re prepared to adapt as situations evolve.
We work with clients early in the overseas expansion process to consider potential exit strategies, develop contingency plans, and anticipate how regulatory environments may evolve.
By preemptively guiding clients to tackle these issues, we help ensure their global expansion and talent management strategy remains flexible and sustainable.
The ability to pivot when necessary — whether scaling down operations or shifting focus to another region — prepares our clients for long-term success.
The Importance of a Skilled Team in Global Employment
In global employment, having a well-rounded, expert team is invaluable.
With so many moving parts — from navigating local regulations to anticipating future challenges — the people behind the service make all the difference.
With over 250 years of collective expertise at Acumen International, our professionals help companies grow with confidence, ensuring that all the critical details are handled with care and precision.
This sets us apart and why our clients trust us to guide them through even the most complex global employment scenarios across over 190 countries.
7 Practical Rules for Guiding Clients Through Global Expansion
With over 20 years of experience supporting organisations across various industries in both the private and public sectors, I have helped and guided businesses, from startups to global enterprises, to manage the challenges of international employment. of international employment.
Through a consultative approach that prioritises understanding each client’s strategic goals, whether they seek to optimise existing operations or expand into new markets, I align our services, support, localised resources, and global experts to realise their vision. I ensure the implementation of programmes that not only meet but exceed expectations and ensure sustainable and scalable success.
Throughout this process, I leverage insights from my experience and my team’s collective expertise, helping to mitigate risks, suggest alternative approaches, and ensure seamless execution.
I believe in building strong, lasting partnerships founded on trust, which is essential for achieving long-term success.
These experiences have shaped my approach to working with clients today.
I’ve distilled the most valuable lessons into seven essential principles serving as my North Star.
1. Think Long-Term
Relationships outlast transactions. Focus on ensuring your solutions evolve alongside your client’s long-term goals, not just immediate needs.
2. Execution Is Everything
A solid strategy is essential, but execution is where success happens. Ensure that operational details—contracts, payroll, and immigration processes—are handled flawlessly on the ground.
3. Flexibility Is Key
Every market operates differently. Build strategies that adapt swiftly to local regulations and hiring dynamics without compromising business outcomes.
4. Plan for the Unexpected
Global markets shift unpredictably. Help clients anticipate changes and be ready to pivot when necessary, developing strategies that keep them agile and resilient.
5. Sustainability Over Speed
Fast growth can lead to operational strain. Focus on sustainable expansion, balancing the need for compliance and workforce retention with long-term market objectives.
6. Manage Risk Like a Pro
From tax obligations to employment law and immigration, global expansion is full of risks. Be the partner who proactively mitigates those risks while ensuring smooth, compliant operations across jurisdictions.
In every conversation with clients across industries and geographies, I focus on the risks involved in doing it wrong and the dangers of choosing a solution that doesn’t deliver. Experience shows that proactive risk management prevents costly errors.
This is where human expertise triumphs. No platform or software can truly match the depth of insight and nuanced understanding needed to mitigate risks effectively. That’s where humans win the game—by recognising what technology cannot foresee or adjust to in real time.
7. Be the Trusted Advisor. Expertise sets you apart.
Position yourself as a strategic partner. Offer solutions that anticipate challenges and help clients navigate complexities — delivering beyond expectations.
At the core of my work is the commitment to provide clarity where there is confusion and expertise where there is uncertainty. This is what differentiates a trusted advisor from a typical service provider.
Global expansion no longer revolves solely around building physical assets or manufacturing bases. Today, it’s increasingly driven by the need to hire talent across borders to produce intangible products and services. This shift has opened up new avenues for businesses and new challenges in managing regulatory complexity, cost, and risk. When businesses decide to enter… Read more Local Entity vs. Global EOR: Which is Right for Your Expansion?
Global expansion no longer revolves solely around building physical assets or manufacturing bases. Today, it’s increasingly driven by the need to hire talent across borders to produce intangible products and services.
This shift has opened up new avenues for businesses and new challenges in managing regulatory complexity, cost, and risk.
When businesses decide to enter new markets, they often face a critical choice:
Commit fully by establishing local entities, which requires substantial investment, long-term commitment, and careful planning, particularly when testing new markets. If the venture fails, exiting can be costly and complicated.
Alternatively, they can leverage third-party employment services, such as a Global Employer of Record (EOR), which enables agile, low-risk entry into multiple locations without the need for entity setup.
Think of a Global EOR as the shared economy’s solution to global hiring, similar to how platforms like Airbnb allow people to access existing infrastructure without the overhead.
A Global EOR leverages its expertise, legal entities, and established infrastructure across various markets, allowing businesses to “rent” a compliant and ready-to-go global hiring system. This approach gives companies the flexibility to scale, test, and withdraw from markets as needed.
Let’s explore these two strategies more deeply, starting with the traditional approach of establishing local entities to gain full control over operations and market presence.
Establishing Local Entities: A Deep Dive into Full Market Control
In the past, businesses expanding into new markets often had no choice but to establish local entities. This method reflected the realities of an era when economies were more tangible—rooted in physical infrastructure, manufacturing, and the need for face-to-face interactions. Travel, communication, and supply chains were less agile, making it essential for companies to build a permanent, on-the-ground presence to oversee operations and build trust with local stakeholders.
While this approach can be resource-intensive and complex, it is still relevant for businesses seeking full integration within local markets and long-term stability.
Why Businesses Still Choose to Establish Local Entities
Deep Local Integration: For companies that require close relationships with customers, suppliers, and government authorities, a local entity builds credibility and signals a strong commitment to the market.
Access to Local Incentives: Governments often offer tax breaks, grants, and subsidies to foreign companies establishing a physical presence. These incentives can offset some upfront costs, making the investment more attractive for long-term strategies.
Direct Control Over Operations: With a local entity, companies can oversee all aspects of their operations—from hiring to compliance—ensuring they adhere to local laws and standards while maintaining brand consistency.
Curious Fact: Many countries offer attractive incentives to lure foreign investors. In some markets, like Singapore, the UAE, and Ireland, up to 80% of businesses receive tax breaks, grants, and subsidies.
However, the traditional model is tied to a world where physical presence was once critical. Today, with technological advances and the rise of remote work, businesses have more options for global hiring and market entry, reducing the need for costly entity setups.
This approach works well when your business plans to stay in a market for the long term and needs full control over operations, hiring compliance, and local market integration. It’s ideal for companies ready to commit substantially to a specific region, which requires strong, direct engagement with local stakeholders.
The True Cost of Market Exit
Exiting a market is rarely straightforward. Beyond initial investments and day-to-day operations, the decision to withdraw from a region comes with challenges. Liquidating assets, managing severance obligations, and navigating complex tax laws can make the exit process financially draining and administratively demanding.
The hidden burden of market exit often lies in the intricacies of compliance. Jurisdictions with rigid labour laws or punitive tax policies can turn an exit into a prolonged and costly ordeal. The legal and financial responsibilities are extensive, from settling severance payments to dissolving local entities.
For businesses considering a long-term commitment through local entities, it’s critical to weigh the costs of entering a market and the true cost of leaving. Exiting is more than just pulling back operations—it requires careful planning to mitigate potential financial penalties and avoid legal entanglements.
Did You Know?In countries like France and Brazil, strict labour laws can make market exits particularly expensive. For example, severance payments can reach up to 12 months of salary, making it critical for businesses to plan exits carefully to avoid severe financial penalties.s.
Global EOR: A Shared Economy Approach to International Expansion
Just as companies like Uber and Airbnbrevolutionised the shared economy by tapping into the latent demand for more flexible access to services, Global Employer of Record (EOR) models have emerged in response to the growing need for outsourced global employment solutions. As businesses increasingly move toward remote work and focus on intangible products and services, the demand for flexible, scalable employment solutions has become more prominent.
The Global EOR model offers an agile alternative for businesses looking to test new markets or expand across multiple regions without the heavy financial burden of setting up legal entities. This model allows companies to hire and manage employees in various countries without local infrastructure.
Just as Uber utilises existing vehicles and Airbnb capitalises on available properties, a Global EOR leverages its own or partner-managed legal entities and local expertise to provide businesses with a fully compliant, ready-to-use global employment infrastructure.
Why Should You Use a Global Employer of Record (EOR)?
A Global Employer of Record (EOR) offers businesses the flexibility to explore new markets with minimal commitment. Instead of the traditional approach of setting up a legal entity in each market, an EOR allows you to test markets, hire talent quickly, and adapt to changing conditions without being locked into long-term infrastructure.
Market Testing Without Long-Term Commitment
Think of the Global EOR model as renting a car before buying. You get to experience the market, build a local team, and gather key insights before deciding whether to fully commit. If the market doesn’t perform as expected, the EOR allows you to pivot and withdraw with minimal financial or legal repercussions. This model is perfect for businesses entering unfamiliar or unpredictable regions with a higher risk of failure or underperformance.
Easy Entry and Exit
With a Global EOR, the barriers to entry are significantly lower. Establishing a legal entity is unnecessary, which means you can enter a market faster and avoid bureaucratic complexities. If the market isn’t right for your business, you can easily exit without dealing with liquidation costs or severance issues typically associated with shutting down a local entity. It’s like living in a rented apartment to get the feel of the place before committing to buy.
Business Transitioning and Scaling
As your business evolves, an EOR gives you the flexibility to scale up or down without long-term commitments. Whether you need to expand into multiple locations simultaneously or transition from one market to another, an EOR acts as a bridge, providing the infrastructure to grow without being tied down. Once you feel confident in a market’s performance, you can transition to a more permanent setup.
Simultaneous Foreign Multi-Market Entry
One of the key advantages of a Global EOR is the ability to expand into multiple countries at once without the need for complex entity setups. You can onboard talent across various regions in a matter of weeks, not months. This is particularly useful for businesses looking to capitalize on time-sensitive opportunities or those testing several markets simultaneously. The EOR’s established infrastructure allows you to enter new markets rapidly, avoiding the delays and costs typically associated with traditional entity setups.
The global employment solution is ideal for businesses with aggressive growth strategies that require rapid market entry across multiple regions or for those looking to test various markets with minimal risk before committing to full-scale operations.
Curious Fact: Payroll compliance violations can be costly. In countries like France and Germany, companies can face fines as high as €300,000 for non-compliance. This highlights the importance of expert guidance when managing international payroll.
Comparing Costs, Time, and Risks: Local Entity vs. Global EOR
When expanding globally, businesses face critical decisions about cost structures, timelines, and the risks of entering new markets. Establishing local entities and leveraging a Global Employer of Record (Global EOR) can facilitate international growth, but their effectiveness depends on the specific market strategy and operational requirements.
The Cost of Establishing and Maintaining Foreign Entities
As covered earlier, creating a legal entity in a new country gives businesses full control over their operations, workforce, and compliance. However, the costs involved—from upfront capital investment to ongoing administrative expenses—are significant. Furthermore, the long timelines associated with entity setup and the complexity of maintaining compliance in multiple jurisdictions can delay market entry and reduce agility.
COST COMPONENT
DETAILS
1. Charter Funds
Employer contributions to social security, healthcare, pensions, and other statutory benefits governed by local labour laws.
2. Entity Setup Costs
Legal fees, registration with government authorities, incorporation paperwork, and other bureaucratic approvals. Costs vary by market complexity.
3. Ongoing Maintenance Costs
Long-term expenses for accounting, annual audits, governance, statutory filings, and board meetings. Recurring costs that depend on local regulations.
4. Corporate Taxes
Country-specific corporate tax rates, with the potential for double taxation if operating in multiple jurisdictions without tax treaties.
5. Employment-Related Taxes
Employer contributions to social security, healthcare, pensions, and other statutory benefits, governed by local labour laws.
6. Legal and Compliance Costs
Costs for legal representation, compliance with local labour laws, tax regulations, and business regulations.
7. Exit Costs
Costs for exiting a market, including liquidation fees, severance payments, and settling outstanding tax liabilities.
8. Post-Incorporation Expenses
Payroll setup, statutory benefits registration, and compliance with data protection laws. These are mandatory costs for operating in a new market.
9. Banking and Financial Setup
Establishing and maintaining a local bank account, including ongoing banking fees. Compliance with local financial regulations may also be required.
10. Audit and Reporting Fees
Ongoing bookkeeping, financial reporting, and mandatory audits. Reporting frequency and complexity vary by country, from quarterly to annual.
Comparing Costs, Time, and Risks: Local Entities vs. Global EOR
When deciding between establishing local entities or using a Global Employer of Record (EOR), the key differentiators often boil down to costs, time to market, and risk management.
Cost Considerations
Local Entity: Setting up a local entity involves substantial upfront capital—including legal fees, registration, and charter funds. Ongoing costs such as tax filings, audits, and payroll management add complexity. The exit process can also be costly, with potential severance payments, asset liquidation, and tax implications.
Global EOR: The Global EOR model reduces upfront costs by eliminating the need for entity setup. Businesses pay service fees covering payroll, HR, and compliance, making this a more cost-effective option for companies with smaller teams or those entering new markets without committing long-term.
Time to Market
Local Entity: Establishing a local entity can take 6–12 months, depending on the market’s complexity. This delays your ability to start operations and take advantage of emerging opportunities.
Global EOR: Market entry with a Global EOR is much faster—often within a few weeks. This speed is critical for businesses looking to respond to time-sensitive opportunities or those that need to test markets quickly without the burden of local bureaucracy.
Risk Management
Local Entity: With full operational control comes increased responsibility for navigating local labour laws, tax regulations, and compliance risks. Mistakes can be costly, and exiting a market can involve significant financial and legal burdens.
Global EOR: The EOR takes on the compliance risks and ensures that all employment laws, taxes, and regulations are handled. This reduces your exposure, especially in unfamiliar or volatile markets. However, relying on an EOR may limit your control over certain operational decisions, particularly in markets where you might eventually want to establish a more permanent presence.
Did You Know? Hiring employees through a Global EOR can significantly accelerate your time to market. A Global EOR can help you cut time to market by up to 70% by streamlining the hiring and onboarding process.
Navigating the Risks of Permanent Establishment in Global Expansion
While expanding your business globally offers exciting opportunities, it’s crucial to understand the concept of Permanent Establishment (PE) and its potential tax implications. A PE is a fixed place of business through which a company conducts business in a foreign country. This can trigger corporate tax obligations in that country, even if your company isn’t formally incorporated there.
How Does PE Risk Apply to Different Expansion Strategies?
Establishing Local Entities
Creating a local entity, such as a subsidiary or branch office, inherently creates a PE. This means your company will be subject to corporate taxes in the foreign country. While this is expected with a formal presence, careful tax planning and compliance are essential to optimize your tax liability and avoid penalties.
Using a Global Employer of Record
A Global EOR can help mitigate PE risk, as the EOR becomes the legal employer of your workforce in the foreign country. However, it’s important to remember that your company’s activities can still trigger PE status. Factors such as:
Employees with significant decision-making authority: If your employees in the foreign country have the power to conclude contracts on your company’s behalf, it could create a PE.
The nature and duration of your activities: Conducting core business activities like sales, marketing, or manufacturing for an extended period can also lead to a PE.
Strategies to Minimise Permanent Establishment Risk
Limit activities: Be mindful of the business activities conducted in the foreign country.
Short-term assignments: Keep employee assignments in the foreign country short to avoid triggering PE status.
Consult with experts: Seek professional advice from tax and legal experts to assess PE risk and develop a compliant expansion strategy.
Understanding and managing PE risk is crucial when choosing your global expansion strategy. By carefully structuring your operations and seeking expert guidance, you can minimise your tax liabilities and ensure a smooth and successful expansion.
Curious Fact: The Global EOR market is experiencing rapid growth, with an estimated annual growth rate of 15%. This surge in demand reflects the increasing need for agile and compliant solutions for managing international workforces.
Checklist for Choosing Between a Foreign Legal Entity and a Global EOR
What are your long-term goals in the target market? Are you aiming for a permanent market presence or simply testing the waters?
How much control do you need over your operations? Do you require direct oversight of all functions, or can payroll, HR, and compliance be outsourced?
What is the complexity of local labour and tax laws? Would handling local compliance be too resource-intensive, or could a Global EOR navigate this more efficiently?
How quickly do you need to enter the market? Is rapid entry critical to your strategy, or can you afford the time it takes to set up a local entity?
What is your budget for expansion? Can you manage the higher costs associated with establishing and maintaining a local entity, or does a Global EOR fit better within your financial limits?
What workforce size are you anticipating in this market? Will you need a large team to meet local demand, or will you start with a small, agile workforce?
What’s the risk of market failure or underperformance? How much would it cost to exit the market if your expansion does not go as planned—especially when comparing the costs of dissolving a local entity versus ending an EOR agreement?
How important is flexibility in scaling your operations? Will you need the ability to scale operations up or down quickly based on market demand, and how does each option impact that flexibility?
How important are local tax incentives or subsidies? Are there significant tax advantages or government incentives only available if you set up a local entity?
What are the ongoing administrative and compliance costs? Can your company handle the long-term administrative burden and compliance responsibilities of maintaining a local entity?
How flexible does your market entry strategy need to be? Do you need the option to scale quickly and adjust your presence based on market performance, or is your commitment long-term?
How will local tax regulations affect your operations? Are you prepared for the complexities of local tax filings, corporate taxes, and potential risks of double taxation?
How important is your brand’s local market perception? Will having a local entity improve your brand’s credibility in the market, or can you operate effectively without this?
How important are direct government relations or incentives? Will setting up a local entity give you access to grants, programs, or other government-led initiatives that would benefit your expansion?
How complex is the process of exiting the market? Are you prepared for the costs and legal steps of liquidating a local entity, or would the easier exit offered by a Global EOR better suit your risk tolerance?
Conclusion
Global expansion strategies have shifted dramatically. Businesses once relied on setting up local entities for complete control and integration into new markets. While that method still has value, the demands of modern globalisation call for greater flexibility. The Global Employer of Record (EOR) provides a newer alternative, helping companies navigate complex regulations while staying agile in fast-changing markets.
The best path forward depends on your business’s specific goals, market conditions, and capacity for adaptation. By weighing these factors carefully, you can choose a strategy that supports your growth in an increasingly interconnected global market.
Bright minds are driven by curiosity. And global expansion is a journey into the unknown. The right questions are your compass, helping you uncover not just the challenges but the hidden opportunities that lie within each new market. This isn’t about simple answers. The questions you ask often matter more than the answers you expect.… Read more 100 Questions to Master Global Hiring: Your Guide to Smart Growth
Bright minds are driven by curiosity. And global expansion is a journey into the unknown. The right questions are your compass, helping you uncover not just the challenges but the hidden opportunities that lie within each new market.
This isn’t about simple answers. The questions you ask often matter more than the answers you expect. These 100 questions are designed to spark critical thinking, challenge your assumptions, and reveal potential blind spots in your strategy. They force you to consider the cultural, legal, and logistical nuances that can make or break your expansion efforts.
At Acumen International, we believe in the power of asking the right questions. We don’t just tell you the rules; we help you anticipate challenges, understand cultural nuances, and develop customised solutions that align with your unique goals. We support you at every step, ensuring your global growth is compliant, strategically sound and sustainable.
1. Strategic Expansion and Market Entry
Expanding into new markets involves more than just setting up operations—it’s about understanding the market, its potential, and the risks involved. Identifying the right entry strategy can save time and resources.
What are the regulatory requirements for entering a new market without establishing a local entity?
How do employment laws affect your ability to hire quickly in a new region?
Are there specific sectors or industries that require different compliance measures?
What are the risks of entering this market from a political, economic, and legal standpoint?
How does local competition affect your hiring and compensation strategy?
What is the best way to scale your workforce in a new market while managing risks?
How do you evaluate a market’s potential before making a full commitment?
What are the legal implications of running a pilot or test phase without setting up a permanent presence?
How do you maintain operational flexibility while exploring new markets?
What is the best way to pivot or exit a market quickly if it proves to be unviable?
2. Legal Compliance and In-country Employment Laws
Expanding into a new market comes with legal challenges that aren’t always obvious. Misunderstanding local laws, even in small ways, can lead to fines, operational delays, or worse. Getting ahead of these issues requires understanding each country’s employment, contracts, and employee rights rules.
What critical employment laws differ between your home country and the new market?
Are you aware of mandatory benefits and protections required for employees in that jurisdiction?
How do local contract laws impact employment agreements?
What are the specific notice periods and termination rights in the new country?
What labour laws, if any, limit employee working hours and overtime?
Are there any industry-specific regulations that need special attention?
Do you understand how unionisation or collective bargaining laws could affect your workforce?
What are the legal consequences of misclassifying workers?
What are the requirements for severance payments and dismissal procedures?
How will you address potential conflicts between corporate policies and local employment laws?
3. Legal Entities, Permanent Establishment Risk, and Worker Classification
Expanding into new markets introduces significant legal considerations that go beyond the surface. Choosing whether to establish a local legal entity or operate without one directly impacts taxation and compliance. Missteps in this area can inadvertently trigger permanent establishment (PE) status, exposing your business to unplanned tax liabilities and complex regulatory requirements. Additionally, classifying workers correctly is essential, as misclassifying employees as independent contractors can lead to legal consequences, financial penalties, and reputational damage.
By understanding and addressing these risks early, you can structure your market entry strategy to be agile, compliant, and scalable while retaining the ability to pivot or exit the market when necessary.
Do you need to establish a legal entity in each country where you plan to hire, or can you operate without one?
What activities could trigger a permanent establishment status in the countries you’re entering?
How can you assess and mitigate the risk of creating a permanent establishment inadvertently?
Are you aware of the tax obligations associated with permanent establishment status in each jurisdiction?
What are the legal and financial implications of operating without a local legal entity?
How do local laws define the difference between an employee and an independent contractor?
What are the risks of misclassifying employees as independent contractors in the countries you’re expanding into?
What processes are in place to ensure correct worker classification across different jurisdictions?
How will you handle payroll, taxes, and benefits for contractors to remain compliant?
What alternatives exist for entering and testing new markets without long-term commitment or heavy investment in case you need to pivot, exit, or handle unexpected changes?
How do you ensure proper tax deductions for remote workers across borders?
Are there any country-specific payroll tax holidays or exemptions to consider?
How will you manage currency exchange rates and cross-border salary payments?
What are the social security and pension obligations in each market?
How do tax equalisation and tax protection schemes apply to expatriates?
What are the penalties for missing local payroll deadlines or tax filings?
Are you prepared to handle tax audits across multiple jurisdictions?
5. Contracts and Agreements
International employment contracts need to account for local regulations. What works in one country may not hold up in another. Drafting contracts that protect your business while complying with local laws is crucial to avoiding disputes and ensuring fair treatment of employees.
What specific clauses must be included in contracts to ensure they are enforceable locally?
How do local contract laws affect the terms of employment agreements? What are the key differences between fixed-term and open-ended contracts in your target country?
Are there mandatory contract terms or benefits that need to be reflected in your agreements?
How do termination clauses vary between regions, and how should they be handled?
What are the requirements for probationary periods in different countries?
How do non-compete or confidentiality agreements differ from country to country?
How will you manage contract renewals in regions with unique employment laws?
What are the risks of using foreign-language contracts, and how should translation be handled?
How do you handle local language requirements for contracts? What contractual protections do you need in case of disputes?
How do you ensure contracts are compliant with regional collective bargaining agreements?
6. Risk Mitigation and Dispute Resolution
Global expansion introduces new risks, such as unforeseen regulatory changes, employee disputes, and market instability. Planning for these challenges in advance helps minimise disruptions to your operations. The right strategy will keep your business stable even when problems arise.
What are the most significant regulatory risks in the markets you’re entering?
How do local laws affect your ability to resolve disputes with employees?
Are there specific legal protections for employees that could lead to disputes?
How will you prepare for changes in employment laws after expansion?
What local arbitration or dispute resolution mechanisms are available?
How will you manage conflicts that arise from cultural misunderstandings?
How do local courts handle employment disputes, and what are the timelines for resolution?
Are there additional risks due to political instability in the regions you’re entering?
What contingency plans are in place for abrupt changes in regulatory requirements?
How will you ensure compliance with laws regarding employee termination in the event of a dispute?
7. Immigration
Securing visas and work permits can slow down or even derail critical hires. Navigating each country’s requirements effectively ensures you can onboard the right talent without delays.
What are the specific visa and work permit requirements for each country?
How long is the average processing time for work permits, and how can it be expedited?
What are the costs associated with securing work permits and visas?
How do changes in local immigration laws affect your ability to hire foreign talent?
How will you manage visa renewals and work permit expirations?
Are there restrictions on hiring expatriates, or do specific quotas apply?
What are the risks of hiring employees before their work permits are approved?
How do dependent visas and family relocation affect your hiring decisions?
What are the implications of hiring remote workers from countries where you don’t have a legal presence?
How do you ensure full compliance with immigration rules for international hires?
8. Employee Benefits and Compensation
Creating an employee benefits package for global teams involves balancing mandatory benefits required by law and voluntary benefits that go beyond the minimum and make your company more competitive. While the legal requirements vary from country to country, offering benefits that employees value—like wellness programs, flexible working arrangements, or retirement plans—can help retain top talent across regions.
What are the mandatory employee benefits in the countries where you’re hiring?
Which voluntary benefits are most valued in the specific regions you’re operating in?
How do local pension and social security systems affect your compensation packages?
Are there tax-efficient benefits you can offer to attract local talent?
How do you tailor voluntary benefits, such as wellness programs or flexible work options, to meet cultural expectations?
What cultural differences in employee expectations around benefits do you need to consider?
How do you handle holiday entitlements and local time-off policies?
Are there any unique voluntary benefits you can offer that stand out from local competitors?
How will you manage salary benchmarks and benefits across different markets to stay competitive?
How do you offer flexible benefits packages that allow employees to customise their perks to meet personal and cultural preferences?
9. Employee Lifecycle Management
Managing international employees involves more than just hiring and firing. It’s about understanding the full employee journey, ensuring compliance at every stage—from onboarding to offboarding.
What are the local onboarding requirements for new hires?
How do you manage probationary periods and performance reviews across different countries?
What specific local laws govern promotions and salary adjustments?
How do you ensure smooth transitions when employees are promoted or transferred across borders?
How do you handle grievances and disciplinary actions while complying with local laws?
What support systems can you implement to improve employee retention in international markets?
How do you ensure local training and development programmes meet corporate and legal standards?
What legal protections must be in place for employees resigning or being terminated?
How do local laws affect severance packages, and what can you do to avoid disputes?
10. Global Workforce Coordination, Support, and Problem Solving
Managing remote and dispersed talent requires more than communication tools—it demands a robust support system capable of addressing both professional and personal challenges as they arise. Whether resolving regulatory or other unexpected issues, employees need reliable, timely, and human-focused support to keep operations running smoothly across borders.
How do you handle urgent employee issues across time zones to ensure timely resolution?
What systems allow employees to access immediate HR, technical, or personal support?
How do you ensure employees in different regions receive localised support relevant to their location?
What processes are established to address unexpected legal or regulatory issues impacting remote employees?
How do you ensure employees feel supported during personal challenges while working remotely?
What steps will you take to create an agile problem-solving framework for your global workforce?
How do you maintain a personal, human touch in resolving issues remotely, ensuring employees feel genuinely supported?
What systems ensure employees know exactly who to contact for urgent issues and can expect a timely, empathetic response?
How will you manage sudden technical challenges that might hinder remote employees’ productivity?
How do you ensure decision-makers are accessible and responsive when critical issues require escalation?
Acumen International: Your Trusted Global EOR Partner
Expanding into global markets presents complex challenges, from legal compliance to navigating local employment laws. Acumen International offers solutions designed to take the uncertainty out of global expansion, enabling businesses to focus on growth while trusting their global employment needs to experienced hands.
With a unique blend of human expertise and technology-driven solutions, Acumen integrates seamlessly with your operations, managing everything from legal compliance to payroll, benefits, and employee lifecycle support. This combination of in-depth local knowledge and global perspective empowers businesses to operate confidently in new markets.
What sets Acumen apart is its comprehensive suite of services tailored to address the complexities of international hiring. Whether it’s ensuring legal compliance through the Global Compliance Navigator, estimating costs through the Global Payroll Calculator, or navigating end-to-end employment solutions with Express Global Employment, Acumen provides businesses with the tools they need to scale globally with confidence.
Acumen takes a people-first approach, recognising that global expansion isn’t just about systems—it’s about ensuring that your employees feel supported and engaged across borders. By combining advanced tools with personalised support, Acumen delivers solutions that ensure compliance and create a smooth, reliable experience for both employers and employees.
Whether your company is in the early stages of global expansion or managing an established international workforce, Acumen International provides the support and resources needed to build a thriving global presence. By partnering with Acumen, businesses gain the confidence to scale globally while efficiently navigating the complexities of international hiring.
Grow with confidence—partner with Acumen International.
Welcome to the 21st Edition of Acumen International’s Global Employment Tax & Compliance Newsletter! Your continued engagement and support have inspired us to craft each edition with even more dedication; this one is no exception. In this September issue, we’ve curated the most critical updates and practical insights to help you confidently navigate global employment.… Read more Global Employment Tax and Compliance Newsletter. September 2024
Welcome to the 21st Edition of Acumen International’s Global Employment Tax & Compliance Newsletter!
Your continued engagement and support have inspired us to craft each edition with even more dedication; this one is no exception. In this September issue, we’ve curated the most critical updates and practical insights to help you confidently navigate global employment.
Solving Global Workforce Challenges with Employer of Record Solutions
As global workforce demands shift, businesses expanding into new markets encounter challenges—from managing compliance with local employment laws to ensuring accurate payroll across multiple jurisdictions. With real-time, hands-on support in over 190 countries, Global Employer of Record solutions helps businesses navigate critical issues such as permanent establishment risks, complex immigration procedures, and worker misclassification.
Explore thisguide to understand how Acumen’s EOR solution enables faster team deployment, efficient market scaling, and seamless compliance without setting up local entities.
EU 🇪🇺: Artificial Intelligence (AI) Regulation
The EU’s new Artificial Intelligence (AI) Regulation has been introduced to establish a legal framework for developing, marketing, and using AI systems across the region. This regulation, which has been in development for nearly three years, aims to ensure that AI systems comply with relevant laws and respect fundamental EU rights and values. The regulation adopts a risk-based approach, categorizing AI systems into four levels of risk: unacceptable, high, limited, and minimal.
Key Changes
AI systems are classified based on risk categories. Depending on the classification, systems may face prohibitions, be subject to market monitoring, or require specific documentation, impact assessments, and transparency measures.
Companies, including HR departments, must assess the use of AI systems and identify whether their systems fall under these regulated categories.
Effective Date: 1 August 2024 (Phased implementation, with obligations entering into force in stages until August 2027).
Employer Actions
Identify which AI systems they use.
Determine if any AI systems, particularly those used for HR purposes, are prohibited or classified as high-risk.
Ensure compliance with the regulations for AI systems deemed high-risk, including monitoring and documentation.
To mitigate liability risks, companies should ensure robust compliance systems are in place to support AI’s safe and lawful use following the regulation’s requirements.
Austria 🇦🇹: Teleworking Regulations to Be Extended
The Austrian Employment Contract Law Amendment Act (AVRAG), Section 2h, currently outlines the requirements for home office use. This regulation is being expanded to include teleworking, which covers working from locations like relatives’ homes, libraries, or co-working spaces. From January 2025, employers must ensure that written agreements for teleworking arrangements, alongside existing home office agreements, are in place to comply with the updated law.
The extended law requires teleworking agreements to be formalised in writing, like home office agreements, to ensure proper organisation and compliance with the expanded scope. The effective date is 1 January 2025.
Czech Republic 🇨🇿: Significant Amendments to the Labour Code (Flexible Amendment)
A new government bill introducing flexible amendments to the Labour Code is currently being discussed in Parliament. These amendments aim to provide flexibility for employees and employers, covering parental leave, termination rules, work time organisation, wages, probation periods, and youth employment. The effective date is 1 January 2025 (subject to changes until final adoption).
Parental Leave
Employees on parental leave can perform the same job under a different contract with the same employer.
Employees returning from parental leave before their child’s second birthday are guaranteed their original position and workplace.
Termination Rules
The notice period will begin on the day the termination notice is received.
The notice period is reduced to one month for terminations due to misconduct or failure to meet job requirements.
Compensation for Work-Related Health Issues
Employees who lose their jobs due to work-related injuries or illnesses will receive special compensation funded by employer insurance.
Work Time Organisation
Employees can schedule their working hours by agreement.
Rest periods can be shortened to six hours in emergencies, with rest time compensated the following day.
Wages
Employees who work abroad, permanently reside abroad, or are EU citizens without permanent residence in the Czech Republic can agree to be paid in a currency other than CZK.
Probation Period
The maximum probation period will be extended to four months for regular employees and up to eight months for managers.
Czech Republic 🇨🇿: Cancellation of Guaranteed Wages
Historically, the guaranteed wage set the minimum pay for various jobs based on complexity, responsibility, and required effort. As of 1 August 2024, this system will be abolished in the private sector. Only the national minimum wage of CZK 18,900 per year (approximately €750) will apply. Effective Date: 1 August 2024.
Czech Republic 🇨🇿: Self-Scheduling of Working Hours
Employers and employees in the Czech Republic may mutually agree for employees to self-schedule their working hours. The agreement must be formalized in writing, and the average weekly working time must be adhered to over the agreed compensation period. Effective date: 1 January 2025. Employers must ensure that any self-scheduling agreements are in writing to avoid penalties. If self-scheduling agreements are not properly documented, a fine of up to CZK 300,000 (approximately €12,000) can be imposed.
Key Points
Notice Period: Either party can terminate the agreement with 15 days’ notice without providing a reason.
Compensation Period: The standard period is 26 weeks, extendable to 52 weeks under a collective agreement.
No Allowance: Employees are not entitled to compensation for personal obstacles like medical appointments.
Is Shadow Payroll Holding Back Your Global Expansion?
Managing payroll for internationally mobile employees often leads businesses to choose shadow payroll as a temporary solution. However, this approach can introduce hidden complexities and risks for long-term growth. In our latest article, we examine the limitations of shadow payroll and present Global Employer of Record (Global EOR) as a more scalable and sustainable alternative.
Why Global Employer of Record Is the Smarter Choice
Compliance across multiple countries: Avoid non-compliance risks and penalties with expert handling of local regulations.
Seamless scalability: Expand into new markets without the complexities of establishing local entities or managing intricate payroll systems.
Simplified operations: Focus on your core business strategy while we manage payroll, taxes, and legal requirements across borders.
Long-term sustainability: While shadow payroll may suffice in the short term, Global EOR is designed to support your long-term international operations with stability and peace of mind.
Looking to assess employment costs across multiple countries? Our Global Payroll Calculator helps you gain clear insights into total costs, tax obligations, and compliance needs across 190 countries.
Read the full article to explore how Global EOR can be a game-changer for your global expansion strategy.
Denmark 🇩🇰: Legal Challenge to the EU Minimum Wage Directive
The Danish Government has launched legal action against the EU’s Directive on adequate minimum wages, arguing that it conflicts with Denmark’s long-standing labour model. In Denmark, wages and other employment terms are negotiated between employers and employees through collective agreements rather than being set by legislation.
The government views the Directive as incompatible with these practices and seeks to have parts of it annulled by the European Parliament.
Impact Date: Awaited (The legal process is ongoing, and the Directive is scheduled to be implemented by 15 November 2024 across the EU).
Key Points
Denmark’s legal challenge is based on its labour model, in which wages are negotiated collectively rather than through statutory regulation.
The outcome of the legal proceedings could impact how the Directive is implemented across Member States.
The French Government plans to introduce a new “birth leave” initiative to replace the current parental leave system. While the proposal is still being developed, it aims to provide both parents with six months of leave following the birth of a child, with flexible arrangements for how the leave can be utilised. The anticipated effective date is subject to final approval.
Key Changes
A 6-month birth leave option will substitute parental leave for both parents.
The leave can be used by either parent or shared between both, simultaneously or separately, with options for full-time or part-time usage.
Social security will cover 50% of the employee’s previous salary, with a cap of €1,932 per month. Employers may opt to top up this compensation.
France 🇫🇷: New Pathway for Legal Residence of Foreign Workers in Labour Shortage Areas
The French government has granted préfets—senior regional government officials who represent the national government at the local level—the authority to provide residence permits to undocumented workers in sectors and regions with significant labour shortages. This measure is in effect until 31 December 2026 and offers eligible individuals a one-year residence permit—an implementation period until 31 December 2026.
Eligibility Criteria
To qualify for legal residence, individuals must meet the following conditions:
Have worked as a salaried employee in a sector or region facing recruitment difficulties for at least 12 months (consecutively or within the last 24 months).
Have held a job in one of the identified areas or sectors.
Have lived continuously in France for at least three years.
Have a clean criminal record with no convictions, disqualifications, or legal restrictions.
Préfets retains the discretion to deny applications based on social and family integration, compliance with public order, and alignment with French values.
Additional Changes
Training programs will be provided for foreign workers who are not proficient in French.
Social security benefits will be extended to non-EU foreign nationals.
Employers should revise their hiring and employment procedures for foreign workers to ensure compliance with the new provisions.
Non-compliance with the new regulations may expose employers to fines and potential claims for damages.
Selling the Illusion: Why Global Employment Can’t Be Fully Automated
As global employment platforms flood the market with promises of rapid onboarding and low costs, the allure of full automation often overshadows the reality. Our latest article explores the critical gaps these platforms leave behind and why human expertise remains essential for sustainable international growth.
Key Insights
The Illusion of Automation: Automated platforms may seem like a quick fix, but they lack the adaptability needed for real-world global employment challenges.
Human Support is Irreplaceable: Complex immigration, tax, and regulatory issues demand personalised, on-the-ground solutions.
Building Strong Teams: Long-term success in global employment requires more than software—it needs the human touch to navigate unpredictable challenges and support employee well-being.
Read the full article to understand why human-led expertise, supported by a robust infrastructure, is vital to building resilient and loyal global teams.
Ireland 🇮🇪: Implementation of the EU Adequate Minimum Wages Directive
Ireland is required to implement the EU Adequate Minimum Wages Directive by 15 November 2024. The Directive promotes wage adequacy and encourages collective bargaining without enforcing a uniform approach across Member States. Ireland, which has a statutory minimum wage, must conduct regular reviews to ensure wages meet set criteria. Impact Date: by 15 November 2024.
Key Points
Ireland must regularly review its minimum wage to ensure it meets adequacy standards.
The Irish Government will work with trade unions and stakeholders to comply with the Directive’s requirements.
Lithuania 🇱🇹: Minimum Wage Increase Legislation
The Lithuanian government has enacted new legislation to increase the minimum wage to better align with living costs and economic conditions. This update aims to provide more substantial financial security for workers. The new wages requirements will become effective on 1 January 2025, and employers must fully comply by this date.
Key Changes
Monthly Minimum Wage: Increased to €1,038 from January 2025.
Hourly Minimum Wage: Raised to €6.35, ensuring that hourly workers receive fair compensation aligned with the new standard.
What Employers Need to Do
Employers should adjust their payroll systems to reflect the new minimum wage levels, ensuring all workers are paid according to the updated legislation. Failing to comply with these wage standards can result in fines imposed by the State Labour Inspectorate, ranging from €240 to €880 for initial violations, with higher penalties for repeated non-compliance.
UAE 🇦🇪: Court Recognizes Cryptocurrency as Part of Salary Payment (Case Law)
In a landmark case, the Dubai Court of First Instance has ruled that part of an employee’s salary can be paid in cryptocurrency, marking a significant development in the UAE Labour Law. This ruling arose from a dispute where an employer failed to pay a portion of the salary in cryptocurrency, as stipulated in the employment contract. The impact date is 15 August 2024. Employers should ensure compliance by this date.
Key Changes
The court has confirmed that cryptocurrency can be used to partially pay an employee’s salary under the UAE Labour Law.
However, paying the full salary in cryptocurrency is not permissible, as salary payments are still required in UAE Dirhams (AED) or another recognised currency for companies under the Wage Protection System or in free zones.
What Employers Need to Do and Why
Employers that wish to pay part of an employee’s remuneration in cryptocurrency must ensure that contracts and policies clearly outline how cryptocurrency will be valued and include provisions for volatility. They should also be aware that tax and social contributions cannot be paid in cryptocurrency and must account for these limitations in their payroll processes.
Failure to properly outline the terms of cryptocurrency payments in contracts could lead to unexpected liabilities or disputes, especially if the cryptocurrency’s value fluctuates significantly or if regulations change. Employers must clarify the arrangements for employees to avoid financial and legal risks.
Global Employment Services in Ukraine and Risky Regions
The war in Ukraine has caused immense disruption, displacing millions and damaging vital infrastructure. Despite these challenges, Ukraine remains a key part of the global economy. Our latest article explains how Acumen International’s Global Employer of Record (EOR) services have helped businesses rehire displaced Ukrainian talent and continue operations across borders.
Key Insights
Rehiring Talent Across Europe: Learn how we helped a Ukrainian enterprise quickly rehire employees who had been displaced in Spain, Poland, and Austria.
Continued Hiring in Ukraine: Despite the conflict, industries such as military production and software development continue to need local talent.
Hiring in Risky Regions: We provide compliant hiring solutions for companies operating in volatile regions, ensuring lawful employment without local entities.
Global Immigration Support: Our tailored services ensure businesses can seamlessly onboard employees and their families, offering essential support in risky or complex regions.
Read the full article to discover how Acumen International’s Global EOR solution helps businesses hire in Ukraine or risky regions, keeping operations running smoothly even in unpredictable circumstances.
Netherlands 🇳🇱: Broadening of Unemployment Premium Exemption
The Dutch government has introduced changes to the unemployment premium system, expanding the conditions under which employers can benefit from lower unemployment premiums. This reform, set to take effect on 1 January 2025, aims to offer employers more flexibility while maintaining employment contract security for workers.
Key Changes
Employers currently pay lower unemployment premiums for permanent employment contracts and higher premiums for flexible contracts.
Under the new rule, employees on permanent contracts will be allowed to work up to 30% overtime beyond their contractual hours without triggering higher unemployment premiums.
Contracts with 30 or more working hours per week will now qualify for this exemption, broadening the scope beyond the current threshold of 35 hours.
If an employee works over 30% overtime in a given year, the higher premium will apply retroactively for the entire year.
What Employers Need to Do and Why
Employers should review their existing contracts and working hour arrangements. Contracts with average working hours of 30 or more hours per week will fall under the expanded exemption, allowing for greater flexibility in work hours while maintaining lower unemployment premiums. Consider adjusting work hours (e.g., reducing to 30 hours) to remain within the new scope and benefit from the lower premium.
Netherlands 🇳🇱: Legislative Proposal to Enhance Job Security for Flexible Workers
The Dutch government has proposed the “More Security for Flexible Employees Act,” which has been under consultation since July 2023. This new law aims to replace on-call contracts with “basic contracts,” offering more precise terms for employees with fixed or indefinite working hours and improving job security for flexible workers. Expected Date: The implementation date is not yet confirmed but is expected no earlier than 1 January 2026. Employers will likely have a 6-month transition period to comply with the new regulations.
Key Changes
Introduction of Basic Contracts: On-call contracts will be replaced by contracts specifying a minimum number of paid hours for which employees are scheduled. These contracts will offer greater stability to workers.
Exemptions: On-call contracts will still be available for students and temporary agency workers, but only during the first 52 weeks of their employment.
Breaks Between Contracts: The maximum allowable gap between fixed-term contracts will increase from 6 months to 5 years. If the combined duration of contracts exceeds 3 years, with breaks of 5 years or less, the contract will automatically convert to an indefinite term.
What Employers Need to Do and Why
Employers should prepare to replace existing on-call contracts with basic contracts where applicable. It is advisable to start keeping detailed records of fixed-term employees and their contracts for at least 5 years after termination to ensure compliance with the new rules. Failure to manage the timing between contract renewals could lead to unintended conversions to indefinite contracts, with potential wage claims from employees.
If this proposal becomes law, employers risk wage-related claims or the automatic conversion of fixed-term contracts into indefinite contracts if breaks between contracts are not managed carefully.
Singapore 🇸🇬: Upcoming Guidelines on Restrictive Clauses in Employment Contracts
The Ministry of Manpower, in collaboration with the National Trades Union Congress and the Singapore National Employers Federation, is developing new guidelines to regulate the use of restrictive clauses in employment contracts. These guidelines will cover clauses related to restraints of trade and non-compete agreements. Effective date: second half of 2024 (exact date pending).
Key Changes
The new guidelines will provide more transparent standards for the reasonable use of restrictive clauses, ensuring fairer employment practices. They will complement existing guidelines on retrenchment and manpower management.
Employers should be aware of these upcoming guidelines and prepare to review their employment contracts once the guidelines are released.
Singapore 🇸🇬: Upcoming Parental and Paternity Leave Legislation
The Singapore government is rolling out new leave policies to support parents better. In 2025, significant changes will be made to paternity and parental leave entitlements.
Key Changes
Paternity Leave Extension: From 1 April 2025, working fathers with Singaporean children born on or after this date will be entitled to four weeks of Government Paid Paternity Leave (GPPL), an increase from the current two weeks.
New Parental Leave Framework: A new system will replace the existing shared parental leave scheme. From 1 April 2025, parents will share six weeks of paid leave, increasing to ten weeks from 1 April 2026. This new entitlement is in addition to the existing maternity and paternity leave provisions.
Effective Dates
Paternity Leave Extension: Effective from 1 April 2025.
Parental Leave: Implementation begins on 1 April 2025 (six weeks) and entirely takes effect on 1 April 2026 (ten weeks).
Employer Implications
Employers hiring in Singapore must update their leave policies and systems to reflect these changes by April 2025. Failure to do so may lead to non-compliance risks. It is also essential to inform employees of these new entitlements on time to ensure a smooth transition.
Expanding into Azerbaijan: A Strategic Approach with a Global EOR Solution
Expanding into a new market like Azerbaijan can present various challenges, but with the right guidance, the process can be significantly streamlined. Acumen International’s Global Employer of Record (EOR) solution offers businesses a streamlined, compliant, and efficient way to enter the Azerbaijani market without the need to establish a legal entity.
Key Insights
Achieve fast, compliant market entry within 1-2 weeks.
Access top local talent without the complexities of setting up local operations.
Stay compliant with evolving tax regulations and labour laws.
Minimise risks while cutting unnecessary operational costs.
Take the next step in your global expansion journey with confidence. Read the full Guide to explore how Global EOR can simplify your business entry into Azerbaijan.
Coming Soon: The Global Compliance Navigator — Your Key to Seamless Global Expansion
Acumen International is soon launching a powerful tool designed to simplify one of the most intricate aspects of global growth: compliance. The Global Compliance Navigator will enable businesses to navigate local laws, workforce regulations, and tax obligations in over 190 countries from a single solution.
This tool is a strategic resource for businesses planning to expand their global footprint. By providing comprehensive, accurate, country-specific insights, the Navigator allows companies to assess potential risks and plan global operations confidently, saving time and avoiding costly mistakes.
The Global Compliance Navigator complements our Express Global Employment solutions, which streamline compliant hiring in new markets, and Global Payroll Calculator, which helps you estimate employment costs across 190+ countries.
Together, these tools offer a seamless way to plan, calculate, and expand globally, all while mitigating risks and ensuring compliance with local regulations.
Stay tuned for the official launch!
Wrap Up
At Acumen International, we believe global employment is about the people behind every solution—those who need it and those who deliver it. This month’s newsletter blends practical updates with our human-first approach. For a deeper look, read “A Different Take on How We Deliver Global Employment Services“, a unique, story-driven reflection on global expansion.
Thank you for reading the Global Employment Tax and Compliance Newsletter. If you found this edition helpful, subscribe to the latest global employment insights and updates. Stay informed, stay ahead!
At Acumen International, every solution we create is as unique as the clients we serve. This time, we’ve stepped away from the usual business talk to share something different — a short story. Why a story? Because stories can reveal complexities and human elements in ways that a traditional case study simply can’t. This one… Read more A Different Take on How We Deliver Global Employment Services
At Acumen International, every solution we create is as unique as the clients we serve. This time, we’ve stepped away from the usual business talk to share something different — a short story.
Why a story? Because stories can reveal complexities and human elements in ways that a traditional case study simply can’t. This one is inspired by the real-life experiences many of our clients face when expanding into new markets.
We hope it offers a fresh look at how we guide our clients through the unknown, with global hiring solutions that are just as human as they are effective.
A Step into the Unknown: As the Horizon Widens
In his office, Tom was a king. He knew the market, the players, the rules. Decisions were swift, assured. The walls of his office bore the weight of framed accolades, symbols of his prowess. In his country, Tom was an adult, a master of his domain.
Then came the call. Expansion. New markets. Opportunities abroad. Tom found himself weighing options —whether to establish legal entities in each new location or explore a way to test these markets with a lighter touch, without long-term commitments.
They needed people — senior executives, sales teams, the right talent in the right places. Excitement mingled with anxiety. Tom knew his business inside out, but stepping onto foreign soil was different. He felt the ground shift beneath him.
The first meeting was in London. The city buzzed with its own rhythm, but here, Tom was a stranger. He entered the office, a calm but unfamiliar space. The consultant greeted him with a welcoming smile. She spoke with clarity and ease, immediately making Tom feel a little more grounded. He could tell she was someone who understood the complexities he was about to face. But this was still new territory for him.
“Welcome, Mr. Lewis,” she said, her voice steady. Tom felt the weight of uncertainty settle on his shoulders. He had questions, too many. The assurance he had at home felt distant.
“We’ll guide you through the process,” she continued. “From managing immigration requirements to handling payroll, taxes, and benefits — covering all the essential details that are often overlooked but critical for success.”
Tom nodded, already grateful for the support. In his own country, he knew every step, every turn. Here, he was learning to walk again.
The consultant explained the regulations, the taxes, the hiring practices. It was a new language, and Tom was learning it slowly. He asked questions, sometimes obvious ones. But he asked, because he had to know. As they discussed bringing senior executives and sales teams abroad, she mentioned the importance of careful structuring— how specific decisions, like where they placed key personnel, could have broader implications, such as triggering permanent establishment risk.
“We’ll handle the complexities,” she assured. “You focus on your business. Leave the rest to us.”
In the following months, Tom traveled more. Tokyo, São Paulo, Paris — then onto dynamic and emerging markets like Lagos, Jakarta, and Buenos Aires. With each destination, Tom adapted, gaining new insights and growing more comfortable navigating the global environment.
The employment landscape shifted constantly — regulations changed, new laws were adopted, immigration policies evolved. But the consultants were always one step ahead, ready with the right questions or answers Tom needed, guiding him through each challenge with care.
Back home, Tom still ruled his office with certainty. Abroad, he was like a child discovering a new world — curious, open, and eager to learn. Each step in this unfamiliar terrain revealed new challenges, but with every lesson, he grew more sure-footed, gradually mastering the complexities of global expansion.
With each trip, he felt a bit more capable, a bit more grown. The world was vast, but he was finding his place in it. One step at a time.
A Fresh Perspective on Global Expansion
Tom’s story reflects the journey many of our clients experience as they expand into new markets. It’s not always straightforward, but with the right support, what starts as uncertainty becomes an opportunity.
At Acumen International, we help businesses navigate these challenges, offering the guidance they need to focus on their growth while we manage the complexities of international hiring and compliance.
We’re here to help you take the next step if you’re considering global expansion.
The war in Ukraine has brought untold devastation to both lives and infrastructure. Civilians—children, the elderly, and families — have been displaced, and cities have been ravaged. The war has led to the destruction of cities, towns, villages, schools, universities, children’s hospitals, libraries, and museums, creating ecological disasters, leaving behind vast minefields, and causing widespread… Read more Global Employment Services in Ukraine and Risky Regions
The war in Ukraine has brought untold devastation to both lives and infrastructure. Civilians—children, the elderly, and families — have been displaced, and cities have been ravaged.
The war has led to the destruction of cities, towns, villages, schools, universities, children’s hospitals, libraries, and museums, creating ecological disasters, leaving behind vast minefields, and causing widespread suffering with long-lasting effects that will ripple for years to come.
Despite this, Ukraine’s resilience remains unbroken as the country continues its fight for survival and victory over russian aggression.
Case Study: Rehiring and Retaining Ukrainian Talent Across Borders During the War
One of our Ukrainian enterprise clients faced the urgent challenge of rehiring key employees displaced across Europe due to the war. These critical team members, essential to the company’s operations, had relocated to countries such as Spain, Portugal, Slovakia, Poland, and Austria. The company needed a swift and compliant solution to rehire Ukrainian employees while avoiding the complexities of establishing legal entities in each country.
Acumen International stepped in with its Global Employer of Record (EOR) solution, enabling the company to rehire and manage its relocated workforce across multiple jurisdictions, eliminating the need to set up local legal entities.
Our team handled every aspect—from drafting international employment contracts to securing work permits and ensuring hiring compliance with local labour laws. By leveraging its extensive partner network across all countries, we facilitated smooth, compliant operations across borders, ensuring all immigration and employment requirements were met efficiently.
Within weeks, the client successfully rehired their key employees, restoring operational stability and following in-country employment laws. Acumen’s swift and comprehensive support in employment and immigration matters ensured business continuity at a critical time.
Continued Hiring in Ukraine: Supporting Critical Operations
Despite the ongoing war, Ukraine remains deeply integrated into the global economy, with international businesses striving to maintain and support their regional operations. As Ukraine increases its military and weaponry production to meet growing defence demands, it receives significant support from the international community, helping to strengthen both its industries and its ability to recover.
This includes financial and logistical backing, helping bolster its industrial sectors. Ukrainian software development, engineering, and cybersecurity professionals remain in high demand.
The need for local talent has become critical, especially in sectors supporting military production and other essential industries. International companies and organisations hire locally to ensure continuity in production, supply chains, and essential services, recognising Ukraine’s resilience and strategic importance in global markets.
Supporting Businesses and People During the War in Ukraine
In the face of such tragedy, international businesses maintain operations and actively support their Ukrainian teams, ensuring affected employees can continue working and contributing.
Acumen International, rooted in Ukraine with years of global workforce management experience, helps these businesses navigate the urgent challenges of hiring, rehiring, and relocating Ukrainian talent abroad.
With our deep understanding of Ukraine’s labour market and extensive global employment infrastructure, we help businesses keep their operations running even in the most extreme circumstances.
Whether companies need to rehire displaced employees or continue operating locally, our team provides tailored, compliant solutions that ensure legal and operational continuity.
In these challenging times, our mission is to ensure businesses can focus on supporting their people and helping Ukraine win and rebuild in the long term.
Immigration Support and Streamlined Onboarding Worldwide
Another critical aspect of hiring in risky regions is the ability to onboard employees quickly and efficiently, often across borders.
Hiring in risky regions often involves relocating employees and their families. Acumen International’s immigration services extend to family members, offering support for dependent visas, relocation assistance, and more. We facilitate smooth transitions for entire families, ensuring they receive the necessary documentation and support to settle into their new countries securely and efficiently.
Whether managing work permits or handling the logistics of relocating families, we ensure that employees and their loved ones are cared for, making the transition as seamless as possible.
Our immigration services help organisations avoid delays and complications, ensuring that teams can be deployed rapidly and compliantly in 190 countries. Whether it’s bringing in skilled talent to support operations in Ukraine or other complex regions, Acumen’s immigration expertise is instrumental in getting your teams up and running.
Global Payroll Calculator: Supporting Workforce Relocation with Informed Decisions
When employees flee from unstable or risky regions, they often find temporary refuge in random countries. For employers committed to helping their workforce resettle and continue their employment officially, understanding the financial implications of relocation is essential. This is where our Global Payroll Calculator becomes an invaluable tool.
The Global Payroll Calculator enables employers to discover the total employment costs across 190 countries and identify the most cost-effective and compliant locations to hire employees.
From payroll and tax considerations to legal compliance, Global Payroll Calculator provides accurate insights that empower companies to make informed decisions about where to establish or expand operations to support their workforce
With Global Payroll Calculator, companies find the optimal locations to relocate their talent and gain clarity on the total employment costs involved, ensuring that the relocation process remains feasible and sustainable.
12 Risk Scenarios Where a Global Employer of Record is the Solution
In today’s unpredictable world, businesses can face sudden disruptions threatening workforce stability and operational continuity. Companies must be prepared to adapt quickly to changing circumstances, from geopolitical unrest to natural disasters. Acumen International’s Global Employer of Record (EOR) talent engagement model provides an essential solution for businesses navigating these challenging and unpredictable circumstances.
Below are 12 scenarios where a Global EOR becomes a reliable answer to maintaining business continuity:
1. Sudden Geopolitical Conflict
Businesses must quickly relocate and rehire displaced employees in safer locations when political instability or conflict occurs while ensuring compliance with local labour laws.
2. Natural Disasters Disrupting Operations
Natural events like earthquakes or floods can devastate infrastructure, forcing companies to shift operations and rehire staff in safer regions to keep operations running smoothly.
3. Global Supply Chain Disruptions
When supply chains are disrupted due to regional instability, businesses may need to relocate key personnel and hire staff in alternative markets to ensure operational continuity.
4. Political Sanctions Impacting Business
Sanctions can force businesses to exit specific regions, requiring them to relocate operations and rehire their team members in more stable countries.
5. Economic Collapse in Emerging Markets
A sudden economic downturn in an emerging market can push businesses to relocate their workforce to more secure locations, ensuring compliance and payroll stability in new regions.
6. Border Conflicts and Migration
When border conflicts lead to mass migration, companies must navigate the complex process of hiring and rehiring talent across multiple jurisdictions.
7. Workforce Nationalisation Policies
Government policies that prioritise hiring local workers may require businesses to either comply by reducing foreign staff or move operations to countries with more flexible employment laws.
8. Corporate Restructuring During Periods of Instability
When businesses restructure in response to regional instability, they need a compliant solution for redeploying employees across borders without establishing legal entities.
9. Forced Market Exits Due to Risk
In volatile markets, businesses may need to exit suddenly but retain essential employees to manage operations remotely. A Global EOR helps ensure compliance without establishing a local presence.
10. Post-Conflict Recovery
When regions begin stabilising after conflict, companies must rehire displaced employees and rebuild operations without facing complex legal hurdles.
11. Global Health Crises
Pandemics or other health emergencies can disrupt operations, forcing businesses to manage remote teams or rehire talent across multiple jurisdictions.
12. Governmental Instability and Regulatory Changes
Sudden government or regulatory changes can create uncertainty, compelling businesses to relocate or rehire employees in new regions while ensuring compliance.
In these scenarios, a Global Employer of Record can provide businesses with the flexibility and compliant hiring infrastructure to manage their workforce across borders, ensuring continuity and stability even in uncertain times.
Global Employer of Record (EOR) Services in Risky Regions
Ukraine is not the only region where businesses face unique challenges. Many international organisations, particularly non-governmental organisations (NGOs) with humanitarian missions, often operate in volatile, high-risk areas. These NGOs require reliable, compliant employment solutions to support their operations in places where traditional hiring processes are not feasible.
Acumen International: a Trusted Partner in Risky Locations
Our Global EOR services are designed to help these organisations hire and manage their workforce in risky, volatile, or underserved regions. We provide the infrastructure, expertise, and regulatory compliance needed to ensure safe and lawful employment, allowing our clients to focus on their humanitarian or business objectives without employment complexities.
Risky Countries Are Not the Same as Blacklisted or Sanctioned States
While Acumen International operates in regions considered risky due to factors like political instability or economic uncertainty, we strictly do not engage in blacklisted or sanctioned countries. Legal restrictions in these countries make it impossible to provide our services there.
In contrast, risky countries remain part of the global economy and offer business opportunities despite their challenges. We provide compliant, practical workforce solutions in these regions, allowing companies to operate smoothly without establishing local legal entities while adhering to international laws and financial regulations.
Our Global Employer of Record (EOR) services ensure that businesses can navigate the complexities of these environments, staying compliant and operational, even in difficult times.
The Path Forward: The Critical Role of Human Connection in Global Talent Management
Managing a global workforce demands more than processes or technology in times of uncertainty and complexity— it requires genuine human interaction. Cross-border employment intricacies, compliance with constantly changing laws, and responding to unexpected disruptions are challenges that no automated system can fully resolve.
At Acumen International, we understand the value of real human connection. The human touch ensures trust is built, problems are solved, and difficult decisions are made with empathy and foresight. Our clients don’t just need solutions — they need partners who can listen, adapt, and provide thoughtful guidance through the complexities of managing global teams, especially in risky or volatile environments.
When critical issues arise — helping re-employ talent amidst war, securing urgent work permits, or ensuring business continuity in unpredictable circumstances—our team steps in with expertise, personal commitment, and problem-solving skills that only human interaction can offer. In the face of unforeseen challenges, this hands-on approach empowers businesses to stay resilient and compliant, no matter the obstacles they face.
If you need a trusted partner to navigate these complexities, Acumen International is here to help. Let’s work together to support your workforce and maintain operations, no matter the challenges ahead.
Many businesses expanding internationally mistakenly opt for shadow payroll, thinking it will solve their global workforce challenges. However, this quick fix often leads to compliance risks and hidden administrative burdens that surface long after the decision has been made. While shadow payroll may work in some specific, short-term situations, it often fails to offer the… Read more What Is Shadow Payroll? Ultimate Guide for Businesses Expanding Globally
Many businesses expanding internationally mistakenly opt for shadow payroll, thinking it will solve their global workforce challenges. However, this quick fix often leads to compliance risks and hidden administrative burdens that surface long after the decision has been made.
While shadow payroll may work in some specific, short-term situations, it often fails to offer the long-term sustainability needed for managing a global workforce.
In this article, we’ll explore how shadow payroll works, when it applies, and its challenges before comparing it to a more comprehensive solution: Global Employer of Record (EOR) services.
What is Shadow Payroll, and How Does It Work?
Shadow payroll is a mechanism used to ensure that companies meet local tax and social security obligations for employees working on international assignments. Unlike a regular payroll system that directly pays employees, shadow payroll operates as a parallel system to the home-country payroll. Its sole purpose is to satisfy the host country’s tax laws and reporting requirements while the employee continues to receive their salary from the home country’s payroll.
Shadow payroll mirrors the actual payroll in the home country but adjusts for tax and social security regulations in the host country. It enables businesses to comply with both jurisdictions’ tax laws without the need to completely shift the employee to the host country’s payroll system.
Example
Consider a UK company sending an employee on a year-long assignment to Spain. The employee remains on the UK payroll, but due to Spanish tax laws, the company needs to report and pay taxes in Spain. To address this, the company sets up a shadow payroll in Spain that calculates the local taxes owed, ensuring compliance with both countries’ regulations.
When is Shadow Payroll Required?
Shadow payroll is often required when an employee works abroad for an extended period—typically exceeding six months or 183 days—depending on the specific regulations of the host country. Many countries impose tax withholding obligations once the employee surpasses the 183-day threshold, triggering the need for shadow payroll to ensure compliance with local tax laws.
At this point, the host country typically requires the employer to withhold income taxes and social security contributions, even though the employee remains on the home-country payroll. Shadow payroll allows businesses to meet these tax obligations without fully transitioning the employment contract or payroll to the host country.
Instead, it mirrors the home-country payroll for reporting and compliance purposes, ensuring the employee’s earnings are taxed appropriately in both jurisdictions.
Key Scenarios
Long-Term Assignments: Employees working abroad for more than six months often trigger tax liabilities in the host country, making shadow payroll necessary to avoid compliance issues.Expatriates: Shadow payroll is often used to manage tax obligations for expatriates while they remain on the home-country payroll.
Expatriates: For expatriates, shadow payroll is often used to manage tax obligations while they remain on the home-country payroll.
When Shadow Payroll Doesn’t Apply
In certain situations, shadow payroll may not be necessary. For instance:
Short-Term Assignments: If an employee is on a short-term assignment (less than six months), tax treaties between the home and host countries might exempt them from local tax obligations, eliminating the need for a shadow payroll.
Global Employer of Record (Global EOR): When an organisation uses a Global EOR talent engagement model, the provider assumes full responsibility for employment and tax compliance across multiple countries, making shadow payroll redundant. This approach offers a cohesive and scalable alternative to shadow payroll, handling compliance in a more streamlined manner.
The Benefits of Shadow Payroll
While complex, shadow payroll can provide some specific advantages for businesses with internationally mobile employees:
Compliance Without Local Contracts: It ensures tax and social security compliance in the host country without the need to sign a local employment contract, which can be unnecessary for temporary assignments.
Cost-Effective for Short-Term Projects: For companies sending employees abroad for brief assignments, shadow payroll is a cost-effective solution compared to setting up an entirely new payroll system in the host country.
The Challenges of Shadow Payroll
The complexity of shadow payroll cannot be overstated. It involves managing multiple tax jurisdictions, handling currency conversions, and ensuring compliance with varying local tax laws.
Many companies face these challenges:
Compliance Risks of Shadow Payroll
The biggest challenge with shadow payroll lies in compliance. Countries frequently update their tax laws, and companies must keep pace with these changes. Failing to meet compliance deadlines or incorrectly calculating taxes can result in penalties and increased scrutiny from tax authorities. Ensuring compliance in both the home and host countries adds an extra layer of complexity.
Operational Complexity
Shadow payroll requires coordination between the home country’s payroll and the host country’s tax regulations. Companies must ensure that all relevant payments and withholdings are accurately reflected in both systems. This is particularly difficult when multiple employees are assigned to different countries, each with its own tax rules and obligations.
Administrative Burden
Managing shadow payroll demands specialised knowledge of local tax laws and resources to ensure compliance. Tracking salary, benefits, and taxes across several jurisdictions requires specialised expertise and resources. Businesses often must rely on local payroll service providers in the host country to ensure accurate tax reporting and compliance. This can lead to fragmented processes and increased costs, as each payroll provider may handle reporting differently.
Scaling Challenges
Shadow payroll may work a small number of employees, but as businesses expand into more countries, managing shadow payroll in multiple jurisdictions becomes increasingly burdensome. Without a comprehensive, scalable solution, businesses risk drowning in complexity and inefficiency as their international workforce grows.
Tax Equalisation and Protection Schemes: An Added Layer of Complexity
One often overlooked aspect of shadow payroll is the need for tax equalisation or tax protection schemes, particularly for expatriates or employees on international assignments. These schemes ensure that employees on international assignments are not unfairly disadvantaged—or advantaged—by the tax implications of working in multiple jurisdictions.
For example, companies may need to calculate “hypothetical taxes” to determine what the employee would have paid had they stayed in their home country, balancing the actual tax liabilities in both the home and host countries.
Tax Equalisation
Tax equalisation is designed to ensure that employees pay the same amount of tax as they would if they remained in their home country. Employers calculate a hypothetical tax, or “hypo tax,” which represents what the employee would have paid in the home country. The employer uses these amounts to pay the tax obligations in both the home and host countries. Year-end adjustments are often required to balance the tax liabilities.
Tax Protection
Tax protection allows employees to keep any tax savings they might enjoy due to lower taxes in the host country while protecting them from paying higher taxes than they would have in their home country. This requires careful tracking of both home and host country tax regulations to ensure correct reporting and payments.
Implementing these schemes demands expert advice, as tax obligations vary by country. Calculating hypothetical taxes and managing year-end adjustments further complicates an intricate payroll process, adding another layer of administrative burden to companies running shadow payroll.
How Global Employer of Record Differs from Shadow Payroll
While shadow payroll addresses temporary tax obligations, it often falls short as a long-term solution for managing international employment. In contrast, a Global Employer of Record (Global EOR) offers a more sustainable and scalable approach, handling the full scope of employment, from payroll and taxes to benefits and compliance across multiple countries.
Why Global EOR is a Better Fit for Long-Term Expansion
Full Compliance: A Global EOR takes full responsibility for ensuring compliance with local laws, removing the need for constant monitoring of tax systems and eliminating the risk of penalties for non-compliance.
Simplified Operations: The Global EOR handles the entire employment process, including payroll, taxes, and benefits administration, under each country’s regulations, simplifying the burden on internal teams.
Scalability Across Multiple Countries: As businesses expand into multiple countries, a Global EOR allows for seamless scaling without the need to set up new legal entities or manage complex payroll systems. This is a key advantage over shadow payroll, which becomes increasingly challenging to manage across numerous countries.
Combined Benefits: A Global Employer of Record provides a comprehensive solution, combining the benefits of compliance, risk mitigation, and scalability across multiple jurisdictions. Unlike shadow payroll, which is often a stop-gap solution, Global EOR offers a unified, long-term approach that grows alongside the company’s international talent management operations.
Understand Employment Costs with the Global Payroll Calculator
Understanding the full scope of employment costs in different countries is essential for businesses navigating international payroll complexities. Global Payroll Calculator by Acumen International offers a powerful tool to help you evaluate total employment costs, including taxes, social security contributions, and compliance requirements across 190 countries.
By using the calculator, you can:
Compare costs across multiple countries and assess the financial impact of shadow payroll versus a Global EOR solution.
Plan for global expansion by understanding the actual cost of hiring and managing employees in new markets.
Stay compliant with local tax regulations by getting a comprehensive breakdown of all costs related to employment.
The Global Payroll Calculator allows you to make informed decisions that align with your company’s strategic goals and reduce compliance risks, ensuring smoother global expansion.
Conclusion: Global EOR—A Sustainable Solution for Global Growth
While shadow payroll can serve as a temporary solution for managing international tax compliance, its inherent complexities, including fluctuating regulations and administrative burdens, can create significant challenges for businesses.
In contrast, Global Employer of Record (Global EOR) offers a scalable, long-term solution that simplifies these complexities, allowing companies to manage their international workforce confidently.
At Acumen International, we understand that navigating fast-changing regulatory environments requires more than just a quick fix. We bring together the right people, knowledge, and technology to provide a connected, holistic solution that supports your business beyond basic compliance.
Through our Global EOR services, we help businesses build trust by ensuring every decision is backed by comprehensive regulatory insight, protecting their reputations across borders, and unlocking new possibilities for growth.
When expanding globally, it’s crucial to choose a partner that helps you comply with local regulations and empowers you to focus on what truly drives your business forward.
We simplify the complexity of managing a global workforce, allowing you to reframe how you approach compliance, mitigate risks, and create sustainable value in multiple countries. By choosing Global EOR, you’re investing in a future-proof solution that safeguards your operations, strengthens your global presence, and opens up new opportunities.
In a world where compliance risks and regulatory demands continue to evolve, Global EOR is more than just a service — it is a partnership built on trust, reliability, and innovation.
The market is flooded with platformed vendors competing for the lowest price and rapid onboarding in the race to offer global employment solutions. Global employment platforms boast of covering hundreds of countries worldwide, presenting an illusion of effortless, seamless management across borders. But in the process, they often sacrifice the complexity and depth required for long-term… Read more Selling the Illusion: Why Global Employment Can’t Be Fully Automated
The market is flooded with platformed vendors competing for the lowest price and rapid onboarding in the race to offer global employment solutions.Global employment platforms boast of covering hundreds of countries worldwide, presenting an illusion of effortless, seamless management across borders.
But in the process, they often sacrifice the complexity and depth required for long-term success.
Global Employment Platforms: The Short-Term Illusion
Automated global employment platforms market a fairy tale to employers: international employment is a breeze as long as their software does the heavy lifting.
They dazzle employers with promises of low prices, quick compliance, and ‘headache-free’ solutions, painting an overly simplified picture of what global workforce management truly entails.
But in this rush to provide a streamlined experience, something critical gets lost: the complex, long-term nature of global hiring and the individual needsof employees.
Automated platforms often focus on short-term efficiencies — speed of onboarding, payroll processing, and handling basic compliance. However, they ignore the deeper, more nuanced aspects of global employment—supporting employees through complex immigration processes, understanding local labour laws, and addressing ongoing, unpredictable challenges.
Le’t explore what these platforms can’t do and why human expertise remains irreplaceable when it comes to building strong, resilient, and loyal global teams.
Beyond the Automation Myth: The Human Complexity of Global Employment
What happens once the paperwork is signed? Employees are often left to navigate many challenges on their own — local healthcare systems, immigration compliance, residency permits, visa extensions, or even something as basic as opening a local bank account.
While automation can manage routine administrative tasks, it can’t provide the personalised, on-the-ground support required to tackle these issues. Employees and their families need more than software—they need real human support and guidance as they navigate their new environments.
The Critical Role of Global Employment Infrastructure
Global employment is not just a series of processes—it’s a complex journey that requires constant adaptation and human expertise. Platforms can only automate part of the hiring journey — such as contracts, payroll, basic compliance checks, or onboarding—but when it comes to the actual employment relationship, it involves local legal entities and human expertise.
Platforms may offer streamlined services, but full automation is a myth—the actual employment journey requires human judgment, adaptability, and local expertise to navigate the unpredictable challenges that arise across different jurisdictions.
In most countries, it’s not enough for vendors to merely operate through owned legal entities or local partners. A Global Employer of Record (EOR) must have a robust and reliable global employment infrastructure. This means having expert, well-established legal entities owned by the vendor or formed through long-term, vetted partnerships.
Such entities must be human-led backed by experienced professionals with deep local knowledge. This combination ensures compliance and effective management, as technology alone is insufficient for the complex realities of cross-border employment.
It takes years of experience, continuous learning, and human expertise to understand and respond to each country’s ever-evolving regulations and individual employee scenarios. This complex and dynamic framework explains why local expertise, supported by a robust infrastructure, is irreplaceable.
The idea that software alone can manage all these complexities for hundreds of countries is, in essence, part of the illusion sold by these vendors.
Replacing Multiple Vendors: The Challenge of Global Workforce Management
Managing global employment means addressing critical challenges and pragmatic issues head-on, from cross-border tax compliance to coordinating multi-jurisdictional contracts and handling complex immigration requirements.
Automated platforms may handle routine tasks, but they can’t anticipate sudden changes in tax laws, manage complicated visa applications, or tailor contracts to local legal requirements. These areas demand human expertise, foresight, and adaptability to mitigate risks and handle the unpredictable nature of global workforce management.
Can platforms handle the complex, multifaceted nature of global employment? As illustrated by the roles a human-led Global Employer of Record like Acumen International can fulfil, the reality is much more complicated.
A Global EOR replaces multiple vendors: payroll companies to manage complex tax laws, compliance advisors for ever-changing regulations, immigration specialists for visa renewals, and more. While automation can execute basic tasks, it falls short in anticipating legal changes or delivering tailored solutions to evolving needs.
Each of these roles addresses a unique aspect of international workforce management, and it’s impossible for a single automated platform to deliver the kind of nuanced expertise that human specialists offer.
Payroll Company: Managing payroll across multiple countries isn’t just sending payments across borders. It involves staying on top of local tax laws, statutory benefits requirements, and currency fluctuations—all of which demand continuous human oversight and adaptability.
Compliance Advisor: Laws are constantly evolving, especially labour regulations. Automated platforms may alert you to changes, but interpreting and applying those changes correctly requires local knowledge and human judgment.
Employee Benefits Broker: Employee expectations for benefits differ significantly across countries. Automation can’t offer the tailored benefits packages critical for retaining talent in diverse locations.
The sheer number of specialists Global EOR solution can replace is a testament to the complexity of global workforce management — something no algorithm can truly automate. The deeper a company’s international footprint, the more it needs human expertise to navigate these multifaceted challenges.
Automation Only Goes So Far: Why Employers Need More Than Software
The employment journey doesn’t end with an offer letter or first paycheck. It’s an ongoing reality—finding a home, understanding local taxation beyond what’s in the contract, and making sure health insurance works in real-life situations.
Automated platforms might ensure compliance on paper, but they fall short when real-world challenges arise, such as assisting employees with relocation and integration.
For employees relocated abroad, especially those with families, the post-onboarding phase is where the stress builds. They need ongoing, human-driven assistance in understanding local regulations, cultural norms, and practical issues. Automated platforms leave this vital support out of the equation.
Global Employment Is Human, Unpredictable, and Beyond Automation
This slide highlights Acumen International’s additional global employment services beyond payroll: family immigration, school placements, temporary housing, and 24/7 assistance.
These are real and often unpredictable needs, unique to each employee and their family. Global employment goes beyond signing contracts—supporting employees through critical life transitions in real time.
A senior executive is relocated to a new country, and their family requires immediate access to medical care. An automated platform can’t respond to this situation in real-time, nor can it offer personalised support for finding local healthcare providers, understanding insurance coverage, and navigating the local medical system.
Employees need help enrolling their children in schools that meet local and international standards. School placements are deeply personal and vary by country, city, and even neighbourhood. A human-led EOR, like Acumen International, offers tailored solutions to ensure employees and their families feel secure and supported in a foreign country.
In short, automation may simplify routine tasks, but it can’t adapt to the complexities of real life. When employees need flexible, responsive support, only a human-centric Global Employer of Record can offer the empathy and agility necessary to meet those needs across locations.
Is your current platform offering real support to your global employees or just handling paperwork?
Real Expertise: The Key to Navigating Cross-Border Employment Laws
Automation works best when it follows a set of predefined rules. But here’s the problem: labour laws are rarely static. Countries adjust tax rates, benefits, and employment protections on short notice. Automated systems can identify changes in the law, but they can’t interpret how those shifts affect your business strategy or workforce.
A minor misinterpretation of tax law could cost your company thousands or risk employee dissatisfaction. Relying on local expertise to navigate these legalities mitigates risk while ensuring compliance.
For example, the notoriously complex French labour code frequently undergoes revisions to protect worker rights. A software solution might alert a business to a law change, but it takes a human expert with local knowledge to understand and adapt employment contracts or company practices accordingly. Automation provides data; experts offer context and insight.
Strategic Compliance: The Role of Human Insight
Compliance plays a crucial role in global employment platforms. It involves analysing how local laws shape business strategies. For instance, shifts in local tax regulations can impact employee compensation and influence workforce structuring.
Automated platforms can flag changes, but they lack the strategic insight needed to interpret those changes in the context of a company’s goals. Human experts can advise on adapting business strategy, ensuring companies remain compliant while maximising opportunities in each local market.
Complexities of Global Mobility: Personalised Support That Automation Misses
The human complexity of relocating high-value talent goes beyond paperwork. International employees require far more than a timely visa application; they need comprehensive, real-time support in navigating the legal complexities of work permit renewals, understanding local residency regulations, and ensuring their families are adequately supported in a foreign legal system —areas where automation fails to meet expectations.
From healthcare access to education, these challenges extend far beyond the workplace, and no automated system can provide the personalised, real-time guidance that employees need to feel secure in a new country.
Automation may handle routine immigration tasks, but managing the unique complexities of high-value talent is a different story. A highly skilled professional — someone your business has worked hard to find and convince to relocate from South Africa to Germany — doesn’t just need legal documents filed on time.
This employee, whose rare expertise your company’s success depends on, requires personalised support: reassurance that their family’s needs are met, real-time solutions to any issues, and ongoing help as they adapt to life in a new environment.
Are you willing to gamble on this crucial hire at the lower cost of an automated platform? Saving a few pounds might seem appealing, but investing in human-led expertise can make all the difference in retention and your company’s long-term future. Do you want to play the low-cost game or secure the talent your company needs to thrive?
When Automation Hits a Wall: Handling Crises and the Unpredictable
Automation is fantastic—until it isn’t. Systems thrive in controlled environments, managing predictable tasks, but when unforeseen crises hit, they fall short. Crises require adaptability, rapid responses, and real-time decision-making, all of which automation struggles to provide. Automated platforms are limited by their predefined processes, making them ill-suited for situations where quick and strategic interventions are essential.
Automation revolutionised global employment, especially in response to the COVID-19 pandemic, when companies urgently needed ways to onboard and manage remote workers across borders. Indeed, many of the platformed solutions available today emerged during this period, addressing the demand for faster onboarding, remote work compliance, and payroll solutions in a rapidly changing landscape.
However, even as these platforms helped manage the basics—like hiring remotely, processing payroll, and ensuring tax compliance—they weren’t designed to handle the full complexity of crises.
Geopolitical events and economic disruptions revealed the limits of automation. When sudden changes occur—a new labour law is enacted, or borders are closed—relying solely on predefined automated processes can leave businesses vulnerable.
Another example is the war in Ukraine, where geopolitical disruptions displaced millions of people, including key talent crucial to businesses. Automated systems couldn’t handle the nuanced challenges of relocating employees to new countries, securing temporary work permits, or ensuring continuity in business operations.
Acumen International stepped in, rapidly re-employing displaced talent across Europe and crafting bespoke solutions in countries like Spain, Portugal, and Poland. Our team’s deep local expertise allowed for swift contract adjustments and compliance with new legal environments. Machines can’t anticipate these human-centric challenges, but experienced, human-led teams can—because crises, by nature, demand flexibility, ingenuity, and empathy.
Only a team with deep local expertise could provide real-time guidance, adjust contracts, advise on temporary remote work solutions, and ensure compliance in a chaotic environment. Machines can’t improvise.
A Personal Touch: Building Employee Loyalty Through Human Interaction
You mentioned employee retention in your last article, and here’s an important continuation: loyalty isn’t built through automated processes. Employees want to feel understood, supported, and valued as individuals, not as payroll entries. Global employees, in particular, face unique stresses—from navigating new cultures to dealing with homesickness or visa uncertainties.
A hiring platform cannot listen, empathise, or provide the emotional intelligence that human experts bring to the table. It cannot build trust.
Employees stay loyal when they feel understood and valued as individuals, not just entries on a payroll.
Conclusion: Automation Isn’t the Silver Bullet. People Still Matter
While automation brings efficiency and scalability to global employment operations, it cannot replace the adaptive, personalised approach required to manage an international workforce effectively. From helping employees navigate life in a new country to providing strategic compliance advice, human expertise fills the gaps that automated global employment platforms leave behind.
The future of global employment isn’t about choosing between automation and human insight; it’s about blending both to create adaptive, sustainable solutions for employers and employees alike.
But in the face of complex and unpredictable challenges, the human element makes all the difference.
Choosing short-term savings over lasting success is a risky move. Your people—and your company’s future—deserve better.
Practical Guide for Strategic Business Growth Azerbaijan, strategically located at the crossroads of Europe and Asia, offers a unique combination of economic opportunity and government support for foreign businesses. While often overshadowed by its larger neighbours, the country presents real advantages for companies seeking growth beyond familiar markets. From a robust oil sector to a… Read more Why and How to Expand into Azerbaijan
Practical Guide for Strategic Business Growth
Azerbaijan, strategically located at the crossroads of Europe and Asia, offers a unique combination of economic opportunity and government support for foreign businesses. While often overshadowed by its larger neighbours, the country presents real advantages for companies seeking growth beyond familiar markets. From a robust oil sector to a rapidly growing technology scene, Azerbaijan’s diverse economy invites attention for companies with well-planned expansion strategies.
This article will explore why Azerbaijan is an ideal market for expansion, particularly for energy, technology, agriculture, and logistics industries.
It will also provide a step-by-step guide on how to enter the market effectively, ensuring regulatory compliance and long-term sustainable growth.
1. Strategic Geopolitical Position
Azerbaijan sits at a critical juncture between Europe, Asia, and the Middle East, making it a natural hub for trade. Its infrastructure, including the Baku-Tbilisi-Kars railway, is designed to facilitate the seamless movement of goods, which is ideal for businesses in logistics, manufacturing, and supply chains.
The Caspian Sea Advantage: Connecting Continents
Azerbaijan’s Caspian Sea coastline positions it as a key transit country in the Trans-Caspian International Transport Route, also known as the Middle Corridor. This initiative connects China to Europe via Central Asia, Azerbaijan, and Turkey. The Alat Free Economic Zone near Baku is being developed to boost trade and logistics further, providing incentives for companies to operate in this strategic hub.
This creates strategic advantages for logistics and trade, connecting Azerbaijan to neighbouring regions and allowing access to Europe through partnerships and shipping lanes.
2. Growth Opportunities in Diversified Sectors
While the energy sector remains prominent, Azerbaijan has diversified significantly, opening up new avenues in:
Agriculture: Strong government initiatives are in place to boost production in areas like cotton, fruit, and wine. This presents a growing market with governmental backing for agribusiness or food processing businesses.
Technology and Innovation: Azerbaijan’s tech sector is seeing increasing investment, particularly in fintech and telecommunications. Supported by initiatives like Startup Azerbaijan, the local tech talent is ready to collaborate on innovative projects.
Streamlined Visas for Tech and Innovation Talent
The Azerbaijani government launched a Simplified Visa Program in 2017 to encourage IT specialists and startups to set up operations there. This program is designed to streamline visa applications for skilled workers, including IT professionals and engineers, to support the development of the tech sector. The Innovation Agency, established in 2018 to promote entrepreneurship and R&D, further supports the startup ecosystem. This is part of the government’s initiative to develop a knowledge-based economy and reduce reliance on oil. Foreign tech professionals are eligible for simplified visa procedures.
Government Support and Business-Friendly Environment
Azerbaijan offers a range of government incentives designed to facilitate foreign businesses’ entry. Special Economic Zones (SEZs) provide tax incentives and simplified administrative procedures, making it easier to establish operations. The government’s clear focus on diversifying the economy means non-oil sectors can benefit from grants and tax relief.
Azerbaijan has worked to streamline regulatory processes, making it easier for foreign companies to navigate the legal landscape. Setting up a business is straightforward, with digital platforms in place to handle much of the bureaucracy efficiently.
Alat Free Economic Zone (AFEZ): A Hub for Investment and Growth
AFEZ, strategically situated adjacent to the Baku International Sea Trade Port and key global transport corridors, aims to become a prominent regional investment hub. It offers a compelling business environment with various fiscal and non-fiscal incentives, coupled with robust infrastructure and an independent legal framework.
Legal Framework
The legal foundation of AFEZ is the Law of the Republic of Azerbaijan, “On the Alat Free Economic Zone.” This law and internal regulations issued by the AFEZ Authority take precedence over the base economy legislation, creating a distinct and business-friendly regulatory environment within the zone.
Incentives for Investors
Tax Benefits
Exemption from value-added tax (VAT), withholding tax, and corporate taxes.
Exemption from customs duties and taxes on imports and exports.
Products manufactured in AFEZ enjoy duty-free access to 10 neighbouring countries due to Free Trade Agreements.
Labour and Ownership
No personal income tax for employees earning up to 8,000 manat (approximately $4,700) monthly.
Optional social security payments for foreign skilled personnel.
No restrictions on foreign ownership or the need for a local partner.
Business Facilitation
No restrictions on foreign currency transactions or profit repatriation.
Trade facilitation-based customs regime.
Protection against nationalization or expropriation.
Full protection of intellectual property rights.
On-site one-stop shop for business services (appraisal, licensing, permitting).
Access to visas for foreign nationals.
Independent dispute resolution mechanisms.
Independent regulatory body.
Target Sectors. Infrastructure and Support
AFEZ welcomes investors in high-value-added, export-oriented manufacturing and internationally traded services, focusing on innovative technologies and best practices.
In addition to the attractive legal and fiscal framework, AFEZ offers industrial land plots equipped with ready-to-use infrastructure and utilities, simplifying the business setup process.
The zone actively assists in finding local skilled personnel.
A Global Leader in Business Reforms
Azerbaijan has made notable progress in improving its business environment, outpacing many regional neighbours. According to the World Bank, the country has implemented nearly 40 reforms over the past decade to enhance regulatory efficiency and overall business quality.
Ranked 34th out of 190 countries in the World Bank’s Doing Business report, Azerbaijan stands out for simplifying business registration, streamlining property registration, and improving tax systems, further establishing itself as a business-friendly destination.
How to Expand into Azerbaijan: A Step-by-Step Process
1. Pre-Entry Planning and Market Research
Before entering any market, it’s crucial to assess the total employment costs, legal requirements, and opportunities in key sectors. This is where the Global Payroll Calculator becomes invaluable. The tool helps companies calculate the total cost of employment across 190 countries, including Azerbaijan. By using this tool, businesses can gain a clear understanding of their potential payroll burden, which includes base salaries, benefits, taxes, and compliance-related expenses.
This data allows companies to make informed decisions about where to allocate their resources and how to structure their workforce most efficiently.
Tax Relief for Government-Prioritized Sectors
Azerbaijan’s income tax rates for employees are progressive, with a 14% tax rate for incomes under AZN 2,500 (about USD 1,470) and a 25% tax rate for incomes exceeding that amount. However, employees working in Special Economic Zones (SEZs) or on government-backed projects may qualify for tax reductions or exemptions, offering a considerable financial advantage for businesses operating in those areas.
2. Choosing the Right Market within Azerbaijan
Not all regions within Azerbaijan offer the same opportunities. Baku, for example, is a clear choice for tech and financial services, while the country’s rural regions are better suited for agriculture and manufacturing investments.
Baku: A Hub for Finance and Technology
As the capital and largest city, Baku is the epicentre of Azerbaijan’s financial services and technology innovation. Rural areas, by contrast, offer fertile ground for agribusiness and manufacturing ventures.
3. Selecting the Mode of Entry: Employer of Record for Flexible, Cost-Effective Market Entry
Your choice of entry mode depends on your company’s long-term goals and resources. Standard options include establishing a representative office for market visibility, forming a subsidiary for complete operational control, or leveraging a Global Employer of Record (EOR) for faster market entry without the need to establish a legal entity or build costly employment infrastructure.
While setting up a legal entity may seem like a conventional route, it comes with substantial administrative and financial burdens, especially in countries like Azerbaijan, where incorporation can take weeks and involve significant ongoing costs. Moreover, managing a foreign entity requires long-term investment in compliance, payroll, tax filings, and navigating changing local regulations.
In contrast, the Global EOR model provides an efficient, flexible solution for companies seeking to expand quickly into Azerbaijan or multiple jurisdictions simultaneously. The Global Employer of Record assumes 100% responsibility and liability for hiring employees on your behalf, managing compliance with local labour laws, and overseeing payroll and benefits administration.
This allows businesses to test the market with minimal upfront investment and avoid the complexities of setting up and managing a legal entity.
The Long-Term Financial and Administrative Burden of Entity Setup
Setting up a legal entity in Azerbaijan requires significant upfront and ongoing costs, including incorporation fees, legal advisors, and in-house HR staff to manage payroll, taxes, and employee benefits. Beyond these costs, exiting the market can be difficult and costly, involving liquidation processes, legal disputes, and potential litigation.
A Flexible and Risk-Reducing Approach
With a Global Employer of Record, companies have easy entry and easy exit options. This is especially beneficial if the market needs to pivot or if performance doesn’t meet expectations. By using a Global EOR, businesses can scale operations up or down without the risks and complications of entity liquidation or employee termination, which often involvecomplex legal processes.
Administrative Efficiency Across Multiple Jurisdictions
For companies expanding not only into Azerbaijan but also into multiple countries, the EOR model allows them to centralize their employment and compliance processes. This reduces the need to deal with jurisdiction-specific regulations individually and avoids the long-term management commitments associated with setting up multiple legal entities across various regions.
Administrative and Financial Flexibility with Global EOR
Companies can begin operations in Azerbaijan using an Employer of Record with minimal costs and commitments compared to establishing a legal entity. The EOR model simplifies compliance management, payroll administration, and workforce scaling, offering a seamless entry into the market that can be adjusted as needed. Unlike a traditional entity setup, where exit can be costly and complicated, the EOR ensures a smooth transition if the company needs to scale down or withdraw from the market.
4. Determining the Talent Hiring Model in Azerbaijan
When expanding into Azerbaijan, it’s important to understand the distinctions between full-time employees and independent contractors to avoid misclassification risks. Like many countries, Azerbaijan has clear employment laws that dictate what constitutes an employee versus a contractor. Misclassifying a worker can lead to legal penalties, tax complications, and reputational damage.
A Global Employer of Record (EOR) can be critical. By working with a Global EOR, businesses can assess the correct classification for each role, ensuring they meet the country’s legal standards for employment. An EOR manages employment’s payroll, benefits, and compliance aspects, which is especially valuable for companies navigating the complexities of hiring in Azerbaijan.
Avoiding Employee Misclassification Risk
Employee misclassification often arises due to financial motivations or a lack of understanding of local regulations. Like many others, the Azerbaijani government has increased scrutiny on businesses that incorrectly classify employees as independent contractors to avoid taxes and benefits. An EOR ensures that all employees are correctly classified and compliant with local labour laws, reducing the risk of audits and penalties.
The Global Payroll Calculator by Acumen International helps businesses in balancing global talent acquisition budgets by accounting for diverse benefits, 13/14 salary accruals, and varying in-country taxes. This tool aids in identifying the actual cost of employment, factoring in all necessary local obligations.
Transparent, Progressive Tax System
Azerbaijan operates a progressive income tax system, applying different rates based on an employee’s income level. The tax structure is designed to ensure fairness for full-time employees while incentivising growth in government-primary sectors, such as agriculture and innovation.
Using Global Employer of Record solutions helps businesses comply with Azerbaijan’s tax regulations. The EOR calculates and deducts the appropriate income taxes, social security contributions, and other statutory benefits. This ensures businesses avoid potential tax penalties or legal complications arising from incorrect filings.
Navigating Global Regulations and Tax Laws
Expanding businesses need to consider the broader global tax and labour landscape in addition to local tax compliance. An EOR ensures compliance with ever-changing regulations across multiple jurisdictions, preventing legal consequences and operational disruptions.
The Global Payroll Calculator helps businesses identify cost-effective, tax-friendly locations for hiring, avoid costly oversights, and ensure adherence to local laws.
10 Reasons to Use Global EOR to Expand into Azerbaijan
1. Accelerated Market Entry with Full Compliance
With Global EOR, businesses can bypass the lengthy process of establishing a local entity and launch operations in 1 to 2 weeks. This approach ensures full compliance with Azerbaijan’s labour laws, minimizing risks and legal complexities.
2. Flexibility Without Long-Term Legal Obligations
Global EOR allows companies to enter the Azerbaijani market without committing to a legal entity, offering the flexibility to pivot or exit quickly if needed. This is ideal for businesses testing the market before making a permanent investment.
3. Access to Local Talent Without Administrative Hassles
Hiring through Global EOR allows access to local talent, particularly in high-demand fields like tech and engineering, without the burden of managing employment contracts, payroll, and tax filings. The EOR handles these processes, freeing up your resources.
4. Compliance with Evolving Labour Regulations
Labour and tax laws in Azerbaijan can change frequently, especially in dynamic industries. Global EOR ensures your business remains compliant with real-time regulatory updates, avoiding costly legal missteps.
5. Mitigation of Currency and Tax Risks
Dealing with Azerbaijan’s distinct currency (Azerbaijani Manat) and progressive tax system can be complex. Global EOR manages payroll, taxes, and social contributions, minimising risks related to currency fluctuations and local tax obligations.
6. Culturally Informed HR and Employment Practices
Global EOR solutions align HR and employment processes with local customs and business etiquette, ensuring compliance and improving employee satisfaction from the start. This culturally informed approach helps businesses retain local talent.
7. Focus on Core Operations, Not Administrative Burden
Global EOR allows companies to concentrate on their core operations rather than getting bogged down by the intricacies of labour laws and administrative tasks. With the administrative side handled by the EOR, businesses can focus on their growth strategy.
8. Seamless Integration of Remote and Distributed Teams
For companies building remote or distributed teams, Global EOR simplifies cross-border operations by ensuring consistent payroll and contract terms, making it easier to integrate Azerbaijani employees into global teams.
9. Cost-Effective Expansion with Predictable Costs
Setting up a legal entity can lead to hidden costs such as office space, local staff, and legal fees. Global EOR eliminates these expenses by providing transparent pricing based on employee costs, allowing businesses to scale up or down efficiently based on market performance.
10. Protection from Compliance Risks and Audits
Non-compliance with Azerbaijani labour and tax laws can result in fines, audits, or operational disruptions. Global EOR ensures that employment practices remain fully compliant, protecting businesses from financial and legal risks.
Strategic Advantage of Expanding into Azerbaijan with Acumen International
Expanding into Azerbaijan offers immense potential, but it requires a clear strategy, local expertise, and a focus on compliance. Acumen International’s Global EOR solution simplifies every step of this process, allowing businesses to expand rapidly without the overhead of establishing local entities.
One of the most complex challenges for businesses expanding into new markets is navigating the immigration and work permit sponsorship processes, especially when relocating international talent. With Acumen’s Global EOR, your company can secure work permits and sponsor visas for employees in Azerbaijan without navigating the intricate local bureaucracy. Acumen’s expertise ensures that all necessary documentation and processes are handled efficiently and in full compliance with local regulations.
With over two decades of experience and a network of in-country professionals, Acumen International combines the best of human-centric service with technology-enhanced solutions to provide businesses with tailored, scalable global employment solutions.
By partnering with Acumen, you gain access to a trusted advisor capable of navigating complex regulatory environments, including immigration laws, ensuring your operations remain compliant, no matter how challenging the jurisdiction. With a focus on flexibility, cost-efficiency, and seamless integration, Acumen’s Global EOR enables businesses to expand into Azerbaijan and beyond with confidence, speed, and minimal risk.
Unlock the potential of global growth with Acumen International and transform your approach to international expansion, including the complexities of immigration and work permits.
Welcome to the August 2024 edition of our Global Employment Tax and Compliance Newsletter. Each month, we bring you the latest updates on employment and immigration laws that impact your business. This month, we’ve gathered the most critical updates in employment and immigration law worldwide. As you navigate these changes, you can also explore our… Read more Global Employment Tax and Compliance Newsletter. August 2024
Welcome to the August 2024 edition of our Global Employment Tax and Compliance Newsletter. Each month, we bring you the latest updates on employment and immigration laws that impact your business.
This month, we’ve gathered the most critical updates in employment and immigration law worldwide.
As you navigate these changes, you can also explore our latest guides and articles—designed to help you stay compliant and informed. Let’s dive in.
Netherlands🇳🇱: New Legislation Aiming to Strengthen Job Security for Flexible Workers
The Dutch government is moving forward with a proposal known as the “More Security for Flexible Employees Act,” which has been in public consultation since July 2023. This proposed law would overhaul the current system of on-call contracts, replacing them with a new type of employment arrangement called “basic contracts.”
These contracts will establish a minimum number of guaranteed working hours that employees are scheduled and paid for, providing greater stability and predictability.
The flexibility currently afforded to employers under on-call contracts will be significantly reduced, with only students and new temporary agency workers (within their first 52 weeks) continuing under these arrangements.
Changes to Anticipate
Introduction of Basic Contracts: Under this new framework, employees will be assured a set number of paid hours, minimizing the uncertainty inherent in on-call contracts. This change is expected to shift the balance more in favour of workers, ensuring they have more predictable work schedules and incomes.
Extended Gap Between Contracts: The legislation also aims to prevent the easy renewal of fixed-term contracts by extending the mandatory break between them from 6 months to 5 years. If an employee has been under contract for over three years, and the gap between contracts is less than five years, the most recent contract will automatically convert into a permanent one.
When Will This Take Effect?
The law is expected to be enforced between January 2025 and January 2026. Once the law is enacted, employers will have approximately six months to adjust their practices to comply with the new requirements.
What Employers Need to Do and Why
To prepare for these changes, employers should start phasing out on-call contracts in favour of basic agreements, except in cases involving students and recent temporary hires. It’s also crucial to carefully track the duration and breaks between contracts to ensure compliance with the new rules, especially since mismanagement could lead to unintended permanent employment commitments.
Employers who fail to adapt to these new requirements may face significant legal and financial risks. For example, incorrectly managing contract breaks could lead to employees automatically receiving permanent contracts, which could carry unintended long-term obligations.
Extended Waiting Period As of January 1, 2024, the waiting period for a newly unemployed person to start receiving unemployment benefits was extended from 5 days to 7 days. Additionally, if a freshly unemployed person has remaining holiday days from their previous employment, the compensation for those days will delay the start of their unemployment benefits.
Abolishment of Child Increments Additional cuts to unemployment benefits came into effect on April 1, 2024. Mainly, child increments previously paid to supplement unemployment benefits have been abolished. Furthermore, the amount of income a person receiving unemployment benefits can earn without affecting their benefits has been decreased.
Prior Work Requirement Adjustments As of today, September 2, 2024, the prior work requirement for determining a person’s eligibility for earnings-related unemployment allowance has been extended to 12 months, up from approximately six months. Earnings of at least €930 in a calendar month now count as one month towards meeting this requirement.
Transition Contractors onto Full-time Employees
Navigating the Shift: From Independent Contractors to Full-Time Employees
Today, the line between independent contractors and full-time employees often blurs, leading to significant business risks. Misclassification is not just a legal grey area—it’s a real threat that can result in fines, back taxes, and costly lawsuits. As companies expand their global operations, managing contractors across multiple jurisdictions becomes increasingly complex.
Many forward-thinking organisations are strategically transitioning their contractors into full-time employees to tackle this head-on. This shift is an investment in building a committed and stable workforce. But how can your company navigate this transition smoothly?
Why Make the Transition?
Risk Mitigation: By converting contractors to full-time employees, businesses can significantly reduce the risk of legal repercussions associated with misclassification.
Increased Stability: Full-time employees are more likely to stay with your company, leading to higher retention rates and a stronger, more cohesive team.
Enhanced Productivity: Employees who feel secure and valued are more engaged and productive, driving innovation and performance across the board.
Key Trends Shaping the Transition
Several global trends drive the transition from contractors to employees:
Complex Regulatory Landscapes: Compliance requirements are becoming more intricate, necessitating robust governance frameworks to avoid pitfalls.
Increased Scrutiny: Governments worldwide are intensifying audits and regulatory scrutiny, especially concerning employee classification.
Evolving Compensation Structures: As companies rethink their compensation models, aligning them with business goals and regulatory requirements is essential.
Your Roadmap to a Smooth Transition with Acumen International
Successfully transitioning contractors to full-time employees requires a strategic approach:
Audit Your Workforce: Evaluate your current contractor engagements for compliance risks.
Estimate Costs: Use comprehensive cost models to understand the financial impact of the transition.
Legal Compliance Check: Ensure your transition plan adheres to local employment laws in each country where you operate.
Implement the Transition: Prepare and communicate your transition plan clearly to all stakeholders, ensuring a seamless shift.
Cyprus: Your Next Strategic Move in Global Expansion
As global businesses eye new frontiers, Cyprus often remains a hidden treasure in the strategic landscape of international expansion. Cyprus is an unpolished gem for forward-thinking enterprises looking to establish a foothold in pivotal markets at the nexus of Europe, the Middle East, and Africa.
In our latest exploration, “Cyprus: A Strategic Hub for Global Expansion,” we explore why Cyprus rapidly emerged as a go-to destination for companies seeking a blend of strategic location, tax efficiency, and regulatory stability. This isn’t just another destination—it’s your gateway to robust growth and sustainable success.
Why Cyprus? Key Highlights
Geostrategic Powerhouse: Cyprus serves as a gateway to some of the world’s most dynamic markets, providing businesses with unparalleled access to Europe, the Middle East, and Africa.
Tax Efficiency: With a corporate tax rate among the lowest in Europe and an extensive network of double taxation treaties, Cyprus is engineered for financial efficiency. This tax environment is favourable and transformative, allowing businesses to reinvest in growth while maintaining a competitive edge.
EU Member Benefits: As part of the European Union, Cyprus provides seamless access to the EU’s single market, facilitating the free movement of goods, services, and capital.
Talent Magnet: Cyprus boasts a highly educated multilingual workforce ready to drive innovation in finance, technology, and beyond.
Emerging Innovation Ecosystem: Supported by government initiatives like the Cyprus Startup Visa, the startup ecosystem in Cyprus is on the rise, offering exciting opportunities for entrepreneurs and investors.
If you’re looking to gain a strategic advantage and integrate Cyprus into your global expansion plans, we invite you to delve into our detailed guide on LinkedIn or read the full article on our website here.
Acumen International: Your Global Employment Partner in Cyprus and Beyond
The complexity of global expansion demands a partner with both deep local knowledge and global reach. At Acumen International, we don’t just help you expand—we help you thrive. With expertise across 190 countries and a human-centric approach to global employment solutions, we are uniquely positioned to guide your business through the complexities of expanding in Cyprus.
Precision and Compliance: We navigate the complexities of local laws, taxes, and employment regulations, ensuring that your operations are compliant and optimised for success.
Tailored Solutions: Our boutique approach means you get tailored support, with a dedicated advisor to guide you every step and ensure that your transition into Cyprus is seamless.
Strategic Support: Whether it’s through our Global Employer of Record solutions, global payroll services, or immigration expertise, we provide the tools and insights you need to make informed, strategic decisions about your global workforce.
Czech Republic 🇨🇿 Introduces Labour Code Amendments and Minimum Wage Changes
From 1 January 2024, the minimum wage in the Czech Republic has already increased to CZK 18,900 per month (up from CZK 17,300). The minimum hourly wage has risen to CZK 112.50.
New Minimum Wage Calculation Method
A new mechanism for calculating the minimum wage is proposed. The monthly minimum wage would be set based on the national economy’s average gross monthly nominal wage for the following calendar year and a coefficient. The goal is to achieve a coefficient of 47% by 2029 (currently at 42.2%).
Guaranteed Wage Changes
The proposal suggests cancelling the levels of guaranteed wages for the private sector. The public sector will be graded according to four groups of work instead of the current eight.
Labour Code Amendments
The draft amendment includes several changes:
Extended probationary periods (up to 4 months for non-managerial employees and 8 months for managerial employees)
Shortened notice periods for dismissals due to employee fault
Guaranteed role reinstatement for employees returning from parental leave
More flexible working hour arrangements
Implications for Employers and Employees
These changes aim to provide more flexibility in employment relationships and ensure fair wage practices. Employers should prepare to:
Adjust wages to meet new minimum wage levels.
Familiarize themselves with the new Labour Code provisions.
Review and potentially update employment contracts and policies.
The draft is still in the early stages of the legislative process and may be subject to further changes.
Czech Republic 🇨🇿: Further Changes to the Labour Code
The Government has proposed an amendment to the Labour Code, introducing several significant changes. It is expected to come into force on 1 January 2025.
These include:
Probation Periods: The amendment allows for a 4-month probation period for managing employees, which can be extended to 8 months.
Notice Period Commencement: Changes to when the notice period begins, with a reduction in its duration from 2 months to 1 month in some instances.
Employee Scheduling: The introduction of the option for employees to schedule their own working time.
Payment in Foreign Currency: Employers can pay certain types of employees in a currency other than CZK.
France 🇫🇷: Upcoming Measure on Birth Leave
The French Government has introduced a new birth leave policy to replace the current parental leave system. Entry into force is expected in August 2025. Although the details are yet to be fully finalized, the expected changes include:
Replacement of Parental Leave: A 6-month birth leave for both parents, replacing the existing parental leave system.
Flexibility in Usage: Leave can be taken by one or both parents, simultaneously or successively, and can be utilised full-time or part-time.
Compensation: Social security will compensate the leave at 50% of the last salary, with a maximum limit of €1,800. The employer may supplement this compensation.
France 🇫🇷: Immigration Law Updates
The French Government has empowered préfets with the authority to regularize undocumented workers employed in sectors facing significant labour shortages. This initiative, valid until December 31, 2026, aims to address these shortages by granting one-year residence permits to eligible individuals.
Eligibility Criteria
To qualify for regularization, workers must meet the following conditions:
Relevant Employment: The individual must have been employed in a role listed as experiencing recruitment challenges for at least 12 months within the last two years. This period can be non-consecutive.
Consistent Job Holding: The worker should have maintained employment in these specified roles or regions.
Stable Residency: The individual must have lived in France continuously for at least three years.
Clean Legal Record: A clean criminal record (bulletin n°2) with no significant legal issues or disqualifications is required.
Discretionary Power of Prefects
Even if all criteria are met, préfets retain the discretion to deny regularisation. Decisions will consider the individual’s social and family integration, compliance with public order, and alignment with French societal values.
Strict Penalties for Non-Compliance
The law also imposes significant penalties on employers who fail to comply with these regulations:
Fines Up to €30,000: For employing a foreign worker without proper authorisation to work in France.
Increased Fines: Up to €200,000 if an organised group commits the violation.
Additional Penalties: For employing foreign nationals outside the terms of their work permits or in unauthorized professional categories or locations.
Next Steps for Employers
The law introduces further obligations, including enhanced training requirements for non-French speaking employees and adjustments to social security benefits for non-EU nationals.
Employers must proactively update their hiring and compliance processes to align with these new regulations. Failure to do so could result in severe financial and legal repercussions.
Entry into force: The law is awaiting final implementation.
Romania 🇷🇴: Key Legislative Updates Affecting Employment and Retirement
Recent legislative changes in Romania will gradually raise the retirement age for women from 63 to 65 by 2035. This adjustment reflects ongoing efforts to align retirement policies with demographic trends. Notably, women with children will see a reduction in their retirement age, recognizing the demands of family care.
Effective Date: 1 September 2024
What Employers Need to Do
Employers should prepare for potential updates to their internal processes and documentation. Keeping an eye out for additional government guidance will be essential to ensure compliance and smooth implementation.
Lithuania: Updates on Leave for Adoptive Mothers 🇱🇹
The Lithuanian Labour Code has been updated to address a prior inconsistency in parental leave. Previously, adoptive fathers were granted both paternity and parental leave, while adoptive mothers were only eligible for parental leave. The amended Labour Code now entitles adoptive mothers to 30 calendar days of leave under the same terms as paternity leave for adoptive fathers.
Effective Date: 1 July 2024
Employer ImplicationsandRisks of Non-Compliance
Employers must not refuse to grant this new leave to adoptive mothers. The leave is funded by the State Social Insurance Fund, not the employer.
Failure to grant the leave may result in a labour dispute. The dispute resolution body can override employer decisions, mandate compensation, and impose fines. Fines could be as high as €3,000, with additional administrative penalties ranging from €240 to €880 imposed by the State Labour Inspectorate for repeated violations.
Netherlands🇳🇱: Changes to Unemployment Premium and State Pension Age
Unemployment Premium
As of 1 January 2025, the rules governing unemployment premiums for overtime hours in permanent employment contracts will be broadened. Currently, employers pay a lower premium for permanent contracts and a higher one for flexible contracts. To maintain eligibility for the lower premium, employees can work up to 30% overtime in addition to their contracted hours without triggering a higher premium.
However, if more than 30% overtime is worked, the higher premium applies retroactively for the entire year. This rule does not apply to larger employment contracts where employees work an average of 35 or more hours per week. The new changes will expand this exemption to contracts with 30 or more hours per week. This adjustment aims to increase employer flexibility while preserving job security for employees.
Impact Date: 1 January 2025
Employer Implications
Starting January 2025, employers can consider offering contracts with 30 working hours per week (instead of the current 35 hours) to benefit from the lower unemployment premium. Employers might also explore reducing the workweek to 28 hours, with an additional 2 hours of overtime, to remain within the exemption criteria for lower premiums.
Singapore🇸🇬: Updates on Employment Pass / COMPASS
Employment Pass (EP) and COMPASS Framework
The Ministry of Manpower (MOM) in Singapore has introduced a new evaluation framework called the Complementarity Assessment Framework (COMPASS) for Employment Pass (EP) applicants. This framework is designed to help employers bring in highly skilled foreign professionals while enhancing workforce diversity. COMPASS operates on a points-based system, assessing both the individual’s qualifications and the specific needs of the employment market.
To qualify for an EP under COMPASS, applicants must meet the new minimum qualifying salary of S$5,000 per month (S$5,500 for financial services) and score at least 40 points in the COMPASS assessment.
Bonus Criteria
MOM has also introduced additional bonus points under COMPASS:
Skills Bonus (Criterion 5): EP applicants who possess skills in high-demand areas with a significant shortage can earn bonus points.
Strategic Economic Priorities (SEP) Bonus (Criterion 6): Firms that contribute to Singapore’s strategic economic goals and are supported by sector agencies can earn up to 20 bonus points per EP application.
Shortage Occupation List (SOL)
Applicants applying for roles on the Shortage Occupation List (SOL) can earn up to 20 additional points. Firms benefiting from the SEP Bonus will receive ten bonus points for each EP application. To qualify, firms must be backed by sector agencies and may receive the SEP Bonus support for up to three years.
Educational Verification
MOM is tightening the requirements for verifying educational qualifications for EP applications. From September 2023, employers must ensure that the qualifications declared are verified through selected background screening companies listed on MOM’s website. This requirement applies to both new applications and renewals from September 2024. MOM also explores alternative verification methods, such as online portals linked to government or educational institutions.
Effective Date: 1 September 2024 for renewals.
Slovakia 🇸🇰: Recent Employment Updates
Employment Opportunities for Ukrainian Nationals
Ukrainian citizens and specific family members living in Ukraine before February 24, 2022, can apply for temporary protection in Slovakia. This status allows them to work under more streamlined conditions. The protection also extends to non-Ukrainian foreign nationals and their families who had been granted international protection in Ukraine by that date. Upon receiving temporary protection, individuals are provided with documentation that authorizes them to work within Slovakia.
Validity Period: March 1, 2022, to March 4, 2025.
Proposal for a Four-Day Working Week in Slovakia
A proposal under consideration by the National Council could introduce a four-day working week in Slovakia. This change would allow employees to work their full weekly hours over four days instead of five, giving them an additional day off. This day would be intended for personal well-being, including family time, health care, and other personal matters.
Although the proposal has not yet been enacted, employers should stay informed. If the change is implemented, significant adjustments in work schedules and resource management could be required.
Compliance Guide 2024: Essential Insights for Global Employers
As your business expands into new markets, the complexities of managing a global workforce become more evident. The “Compliance Guide 2024—Global EOR” is designed to provide you with clear, actionable insights into navigating these challenges effectively.
What’s Inside
Current Trends: An analysis of the key shifts in global employment, from the rise of remote work to the evolving expectations of international employees.
Foundations of Compliance: We break down the core areas where compliance is critical, including employment contracts, tax obligations, and social security requirements.
Practical Tools: From checklists to best practices, this guide provides the resources to streamline your compliance efforts and focus on your business goals.
In global employment, unpredictability is the rule rather than the exception. Expanding across borders means you will inevitably encounter situations that no automated system can fully address.
Whether adapting to sudden changes in local legislation or managing the complexities of relocating key employees and their families—especially without a legal entity in the target country and requiring a work permit sponsor—these challenges demand a personalised approach.
Why Personalised Global Employer of Record Solutions Count
Handling HR Compliance Challenges: Laws are different everywhere and can change without warning. You need someone who knows the local rules to help you adapt quickly. Automated systems can’t do that.
Solving Payroll Issues: Global payroll is rarely straightforward. Unexpected tax problems or local regulations can throw things off. With a personalised Global EOR service, you have real people who can quickly step in and fix these issues.
Customising Employee Benefits: Employee expectations differ across regions, and a one-size-fits-all benefits package falls short. Our experts leverage their deep local knowledge to design competitive, tailored benefits that resonate with your workforce, ensuring they feel genuinely valued and understood.
Tackling Global Mobility Challenges: Relocating employees isn’t just about paperwork; it’s about managing the unexpected. Whether navigating visa complications, finding suitable housing, or securing a school for your employee’s children, our dedicated advisors address these challenges.
Try Global Payroll Calculator by Acumen International
Expanding globally? Global Payroll Calculator helps you make smart decisions by quickly showing you the total cost of hiring in 190 countries. Compare taxes, benefits, and compliance details to find the best places to grow your team.
You can spot the most cost-effective locations and avoid surprises with accurate, up-to-date data. Whether you’re budgeting for new hires or planning your next move, our tool makes global expansion more straightforward and transparent.
Conclusion
Keeping up with these legal updates is crucial for staying compliant in your global operations. If you found these insights valuable, subscribe to our Global Employment Tax and Compliance Newsletter to receive monthly updates in your inbox. Stay informed and prepared for what’s next.
Cyprus is often seen as a beautiful Mediterranean destination, but its potential as a global business hub is frequently overlooked. Positioned at the intersection of Europe, the Middle East, and Africa, Cyprus offers more than just strategic geography. It’s a place where the benefits of a favourable tax environment, EU membership, and a skilled workforce… Read more Cyprus: A Strategic Hub for Global Expansion
Cyprus is often seen as a beautiful Mediterranean destination, but its potential as a global business hub is frequently overlooked.
Positioned at the intersection of Europe, the Middle East, and Africa, Cyprus offers more than just strategic geography. It’s a place where the benefits of a favourable tax environment, EU membership, and a skilled workforce converge—yet it remains underappreciated by many businesses looking to expand internationally.
Today, expanding globally is synonymous with acquiring and managing talent across borders; it demands the right tools and expertise.
As you consider your next move in global expansion, let us show you why Cyprus could be the unexpected catalyst for your business growth—and how Acumen International can make that journey seamless.
Why Expand into Cyprus
1. Cyprus’s Strategic Location: Your Gateway to Global Markets
Cyprus’s geographic position unlocks access to some of the world’s most dynamic and high-growth markets, making Cyprus an ideal hub for international expansion.
For businesses with global ambitions, Cyprus is an ideal gateway to these regions, offering a unique blend of geographical advantage and connectivity.
As part of the European Union, Cyprus provides seamless access to the EU’s single market, encompassing over 450 million consumers. This makes it a strategic entry point into Europe and a cornerstone for any business aiming to scale efficiently and integrate into the world’s largest economic zone.
2. Favorable Tax Environment in Cyprus
Cyprus has an extensive network of double taxation treaties with over 60 countries, which minimises tax burdens for international businesses and enhances cross-border trade.
With its impressively low 12.5% corporate tax rate, Cyprus presents significant tax advantages for businesses seeking a tax-efficient environment. These advantages include dividends and capital gains exemptions, making Cyprus a highly attractive location for businesses. Lowering the tax burden also improves profitability and boosts competitiveness, enabling companies to offer more competitive prices or reinvest profits into growth initiatives.
3. EU and Eurozone Membership
As a member of the European Union and the Eurozone, Cyprus offers businesses a robust and stable economic environment and direct access to a large and affluent European market. The benefits of operating in Cyprus include the free movement of goods, services, and capital across EU member states, access to the EU’s single market—one of the largest in the world—and the security and stability provided by the EU’s comprehensive regulatory framework.
4. Robust Legal Framework
Cyprus’s legal system is fully aligned with EU regulations, providing a secure and predictable environment for business operations, which enhances investor confidence. The country offers a business-friendly ecosystem with a streamlined company registration process. Securing a company name typically takes 1 to 3 working days, with document submissions processed within five days. The registration fees depend on the company’s structure, and there is an option to expedite the process for those requiring faster results.
The Cypriot government is committed to promoting investment through various policies and incentives. This reliable and transparent environment makes Cyprus an attractive destination for businesses.
5. Unlocking Cyprus’s Talent Pool: A Highly Skilled Workforce
Cyprus has a well-educated talent pool, with one of the highest rates of university graduates per capita in the European Union.
Cyprus’s robust education system produces a steady stream of skilled, multilingual professionals in finance, technology, and professional services. With its diverse and dynamic talent pool, the EU offers businesses access to the skills and expertise needed to innovate and grow.
6. Financial Services
Cyprus boasts a thriving financial sector driven by a well-established banking system that serves global enterprises. The country provides diverse corporate financing options within a secure and transparent environment, making it a trusted destination for international financial operations.
7. Advanced Infrastructure and Investment Opportunities
Cyprus offers a strong infrastructure that supports global business operations. Reliable communication networks provide excellent internet and mobile coverage, essential for modern enterprises. The island’s well-connected transport system, including major highways and two international airports, ensures easy access to global markets.
Modern ports in Limassol and Larnaca facilitate smooth trade, making Cyprus a key hub at the crossroads of Europe, Asia, and Africa.
Cyprus continuously invests in its infrastructure, with ongoing projects in renewable energy, smart city initiatives, and sustainable development. These improvements ensure the island remains attractive for businesses looking to grow or expand.
Cyprus offers a wide range of investment opportunities across sectors such as real estate, IT, and shipping, providing businesses with multiple avenues for growth.
Promising Startup Ecosystem
While Cyprus thrives in tourism and boasts a highly educated workforce, its startup scene remains underdeveloped. The primary challenge lies in limited access to capital and a lack of visibility on the global stage. This scarcity slows down startup growth, potentially discouraging entrepreneurship.
Although the island benefits from a rich talent pool, further enhanced by the influx of skilled IT professionals, the allure of stable employment often overshadows the entrepreneurial path, highlighting a key challenge for Cyprus’s economic diversification.
Despite its progress, Cyprus still has untapped startup potential, which is now being harnessed through a growing network of startup accelerators, incubators, and research institutions.
Despite these positive developments, there is still significant room for growth. The government should consider introducing policies that support the launch of venture capital funds, which are critical for nurturing entrepreneurship and further developing the startup culture. By doing so, Cyprus can generate more success stories and strengthen its position in the global startup ecosystem.
8. Government Support. Cyprus Startup Visa program
The Cypriot government has made significant efforts to boost its emerging startup ecosystem and attract international entrepreneurs. They established the Deputy Ministry of Research, Innovation, and Digital Policy, which has since rolled out several initiatives to create a more dynamic startup environment. These include tax incentives to encourage investment, increased funding opportunities, and the introduction of a special Startup Visa.
The Cyprus Startup Visa program is particularly noteworthy. It invites talent outside the EU and EEA to establish high-potential ventures on the island. This visa is part of a broader strategy to support startups, including programs like Invest Cyprus and ARIS. These initiatives, supported by major financial institutions, provide essential resources, mentorship, and guidance to help new businesses succeed.
In addition to these initiatives, Cyprus is becoming increasingly recognised as a hub for fintech, but its innovation landscape doesn’t stop there. The island is also home to leading players in regtech, IoT, cybersecurity, and the gaming industry. The growth in Blockchain technology is awe-inspiring, with the University of Nicosia becoming the first in the world to offer a Master’s Degree in Digital Currency.
NGOs such as Tech Island and Cyprus Seeds play a key role in fostering entrepreneurship by offering grants, mentorship, and other vital support.
Projects like CYENS, which brings together universities and international partners to drive research and innovation, further highlight the government’s commitment to creating a knowledge-based economy.
Seamless Global Expansion with Acumen International
Expanding globally from or into Cyprus demands expertise in managing international employment and compliance complexities. Acumen International is a reliable partner.
With over 23 years of experience, we specialise in providing comprehensive global employment solutions tailored to your business’s unique needs. Our presence in Cyprus offers comprehensive Employer of Record solutions for companies leveraging the island’s strategic advantages while ensuring seamless operations across borders.
Global Reach, Expertise and Compliance
Acumen International, with our Operations Centre in Cyprus, operates in 190 countries, offering expert advice on employment tax, labour laws, and immigration regulations. Our deep understanding of local laws, especially within the EU, ensures that your global workforce remains compliant. This allows you to focus on leveraging Cyprus’s strategic advantages for your business growth without getting bogged down by legal complexities.
Human-Led Service
If you want to expand your operations in Cyprus or beyond, we provide fast, smooth, and compliant talent onboarding to get your teams up and running quickly. Our human-first, boutique approach ensures you and your team receive personalised service, with a dedicated contact guiding you through every step of your global employment journey. Whether you’re bringing talent to Cyprus or sending teams abroad, we make the process seamless.
Immigration Support and Global Mobility in Cyprus
Navigating the complexities of international immigration, especially within the dynamic Cypriot market, can be challenging, but we make it easier. We sponsor work permits, visas, and other immigration requirements, whether you’re relocating talent to Cyprus or expanding your workforce internationally. If you don’t have a local entity, there’s no need to establish one. This ensures your team can move and operate across borders smoothly, taking full advantage of Cyprus’s strategic location.
Comprehensive Global Payroll Services
Our services are tailored to ensure seamless payroll management. We take care of everything from salary payments in local currency to compliance with Cypriot tax and labour regulations. We handle the complexities of tax filing, social contributions, and benefits administration so you can focus on growing your business in Cyprus.
Trusted Advisor and Cross-border Hiring Expertise
We combine our deep industry knowledge with cutting-edge technology to provide solutions that align with your business goals, whether you’re based in Cyprus or expanding from Cyprus into new markets. Whether you need reliable Global EOR services, strategic HR support, or compliance guidance, we’re your trusted partner, ready to help your business succeed in the global marketplace while leveraging Cyprus’s unique advantages.
Global Payroll Calculator for Expanding Businesses
Expanding your business from Cyprus to global markets requires a clear understanding of the financial implications. Our Global Payroll Calculator is an invaluable tool that allows you to:
Facilitate Cost-Effective Talent Acquisition: Plan your international expansion confidently, ensuring that you maximise your resources and minimise costs as you grow your operations from Cyprus to other global markets.
Simulate and Compare Employment Costs: Easily compare the cost of hiring and managing talent across different countries, giving you a clear picture of financial commitments.
Gain Transparency: Obtain a transparent view of the total costs involved in global employment, including salaries, taxes, and benefits.
Make Informed Decisions: Use insights from the Global Payroll Calculator to make data-driven decisions about your global workforce strategy and budget planning.
Conclusion: Seizing the Untapped Potential of Cyprus
While Cyprus may not always be the first destination that comes to mind, its strategic advantages — from its ideal geographic location and favourable tax environment to its robust legal framework and skilled workforce — make it a compelling choice for forward-thinking companies.
As global expansion increasingly intertwines with effective talent acquisition and management, Cyprus offers the infrastructure and opportunities to propel your business to new heights. However, unlocking its full potential requires the right partnership to navigate the complexities of international growth.
Acumen International is here to bridge that gap, providing the expertise, tools, and support you need to turn Cyprus into your gateway for global success. Whether you’re considering Cyprus as your next strategic move or already operating on the island, the journey toward seamless international expansion begins here.
Navigating the complexities of international employment is far from straightforward. The employment journey involves challenges that extend well beyond the basics of hiring and payroll. Employees want to feel secure, valued, and supported in their specific circumstances, regardless of where they are. From legal compliance to handling unexpected scenarios that require quick, thoughtful solutions — these… Read more Beyond Automation: How Personalised Global EOR Services Boost Employee Retention
Navigating the complexities of international employment is far from straightforward. The employment journey involves challenges that extend well beyond the basics of hiring and payroll. Employees want to feel secure, valued, and supported in their specific circumstances, regardless of where they are.
From legal compliance to handling unexpected scenarios that require quick, thoughtful solutions — these are the realities of managing a global workforce.
Many Global Employer of Record (EOR) service providers have gone the route of automation, using platforms to manage employees worldwide.
Automated global employment platforms might be equipped to handle routine tasks. Still, they often fall short when dealing with the dynamic and unpredictable nature of real-world employment. The global environment is too complex for a one-size-fits-all approach. What’s needed is a service that understands the intricacies of international employment and responds to them with agility and a human touch.
A Global EOR focusing on personalised, human-led services is equipped to navigate these complexities. Whether it’s ensuring compliance with ever-changing local laws, providing tailored benefits that respect cultural differences, or managing the stress of international mobility, a Global EOR prioritising human interaction over automation can significantly help enhance employee retention.
In this article, we’ll explore how a Global EOR partner can address the unique challenges that arise throughout the employment journey, offering solutions that keep your global team engaged, supported, and committed for the long term.
1. Legal Compliance: The Foundation of Job Security
Job security is crucial for retaining employees, especially in a global context. Employees must trust that their employment is legally sound and compliant with local laws. Ensuring that contracts, HR policies, and workplace practices align with in-country labour laws is vital. When employees are confident in the legal foundation of their employment, they are more likely to remain with the company long-term.
A Global EOR ensures that the work environment is tailored to meet local legal requirements, allowing employees to focus on their work. This legal assurance fosters a sense of stability and trust, which is essential for employee retention.
2. Payroll Precision: Building Employee Trust and Loyalty
Payroll issues are a fast track to losing employee trust. Ensuring that employees are paid accurately and on time across borders is critical for maintaining satisfaction and loyalty. Managing different tax regulations and payroll systems in various countries is complex, but getting it right is essential for building a positive employee experience.
A Global Employer of Record efficiently handles payroll across multiple regions, ensuring compliance with local tax laws and regulations. This reliability builds trust and contributes to a seamless experience for employees. When employees know they can rely on their paycheck, they are more likely to stay engaged and committed.
Tax Payments and Reporting across Multiple Jurisdictions
From deducting and paying income taxes to handling all necessary reporting and documentation, this comprehensive approach to payroll management reassures employees that their financial well-being is a priority, further enhancing loyalty and retention.
Employee benefits are crucial in keeping teams satisfied and engaged, but what employees value can differ significantly depending on their location. A standardised benefits package often fails to meet the diverse needs of a global workforce.
A Global EOR offers deep expertise in statutory benefits across multiple countries, ensuring that benefits packages comply with local regulations. Beyond compliance, they also have practical knowledge of the voluntary benefits that resonate with local expectations and cultural norms. This expertise allows companies to balance adhering to legal requirements and offering competitive, attractive compensation packages.
Automated platforms often lack the flexibility to address these nuances, missing opportunities to customize benefits to the unique needs of each market. In contrast, a tailored approach allows for a personal touch that directly impacts employee satisfaction and retention. When employees receive benefits that are compliant and aligned with their cultural expectations, they feel more valued and connected to their employer, which strengthens their commitment and reduces turnover.
Statutory Employee Benefits
Health Insurance: We provide access to local health insurance plans as local law requires.
Retirement Plans: Contributions to national pension schemes are managed by our local partners.
Leave Entitlements: We ensure you receive statutory leave entitlements, such as sick leave, maternity/paternity leave, and annual leave.
Optional Employee Benefits
Extra Health Coverage: Options for enhanced health insurance beyond statutory requirements.
Wellness Programs: Access to wellness and employee assistance programs.
Flexibility in Benefits: Tailored benefits packages to meet employee-specific needs and preferences.
4. Global Mobility: Expert Immigration and Relocation Support
Relocating for work is one of the most challenging experiences an employee can face, particularly when it involves moving to a different country. International employees require extensive global mobility support to make this transition smooth. A Global EOR helps manage the complexities of relocation, ensuring that the entire process is handled efficiently and with minimal disruption to the employee.
Managing immigration procedures is critical. A Global EOR doesn’t just facilitate the basics; it often serves as the work permit sponsor, responsible for navigating the intricate visa application process. This includes securing the necessary work permits for the employee and managing visa applications and extensions for their dependants. This level of support is indispensable for high-calibre professionals relocating with their families.
The challenges involved in these processes—dealing with varying regulations, timelines, procedures, and requirements — can be overwhelming, and any misstep can delay or derail the entire relocation.
By expertly handling these immigration processes, a Global EOR ensures that employees and their families can transition smoothly into their new environment and focus on their new roles from day one.
Global EORs like Acumen International go beyond basic relocation logistics by providing comprehensive support tailored to the needs of the employee and their family.
Such personalised attention ensures that employees and their families feel comfortable and supported in their new surroundings. This is crucial for maintaining engagement and long-term commitment to the company.
When employees feel that their global mobility is managed with care and precision, they are far more likely to stay engaged and committed to their new role, leading to better retention outcomes for the company.
Onboarding Excellence: A Smooth Start for Global Talent
Onboarding is a critical first step in an employee’s journey with a new company, especially when relocating to a different country. The onboarding process sets the tone for the entire employee experience, and it’s where a Global EOR can make a significant impact.
A Global EOR handles all the complex aspects of cross-border onboarding, from setting up compliant international employment contracts to managing the necessary paperwork for work permits and visas. This ensures that employees can start their roles without delays or legal concerns.
Beyond the paperwork, a Global EOR helps new employees feel settled and ready to contribute from day one, including practical matters like opening a bank account, finding housing, or finding a school for children.
This positive start boosts immediate productivity and lays the groundwork for long-term job satisfaction and employee retention.
6. Reduced HR Administration Burden with a Global Employer of Record
In the modern workplace, employees value prioritising their primary responsibilities without being burdened by administrative complexities.
A Global EOR can take over these burdens, ensuring that everything from paperwork to compliance is handled efficiently. This allows employees to concentrate on their roles, boosting their job satisfaction and making them more likely to stay.
Benefits of the Global EOR Talent Engagement Model for Employees
Easy Onboarding: Quick and straightforward process to start a job.
Legal Compliance: Employee rights are protected under local laws.
Timely Pay: Employees get their salary on time in local currency.
Customised Benefits: Access to local health insurance and other perks.
Support: Local HR support for any questions or issues international employees have coordinated by Acumen International.
Consistent HR Support: Key to a Thriving Global Workforce
Building a unified company culture across different regions requires consistent HR support. Employees should receive the same level of care and assistance regardless of location. A Global EOR ensures this consistency, which is vital for fostering a robust and loyal workforce.
Employees who relocate to a new country are not just adapting to a new job. They face challenges beyond adapting to new job responsibilities — they also need to navigate unfamiliar cultural and legal landscapes. A Global EOR provides local HR expertise to smooth this transition, helping employees understand local laws and acclimate to cultural differences.
This is where automated employment platforms often fall short. They typically offer standardised, pre-set onboarding processes, but international employment is far more complex than a simple algorithm can handle.
Employees frequently encounter unique situations that require human attention, support, and quick, practical solutions.
Moreover, employees who are dispersed across different countries often need support at various times, sometimes across different time zones and in environments where they might not be fluent in the local language.
A responsive Global EOR offers the flexibility to provide timely assistance, ensuring that employees receive the guidance they need, when they need it, in a language they understand.
Conclusion
In a world where talent is increasingly mobile and diverse, the personal touch can be the key to keeping your best people engaged and committed, no matter where they are.
Retaining international talent requires more than compliance and efficient payroll management—it demands a comprehensive approach that addresses each employee’s unique needs.
While platform-based Global EORs offer scalability, they often miss the nuances that can make or break employee satisfaction and loyalty.
When you choose Acumen International, you’re choosing a partner as dedicated to your people as you are. We deliver a personalised, hands-on experience—not just faceless software that leaves you to figure things out alone.
As businesses look to expand their global reach, tapping into diverse talent pools becomes a key strategy. However, the complexities of international hiring—ranging from understanding local labour laws to accurately forecasting total employment costs—can present significant challenges. For companies without a local entity, these challenges can be daunting and pose significant risks to both financial… Read more Optimising Global Talent Acquisition with Global Payroll Calculator
As businesses look to expand their global reach, tapping into diverse talent pools becomes a key strategy. However, the complexities of international hiring—ranging from understanding local labour laws to accurately forecasting total employment costs—can present significant challenges. For companies without a local entity, these challenges can be daunting and pose significant risks to both financial stability and legal compliance.
In response to these challenges, Acumen International—a leader in Global Employer of Record (EOR) services—developed the Global Payroll Calculator (GPC). This tool is designed to provide businesses with precise, country-specific data that simplifies the processes of cost forecasting, budgeting, and ensuring compliance. The GPC is a practical tool and an integral part of a strategic approach to global talent acquisition.
The Challenges of Managing Global Talent Acquisition
Expanding a workforce internationally presents exciting opportunities for growth and innovation but also introduces complex challenges, especially in cost forecasting and compliance. Effectively addressing these challenges is crucial for successful global expansion.
Complex Cross-Border Employment Cost Forecasting
Accurately estimating the cost of hiring in different countries is challenging due to varying tax structures, employee benefits requirements, and other financial obligations. These factors can significantly impact the total cost of employment, making precise forecasting essential to avoid budget overruns and ensure financial stability.
Compliance with Local Employment Laws
Employment laws differ widely across countries, covering minimum wages, working conditions, mandatory benefits, and more. These regulations frequently change, requiring businesses to stay vigilant to maintain compliance. Non-compliance can lead to legal issues, fines, and damage to a company’s reputation.
Accurate Budgeting for Global Hiring
Creating a budget for global hiring is complex due to the varied costs associated with each region. This includes understanding local market salaries, taxation, and benefit costs. An inaccurate budget can lead to either over-expenditure or missed opportunities due to underfunding.
Integrating Global Hiring Data
With hiring happening across multiple regions, integrating and analyzing data from different countries can be challenging. Different systems and standards can lead to inconsistencies, complicating the overall view of global hiring costs and compliance status.
Balancing Global Expansion Speed and Compliance
Global talent acquisition demands quick action to secure top candidates, but this must be balanced with thorough compliance checks. Speeding through processes can lead to compliance oversights, while delays can result in losing top talent to competitors.
How the Global Payroll Calculator Addresses These Challenges
By providing accurate, real-time data tailored to each country’s requirements, it enables businesses to manage their global hiring processes effectively. The GPC simplifies cost forecasting by offering precise calculations of taxes, benefits, and other employment costs, ensuring that budgeting is accurate and comprehensive. It also supports compliance by keeping businesses informed of local laws and regulations, reducing the risk of legal complications.
The GPC acts as a guide, providing real-time calculations and a comprehensive database of global payroll information. It ensures accuracy, compliance, and peace of mind, allowing businesses to confidently navigate the complexities of international expansion.
Here’s how the Global Payroll Calculator helps you navigate global talent acquisition complexities.
Accurate Budgeting for New Hires
When hiring internationally, understanding the true cost of employment is essential to maintaining a sustainable budget. Each country has its own set of tax regulations, social contributions, and mandatory benefits, all of which can significantly impact the overall cost of employment. The GPC helps you determine the gross salary needed to meet net pay requirements by converting net salary expectations into gross figures that reflect all relevant deductions. This ensures that your budgeting process is grounded in accurate, country-specific data from the start, helping you avoid unexpected costs and financial strain.
Ensuring Compliance with Local Labour Laws
Navigating the intricacies of local payroll laws is one of the most challenging aspects of global hiring. Each country has its own tax structure, and staying compliant requires precise calculations that account for national, regional, and local taxes. The GPC enables businesses to convert gross to net pay accurately, ensuring that all payroll calculations are in line with local tax regulations. This level of accuracy not only prevents legal pitfalls and penalties but also strengthens your company’s reputation as a compliant and responsible employer.
Managing Salary Negotiations with International Talent
Negotiating salaries with international talent requires a deep understanding of local market conditions and tax implications. The GPC supports this process by allowing you to convert net salary expectations into gross salary offers that align with both local laws and your company’s budget. This functionality ensures that your compensation packages are competitive within the local market while also being financially sustainable for your business.
Payroll Planning for Remote Workers
As remote work becomes increasingly common, businesses must ensure that they offer fair and compliant compensation to contractors and remote employees worldwide. The GPC helps you manage these relationships by providing accurate net-to-gross and gross-to-net conversions that account for all relevant taxes and deductions. This simplifies the payroll process, making it easier to manage payments across borders and ensuring that your remote workforce is compensated correctly and on time.
Managing Global Mergers and Acquisitions with Global Payroll Calculator
Mergers and acquisitions across borders introduce a host of payroll integration challenges. Different regions have different payroll practices, and aligning these systems can be complex. The GPC helps standardise payroll across regions by accurately converting salaries from net to gross or gross to net, ensuring that all employees are compensated fairly and in compliance with local laws. This tool is crucial for maintaining operational continuity and employee trust during the integration process.
Providing employee relocation packages can significantly enhance your organisation’s ability to attract top talent worldwide. By easing the transition for employees moving from other countries, you create a more appealing offer.
Integrating Global Payroll Data
Integrating payroll data from multiple countries into a single, cohesive system is often a time-consuming and error-prone process. The Global Payroll Calculator addresses this challenge by centralising all payroll calculations across 190 countries, making it easier to manage and analyze payroll data across regions. This not only improves accuracy but also provides a clear view of global payroll costs and compliance status, supporting better decision-making and strategic talent acquisition planning.
Balancing Speed and Accuracy in Talent Acquisition
In the competitive global talent market, the ability to move quickly while maintaining accuracy is crucial. Delays in extending offers or finalising compensation packages can result in losing top candidates to competitors. However, rushing through these processes without thorough calculations can lead to errors, compliance issues, and budget overruns.
The Global Payroll Calculator (GPC) ensures that you can strike the right balance. It provides fast, precise salary calculations that comply with local regulations, allowing you to extend offers quickly and confidently. By using the GPC, you can streamline the talent acquisition process, making sure that you attract and secure the best talent without sacrificing the accuracy and compliance that are vital to long-term success.
Cross-country Comparisons with Global Payroll Calculator
In the competitive landscape of global talent acquisition, identifying the best hiring markets isn’t just a strategic advantage—it’s essential. Companies need to know where they can find the best talent at the most efficient cost while also navigating complex payroll regulations.
The Global Payroll Calculator offers a powerful solution: Cross-country Comparisons. This feature allows you to instantly compare talent acquisition costs and payroll variables across multiple countries using customisable inputs. By standardising these comparisons in a single format, the tool helps you identify the most cost-effective countries for hiring top talent, giving you a clear, consistent view of your payroll obligations across various countries.
Whether you’re evaluating different talent pools or planning your global expansion, the GPC equips you with the data you need to make informed, strategic decisions.
With multi-currency support and a standardised view, you can quickly assess the financial and logistical implications of hiring in different markets, ensuring that your global talent strategy is both efficient and effective.
Empower Your Global Talent Acquisition with Precision and Confidence
Expanding your workforce globally opens doors to new opportunities, but it also introduces a range of challenges—from accurate budgeting and compliance to swift and effective talent acquisition. The Global Payroll Calculator (GPC) from Acumen International is designed to address these challenges head-on, providing the tools and insights you need to make informed decisions at every stage of the hiring process.
By leveraging the GPC, you can:
Accurately forecast employment costs in any market, ensuring that your budget is both realistic and sustainable.
Maintain compliance with local laws, avoiding the pitfalls of legal issues and penalties that can arise from miscalculations.
Make competitive and compliant salary offers that attract top talent without compromising your financial or legal standing.
Streamline the payroll process for contractors and remote workers, ensuring that your global workforce is paid accurately and on time.
Integrate payroll data across multiple regions, giving you a clear, cohesive view of your global hiring strategy.
In today’s fast-paced talent market, the ability to move quickly while maintaining precision is key to staying ahead. The GPC empowers you to do just that—secure the best talent for your organization, manage costs effectively, and ensure compliance every step of the way.
Global Employer of Record (EOR) services have emerged as a pivotal element in international business expansion strategy. The traditional 9-to-5 office job is becoming a relic of the past. Today’s workforce is increasingly global and mobile, with companies tapping into talent from around the world. But this borderless approach to employment comes with a unique… Read more Global EOR: 10 Surprising Facts for International Business Growth
The traditional 9-to-5 office job is becoming a relic of the past. Today’s workforce is increasingly global and mobile, with companies tapping into talent from around the world. But this borderless approach to employment comes with a unique set of hurdles.
How do you navigate the complexities of international labour laws?
How do you manage payroll for employees scattered across different continents?
And how do you ensure compliance with ever-changing regulations?
The answer lies in a revolutionary global talent engagement model known as the Global Employer of Record (EOR). These innovative organizations are transforming the way businesses operate on a global scale, and we’re about to uncover 10 surprising facts that reveal their growing influence in the modern workplace.
1. Roots in Globalisation
The concept of an Employer of Record dates back to the 1970s. Initially, US companies began outsourcing payroll and HR functions to navigate complex regulatory environments during rapid globalisation. This historical evolution laid the foundation for the comprehensive Global EOR solutions we see today.
2. Pandemic Resilience
The COVID-19 pandemic wasn’t just a challenge; it was a catalyst for EOR growth. During the COVID-19 pandemic, the demand for Global EOR services surged by over 250%. Companies needed to adapt quickly to remote work and international hiring without traditional physical offices. Global Employers of Record enabled businesses to maintain operational continuity and compliance amid unprecedented challenges.
3. Unique Employee Benefits
In various countries, Global EORs have facilitated unique local benefits. For instance, during lockdowns, they provided home office setups. In regions where family is central to society, they offered extended family leave, ensuring that benefits are culturally relevant and supportive.
4. Impact on Local Economies
Global EORs contribute significantly to local economies. By creating employment opportunities and facilitating the flow of international expertise, they drive economic growth in developing regions. This not only benefits the companies but also boosts local job markets and skill development.
5. Global Mobility Support
Managing immigration, work permits, and global mobility processes can be daunting. Global Employers of Record excel in immigration support, enabling companies to hire expatriates and navigate the complex immigration requirements of various countries. This support ensures that businesses can deploy talent globally without legal hurdles.
6. Temporary Staffing Solutions
Global EORs provide flexible staffing solutions, allowing companies to scale their workforce up or down quickly in response to market demands. This agility is crucial for businesses facing fluctuating workloads and seasonal demands, eliminating the complexities of local hiring.
7. Global Talent Retention Strategies
Retaining talent in diverse regions requires localised strategies. Global EORs offer culturally relevant and competitive benefits and employee well-being programs tailored to regional expectations. This localisation helps in maintaining high employee satisfaction and reducing turnover rates of international talent.
8. Remote Work Revolution
Global EORs played a pivotal role in the remote work revolution. They enabled companies to hire and manage remote teams globally with ease, breaking down geographical barriers and supporting the shift towards more flexible working arrangements.
9. Cross-Border Payroll Harmonisation
Managing payroll across multiple countries can be complex due to varying local laws and currency fluctuations. Global EORs streamline this process, ensuring that employees in different regions receive equitable compensation packages, thus maintaining consistency and compliance.
10. Navigating Hiring in Unique Jurisdictions
Global Employers of Record have expertise in managing employment in unique micro-jurisdictions like San Marino and Andorra. They ensure compliance with very niche local laws, allowing companies to operate in these regions without the typical bureaucratic challenges.
The Future of Global EOR: Innovation and Transformation
Global Employer of Record solutions providers are increasingly leveraging technology to streamline and automate hiring and talent management processes. This includes using AI-powered platforms for onboarding, payroll management, and HR compliance monitoring. These advancements will further reduce administrative burdens for international clients, allowing for more efficient and error-free operations.
Data-Driven Insights
EOR platforms are becoming more sophisticated in their data analytics capabilities. This allows companies to gain deeper insights into their global workforce, such as compensation trends and compliance risks. These insights can inform strategic decision-making and drive operational efficiencies, providing companies with a competitive edge in managing their international workforce.
Enhanced Employee Experience
Global EOR providers are recognising the importance of employee experience in attracting and retaining top talent. They are developing tools and services to support employee engagement and well-being, regardless of their location. This includes providing access to tailored employee benefits programs and mental health support, ensuring a holistic approach to employee satisfaction and productivity.
Specialised Global Employment Solutions
As the global business landscape becomes more complex, Employers of Record solutions providers are specialising their services to meet the unique needs of specific industries and regions. This includes developing expertise in areas such as local labour laws, cultural nuances, and industry-specific compliance requirements. By offering tailored solutions, Global EORs can better support the strategic goals of their clients.
Integration with HR Tech Ecosystem
Global EOR platforms are increasingly integrating with other HR technology solutions, such as payroll management systems, benefits administration platforms, and more. This seamless integration creates a more holistic and efficient approach to global workforce management, allowing companies to streamline their operations and improve overall HR functionality.
Conclusion: Navigating the Future of Global EOR
As globalization and remote work continue to expand, companies are increasingly likely to prefer Global Employer of Record (EOR) services over establishing legal entities in new markets. The reasons are clear: EORs offer cost-effective, swift, and compliant solutions that simplify international hiring.
Global EOR Solutions Over Local Entities
Cost and Efficiency: Setting up local entities is costly and time-consuming. Global Employers of Record provide a streamlined alternative, enabling rapid market entry across multiple locations without the administrative burden.
Compliance and Risk Management: An Employer of Record ensures compliance with local labour laws, reducing legal risks and operational headaches for companies expanding internationally.
Flexibility: Global EORs allow companies to scale their workforce up or down quickly, adapting to market demands without the complexities of local entity management.
Balancing Technology and Human Interaction
Automation Benefits: AI and automated platforms enhance efficiency in HR processes like payroll and compliance monitoring.
Human Touch: Despite technological advancements, human interaction remains crucial in HR for employee engagement, conflict resolution, and personalized support. Global EORs must balance tech-driven efficiency with a personal touch to maintain high employee satisfaction.
Strategic Integration
Holistic Solutions: EORs are increasingly integrating with other HR tech solutions, creating seamless and efficient global workforce management systems.
We’re excited to announce Acumen International’s rebranding! Along with our fresh new look, we are sharing a curated selection of our global employment expertise in this issue. In this issue, we also share a curated selection of our global employment expertise, insightful articles, and the latest updates on global employment tax and significant legislative changes.… Read more Global Employment Tax and Compliance Newsletter. July 2024 Edition
We’re excited to announce Acumen International’s rebranding! Along with our fresh new look, we are sharing a curated selection of our global employment expertise in this issue.
In this issue, we also share a curated selection of our global employment expertise, insightful articles, and the latest updates on global employment tax and significant legislative changes.
Our aim is to provide you with actionable insights that help you navigate the complexities of international hiring and compliance with confidence.
Acumen International Unveils New Brand Identity
We’re excited to share some big news with you! Acumen International has rebranded to better serve your needs and reflect our dedication to helping your business expand globally with ease and compliance.
Express Global Employment: Simplifies the process of international hiring, removing the need for local entities.
Global Payroll Calculator: An easy-to-use tool for calculating and comparing employment costs, including taxes and benefits, across 190 countries.
Global Compliance Navigator: Offers expert guidance on compliant employment and payroll regulations, helping you manage your global workforce effortlessly.
A Word from Our CEO, Nick Ganzha
“We envision a future where Acumen International continues to lead the way in human-to-human, personalised global employment solutions, helping businesses overcome challenges and seize opportunities in international markets,” said Nick Ganzha, CEO and founder. “Acumen upholds the core values that have always guided us and define our legacy. Our rebranding signifies our ambition for growth, innovation, and excellence.”
What This Means for Our Clients
Streamlined Services: Our new sub-brands provide targeted solutions to make your international operations smoother and more efficient.
Enhanced Support: With a focus on personal interaction and local expertise, you’ll receive even better guidance tailored to your specific needs.
Innovative Tools: Our Global Payroll Calculator and Global Compliance Navigator offer practical, easy-to-use resources to simplify complex processes.
Continued Excellence: You can expect the same high standards and commitment to quality that you’ve always experienced with Acumen International.
With 23 years of experience, we help you confidently explore new markets, manage complex local regulations, and build cross-border teams. Our comprehensive services—from recruitment and payroll to compliance and risk management—are designed to let you focus on growing your business.
🇮🇪 Ireland Updates Guidelines for Determining Employment Status
Significant changes have been made to the process of determining whether a worker should be treated as an employee or self-employed for Irish tax purposes. These changes follow a recent Irish Supreme Court decision regarding the employment status of a company’s pizza delivery drivers, which ruled in favour of the Irish Revenue.
New Five-Step Process The Supreme Court’s decision introduces a five-step process to be used when engaging an individual, other than through a direct employment contract, to perform services:
Wage Exchange: Is there an exchange of wages or remuneration for work?
Personal Service: Is the worker providing their own services, not those of a third party, to the employer?
Control: Does the employer exercise sufficient control over the worker to consider the agreement an employment contract?
Contract Terms: Are the terms of the contract consistent with an employment agreement or another type of contract, considering the working arrangements?
Legislative Adjustment: Is there anything in the relevant legislative regime that requires adjustments to the previous considerations?
Impact on Businesses Determining the correct employment status is crucial for businesses, as misclassification can lead to significant liabilities. If Irish Revenue identifies misclassification, businesses must settle the payroll withholding (PAYE) liability, plus interest and penalties. Recovery of these liabilities from the individual depends on the contractual arrangements between the parties.
Revenue’s New Guidelines Irish Revenue has released a new Tax & Duty Manual titled “Revenue Guidelines for Determining Employment Status for Taxation Purposes”. This manual provides guidance on applying the new framework, with examples and commentary specific to industries where individuals are often treated as self-employed, such as construction and media.
These changes aim to provide clearer guidance and reduce the risk of misclassification, helping businesses and workers understand their tax obligations better.
🇿🇦 South Africa Extends Visa Concessions to 31 December 2024
The extension alleviates uncertainty and stress for foreign nationals and their employers, who were concerned about the legal status of affected individuals after the previous concession expired on 30 June 2024.
Details of the Extension
Waiver Applications: Foreign nationals with pending waiver applications as of 30 June 2024 are granted an extension until 31 December 2024.
Long-term Visas: Includes Visitors Visa (Section 11(1)(b)), Study, Business, Work, Relatives, and Section 11(6) Visas. Extensions are valid until 31 December 2024.
Appeals: Foreign nationals who have appealed negative decisions on long-term visa applications are also granted an extension until 31 December 2024.
Travel and Documentation
Visa Conditions: Applicants must adhere to the conditions of their current visas.
Non-Visa-Exempt Nationals: Must apply for a ‘port of entry visa’ to re-enter South Africa if travelling.
Short-term Visa Holders: Those with visas for 90 days or less must depart within 90 days of their visa expiry if renewal outcomes are pending.
Required Documentation: Original passport and VFS Global receipt for verification.
This extension allows the Department of Home Affairs more time to process applications and provides clarity for foreign nationals currently in South Africa.
🇦🇷 Argentina and 🇨🇭 Switzerland Sign New Social Security Agreement
On 27 May 2024, Argentina and Switzerland signed a new Social Security Agreement (SSA). The agreement will become effective once both countries complete their legal and constitutional procedures and notify each other. It will take effect on the first day of the third month following the final notification.
Benefits of the Agreement
This agreement helps workers who split their careers between Argentina and Switzerland by eliminating the hassle of double social security taxation and ensuring they receive their deserved benefits.
Key Highlights
Single System Contribution: Workers will only need to pay into one social security system at a time.
Benefit Security: Ensures workers’ contributions are recognised in both countries for their benefits.
Enhanced Worker Mobility: Simplifies cross-border employee assignments and business travel.
Background
This is the first SSA between Argentina and Switzerland, complementing Argentina’s existing agreements with Belgium, Slovenia, Spain, France, Greece, Italy, Luxembourg, and Portugal. Until the new SSA is in place, existing domestic legislation will continue to apply, typically avoiding double taxation as assignees generally resign or take unpaid leave.
🇦🇺 Australia Eases Visa Rules to Protect Workers and Boost Productivity
Starting 1 July 2024, Australia is updating visa conditions 8107, 8607, and 8608 to better protect workers and increase productivity.
What’s Changing?
Temporary Skill Shortage (Subclass 482) and Skilled Employer Sponsored Regional (Subclass 494) visa holders now have more flexibility if they stop working for their sponsoring employers. They will have:
Up to 180 days at a time
A maximum of 365 days in total during their visa period
This is a big jump from the current 60-day limit.
Implications
This change gives visa holders more breathing room to find a new sponsor, apply for another visa, or plan their departure from Australia without rushing. It also helps them support themselves by allowing them to work for other employers, even in different occupations, as long as it doesn’t conflict with any required licences or registrations for their original job.
Key Points
Flexibility for Workers: Visa holders can work elsewhere while looking for a new sponsor, but they must quit their current job first and can’t work in roles that need specific licences their original job required.
Sponsor Responsibilities: Employers must inform the Department of Home Affairs within 28 days if a visa holder stops working for them.
These updates apply to all visa holders from 1 July 2024 onwards. Any gaps in employment before this date won’t count towards the new limits.
🇨🇾 Cyprus Clarifies Tax Exemption for High Earners
On 8 July 2024, the Cyprus Tax Department issued Circular 4/2024. This circular explains the 50% income tax exemption for first-time employment in Cyprus, specifically for those earning over EUR 55,000 per year, as per Article 8(23A) of the Income Tax Law.
New Guidelines
The circular provides clear examples and guidance to help high earners, and their tax advisors understand if they qualify for this tax benefit. You can access the full text of the Circular here.
Impact on Taxpayers in Cyprus
The detailed scenarios and explanations remove previous confusion, making it easier for expatriates and locals to determine their eligibility. This clarity is crucial for better tax planning and compliance.
Key Points
Specific Targets: High earners over EUR 55,000 annually.
Clear Instructions: Detailed examples of how the exemption applies.
Improved Clarity: Helps employees understand their tax benefits.
With these new guidelines, high earners working in Cyprus for the first time can now navigate their tax responsibilities more effectively.
Global Employment Insights from Acumen International
Key Employment Trends Shaping the Future of Work in 2024
The following significant trends that are transforming the workplace:
Remote Work Dominance: Over 60% of companies now offer hybrid or fully remote work models.
Gig Economy Expansion: Growing at 17% annually, offering flexibility for workers and scalability for businesses.
Rise of Digital Nomads: By 2024, 35 million people will be digital nomads, combining work and travel.
Aligning Global Employment Laws: Increasing global alignment on issues like pay transparency and work scheduling.
Focus on Mental Health: 85% of companies are boosting mental health resources to support employees.
Addressing the Skills Gap: 70% of employers struggle with finding the right skills, highlighting the need for upskilling.
Sustainability in the Workplace: 55% of companies are adopting eco-friendly practices.
Global Talent Pools: 30% increase in cross-border hiring, facilitated by EOR services.
Diversity and Inclusion: 80% of organizations prioritize DEI initiatives to foster innovation.
Cybersecurity Prioritization: 90% of companies are enhancing cybersecurity to protect remote work setups.
Acumen International’s Global EOR services and Global Payroll Calculator support businesses in navigating these trends, ensuring compliance and cost-efficiency in global operations.
Acumen International has released the Global Employment Contracts Guide to help businesses navigate the complexities of drafting compliant employment contracts across various jurisdictions. This comprehensive guide offers practical insights to support international operations and talent integration.
Highlights of the Guide
When you need an international employment contract
International Employment Law: Avoiding Pitfalls in Cross-Border Terminations
Navigating employee terminations across different countries is complex, with each region having unique laws and cultural expectations. Mishandling terminations can lead to legal disputes and damage your company’s reputation.
Key Considerations
France: Requires valid reasons and formal procedures.
Japan: Prefers voluntary resignations due to cultural norms.
Brazil: Expensive severance packages for terminations without “just cause”.
Germany: Strict legal framework with lengthy notice periods.
India: Requires government permission for companies with over 100 employees.
United States: “At-will” employment allows flexible terminations, but state laws vary.
Italy: Requires justified terminations and involves union consultations for collective dismissals.
United Kingdom: Mandates fair dismissal standards with the right to challenge terminations.
How Acumen International Can Help
Ensuring compliance with local laws.
Handling terminations respectfully and culturally appropriately.
Managing the entire termination process efficiently.
Providing detailed cost analysis and budgeting for terminations.
For a detailed guide on avoiding pitfalls in cross-border terminations, read the full International Employment Law article.
Conclusion
Thank you for reading the July 2024 edition of the Global Employment Tax and Compliance Newsletter. We hope you find these updates and insights valuable as you navigate the complexities of global employment. If you have any questions or need further assistance, please don’t hesitate to reach out.
The world of work is undergoing a remarkable transformation. In 2023-2024, global employment trends are reshaping how, where, and with whom we work. From the rise of remote work and the gig economy to the growing emphasis on mental health and diversity, businesses and professionals must adapt to stay competitive. Let’s dive into the 10… Read more 10 Global Employment Trends Shaping the Future of Work in 2024
The world of work is undergoing a remarkable transformation. In 2023-2024, global employment trends are reshaping how, where, and with whom we work. From the rise of remote work and the gig economy to the growing emphasis on mental health and diversity, businesses and professionals must adapt to stay competitive.
Let’s dive into the 10 most fascinating facts about global employment that are defining the future of work.
1. The Unstoppable Rise of Remote Work
The COVID-19 pandemic forced a global experiment in remote work, and the results are that it’s highly effective for many roles. Over 60% of companies worldwide now offer hybrid or fully remote work models, providing employees with unprecedented flexibility in where and when they work.
This shift has far-reaching implications, from reduced commuting times and real estate costs for companies to a better work-life balance for employees.
However, it also presents challenges like maintaining team cohesion and ensuring cybersecurity.
2. The Gig Economy: A Thriving Workforce
The gig economy, characterised by freelance and contract work, is experiencing explosive growth. It’s estimated that the gig economy is growing at 17% annually. This trend is fueled by both worker preferences for autonomy and flexibility and companies’ desire for a scalable workforce.
Gig workers are becoming integral to industries like transportation, delivery, creative services, and professional consulting.
This lifestyle is attractive to those seeking adventure, cultural immersion, and the freedom to choose their work environment. Companies that offer remote work options are better positioned to attract this growing pool of talent.
However, the methods and regulations vary to accommodate distinct cultural environments and specific national challenges. This convergence aims to create fairer and more transparent work conditions globally.
5. Mental Health: A Workplace Priority
The stigma around mental health in the workplace is fading, and employers are recognising the importance of employee well-being. 85% of companies are investing more in mental health resources, including employee assistance programs (EAPs), counselling services, and wellness initiatives.
This focus on mental health not only supports employees but also reduces absenteeism, improves productivity, and enhances employee engagement.
6. Skills Gap: The Urgent Need for Upskilling
The rapid pace of technological advancement has led to a growing skills gap, where the skills workers possess don’t match the skills employers need. 70% of employers report difficulty finding candidates with the right qualifications.
This challenge underscores a focus on upskilling and reskilling programs to bridge the gap and ensure that the workforce remains adaptable in an ever-changing landscape.
7. Sustainability: Green Workplaces Thrive
Sustainability is no longer a buzzword; it’s a business imperative. 55% of companies are implementing eco-friendly policies and practices, from reducing energy consumption to using sustainable materials.
Sustainable workplaces not only benefit the environment but also appeal to environmentally conscious employees and consumers. They can also lead to cost savings and a stronger brand image.
8. Global Talent Pools: Expanding Horizons
The globalisation of work is in full swing. With a 30% increase in cross-border hiring, companies are increasingly looking beyond their borders to access specialized skills and diverse perspectives.
Global Employer of Record (EOR) services facilitate international hiring by handling complex legal and logistical issues, enabling companies to build global teams seamlessly.
Companies with robust DEI initiatives are not only more ethical but also more successful in attracting top talent and driving business growth.
10. Cybersecurity: A Top Concern in the Remote Era
The shift to remote work has expanded the attack surface for cyber threats. 90% of companies have increased their investment in cybersecurity measures.
This includes not only technical solutions like firewalls and encryption but also employee training to raise awareness of phishing and other social engineering attacks.
Cybersecurity is critical for protecting sensitive data and maintaining customer trust.
Conclusion
The global employment landscape is undergoing significant changes, from the rise of remote work and the gig economy to a stronger emphasis on mental health and diversity. These trends present both opportunities and challenges for businesses looking to stay competitive.
Acumen International’s Global EOR (Employer of Record) services are perfectly positioned to help businesses navigate this evolving landscape. By handling complex legal and logistical issues associated with international hiring, Acumen allows companies to build global teams seamlessly and compliantly, tapping into a diverse and skilled global workforce.
The Global Payroll Calculator further enhances Acumen’s offering by providing precise employment cost analyses across 190 countries. This tool ensures instant total employment payroll calculations, helps identify cost-effective hiring locations, manages global payroll budgets effectively, and ensures compliance with international regulations.
By leveraging Acumen International’s global employment services, businesses can adapt to the latest employment trends and ensure flexibility, compliance, and cost-efficiency in their global operations. Are you ready to embrace the future of work?
Contact Acumen International today to discover how our Global EOR services and Global Payroll Calculator can drive your business growth in the dynamic global market.
As a Global Employer of Record (EOR), we designed the Global Employment Contracts Guide to help you navigate the complexities of drafting compliant employment contracts across various jurisdictions. This Guide reflects Acumen International’s expertise in handling complex global employment scenarios, offering practical insights to support your international operations and talent integration. When Do You Need… Read more International Employment Contracts Guide 2024
As a Global Employer of Record (EOR), we designed the Global Employment Contracts Guide to help you navigate the complexities of drafting compliant employment contracts across various jurisdictions.
This Guide reflects Acumen International’s expertise in handling complex global employment scenarios, offering practical insights to support your international operations and talent integration.
When Do You Need an International Employment Contract?
International employment contracts are required when hiring an employee who resides in a different country while working for your company.
The rise in remote work and global hiring has led many businesses into this scenario. Employers are based in one country, while employees work from their home countries or travel as digital nomads.
If employees are relocated to the country where the company is based, an international employment contract is unnecessary, as the employee’s income becomes locally sourced and subject to local taxes.
Understanding the Basics of International Employment Con
International employment contracts are legally binding agreements between employers and employees that outline the rights, responsibilities, and obligations of both parties.
Essential elements of an international employment contract include:
Job Title
Job Description
Salary or Wages
Working Hours
Overtime Policy
Contract Duration
Probation Period
Notice Period
Termination Conditions.
Intellectual Property Rights
In an international context, employment contracts must align with the host country’s legal requirements while maintaining global coherence, considering jurisdictional rules, choice of law, and translation needs, based on the employee’s country of tax residence.
International employment contracts are the bedrock of the employer-employee relationship in a cross-border hiring context, defining roles, responsibilities, and expectations. They are essential for protecting the interests of both parties and ensuring smooth operations.
However, drafting these contracts becomes exponentially more challenging when your business spans multiple jurisdictions.
Employment Contracts across Jurisdictions
Each country has its own unique set of labour laws and cultural norms. What is considered standard practice in one region may be illegal or frowned upon in another. This diversity requires contracts that are meticulously tailored to meet local legal requirements while maintaining global consistency. Failing to do so can lead to misunderstandings, legal disputes, and damaged relationships.
Unprofessionally drafted employment contracts pose significant risks. They can result in non-compliance with local laws, leading to fines, litigation, and reputational harm. They may also fail to clearly communicate expectations, causing confusion and dissatisfaction among employees. Furthermore, poorly crafted contracts can inadvertently include discriminatory clauses or overlook essential statutory benefits, undermining your commitment to a fair and inclusive workplace.
At Acumen International, we understand the intricacies of global employment contracts. Our guide provides you with the insights and tools needed to draft contracts that are not only legally compliant but also foster positive and productive working relationships. Whether you are managing full-time employees, remote workers, or temporary staff, this guide will help you navigate the complexities and mitigate the risks associated with global employment contracts.
Essential Components of an International Employment Contract
Identification Details: Names and addresses of the employer and employee.
Start Date: Employee’s start date and continuous employment date.
Position: Job title.
Compensation: Payment frequency, rate of pay, and salary review provisions.
Duties: Roles and responsibilities.
Leave Allowances: Holiday and leave entitlements, public holidays, PTO.
Work Schedule: Required working hours.
Probation: Probation period details.
Conduct Policies: Disciplinary and grievance procedures.
Additional Perks: Other benefits offered by the employer.
Essential Components of a Cross-border Employment Contract Explained
An international employment contract is a cornerstone document that outlines the mutual obligations between an employer and an employee. It is crucial to ensure that these contracts are comprehensive and meticulously detailed to avoid misunderstandings and legal issues. Here are the essential components that should be included in every employment contract:
Identification Details: The full names and addresses of the employer and the employee must be clearly stated. This ensures that the contract legally binds the correct parties.
Start Date: This specifies the date when the employee will begin their employment and, if applicable, the date of continuous employment. It is essential for calculating tenure and related benefits.
Position: The job title should be clearly defined to provide clarity on the role the employee will occupy within the organization.
Compensation: This section outlines the payment frequency (such as weekly or monthly), the rate of pay, and any provisions for salary reviews. It should also detail any bonuses, commissions, or other financial benefits.
Duties: A description of the roles and responsibilities associated with the position. This ensures both parties have a clear understanding of job expectations.
Leave Allowances: Information on holiday and leave entitlements, including public holidays and Paid Time Off (PTO), should be provided. This helps manage employee expectations regarding their leave rights.
Work Schedule: The required working hours must be specified. This includes regular working hours, overtime, and any flexible working arrangements.
Probation: Details regarding any probation period, including its duration and criteria for completion, are crucial. This period allows employers to assess the suitability of the new hire.
Conduct Policies: The disciplinary and grievance procedures in place should be described. This section is vital for maintaining workplace order and addressing issues that arise.
Workplace: The location(s) where the work will be performed should be indicated. This can include specific offices, remote work provisions, or other relevant sites.
Termination: The notice periods required from either party to end the employment should be detailed, along with the grounds for termination and any severance pay conditions. Clear termination terms help prevent abrupt and unfair dismissals.
Additional Perks: Any other benefits offered by the employer, such as health insurance, retirement contributions, and other incentives, should be mentioned. These perks can significantly enhance employee satisfaction and retention.
Incorporating these components into your international employment contracts ensures they are comprehensive and legally robust.
At Acumen International, we specialise in helping businesses navigate the complexities of global employment contracts, ensuring compliance and fostering positive employer-employee relationships worldwide.
5 Types of International Employment Contracts
Full-Time Contract: 35-40 hours per week, steady income, statutory benefits.
Fixed-Term Contract: Temporary staffing needs, specific end date, project-based work.
Part-Time Contract: Less than full-time hours, pro-rated entitlements.
Zero-Hours Contract: No guaranteed hours, work as needed.
Indefinite Term Contract: No defined end date, long-term roles, or notice period for termination.
Types of Cross-border Employment Contracts Explained
Cross-border employment contracts come in various forms, each designed to meet the specific needs of the employer and the employee. Understanding the different types of contracts is crucial for aligning your workforce strategy with business goals and legal requirements. Here are the primary types of employment contracts:
Full-Time Contract: This type of contract obligates an employee to work between 35 to 40 hours per week. Full-time contracts offer a steady income and typically include statutory benefits such as health insurance, retirement contributions, and paid leave. These contracts are ideal for roles that require a consistent and long-term commitment.
Fixed-Term Contract: Fixed-term contracts are designed for temporary staffing needs and are often used for project-based work, maternity leave coverage, or to fill gaps during long-term absences. These contracts have a specific end date, providing clarity on the duration of employment. Employers benefit from flexibility while ensuring that short-term needs are met without long-term commitments.
Part-Time Contract: Part-time contracts are suitable for roles that require less than full-time hours. Employees under these contracts receive entitlements pro-rated to reflect those of full-time employees. This type of contract is ideal for positions that do not necessitate a full-time commitment, offering flexibility to both the employer and the employee.
Zero-Hours Contract: Zero-hours contracts provide maximum flexibility for employers, as they do not guarantee any minimum hours of work. Employees work on an “as and when required” basis, often filling in for unexpected staffing needs or surges in demand. While these contracts offer flexibility, they require careful management to ensure compliance with employment laws and fairness to workers.
Indefinite Term Contract: Unlike fixed-term contracts, indefinite-term contracts do not have a defined end date. Employment continues until either the employer or employee decides to terminate the relationship, usually through a notice period. These contracts are typically used for long-term roles and offer job security and stability to employees.
By selecting the appropriate type of employment contract, businesses can effectively manage their workforce, ensuring they meet both operational needs and legal obligations. Each contract type has its advantages and specific applications, making it essential to choose wisely based on the role and the business environment.
Language and Jurisdictional Compliance of International Employment Contracts
Specify the prevailing language for the legal interpretation of an international employment contract. The jurisdiction clause should identify the country’s legal system for contract interpretation and dispute management.
Language and Jurisdictional Compliance of International Employment Contracts
When drafting employment contracts for a global workforce, language and jurisdictional compliance are critical components that ensure the contract’s enforceability and clarity across different legal systems.
Prevailing Language: It is essential to specify the prevailing language of the contract, which will be used for legal interpretation. In cases where the contract is translated into multiple languages for better understanding, it should be explicitly stated which version will govern in the event of inconsistencies. This prevents misunderstandings and ensures that both parties have a clear and uniform understanding of the contract terms.
Jurisdiction Clause: The jurisdiction clause is a vital part of any employment contract, especially in an international context. This clause identifies the legal system that will be applied in interpreting the contract and managing any disputes that arise. Given that employment laws can vary significantly from one country to another, specifying the jurisdiction helps in:
Legal Certainty: Both parties know which country’s laws will govern their relationship, providing clarity and predictability.
Dispute Resolution: It sets out the legal framework for resolving disputes, which is crucial for avoiding protracted legal battles and ensuring a fair process.
Compliance: Ensuring that the contract adheres to the local laws of the chosen jurisdiction helps avoid legal pitfalls and potential penalties.
Considerations for Global Employers
Local Legal Requirements: Each jurisdiction has specific legal requirements regarding employment contracts. It’s crucial to ensure that the contract complies with these local laws to avoid legal complications.
Cultural Sensitivities: Understanding and respecting cultural differences can impact how contracts are perceived and enforced. This includes language nuances, negotiation styles, and customary practices.
Choice of Law: The contract should clearly state which country’s laws will apply. This is particularly important for multinational companies operating across various territories with differing legal frameworks.
By addressing language and jurisdictional compliance in employment contracts, businesses can safeguard against legal ambiguities and disputes, ensuring that contracts are enforceable and respected across different regions. This not only protects the company but also builds trust with employees, who can be confident that their rights and responsibilities are clearly defined and upheld.
Equal Opportunity Worldwide: Crafting Inclusive International Employment Contracts
Promote equal opportunities and inclusive hiring practices. Avoid discriminatory clauses and include an equal opportunity clause to demonstrate commitment to diversity.
Anti-Discrimination Provisions in International Employment Contracts
Creating a fair and inclusive workplace is not only a legal obligation but also a moral imperative for modern businesses. When drafting employment contracts, it’s essential to ensure that they promote equal opportunities and avoid any form of discrimination. Here’s how to embed these principles into your contracts:
Promote Equal Opportunities: An inclusive hiring practice ensures that all potential and current employees have equal access to employment opportunities and advancements without discrimination. This can be achieved by:
Inclusive Job Descriptions: Write job descriptions that focus on the skills and qualifications needed for the job rather than unrelated characteristics such as age, gender, or nationality.
Fair Recruitment Processes: Implement recruitment processes that are transparent and unbiased. This includes using diverse interview panels and standardized evaluation criteria to ensure fair treatment for all candidates.
Avoid Discriminatory Clauses: Ensure that your employment contracts do not contain any clauses that could be interpreted as discriminatory. This involves:
Gender-Neutral Language: Use gender-neutral language in all contract documents. For example, use “they” instead of “he/she” and “employee” instead of “man/woman.”
Equal Treatment: Clearly state that all employees will be treated equally regardless of race, gender, age, religion, sexual orientation, disability, or any other protected characteristic.
Include an Equal Opportunity Clause: To demonstrate your commitment to diversity and inclusion, include a specific clause in your employment contracts that outlines your policy on equal opportunities. This clause should affirm your commitment to:
Non-Discrimination: Declare that the company will not tolerate any form of discrimination or harassment in the workplace.
Diversity and Inclusion: Emphasize the company’s dedication to creating a diverse and inclusive environment where all employees feel valued and respected.
Compliance with Laws: Ensure that the company complies with all relevant anti-discrimination laws and regulations in the jurisdictions where it operates.
Fostering a Discrimination-Free Global Workforce
To reinforce discrimination-free principles, provide regular training and awareness programs for all employees across locations, especially those involved in hiring and talent management. This helps to foster a culture of inclusion and ensure that everyone understands the importance of non-discriminatory practices.
By proactively addressing discrimination in your international employment contracts and workplace practices, you can create a more inclusive, fair, and productive work environment. This not only helps in legal compliance but also enhances your company’s reputation as an employer of choice.
Payroll and Compensation Compliance in International Employment Contracts
Comply with minimum wage requirements, consider the cost of living and market standards. Define payment frequency, method, overtime pay rates, bonuses, and allowances, adhering to local laws.
Payroll and Compensation Compliance Worldwide
Ensuring compliance with payroll and compensation laws is a fundamental aspect of managing a global workforce. It is crucial to align your employment contracts with local regulations to avoid legal issues and ensure fair treatment of employees. Here’s how to effectively address payroll and compensation compliance in your contracts:
Comply with Minimum Wage Requirements
Every country has its own minimum wage laws. It is essential to:
Research Local Laws: Stay updated with the minimum wage requirements in each jurisdiction where you operate. These laws can change frequently, so continuous monitoring is necessary.
Contractual Adherence: Ensure that the wages specified in the employment contracts meet or exceed the local minimum wage standards.
Consider Cost of Living and Market Standards
To attract and retain top talent, consider:
Cost of Living Adjustments: Take into account the cost of living in the employee’s location. This ensures that compensation is fair and competitive.
Market Benchmarking: Compare your compensation packages with industry standards in the local market to ensure they are attractive and competitive.
Define Payment Frequency and Method
Clearly outline how and when employees will be paid:
Payment Frequency: Specify whether the payment will be weekly, bi-weekly, or monthly. Consistent payment schedules help employees manage their finances better.
Payment Method: Detail the method of payment, such as direct bank transfer, check, or digital payment platforms. Ensure the chosen method complies with local laws.
13th/14th Month Pay: In some countries, it is customary or legally required to provide additional monthly salaries, often referred to as the 13th and 14th month pay. Clearly state if and how these payments will be made, ensuring compliance with local regulations.
Overtime Pay Rates
Overtime regulations vary significantly across different jurisdictions:
Legal Compliance: Make sure your overtime pay rates comply with local labour laws. This includes the conditions under which overtime is paid and the rates (e.g., time and a half, double time).
Clear Definitions: Clearly define what constitutes overtime work and how it will be compensated. This helps in avoiding disputes and ensures transparency.
Employee Bonuses and Allowances
Include details about any additional financial incentives:
Performance Bonuses: Outline the criteria for earning performance-based bonuses, including the evaluation process and payment schedule.
Allowances: Specify any additional allowances, such as housing, transportation, or meal allowances. Ensure these comply with local tax laws and employment regulations.
Employee Tax Withholding
Properly managing tax withholding is essential to ensure compliance with local tax laws:
Local Tax Laws: Understand the tax withholding requirements in each jurisdiction where you operate. This includes income tax, social security contributions, and other mandatory deductions.
Employee Documentation: Ensure that employees provide the necessary tax documentation, such as tax identification numbers and residency information.
Accurate Withholding: Implement accurate tax withholding procedures to avoid underpayment or overpayment of taxes. This includes regularly updating payroll systems to reflect any changes in tax laws.
Adhering to Local Employment Laws
Each country has specific laws governing payroll and compensation. Ensure that your employment contracts:
Regulatory Compliance: Fully comply with local labour laws, including tax regulations, social security contributions, and mandatory benefits.
Regular Audits: Conduct regular audits of your payroll practices to ensure ongoing compliance and to address any discrepancies promptly.
By meticulously addressing payroll and compensation compliance in your employment contracts, you safeguard your business against legal risks and enhance employee satisfaction. This commitment to fairness and transparency not only strengthens your legal standing but also builds trust and loyalty among your global workforce.
Incorporating Statutory Employee Benefits in Contracts
Include mandatory employee benefits like health insurance, unemployment insurance, employee compensation, and paid time off as required by host country laws.
Incorporating Statutory Benefits in Contracts
Ensuring that your employment contracts include all mandatory employee benefits is crucial for compliance with local laws and for maintaining a fair and supportive work environment. Statutory benefits can vary widely from one country to another, so it’s essential to be well-informed about the requirements in each jurisdiction where you operate. Here’s how to effectively incorporate these benefits into your contracts:
Health Insurance: Many countries require employers to provide health insurance to their employees. Your contracts should:
Local Compliance: Specify the health insurance coverage that meets or exceeds the requirements of the host country’s laws.
Details of Coverage: Clearly outline the extent of the health insurance benefits, including what is covered (e.g., medical, dental, vision), the provider, and any employee contributions.
Unemployment Insurance: Unemployment insurance is another common statutory requirement:
Mandatory Contributions: Ensure that your contracts specify the employer’s contributions to the unemployment insurance fund as required by local laws.
Eligibility and Benefits: Provide information on how employees can claim unemployment benefits, if applicable, including any necessary procedures and conditions.
Employee Compensation: Workers’ compensation laws vary, but most jurisdictions require employers to cover employees for work-related injuries and illnesses:
Coverage Details: Include details of the workers’ compensation insurance provided, specifying what is covered and how employees can access these benefits.
Compliance: Ensure the compensation coverage complies with local regulations, including any required documentation or reporting procedures.
Paid Time Off (PTO): Paid leave entitlements are a critical part of statutory benefits:
Holiday Entitlements: Clearly state the number of paid holidays employees are entitled to, as well as any public holidays recognized by the host country.
Sick Leave: Detail the sick leave policy, including the number of days available and any requirements for medical certification.
Parental Leave: Include provisions for maternity, paternity, and parental leave as mandated by local laws, specifying the duration and conditions for each type of leave.
Other Leave Types: Ensure that other types of statutory leave, such as bereavement or personal leave, are included in the contract as required.
Retirement Contributions: Retirement or pension contributions are often mandatory:
Contribution Rates: Specify the employer’s contribution rate to retirement or pension funds as required by local laws.
Employee Participation: Provide details on how employees can participate in the retirement plan, including any matching contributions and vesting periods.
Other Statutory Benefits: Depending on the country, there may be additional mandatory benefits such as:
Housing Allowances: In some jurisdictions, employers must provide or subsidize housing for their employees.
Transportation Allowances: Ensure compliance with any local laws requiring employers to subsidize transportation costs.
Education and Training: Some countries mandate employer contributions towards ongoing education and training for employees.
Regular Updates and Compliance Checks: Laws regarding statutory benefits can change:
Stay Informed: Regularly update your knowledge of local laws to ensure ongoing compliance.
Contract Revisions: Amend contracts as necessary to reflect any changes in statutory benefit requirements.
Incorporating statutory benefits into your employment contracts ensures legal compliance and demonstrates your commitment to providing a supportive and fair work environment. This can significantly enhance employee satisfaction and retention, positioning your company as a desirable place to work.
Global Payroll Calculator – Your Precision Tool for Global Employment Cost Analysis
The Global Payroll Calculator (GPC) offers a sophisticated solution for instantly calculating employment costs across 190 countries, streamlining your global hiring strategy and ensuring cost-effective decisions.
Key Features & Benefits for International Hiring
Instant Cost Calculations: Quickly determine total employment costs, factoring in real-time tax rates and benefits for local and foreign talent in 190 countries.
Precision & Clarity: Achieve precise payroll calculations with detailed breakdowns of all payroll variables, ensuring transparency and preventing unexpected costs.
Cross-Country Comparisons: Utilise GPC’s capability to perform instant comparisons between countries, helping you identify the most advantageous locations for hiring.
Core Capabilities of Global Payroll Calculator
Total Employment Cost Analysis
Monthly and yearly costs.
Gross-to-net and net-to-gross calculations.
Detailed breakdowns, including employer liability and employee taxes.
Full Tax Breakdown
Comprehensive coverage of social contributions, personal income tax, and automated tax caps.
Employer and employee tax splits with allowances and holiday entitlements.
Built-in HR Compliance
Ongoing validation against trusted government sources.
Updates in real-time to reflect the latest tax and labour laws.
Unique Solutions for Global Expansion Challenges
Express Global Employment Support: Backed by 20+ years of expertise, GPC is integrated with global EOR solutions to support your international workforce management.
Robust Methodology: Standardises diverse data into a clear, unified format, enhancing decision-making clarity across multiple jurisdictions.
With Global Payroll Calculator, you gain a powerful tool at your fingertips, designed to optimise your global employment strategies and ensure that your international operations are cost-effective and compliant. Enjoy a free trial to experience firsthand how GPC can transform your global payroll processes.
Intellectual Property Rights and Confidentiality
In the modern business landscape, safeguarding intellectual property (IP) and maintaining confidentiality are critical for protecting a company’s competitive edge and sensitive information. When drafting employment contracts, it is essential to define Intellectual Property (IP) ownership of work products, inventions, and designs. Include confidentiality clauses to protect sensitive business information, specifying what is confidential and the employee’s obligations.
Here’s how to effectively incorporate intellectual property rights and confidentiality clauses into your international employment contracts:
Intellectual Property Rights in International Employment Contracts
Clearly, defining the ownership of intellectual property created during employment is crucial. Your contracts should:
Ownership of Work Products: Specify that any work products, inventions, designs, or other IP created by the employee during the course of their employment belong to the employer. This includes both tangible and intangible creations.
Scope of IP: Define the scope of IP covered, such as patents, trademarks, copyrights, trade secrets, and any other proprietary information. This helps prevent disputes over what constitutes IP.
Assignment of Rights: Include a clause where the employee agrees to assign all rights to any IP developed during their employment to the employer. This ensures that the employer retains full control over any creations.
Disclosure and Cooperation: Require employees to disclose any inventions or work products promptly and to cooperate with the employer in securing IP protection, such as filing for patents or trademarks.
Pre-existing IP: Address any pre-existing IP the employee may bring to the job, ensuring that there is a clear distinction between what belongs to the employee and what is developed during employment.
Confidentiality Clauses
Protecting sensitive business information is vital. Confidentiality clauses in employment contracts should:
Definition of Confidential Information: Clearly define what constitutes confidential information. This can include trade secrets, business plans, financial data, client lists, and other proprietary information.
Obligations of the Employee: Specify the employee’s obligations to protect and not disclose any confidential information during and after their employment. This includes not using the information for personal gain or sharing it with third parties.
Duration of Confidentiality: State the duration for which the confidentiality obligations will apply. While some information may need protection indefinitely, other information might have a limited confidentiality period.
Consequences of Breach: Outline the consequences of breaching confidentiality clauses, including potential legal actions and compensation for damages. This serves as a deterrent and emphasizes the importance of maintaining confidentiality.
Exclusions: Clearly mention any exclusions to the confidentiality obligations, such as information that becomes publicly known through no fault of the employee or information disclosed under legal requirements.
Balancing IP and Confidentiality with Employee Rights
While protecting the company’s interests is crucial, it’s also important to ensure that the clauses are reasonable and do not unfairly restrict the employee’s future opportunities:
Reasonableness: Ensure that IP and confidentiality clauses are reasonable in scope, duration, and geographic area. Overly restrictive clauses can be challenged and may not be enforceable in some jurisdictions.
Clarity and Transparency: Be transparent with employees about their rights and obligations regarding IP and confidentiality. Clear communication can help prevent misunderstandings and foster a trust-based work environment.
Legal Compliance: Verify that all IP and confidentiality clauses comply with local laws and regulations. Different jurisdictions have varying standards for enforceability, so it’s important to tailor these clauses accordingly.
By incorporating robust intellectual property and confidentiality clauses into your employment contracts, you can protect your company’s innovations and sensitive information, ensuring that your competitive advantage is maintained while fostering a secure and trustworthy relationship with your employees.
Streamline Your International Talent Onboarding with Acumen International
Creating an international employment contract independently is feasible but can be overwhelming, time-consuming, and risky. Additionally, you must have it reviewed by legal professionals familiar with the labour laws of the country you’re hiring from. Despite the complexity, this should not deter you from engaging in international hiring.
Operating in 190 countries, Acumen International enables seamless onboarding of new employees, ensuring they sign fully compliant contracts. We streamline payroll management across multiple locations and provide employee benefits that might otherwise be difficult to offer.
As a Global Employer of Record, Acumen International assumes all legal responsibilities for your global workforce, allowing you to focus on managing their daily tasks efficiently.
Contact us for immediate hiring needs or if you plan to expand globally.
Terminating an employee is never easy. It’s a complex process riddled with legal landmines and cultural nuances that vary wildly across the globe. In an era where corporate actions face heightened scrutiny, how a company handles employee terminations can significantly impact its global reputation and future talent acquisition efforts. Mishandling this sensitive process can lead… Read more International Employment Law: Avoiding Pitfalls in Cross-Border Terminations
Terminating an employee is never easy. It’s a complex process riddled with legal landmines and cultural nuances that vary wildly across the globe. In an era where corporate actions face heightened scrutiny, how a company handles employee terminations can significantly impact its global reputation and future talent acquisition efforts. Mishandling this sensitive process can lead to legal battles, tarnished brand image, and difficulty attracting top talent.
Yet, the termination process is unavoidable, particularly during periods of transition or downsizing. However, navigating this process across different countries is like traversing a legal and cultural minefield. Each country has its own unique set of laws and customs that dictate how terminations should be handled.
Here are some key aspects of employee termination practices in various countries and how Acumen International can support your global employment needs.
Understanding the diverse regulations and practices surrounding employee terminations is essential for businesses operating globally. Navigating these complexities requires a deep understanding of local laws and cultural expectations.
International Employment Law for Terminations
Here’s a closer look at employee termination practices in various countries, highlighting key considerations and how Acumen International can support your global employment needs.
France: Stringent Labor Protections and Termination Laws
Strong Employee Protections:France’s stringent labour laws prioritise employee rights. Terminations require a valid reason (e.g., economic difficulties, poor performance, misconduct) and adherence to a formal procedure, including a pre-dismissal meeting and written notification. The complexity of these requirements underscores the importance of meticulous compliance to avoid legal disputes.
Japan: Navigating Terminations in a Lifetime Employment Culture
Lifetime Employment Influence: While the traditional notion of lifetime employment is evolving, it still influences Japanese workplaces. Direct terminations are often avoided in favour of encouraging voluntary resignation through transfers or other incentives. This cultural approach highlights the preference for maintaining long-term employment relationships in Japan and avoiding direct terminations.
Brazil: Understanding Severance Pay and Termination Costs
Costly Severance Packages: Terminating an employee without “just cause” in Brazil can be expensive due to mandatory severance pay, including a 40% penalty on the employee’s FGTS (Fundo de Garantia do Tempo de Serviço) balance. This financial obligation necessitates careful consideration before proceeding with terminations. Brazilian labour laws make terminating an employee without just cause an expensive affair.
Germany: Rigorous Legal Framework
Rigorous Legal Framework:Germany’s termination laws are strict, requiring a valid reason (e.g., operational changes, poor performance) and often involving a conciliation process. Employees are generally entitled to severance pay and lengthy notice periods, which vary based on tenure and circumstances and can extend up to seven months.
These stringent requirements aim to protect employees’ rights and ensure fair treatment.
India: Industrial Disputes Act and Termination Regulations
In India, the Industrial Disputes Act offers significant protections to employees in certain sectors. For companies with more than 100 workers, terminating an employee requires government permission, making the process complex and lengthy. This legislative safeguard underscores the importance of securing governmental approval to ensure compliance.
United States: At-Will Employment and Termination Practices
The United States operates under the “at-will employment” principle, allowing employers to terminate employees for any reason or no reason at all, provided it is not illegal (e.g., discrimination). However, some states have additional protections that may apply. This flexibility contrasts with the more regulated termination processes seen in other countries.
Italy: Justified Terminations and Collective Dismissals
In Italy, employee terminations require valid justification, such as poor performance or misconduct. Collective dismissals involve consultation with trade unions, and severance pay is mandatory, calculated based on the employee’s length of service. These requirements highlight the emphasis on fairness and transparency in the termination process.
United Kingdom: Fair Dismissal Regulations
The United Kingdom mandates fair dismissal standards, requiring a valid reason for termination. Employees with more than two years of service have the right to challenge the termination at an Employment Tribunal. Additionally, redundancy payments and notice periods are stipulated by law, ensuring employees are treated fairly.
How a Global Employer of Record Can Facilitate Compliant and Respectful Terminations
As a Global Employer of Record, Acumen International specialises in providing comprehensive support for global employment needs, ensuring compliance and smooth operations across borders.
Managing employee terminations across multiple jurisdictions presents significant challenges due to varying legal requirements and cultural sensitivities. This is where a Global Employer of Record (EOR) like Acumen International offers substantial value.
Ensuring Global HR Compliance for Employee Terminations
One of the biggest challenges in managing employee terminations globally is ensuring legal compliance in each country. Employment laws can vary widely, and failure to adhere to local regulations can result in legal disputes and financial penalties. Acumen International helps businesses navigate these complexities by:
Expertise in Local Laws: Acumen International has extensive knowledge of employment laws in various countries. This ensures that every termination is conducted in full compliance with local legal requirements, mitigating the risk of litigation.
Documentation and Processes: The Global EOR manages all necessary documentation and processes, from providing the correct termination notices to handling severance payments and ensuring that all legal obligations are met.
Culturally Sensitive Termination Practices for Global Companies
Terminations are not just a legal matter but also a human one. Different cultures have different expectations regarding how terminations should be handled. Acumen International provides support in:
Cultural Awareness: Understanding the cultural context is crucial for conducting terminations respectfully. Acumen International’s local expertise ensures that terminations are handled in a culturally sensitive manner, preserving the dignity of the affected employees.
Communication Strategies: Effective communication is key to a respectful termination process. The Global Employer of Record assists in crafting and delivering messages that are appropriate and considerate, helping to maintain positive relationships and protect the company’s reputation.
Efficient Transition Management
During periods of transition or scale-downs, managing the logistics of terminations can be overwhelming. Acumen International offers expert assistance in:
Streamlined Processes: The EOR manages the entire termination process, from planning to execution, ensuring that it is conducted efficiently and with minimal disruption to business operations.
Fair Treatment: Ensuring that all employees are treated fairly and with respect, regardless of the circumstances of their termination.
Support for Remaining Employees: Managing morale and productivity among remaining employees is critical. Acumen International provides guidance on communication strategies and support programs to help maintain a positive work environment during challenging times.
Managing Termination Costs and Financial Risks with EOR Expertise
Terminations, especially on a large scale, can have significant financial implications. Acumen International helps manage these costs effectively by:
Cost Analysis: Providing detailed analysis and forecasting of termination costs, including severance payments and potential legal fees.
Budget Management: Assisting in budgeting for terminations and ensuring that all financial obligations are met without unexpected expenses.
Drafting Compliant Termination Procedures
Termination procedures are a critical aspect of employment contracts, ensuring that both parties understand the process and conditions under which the employment relationship can be ended. To prevent legal disputes and ensure fairness, it’s essential to draft termination procedures that are clear, compliant with local laws, and considerate of both the employer’s and employee’s rights. Here’s how to effectively draft compliant termination procedures:
Clear Definition of Termination Procedures
Establishing clear procedures helps both parties understand the process and reduces the risk of disputes:
Notice Periods: Clearly specify the notice periods required by both the employer and the employee. These periods should comply with local laws, which often set minimum notice requirements. For example, notice periods might range from one week for short-term employees to several months for long-term employees.
Grounds for Termination: Define the grounds on which either party can terminate the contract. This includes:
For Cause: Immediate termination due to serious misconduct, such as fraud, theft, or gross negligence.
Without Cause: Termination for reasons not related to misconduct, such as restructuring or redundancy, typically requiring notice and possibly severance pay.
Employee Resignation: Conditions under which an employee can resign, including required notice periods.
Early Termination Provisions: Outline any provisions for early termination, including any penalties or conditions that may apply. For example, specify if the employee or employer can terminate the contract without notice under certain circumstances, such as breach of contract.
Severance Pay Conditions
Clearly define any severance pay conditions to avoid misunderstandings and ensure compliance:
Eligibility: State who is eligible for severance pay, such as employees terminated without cause.
Calculation: Explain how severance pay is calculated, including factors like length of service, salary, and any local legal requirements.
Payment Timing: Specify when severance pay will be provided, ensuring it complies with local laws.
Compliance with Host Country Laws
To prevent unlawful dismissal claims, ensure that your termination procedures comply with the laws of the country where the employee is based:
Local Legal Requirements: Research and incorporate any specific legal requirements regarding termination, notice periods, and severance pay in the host country. Laws can vary significantly, so it’s crucial to tailor your contracts to each jurisdiction.
Employee Protections: Be aware of any additional protections for employees, such as those related to discrimination, retaliation, or whistleblowing. Ensure that termination procedures do not violate these protections.
Documentation and Record-Keeping: Maintain thorough documentation of the termination process, including reasons for termination, notice given, and any communications with the employee. This documentation is vital for defending against potential legal claims.
Fair and Transparent Employment Termination Process
Ensure that the termination process is fair and transparent to maintain a positive reputation and minimize conflict:
Performance Reviews and Warnings: Implement a system of performance reviews and warnings before proceeding with termination for performance-related issues. This provides employees with an opportunity to improve and demonstrates fairness.
Exit Interviews: Conduct exit interviews to understand the reasons behind employee resignations and to gain insights for improving workplace conditions and retention strategies.
Confidentiality and Respect: Handle all termination procedures with confidentiality and respect, ensuring that the employee’s dignity is preserved throughout the process.
Alternative Dispute Resolution
Include provisions for resolving disputes that may arise from termination:
Mediation and Arbitration: Offer mediation or arbitration as alternatives to litigation, providing a less adversarial and often quicker resolution method.
Grievance Procedures: Outline a clear grievance procedure that employees can follow if they believe the termination was unjust.
By drafting clear and compliant termination procedures, you protect your business from legal risks and ensure a fair process for employees. This not only helps in maintaining a positive working environment but also upholds your company’s reputation as a fair and responsible employer.
Strategic Workforce Transitions: Optimising Costs with the Global Payroll Calculator
For businesses operating across borders, workforce transitions are inevitable. Whether you’re expanding into new markets, restructuring existing teams, or facing the difficult decision of terminations, understanding the financial implications of these changes is crucial. This is where the Global Payroll Calculator (GPC) becomes an indispensable tool.
The GPC empowers you to make informed decisions by providing:
Accurate Cost Comparisons: Instantly calculate and compare total employment costs across 190 countries. This is essential for assessing the financial impact of terminating employees in one location and hiring in another.
Detailed Breakdowns: Understand the full scope of payroll expenses, including taxes, social security contributions, and benefits. This transparency helps you identify potential cost savings and budget accordingly.
Scenario Planning: Model different workforce scenarios to see how they impact your bottom line. Whether you’re considering layoffs, new hires, or relocations, the GPC allows you to anticipate costs and make strategic decisions.
Backed by 20+ years of expertise and integrated with comprehensive global employment solutions, the GPC is more than just a calculator – it’s your strategic partner for optimizing global workforce transitions. Experience the power of the GPC with a free trial and discover how it can transform your approach to workforce management.
Empower Your Global Workforce with Acumen International
Employee terminations are a necessary part of business, but they don’t have to be a source of stress or risk. Partner with Acumen International, and let us transform this challenge into an opportunity. By ensuring fair, compliant, and respectful terminations, we help you:
Protect Your Reputation: Maintain a positive image in every market you operate in.
Attract Top Talent: Demonstrate your commitment to ethical and responsible employment practices.
Focus on Growth: Free your resources to invest in innovation and expansion.
The future of your global workforce starts with a solid foundation. Contact Acumen International today, and let us help you build it.
Digital Nomad Visas are becoming a valuable asset in the modern workplace, offering a win-win solution for both employers seeking global talent and employees seeking greater flexibility and work-life balance. With the rise of remote work, South America is becoming a hotspot for digital nomads. The continent’s blend of vibrant cultures, affordable living, and stunning… Read more Digital Nomad Visa 2024
Digital Nomad Visas are becoming a valuable asset in the modern workplace, offering a win-win solution for both employers seeking global talent and employees seeking greater flexibility and work-life balance.
With the rise of remote work, South America is becoming a hotspot for digital nomads. The continent’s blend of vibrant cultures, affordable living, and stunning landscapes makes it an ideal destination for those seeking to combine work and travel.
Our comprehensive guide explores digital nomad visas in key South American countries, offering valuable insights for both remote workers seeking a new adventure and employers looking to expand their talent pool across this vibrant continent.
Why Digital Nomad Visas Are Gaining Traction Among Employers
Digital Nomad Visas, which allow employees to live and work remotely in a foreign country for an extended period, are increasingly being considered by employers as a valuable tool for attracting and retaining global talent.
Key Advantages for Employers
Access to Global Talent: Digital nomad visas open doors to a worldwide talent pool, allowing companies to hire highly skilled professionals without requiring them to relocate permanently.
Flexibility and Remote Work: They cater to the growing demand for remote work, providing employees with the flexibility to work from various locations while maintaining their productivity.
Cost-Effectiveness: Compared to traditional expatriate assignments, Digital Nomad Visas can be a more budget-friendly option for employers, as they eliminate many of the relocation and long-term housing costs.
Compliance and Legal Framework: These visas offer a legal framework that ensures employers and employees adhere to local laws, mitigating legal risks associated with immigration and employment.
Employee Satisfaction and Retention: The opportunity to live and work in different countries can significantly boost employee morale and loyalty, contributing to lower turnover rates.
Practical Considerations of Digital Nomad Visas
Tax Implications: Employers and employees must carefully navigate the tax regulations of both the home and host countries, as they can vary significantly.
Healthcare and Insurance: Ensuring adequate healthcare coverage for employees working abroad is often a requirement for obtaining a Digital Nomad Visa and is essential for employee well-being.
Documentation and Support: Employers may need to provide documentation like employment contracts and proof of income. Partnering with Global Employer of Record can streamline the process of managing legal and compliance matters.
Argentina: A Year in the Land of Tango
Argentina offers a rich cultural experience with its vibrant arts scene, historical landmarks, and diverse natural landscapes, from the Andes mountains to Patagonia’s glaciers. The capital, Buenos Aires, is known for its European-style architecture and lively nightlife.
Argentina aims to boost its tourism sector and local economy by attracting high-earning remote workers who will spend money on local services and accommodations. The introduction of the Digital Nomad Visa helps promote Argentina as a modern and progressive destination for international professionals. This visa allows professionals to stay in the country for up to one year.
Key Details of Securing a Digital Nomad Visa in Argentina
Validity: Initially valid for 180 days, renewable for another 180 days.
Income Requirement: Applicants must demonstrate a monthly income of around $2,500.
Work Restrictions: The visa only permits remote work for foreign employers or self-employment. It does not allow working for Argentine companies.
Application Process: Requires submission of documents such as a passport, work contract, proof of income, and accommodation details. The total visa fee is approximately $200.
Family Relocation: Family members can join, but additional income may be required to meet visa criteria for dependents
Colombia: The Land of Coffee and Culture
Colombia is renowned for its coffee culture, beautiful landscapes, and warm, welcoming people. Cities like Medellín offer a pleasant climate, modern amenities, and a growing community of digital nomads, making it an attractive place to live and work remotely.
The Colombian government introduced the Digital Nomad Visa to enhance its global image and attract foreign talent. By welcoming digital nomads, Colombia seeks to stimulate local economies and foster cultural exchange, contributing to the country’s development.
Key Details of Securing a Digital Nomad Visa in Colombia
Validity: The visa is valid for up to 2 years.
Income Requirement: Applicants must show proof of a monthly income of at least $900.
Work Restrictions: Only remote work or self-employment is permitted for foreign employers.
Application Process: You must submit documents such as a valid passport, proof of remote work, proof of income, health insurance, and a criminal background check. The total cost is approximately $222.
Family Relocation: Family members can join under dependent visas.
Ecuador: Discover Natural Wonders and Tranquility
Ecuador offers unparalleled natural beauty, including the Amazon rainforest, the Andes mountains, and the Galápagos Islands. The cost of living is relatively low, and the country provides a tranquil and scenic environment for remote work.
Key Details of Securing a Digital Nomad Visa in Ecuador
Validity: Valid for 24 months (2 years), renewable for an additional two years.
Income Requirement: Applicants must demonstrate a monthly income of at least $1,275.
Work Restrictions: Only remote work for foreign employers or self-employment is allowed.
Application Process: Requires submission of documents such as a passport, proof of income, health insurance, and a criminal background check. The visa fee is approximately $450 in total.
Family Relocation: Family members can join under dependent visas, with additional income requirements for each dependent.
Mexico: Enjoy a Rich Cultural Heritage and Modern Amenities
Mexico provides a warm climate, rich cultural heritage, and affordable living costs. Cities like Mexico City and Playa del Carmen are popular among digital nomads for their vibrant communities, modern amenities, and excellent infrastructure.
Key Details of Securing a Digital Nomad Visa in Mexico
Validity: Initially valid for 1 year, renewable annually up to a total of 4 years.
Income Requirement: Must demonstrate a monthly income of at least $2,595 or a bank balance of $43,000 for the last 12 months.
Work Restrictions: The visa permits only remote work for foreign employers or self-employment.
Application Process: You must submit a passport, proof of income, health insurance, and a criminal background check. The total cost is approximately $240.
Family Relocation: Family members can join under dependent visas, with an additional income requirement of $861 per dependent.
Uruguay: Embrace Stability and Quality of Life
Uruguay is known for its high quality of life, political stability, and beautiful coastal towns. Montevideo, the capital, offers a relaxed atmosphere with modern amenities, making it an ideal spot for digital nomads looking for a peaceful yet connected environment.
Key Details of Securing a Digital Nomad Visa in Uruguay
Validity: Initially valid for 6 months, renewable for another 6 months.
Income Requirement: Must demonstrate sufficient financial means via an affidavit.
Work Restrictions: Only remote work or self-employment is allowed for foreign employers.
Application Process: Requires a passport, proof of income, health insurance, and a criminal background check. The visa fee is approximately $10 to $30, payable in Uruguay.
Family Relocation: Family members can join under dependent visas, with additional applications required for each dependant.
Digital Nomad Visa Benefits
Remote Work Authorisation
A Digital Nomad Visa allows your employee to legally reside in another country while working remotely for your company. This visa type is specifically designed for remote workers and freelancers who maintain their employment or business activities outside the host country.
Tax Residency Management
Typically, digital nomad visas do not require the holder to pay local taxes if their income is sourced from abroad. Therefore, your employee can continue to pay taxes in their home country, avoiding complications associated with double taxation. However, it’s crucial to check the specific tax regulations of the host country to ensure compliance.
Example Scenario: Relocating with a Digital Nomad Visa
A Digital Nomad Visa can be an ideal solution if your employee currently works for your company and wants to move to another country but prefers to continue paying taxes in their home country.
Here’s how it works:
An employee working for a global company wants to move to Argentina. They prefer to continue paying taxes in their home country. By applying for a Digital Nomad Visa in Argentina, the employee can live there while working remotely for their company. This visa typically exempts them from paying Argentine taxes on foreign-sourced income.
Global Employment Services by Acumen International
Acumen International empowers your global workforce to thrive wherever they are. From startups to enterprises, our tailored remote work solutions ensure seamless global collaboration.
Acumen International’s Employer of Record (EOR) services streamline the management of immigration, HR, payroll, and compliance matters.
Acumen International offers bespoke global mobility solutions tailored to your company’s unique needs. Our comprehensive services facilitate the seamless relocation of employees across borders, ensuring they meet all local requirements while maintaining their tax obligations in their home country.
Our expert global team handles all aspects of global mobility, from securing visas and work permits to managing tax obligations and social security contributions.
Our personalised approach ensures a smooth transition for employees and helps companies maintain operational efficiency and continuity, even in the most challenging and remote locationslf
Global Payroll Calculator – Your Precision Tool for Global Employment Cost Analysis
Instant Cost Calculations: Quickly determine total employment costs, factoring in real-time tax rates and benefits for local and foreign talent in 190 countries.
Precision & Clarity: Achieve precise payroll calculations with detailed breakdowns of all payroll variables, ensuring transparency and preventing unexpected costs.
Cross-Country Comparisons: Global Payroll Calculator allows you to perform instant comparisons between countries, helping you identify the most advantageous locations for hiring.
Core Capabilities of Global Payroll Calculator
Total Employment Cost Analysis:
Monthly and yearly costs.
Gross-to-net and net-to-gross calculations.
Detailed breakdowns, including employer liability and employee taxes.
Full Tax Breakdown:
Comprehensive coverage of social contributions, personal income tax, and automated tax caps.
Employer and employee tax splits with allowances and holiday entitlements.
Built-in HR Compliance:
Ongoing validation against trusted government sources.
Updates in real-time to reflect the latest tax and labour laws.
Advantages of Global Payroll Calculator for Employers
Manage complex global payroll budgets effectively.
Identify tax-friendly, cost-effective global talent hotspots.
Ensure compliance with international regulations to avoid legal issues.
Overcome data complexity and reduce proposal inefficiency.
Navigate global compliance challenges, enhancing accuracy and reputational trust.
Unique Solutions for Global Expansion Challenges
Express Global Employment Support: Backed by 20+ years of expertise, Global Payroll Calculator is integrated with global EOR solutions to support your international workforce management.
Robust Methodology: Standardises diverse data into a clear, unified format, enhancing decision-making clarity across multiple jurisdictions.
With Global Payroll Calculator, you gain a powerful tool at your fingertips, designed to optimise your global employment strategies and ensure that your international operations are cost-effective and compliant. Enjoy a free trial to experience firsthand how GPC can transform your global payroll processes.
Concluding Thoughts
A Digital Nomad Visa can indeed be a practical solution for employees wishing to relocate internationally while maintaining their tax obligations in their home country. Acumen International’s Global Employer of Record (EOR) services streamline the cross-border hiring processes, ensuring flexibility and adherence to international work and tax regulations.
Ready to simplify your global employment strategy? For personalised assistance and more detailed information, visit Acumen International or contact their support team.
London, UK – July 19, 2024 – Acumen International, a leading provider of global Employer of Record (EOR) services, proudly announces its rebranding to reflect its commitment to empowering businesses with seamless and compliant international expansion solutions based on human-to-human support. The rebranding introduces a modern visual identity, an enhanced range of services, and three… Read more Acumen International Unveils New Brand Identity
London, UK – July 19, 2024 – Acumen International, a leading provider of global Employer of Record (EOR) services, proudly announces its rebranding to reflect its commitment to empowering businesses with seamless and compliant international expansion solutions based on human-to-human support.
The rebranding introduces a modern visual identity, an enhanced range of services, and three new sub-brands: Express Global Employment, Global Payroll Calculator, and Global Compliance Navigator.
New Brand Identity
Acumen International’s new brand identity embodies its evolution and growth, mirroring its position as a trusted partner in the global employment landscape. The updated logo and visual elements symbolise the company’s forward-thinking approach and ability to bridge the gap between businesses and their global workforce needs.
Our new logo and colourful visual identity symbolise our forward-thinking approach, extensive global presence, and inclusivity, which are vital for our clients’ success in today’s world.
The vibrant red globe at the centre represents the passion, dedication, and positive impact Acumen International strives to bring to our clients globally. Our world-class team supports our clients comprehensively in any country, whether developed, underserved, risky, remote, or exotic.
“We envision a future where Acumen International continues to lead the way in human-to-human, personalised global employment solutions, helping businesses overcome challenges and seize opportunities in international markets,” said Nick Ganzha, CEO and founder. “Acumen upholds the core values that have always guided us and define our legacy. Our rebranding signifies our ambition for growth, innovation, and excellence.”
Introducing Acumen International Sub-Brands
Combining Express Global Employment Services, Global Payroll Calculator and Global Compliance Navigator, our unified solution helps our clients identify prime markets for growth and execute compliant international hiring seamlessly. Businesses gain comprehensive analysis and operational expertise to scale confidently across borders relying on us as a trusted partner.
As part of the rebranding, Acumen International is proud to introduce three new sub-brands, each designed to address specific needs within the global employment landscape:
Express Global Employment: Streamlining international hiring with a comprehensive, all-inclusive global employment service that eliminates the need for local entities.
Global Payroll Calculator: A one-click tool for global businesses and service providers to calculate and compare total employment costs, including taxes and benefits, across 190 countries.
Global Compliance Navigator: A portal providing distilled expertise and data on compliant employment and payroll, and tax regulations in 190 locations, helping businesses manage their global workforce employed through the Global EOR solution.
Core Values and Vision for the Future
The rebranding aligns with Acumen International’s core values:
Human Touch: Emphasizing the importance of personal interactions and genuine human engagement over automated solutions.
Global Expertise: Leveraging deep local market knowledge to provide seamless support and integration in any country.
Excellence: Delivering the highest quality of service and exceeding client expectations.
Innovation: Continuously evolving and adopting cutting-edge solutions to meet the dynamic employment needs of global businesses.
Client-Centric Approach: Prioritising personalised/bespoke/tailored, hands-on service to ensure tailored solutions for every client.
Integrity: Upholding the highest standards of ethics and transparency in all business dealings across 190 countries.
Scalability and Flexibility: Offering scalable and flexible solutions that can be adjusted based on client needs, catering to companies of all sizes.
Key Highlights
Global Experience, Local Insight: With 23 years of expertise, Acumen International helps clients navigate new markets confidently, understand complex local regulations and manage cross-border teams.
Unparalleled Global Network: Our reach spans most markets worldwide, including remote and challenging regions, providing a strategic advantage in global expansion.
Comprehensive Service Offering: From recruitment and immigration support to payroll and compliance, Acumen International covers all aspects of global expansion, allowing clients to focus on their core business activities.
Enhanced Global Employment Service Portfolio
Acumen International continues offering comprehensive services to facilitate smooth and compliant international operations. These include:
Global Payroll Services: Providing accurate and timely payroll solutions for international employees.
Talent Acquisition: Customised recruitment services to find and hire top talent globally.
Global Mobility: Solutions for employee relocation, including immigration support and relocation management.
Compliance and Risk Management: Ensuring adherence to local laws and mitigating risks.
Consulting and Advisory: Expert guidance on global HR strategy, compliance, and market entry.
Bespoke Immigration Support: Work permit sponsorship, streamlined visa applications and extensions, minimised rejections, and continuous support.
Looking to the future, Acumen International aims to expand its global footprint further, enhance its service offerings, and remain at the forefront of innovation in the global employment sector. The company is committed to supporting businesses in navigating the complexities of international expansion, ensuring compliance, and achieving operational excellence.
About Acumen International
Acumen International is a leading provider of Global Employer of Record (EOR) services, offering comprehensive solutions to help businesses expand internationally with confidence and compliance. With over 23 years of expertise in 190 countries, Acumen International provides bespoke employment strategies, ensuring seamless and compliant HR operations for mid-size and enterprise companies worldwide.
Venture Capital (VC) funds play a crucial role in nurturing high-potential startups, guiding them from inception through growth and, ultimately, to successful exits. One of the significant challenges for VC funds is facilitating the international expansion of their portfolio companies while managing risks and optimising costs. Global Employer of Record (EOR) solutions can be instrumental… Read more Global EOR Solutions: Strategic Value for Venture Capital Funds
Venture Capital (VC) funds play a crucial role in nurturing high-potential startups, guiding them from inception through growth and, ultimately, to successful exits. One of the significant challenges for VC funds is facilitating the international expansion of their portfolio companies while managing risks and optimising costs.
Global Employer of Record (EOR) solutions can be instrumental in navigating this complex journey. This article explores the unique advantages of Global EOR solutions for VC investment funds and their portfolio companies, addressing specific challenges and offering global expansion insights.
Global EOR Solutions: Addressing the Needs of VC Funds and Startups
A Global Employer of Record (EOR) is a third-party organisation that manages all aspects of employment for another company, including payroll, employee benefits, taxes, and compliance with local labour laws.
Setting up legal entities can be financially burdensome and create substantial exit challenges if the market doesn’t align with your growth projections.
For venture capital funds, a Global EOR can serve as a global expansion vehicle and a portfolio-wide global employment partner. This approach allows startups within a VC fund’s portfolio to hire employees in multiple countries without the need to establish and maintain legal entities in each location, ensuring a low-risk and lightweight investment.
Furthermore, it facilitates easy market entry and exit, enabling seamless investment and divestment while avoiding the pitfalls of costly country or market lock-in.
1. Streamlined Global Expansion for VC Portfolio Companies
Global EOR solutions enable VC portfolio startups to launch teams quickly and compliantly anywhere in the world. By bypassing the need to establish local entities, startups can avoid overhead costs and delays, allowing them to enter and operate in new markets with unprecedented speed.
Acumen International provides additional services such as recruitment when startups do not have candidates, facilitating immigration and sponsoring work permits to get the team up and running. This comprehensive support maximises the return on investment (ROI) for VC funds by accelerating the growth trajectory of their portfolio companies, increasing the likelihood of successful exits.
Establishing a physical presence in foreign markets can lead to permanent establishment risks, including potential tax liabilities. Global EOR solutions help startups avoid permanent establishment risk by providing the necessary infrastructure to operate internationally without the associated tax complications, ensuring operational flexibility.
2. Portfolio-Wide Integration
A Global EOR acts as a unified partner for all companies within a VC’s portfolio, providing a consistent and streamlined approach to global employment. This consistency reduces the VC fund’s administrative burden and ensures that all portfolio companies benefit from the same high standards of compliance and risk management.
By integrating a Global EOR across the entire portfolio, VC funds can facilitate cohesive and efficient international expansion for each startup under their management.
3. Enhanced VC Investment Security Worldwide
Ensuring compliance with diverse and complex local regulations is a major challenge for international operations.
Global EORs possess deep expertise in international labour laws, tax regulations, and employment standards, ensuring full compliance across various jurisdictions. This comprehensive compliance management mitigates the risk of legal issues and financial penalties, protecting the VC fund’s investments and reputation.
5. Agility and Flexibility of Global Operations
The flexible global employment infrastructure provided by a Global EOR allows startups to quickly scale their workforce up or down based on business needs. This agility allows portfolio companies to respond rapidly to market opportunities and challenges, enhancing their competitive edge.
Facilitating Strategic Exits and Transitioning for VC Portfolio Startups
Venture capital (VC) funds aim for successful exits, whether through IPOs, mergers, or acquisitions. Global EOR solutions play a crucial role in positioning portfolio companies as attractive acquisition targets by ensuring they are compliant, efficiently managed, and capable of seamless international operations.
This approach can facilitate smoother, more profitable exits. Additionally, Global EOR solutions provide critical support during startup transitioning periods.
Supporting Transition Periods
During periods of transition, such as mergers or acquisitions, startups often face significant challenges in maintaining operational continuity and compliance. A Global EOR provides essential support by managing employment responsibilities, ensuring that all employees remain legally employed and compliant with local labour laws. This continuity is crucial in maintaining the confidence of new owners and stakeholders.
Ensuring Seamless Talent Integration
The transition period following an acquisition or merger can be fraught with integration challenges. Global Employer of Record solutions help smooth this process by maintaining consistent employment practices and managing cross-border employment complexities. This consistency ensures that the acquiring company can integrate the startup’s operations without disruptions, maintaining productivity and morale among the workforce.
Facilitating Rapid Adjustments
Transitions often require rapid adjustments in workforce size and structure across locations. A Global EOR offers the flexibility needed to scale the workforce up or down in response to the changing needs of the business during these critical periods. This ability to adapt quickly ensures that the startup can meet new business requirements and business goals set by new ownership.
Additionally, a Global EOR can ensure the swift and compliant onboarding of a new workforce or the respectful and compliant termination of employees during layoffs, thereby maintaining legal compliance and protecting the company’s reputation.
Minimising Risks During Transition
The legal and regulatory landscape can be complex and risky during transitions. Global EORs mitigate these risks by ensuring compliance with all relevant labour laws and regulations. This minimises the risk of legal issues and financial penalties that could arise during a transition, protecting the startup and its new owners.
By leveraging Global EOR solutions, VC funds can ensure that their portfolio companies are well-prepared for strategic exits and transitions. This support not only enhances the companies’ attractiveness to potential buyers but also ensures a smooth transition, contributing to more successful and profitable exits.
Regulatory and Political Risks Mitigation for VC Funds
While compliance with local labour laws is crucial, Global EOR solutions also play a vital role in navigating broader regulatory and political risks. In an unpredictable global environment, sudden changes in employment laws or political instability can pose significant challenges for international operations.
Flexibility of Global Employer of Record
The flexible nature of Global Employer of Record arrangements allows portfolio companies to rapidly adjust their operations in response to regulatory or political changes. For instance, if a country introduces restrictive employment laws or experiences political turmoil, a company can quickly scale down or shift its workforce to more stable regions without the need for lengthy legal processes or significant financial investment.
Risk Diversification
By utilising Global EOR solutions, VC funds can diversify their portfolio companies’ operational risks. Instead of concentrating their workforce in a single country, startups can distribute their employees across multiple jurisdictions, minimising the impact of localised regulatory or political issues.
Cost and Time Efficiency of Global EOR Services
The visual below illustrates the significant savings in both cost and time when using Global Employer of Record (EOR) services compared to traditional methods of entering a new market.
Cost Efficiency: Traditional methods incur significant costs, including legal advisors fees, employment benefits, incorporation and liquidation costs, bank account setup, and ongoing maintenance. The overall cost of these processes is approximately $74,000. In comparison, using a Global EOR service costs around $15,000.
Scalability Across Multiple Jurisdictions: The costs outlined in the visual relate to a single jurisdiction. When expanding across multiple jurisdictions, the savings and efficiencies offered by Global EOR solutions become even more pronounced. Instead of replicating these costs and processes in each new country, a Global EOR provider manages these complexities centrally, resulting in greater overall cost savings and streamlined operations.
By leveraging Global EOR services, venture capital funds and their portfolio companies can substantially reduce employee management costs and accelerate time to market.
Global Employer of Record Solutions: Compliance, Risk Management, Legal Security for Venture Capital Funds
For venture capital funds, Global EOR solutions offer a strategic tool to enhance the growth and success of their portfolio companies. By enabling rapid, compliant, and capital-efficient global growth, Employers of Record are becoming essential in the VC toolkit. Funds that effectively leverage these solutions may gain a competitive edge in driving portfolio company growth and optimising returns on investment.
By outsourcing employment responsibilities to Global EOR providers, portfolio companies can focus on their core objectives, such as product development, market expansion, and customer acquisition. This focused approach enhances portfolio companies’ overall performance, driving higher valuations and better investment outcomes for VC funds.
As the global business landscape continues to evolve, the use of Global EOR solutions will likely become increasingly important in venture capital strategy and operations.
Across the globe, the practice of paying a 13th or even a 14th-month salary has become a significant aspect of employee compensation strategies. These payments, often perceived as bonuses, are more than just a generous perk; they reflect deep cultural traditions, compliance with local labour laws, or strategies to boost employee satisfaction and retention. Historical… Read more 13th Month Salary Payments: a Global Perspective
Across the globe, the practice of paying a 13th or even a 14th-month salary has become a significant aspect of employee compensation strategies. These payments, often perceived as bonuses, are more than just a generous perk; they reflect deep cultural traditions, compliance with local labour laws, or strategies to boost employee satisfaction and retention.
Historical Overview
The concept began as traditional bonuses given at the end of the harvest or during religious festivals to thank and retain workers. Over time, this evolved into more structured payments.
In the mid-20th century, many Latin American countries formalised these payments. For example, Brazil introduced the 13th salary in 1962 to boost economic activity by increasing workers’ purchasing power during the Christmas season.
Post-World War II, Europe saw similar practices, with countries like Italy and Spain institutionalising these payments as part of employee benefits to stimulate consumer spending during holidays.
What Are 13th and 14th Month Salaries?
The 13th and 14th-month salaries are bonus payments typically equivalent to one month’s salary each, provided in addition to employees’ regular annual earnings.
The term “13th-month pay” can take various forms, including bonuses, holiday pay, and profit-sharing schemes. These payments are implemented in various ways, reflecting the diverse legal and cultural landscapes across different regions.
What Is 13th Month Pay?
What does the 13th month’s salary mean? Local labour laws often mandate this bonus payment, which is generally paid at the end of the year to help employees cover the financial demands of the holiday season. It is a standard requirement in countries like the Philippines and Brazil and is also commonly practiced under different guidelines in parts of Europe and Asia, such as Spain and South Korea, where it may be tied to specific cultural or performance-based criteria.
What Is the 14th Month Salary?
The 14th-month salary is typically less regulated and varies more significantly by region. While less common, when it is offered, it is usually paid at the employer’s discretion, often in the middle of the year. This mid-year bonus helps with other periodic expenses like education, vacations, or seasonal festivals. In countries like Ecuador and Italy, this additional payment serves as a mid-year incentive, boosting performance and enhancing productivity.
13th Month and 14th Month Salary Calculation Methods
General Formula
The calculation of the 13th and 14th-month salaries typically depends on the employee’s monthly salary. If the employee has been with the company for the full year, the bonus is usually equivalent to one month’s salary.
The formula can vary slightly by country, depending on local labour laws.
13th Month Salary: This is generally calculated by dividing the annual salary by 12, regardless of the number of months worked. This ensures that the bonus accurately reflects an extra month’s pay.
14th Month Salary: If a 14th-month salary is given, it usually follows the same calculation basis as the 13th. However, when this payment is discretionary, it may be adjusted based on company performance, profitability, or other criteria set by the employer.
13th Month and 14th Month Salary Calculation Examples
Basic Salary Calculation
Employee A: Monthly salary = €2,500
13th Month Salary: €2,500
This calculation assumes the employee has worked the entire year. If Employee A joined mid-year, some companies might prorate this amount based on the actual months worked.
Prorated Salary Calculation
Employee B: Monthly salary = €2,500, joined in July, thus working 6 months till December.
13th Month Salary: €2,500 x (6/12) = €1,250
This calculation demonstrates the prorated 13th-month salary for someone who hasn’t worked the full year.
Global Variations in 13th/14th Salary Practices
Africa
In Africa, the practice of 13th and 14th month salaries is influenced largely by economic conditions and local traditions. Mandatory payments, such as those in Angola, aim to provide financial stability and support during key spending periods.
Country
Status
Details
Angola
Mandatory
Vacation bonus paid before a holiday and a 14th-month Christmas bonus in December.
Egypt
Not Typical
Bonuses are discretionary and not mandated by law.
Ghana
Customary
Common practice in some sectors, but not legally mandated.
Kenya
Customary
Year-end bonus is customary but not mandated by law.
Mauritius
Customary
Paid in December.
Nigeria
Customary
Commonly paid before Christmas by many employers, but not mandatory.
South Africa
Customary
13th salary is common but not legally required.
Tunisia
Customary
Common in public sector and large private companies, but not mandatory.
Asia
Asia’s approach to 13th and 14th-month salaries is deeply rooted in cultural and religious traditions. In countries like the Philippines and Indonesia, these payments are mandatory and aligned with major holidays, providing employees with financial support during festive times. Customary practices in countries such as China and Japan also tie bonuses to significant cultural events, underscoring the importance of these periods in the region’s social and economic life.
Country
Status
Details
India
Mandatory
Regulated by the Payment of Bonus Act, 1965. Eligible employees must receive a bonus within eight months of the fiscal year’s end.
Indonesia
Mandatory
Religious-holiday bonus, paid at least one week before the holiday.
Philippines
Mandatory
Religious holiday bonus, paid at least one week before the holiday.
Saudi Arabia
Mandatory
Paid on Eid al-Fitr.
China
Customary
Paid during the month of the Lunar New Year or Spring Holiday.
Hong Kong
Customary
Paid at the Lunar New Year or the end of the year.
Israel
Customary
Typically associated with end-of-year or holiday bonuses, though not explicitly required as a 13th-month salary.
Japan
Customary
A summer bonus in June and a 14th-month winter bonus in December.
Malaysia
Customary
Paid at the end of the year.
Nepal
Customary
Paid with the last month’s salary before the festival of Dashain.
Singapore
Customary
“13th-month pay” must be paid by December 24 or in two instalments in May and November.
Taiwan
Customary
Paid at the end of the year.
United Arab Emirates
Customary
A 14th-month bonus is often paid at the end of the year.
Vietnam
Customary
Paid the month before the Lunar New Year.
Europe
In Europe, the mix of mandatory and customary 13th and 14th-month salaries reflects a blend of historical, cultural, and economic factors. Southern European countries like Italy, Greece, and Spain mandate these payments to help employees manage holiday expenses, stemming from a long tradition of Christmas bonuses.
In Northern and Western Europe, such as Germany and Austria, while not always legally required, these bonuses have become a customary practice, promoting employee satisfaction and financial planning.
Country
Status
Details
Armenia
Mandatory
Paid before the New Year holidays.
Greece
Mandatory
14th-month and holiday bonuses are paid on Christmas, Easter, and summer vacation.
Italy
Mandatory
“Tredicesima” paid around Christmas; includes public and private workers, retirees. Not applicable to certain worker categories.
Portugal
Mandatory
13th-month paid in summer vacation and 14th-month at Christmas.
Spain
Mandatory
“Pagas extraordinarias” are paid in summer and at Christmas, can be prorated into twelve monthly salaries.
Austria
Customary
End of June; a 14th-month bonus paid at the end of November.
Belgium
Customary
Paid at the end of the year; includes a mandatory holiday bonus.
Croatia
Customary
Paid at Christmas or Easter.
Czech Republic
Customary
The 13th month salary is not mandatory, offered based on performance.
Cyprus
Customary
The 13th-month salary is not legally mandated but is a common practice, received before Christmas.
Slovakia
Customary
27% of all employees receive a Christmas bonus, and 17% receive a 13th-month salary. More common in telecommunication, banking, and finance.
Finland
Customary
Paid in summer, usually 50 – 60% of monthly salary.
France
Customary
The 13th-month salary is not legally mandated but commonly practiced. Generally received twice: first payment in June and second in December.
Germany
Customary
Most employers pay the annual salary in 13 instalments, with two months’ salary in December or half in July and half in December.
Switzerland
Customary
13th and 14th-month salaries are not a common practice; bonuses are typically performance-related and discretionary.
United Kingdom
Not Common
The 13th-month salary is not legally mandated but commonly practiced. It is generally received twice: the first payment in June and the second in December.
Latin America
Latin American countries often mandate 13th and 14th month salaries, with these practices rooted in social welfare policies aimed at supporting workers’ financial health. Countries like Brazil and Argentina have institutionalised these bonuses to mitigate economic disparities and ensure workers have additional income during mid-year and year-end periods.
These payments are a critical component of the social contract between employers and employees, reflecting the region’s emphasis on social equity.
Country
Status
Details
Argentina
Mandatory
Two equal installments, by June 30 and December 18.
Bolivia
Mandatory
Tax-free, up to one month’s wages. A 14th-month bonus is mandatory if GDP growth > 4.5%.
Brazil
Mandatory
Paid in two parts, by November 30 and December 20. A mandatory 14th-month “holiday bonus”.
Colombia
Mandatory
Paid in two halves, by June 15 and December 20.
Costa Rica
Mandatory
Paid during the first 20 days of December.
Dominican Republic
Mandatory
Paid by December 20.
Mexico
Mandatory
A 14th-month bonus is paid in parts or lump sum.
Ecuador
Mandatory
A 14th-month bonus paid in parts or lump sum.
El Salvador
Mandatory
Christmas bonus based on years of service.
Guatemala
Mandatory
Paid at mid-year; 14th-month bonus paid at year-end.
Honduras
Mandatory
Paid in December; 14th-month bonus paid in July.
Nicaragua
Mandatory
One month’s salary, paid by December 10.
Panama
Mandatory
Paid in three parts: April 15, August 15, and December 15.
Peru
Mandatory
Paid in July; 14th-month bonus paid in December.
Uruguay
Mandatory
Paid in two halves, by June 30 and year-end.
Paraguay
Mandatory
Paid at the end of the year.
Venezuela
Mandatory
Paid at the end of the year.
Puerto Rico
Mandatory
Paid between October 15 and December 15; varies based on employment start date.
Chile
Customary
Paid in December or two halves, in September and December.
How Is 13th-month Pay Taxed: a Global Perspective
The taxation of 13th and 14th-month salaries (or equivalent bonuses) is a complex subject that varies significantly across countries due to different legal frameworks, income classifications, and tax incentives.
General Taxation Principles
Income Classification: In most countries, these payments are considered part of an employee’s taxable income, subject to the same income tax rates as regular salaries. However, some countries have specific legal classifications that may distinguish these payments from ordinary income, leading to different tax treatments.
Withholding Tax: Employers are typically required to withhold income tax at the source, similar to regular salaries. However, the specific withholding rates and calculation methods can vary significantly depending on the country and the employee’s income level.
Country-Specific Variations
Fully Taxable: This is the most common scenario, where 13th and 14th-month payments are taxed at the same rates as regular income. However, the actual tax amount can vary considerably depending on the country’s tax brackets and the individual’s overall income.
Partially Taxable or Capped: Some countries offer tax exemptions or caps on these payments, either to incentivize employers to provide them or to reduce the financial burden on employees. For example, in the Philippines, 13th-month pay up to a certain amount is exempt from income tax.
Non-Taxable: In a few countries, these payments may be entirely exempt from income tax. These exemptions are often linked to specific social or economic policies, such as promoting employment in certain sectors or supporting low-income earners.
Compliance and Reporting
Employer Responsibilities: Employers have a crucial role in ensuring compliance with tax laws. This involves accurately calculating and withholding taxes, timely reporting to tax authorities, and providing employees with the necessary documentation for their tax filings.
Employee Considerations: Employees must understand how these payments affect their overall taxable income and any potential deductions or credits they may be eligible for. It’s essential to keep accurate records and seek professional advice if needed, especially for complex tax situations.
Impact on Tax Planning
For Employers: Understanding the tax implications can help employers optimise their compensation packages, making them more attractive to employees while managing their own tax liabilities.
For Employees: Tax planning can help individuals maximise their take-home pay after taxes by taking advantage of available deductions and credits. This is particularly important when receiving significant additional income, such as 13th — and 14th-month payments.
Additional Considerations
Social Security and Payroll Taxes: Depending on the country, these payments may also be subject to income tax, social security contributions, or other payroll taxes.
Currency Conversion and Exchange Rates: Due to currency conversions and fluctuating exchange rates, the taxation of these payments can become complex for multinational companies and employees working abroad.
Specific Exemptions and Deductions: Some countries may offer additional tax benefits or deductions related to these payments, such as deductions for charitable contributions or educational expenses.
Accurate Budgeting for Additional Compensation with Global Payroll Calculator
Managing 13th and 14th-month salaries across various countries requires precise accounting to ensure compliance and effective budgeting. The Global Payroll Calculator (GPC) by Acumen International Global EOR provides a vital tool for this purpose.
Annual Employee Cost Estimations
Comprehensive Cost Insights: The Global Payroll Calculator allows employers to calculate the total employment costs accurately, including 13th and 14th-month salaries. This accuracy is crucial for budgeting the annual expenses associated with global teams and ensures that financial planning aligns with actual compensation obligations.
Real-Time Compliance and Taxation: It offers real-time updates on tax implications and benefits associated with these additional salary payments, which are critical for adhering to local regulations. This helps businesses prevent costly legal issues and maintain transparent operations.
Strategic Planning and Global Expansion
Streamlined Talent Acquisition: By integrating 13th and 14th-month salaries into the overall compensation strategy, the Global Payroll Calculator helps businesses identify cost-effective hiring locations and manage payroll budgets efficiently. This strategic insight supports global expansion and talent acquisition initiatives.
User-Friendly Features: The tool’s customisable inputs and instant cross-country comparisons facilitate strategic global talent acquisition planning, allowing businesses to explore various payroll scenarios and strategies as markets evolve.
Empower Your Global Hiring with Acumen International
We’ve tailored our global employment processes to meet the needs of global businesses, enabling you to hire international talent with peace of mind. Our Global Employer of Record solutions ensure compliance with local labour laws and accurate talent acquisition forecasting worldwide.
If you’d like to learn more, contact us for a consultation. Our experts are ready to help you navigate the complexities of global employment and ensure smooth and efficient operations worldwide.
Welcome to the June 2024 Edition of the Express Global Employment Tax and Compliance Newsletter. In this issue, we bring you the latest updates on global employment tax, important legislative changes, and innovative solutions for managing a global workforce. Our goal is to provide you with up-to-date, actionable insights that help you make informed hiring… Read more Global Employment Tax and Compliance Newsletter. June 2024
Welcome to the June 2024 Edition of the Express Global Employment Tax and Compliance Newsletter.
In this issue, we bring you the latest updates on global employment tax, important legislative changes, and innovative solutions for managing a global workforce.
Our goal is to provide you with up-to-date, actionable insights that help you make informed hiring decisions.
🇫🇮 Finland Eases EU Blue Card Requirements for Highly-Skilled Non-EU Nationals
Lower Salary Requirement: The new minimum salary is EUR 3,638 per month, down from 1.5 times the gross salary.
Flexible Education Requirements: Applicants need a higher education degree of at least three years or five years of relevant work experience.
Shorter Assignment Duration: The minimum employment duration is now six months, reduced from one year. For contracts less than years, the Blue Card will be valid for the contract duration plus 3 additional months, up to 2 years.
Unemployment Protection: Blue Card holders have at least three months (or six months if they have lived in Finland for over two years) to find new employment without losing their residence permit.
Increased Mobility: Blue Card holders can move to another EU country after 12 months, down from 18 months.
These reforms make Finland and the EU more attractive to global talent by standardising entry and residence conditions for highly skilled non-EU workers.
🇮🇪 Ireland Grants Work Rights to Spouses and Partners of Certain Employment Permit Holders
As of 15 May 2024, spouses or partners of Intra-Company Transfer Employment Permit and General Employment Permit holders can work in Ireland without needing a separate employment permit.
Impact
This change allows immediate work access for spouses and partners, making it easier for families of permit holders to live and work in Ireland.
Key Points
IRP Stamp 1G: Spouses or partners will get IRP Stamp 1G, allowing work without a separate permit.
Automatic Update: Current IRP Stamp 3 holders automatically have work rights from 15 May 2024 and can inform employers of this status change.
Transition Period: All IRP Stamp 3 cards should be renewed as IRP Stamp 1G by 15 May 2025.
Exclusions: This does not apply to other family members or those with different visas (e.g., tourism or education).
🇨🇿 Czech Republic Simplifies Work Permit Exemptions for Select Nationals
The Czech Republic has amended its Employment Act to include a new category of ‘citizens of selected countries’ exempt from needing a work permit. Effective from 1 July 2024, citizens from specified countries will benefit from a simplified immigration process, although a residence permit is still required.
Free Access to Labour Market: Citizens of Australia, Canada, Israel, Japan, the Republic of Korea, New Zealand, Singapore, the United Kingdom, and the United States no longer need a work permit to work in the Czech Republic.
Simplified Employment Process: This exemption covers both locally employed and posted workers. However, a relevant visa or residence permit is still required.
Non-Dual Employee Cards: For stays over 90 days, citizens can apply for an Employee Card, which will now only cover the right to stay as work does not require government approval.
Automatic Transition: Existing Employee Cards will automatically switch to the new non-dual regime on 1 July 2024, requiring no action from cardholders.
Excluded Countries: Taiwan was initially included but later removed due to political considerations, though future inclusion is possible once terminology issues are resolved.
Streamlined Procedures
The simplified immigration process is designed to make the Czech Republic a more attractive destination for skilled workers. Although the visa-free regime remains for the specified countries, it does not apply to employment, requiring a Schengen visa for short-term stays or an appropriate residence permit for longer stays.
🇦🇺 Australia Updates Visa Conditions to Combat Worker Exploitation
Temporary Skill Shortage (Subclass 482) and Skilled Employer Sponsored Regional (Subclass 494) visa holders will benefit from extended periods to find new employment or manage their visa status if they cease work with their sponsoring employers.
Key Points
Extended Job Search Period: Visa holders will have up to 180 days at a time, or a total of 365 days across the visa period, to find a new sponsor, apply for another visa, or arrange a departure from Australia. This is a significant increase from the current 60-day allowance.
Work Flexibility: During this period, visa holders can work for other employers, including in different occupations, to support themselves. However, they must not engage in work requiring specific licences or registrations for their nominated occupation.
Notification Requirement: Sponsors must notify the Department of Home Affairs of any changes in employment status within 28 days.
Applicability: These changes apply to both existing and new visa holders as of 1 July 2024. Periods of non-employment before this date will not count towards the new time limits.
Implications
Increased Flexibility: Visa holders will have more time and flexibility to transition between employers, reducing the risk of exploitation and financial instability.
Employer Caution: Sponsors may need to exercise greater caution and consideration due to potential increased costs and limited refund options for the Skilling Australians Fund Levy.
Compliance Monitoring: Details on how the government will monitor compliance and the impact on permanent residence applications under the Employer Nomination Scheme remain to be clarified.
Employee Benefits Guide
Employee Benefits Guide
Employee Benefits Guide for Global Employers provides comprehensive insights on best practices for offering employee benefits across multiple jurisdictions.
Key Highlights
Types of Benefits: Detailed information on various employee benefits, including health insurance, retirement plans, paid time off, life and disability insurance, and more.
Mandatory Benefits: Essential compliance requirements for social security, healthcare, disability, and retirement plans across different countries.
Voluntary Benefits: Strategies for offering additional benefits like wellness programs, flexible working arrangements, and professional development to attract and retain top talent.
Designing a Benefits Program: Steps to create a tailored benefits package that aligns with company goals and meets employee needs.
Global Payroll Calculator (GPC): An innovative tool for managing global payroll, budgeting, and talent insights efficiently.
The guide is designed to help global employers navigate the complexities of benefits provisioning, ensuring compliance while fostering a supportive and attractive work environment.
Global Employer of Record Services for the Oil and Gas Industry
The oil and gas industry is one of the world’s most dynamic and challenging sectors; it continues to attract significant investment, albeit with some fluctuations.
Despite the evolving energy landscape and the push towards renewable resources, the oil and gas industry remains a crucial part of the global economy. Startups in this sector are driving innovation, improving efficiency, and addressing environmental challenges, making it an attractive area for investment. This influx of investment fuels industry growth and generates numerous employment opportunities across various functions and regions.
A Global Employer of Record talent engagement model can be a flexible and low-investment solution for engaging the workforce for cross-border projects, ensuring compliance, and streamlining operations in the oil and gas industry.
Discover the Global Payroll Calculator by Acumen International, the ultimate solution for streamlined global talent cost forecasting and a Global Payroll Association (GPA) award winner.
Here’s how it can improve your hiring process:
🔹 Comprehensive Employment Cost Data: Gain detailed information on employment costs across 190 countries, including gross-to-net calculations, employer liabilities, and employee taxes.
🔹 Streamline Talent Acquisition: Make informed hiring decisions and optimise your budgeting process with up-to-date, accurate data.
🔹 Identify Cost-Effective Talent Hubs: Pinpoint the best locations for remote talent with the Global Payroll Calculator.
🔹When it’s time to hire, onboard talent seamlessly with Express Global Employment. As a leading Global Employer of Record, we help you recruit, sponsor work permits, hire talent, and launch global teams with the speed of light.
Wrapping Up This Month’s Global Employment Insights
Thank you for joining us for the June 2024 edition of the Express Global Employment Newsletter.
Stay tuned for more fresh insights and tools in our upcoming editions to help you navigate the world of global employment.
Sign up for the Global Employment Tax & Compliance Newsletter to stay updated on hot labour and tax law changes with the latest in global employment, tax, and compliance across 190 countries. Click this link.
Global Employer of Record (EOR) services offer a streamlined solution for businesses that want to hire and manage employees across multiple countries without establishing legal entities in each location. A Global EOR handles payroll, benefits, taxes, and compliance with local employment laws, effectively becoming the legal employer while you maintain control over your employees’ day-to-day… Read more Global EOR Services: Are They Right for You?
Global Employer of Record (EOR) services offer a streamlined solution for businesses that want to hire and manage employees across multiple countries without establishing legal entities in each location.
A Global EOR handles payroll, benefits, taxes, and compliance with local employment laws, effectively becoming the legal employer while you maintain control over your employees’ day-to-day activities.
However, these services are not a one-size-fits-all solution.
Understanding when Global Employer of Record services are necessary can help you make an informed decision and avoid potential pitfalls.
12 Scenarios Where You Might Need Global EOR Services
Here are some common scenarios where these services can be beneficial:
1. Unhappiness with the Current Provider
You have hired an employee overseas but are unhappy with your current global employment service provider and are looking for better options.
You seek to enhance the quality of global employment services while avoiding the risk and hassle of dealing with multiple service providers in different jurisdictions.
4. Budget Constraints
Your company can no longer afford to maintain a fully-fledged legal operation in the target country and needs a more cost-effective talent management solution.
5. Temporary Projects
You have a temporary or short-term project in a foreign country that does not warrant setting up a full legal entity.
6. Hiring Foreign Workforce
You need to hire a foreign workforce for a new international project and ensure legal compliance.
7. Business Transitions
Your company is undergoing a business transition such as mergers, acquisitions, or shutdowns, and you want to ensure smooth and compliant employee transitions.
8. NGO Staffing
You are an NGO (non-government organisation) that needs to hire professionals quickly in various locations worldwide.
Your company is rapidly growing and needs to hire and launch teams in countries where it has yet to establish a presence.
11. Remote Work Expansion
You want to leverage the global talent pool by enabling remote work, but you need help with the employment regulations to be met and talent support in each worker’s country.
12. Reducing Legal Liability
Your company wants to reduce potential legal liabilities and mitigate risks related to international employment and seeks expert assistance.
Signs You’re Not Ready for Global EOR Services
Global Employer of Record (EOR) services have become an essential resource for businesses seeking to hire employees internationally while managing compliance and employment risks.
Here are some indicators that your company may not be ready for Global EOR services:
1. Very Early Stage of Development
Businesses in their nascent stages, particularly those bootstrapping with minimal funding, often lack the resources necessary for a successful global expansion. These companies typically focus on survival and local growth, making substantial investments in Global EOR services impractical.
If your company is still navigating the early stages of development, concentrating on local market growth and stabilisation could be your priority.
2. Absence of Clear Global Expansion Plans
Companies with no plans to explore new markets or test international waters are not ideal candidates for Global EOR services. Businesses that focus solely on a single local market or operate in only a few locations without intending to expand globally won’t benefit from the comprehensive solutions Global EOR services offer.
These services are designed to simplify the complexities of hiring international employees and managing compliance across various jurisdictions.
3. Compliance Unawareness and Neglect
Businesses that engage in non-compliant employment practices, such as hiring independent contractors as disguised full-time employees, are ill-prepared for the structured compliance requirements of Global EOR services.
These services are built on ensuring compliance with diverse, complex, and ever-evolving international regulations, and a basic understanding of these requirements is crucial for any business looking to expand globally.
4. Unrealistic Cost Expectations
Some companies approach Global EOR services with the sole aim of bringing costs down as much as possible. While it is understandable to seek cost efficiencies, it is unrealistic to expect high-quality, compliant employment services to come at a bargain-basement price.
Respectful and compliant employment practices, which ensure adherence to local laws and provide fair treatment and support to your international employees, require investment.
Global EOR services can significantly plug the gap in employment infrastructure in any country of your choice. These services help you mitigate legal risks and save you the cost, time, and effort required for global expansion by investing in creating the necessary infrastructure.
A Global EOR can make international hiring and compliance more cost-effective. By leveraging a Global EOR, companies can save up to 75% of employee management costs, as shown in the comparison below.
These figures highlight that while Global EOR services require an investment, they offer substantial savings and efficiencies in the long run.
The cost savings and quick market entry provided by Global EOR services can be pivotal for companies looking to expand internationally without the significant overheads and delays associated with setting up their own legal entities.
By utilising Global EOR services, companies can avoid the significant costs of establishing and maintaining a legal entity in each target country. This can be particularly beneficial for small to mid-sized businesses or those with budget constraints. A Global EOR can save up to 75% of employee management costs, reducing expenses related to legal advisors, official employment and benefits, incorporation and liquidation costs, and maintenance.
2. Time Savings
Setting up a legal entity in a foreign country can be time-consuming. Global EOR services expedite this process, allowing companies to quickly hire and manage employees across borders without the lengthy setup time. Express Global Employment solutions can reduce the time to market from 10+ weeks to just 72 hours.
3. Dealing with Complexities of Global Talent Management
Managing a global workforce involves navigating various local labour laws, tax regulations, and employment practices. A Global EOR can handle these complexities, ensuring companies remain compliant while focusing on their core business operations.
4. Launching International Teams Quickly
With Global EOR services, companies can rapidly deploy teams in new markets, facilitating quicker market entry and operational efficiency. This agility is crucial for businesses looking to capitalise on new opportunities without delay.
5. Labour Law, Tax, Immigration, and Payroll Compliance
Compliance with local labour laws, immigration requirements, and payroll regulations is essential for avoiding legal and financial penalties. Global EORs can help you avoid employee misclassification and Permanent Establishment risk. They provide the expertise needed to ensure adherence to these regulations, reducing non-compliance risk.
The Timeless Value of Human-Centric Global Employment Solutions
The human touch has become a modern luxury in an age dominated by platformed Global EOR solutions. Acumen International stands out by offering personalised, human-centric service, ensuring that global employment remains a deeply human interaction.
While platforms may offer scalability, they often lack the personal connection that is crucial in managing globally distributed workforces.
We believe that employment is fundamentally about people, and we provide the premium service of human touch that platforms cannot offer.
Our clients benefit from dedicated support, personalised service, and the assurance that their global workforce is managed by experienced professionals who care.
Why Choose Express Global Employment by Acumen International
Personalised Support: Our team of experts dedicates time and effort to each client and their employee, ensuring their unique needs are met with precision and care.
Seamless Human Interaction: We offer the rare luxury of direct human contact in managing global workforces, making employment a more personal and effective experience.
Comprehensive Solutions: From recruitment and immigration to payroll and compliance, our integrated services are designed to support your global expansion every step of the way.
Peace of Mind: With Acumen International, you can rest assured that your global employment needs are handled by professionals who prioritise your success and employee satisfaction.
Deep Expertise: With over 23 years of experience, we understand the complexities of global employment and navigate them with a personal touch.
Global Reach: Operating in 190 countries, we cover remote, underserved, and risky regions as well as developed markets. Whether you are entering a developed market or venturing into remote or high-risk regions, our expertise and comprehensive coverage enable you to expand your global workforce with confidence and ease.
Navigating Global Employment: How Our Consultancy Services Can Help
In addition to our comprehensive Global EOR services, we offer specialised consultancy services for companies that are uncertain if they are ready to implement a Global EOR solution.
Our consultancy team guides businesses through the initial stages, helping them assess their readiness and understand the complexities involved in global employment. You can receive valuable initial advice and strategic insights by engaging with us early in the decision-making process.
This proactive approach allows you to refine your plans and return to us when you are fully prepared to leverage our Global Employer of Record solutions. Our goal is to ensure that every company we work with has the knowledge and support needed to succeed in expanding globally and managing their global workforce.
Global Payroll Calculator – Your Precision Tool for Global Employment Cost Analysis
The Global Payroll Calculator (GPC) offers a sophisticated solution for instantly calculating employment costs across 190 countries, streamlining your global hiring strategy and ensuring cost-effective decisions.
Key Features & Benefits for International Hiring
Instant Cost Calculations: Quickly determine total employment costs, factoring in real-time tax rates and benefits for local and foreign talent in 190 countries.
Precision & Clarity: Achieve precise payroll calculations with detailed breakdowns of all payroll variables, ensuring transparency and preventing unexpected costs.
Cross-Country Comparisons: Utilise GPC’s capability to perform instant comparisons between countries, helping you identify the most advantageous locations for hiring.
Core Capabilities of Global Payroll Calculator
Total Employment Cost Analysis:
Monthly and yearly costs.
Gross-to-net and net-to-gross calculations.
Detailed breakdowns, including employer liability and employee taxes.
Full Tax Breakdown:
Comprehensive coverage of social contributions, personal income tax, and automated tax caps.
Employer and employee tax splits with allowances and holiday entitlements.
Built-in HR Compliance:
Ongoing validation against trusted government sources.
Updates in real-time to reflect the latest tax and labour laws.
Advantages of Global Payroll Calculator for Employers
Manage complex global payroll budgets effectively.
Identify tax-friendly, cost-effective global talent hotspots.
Ensure compliance with international regulations to avoid legal issues.
Overcome data complexity and reduce proposal inefficiency.
Navigate global compliance challenges, enhancing accuracy and reputational trust.
Unique Solutions for Global Expansion Challenges
Express Global Employment Support: Backed by 20+ years of expertise, GPC is integrated with global EOR solutions to support your international workforce management.
Robust Methodology: Standardises diverse data into a clear, unified format, enhancing decision-making clarity across multiple jurisdictions.
With Global Payroll Calculator, you gain a powerful tool at your fingertips, designed to optimise your global employment strategies and ensure that your international operations are cost-effective and compliant. Enjoy a free trial to experience firsthand how GPC can transform your global payroll processes.
Conclusion
Global EOR services offer significant benefits for companies poised for international growth. However, businesses in the early stages of development, with no clear expansion plans or those that rely solely on local talent and non-compliant practices, are not ready to harness the potential of global employment services.
Companies seeking only to minimise costs without understanding the value of compliance and ethical employment practices are not ideal candidates for Global EOR services.
Before engaging with global EOR services, ensuring that your company has a clear strategy and is ready to explore new markets is essential. Focusing on these areas will position your business for successful global expansion when the time is right.
International Investment, Global Expansion Opportunities, and HR Risks Globalization has resulted in significant interconnectivity, meaning businesses can travel and reach new markets like the Silk Road of old. The commercial space is now a globalized network, and companies that raised investments in the last 12 months can and should take advantage of it. The economic… Read more Benefits of Global Employer of Record
International Investment, Global Expansion Opportunities, and HR Risks
Globalization has resulted in significant interconnectivity, meaning businesses can travel and reach new markets like the Silk Road of old. The commercial space is now a globalized network, and companies that raised investments in the last 12 months can and should take advantage of it. The economic effects of a globalized market are amplified because founders and investors can access new opportunities at a greater distance than ever before — their physical location or proximity no longer limits their reach to the consumer.
To rise above the competition and become industry leaders, tech companies need to expand into new markets. For startups and scale-ups, global growth can mean gaining access to more customers, increasing revenue, and boosting brand visibility globally — not just in one region. Companies with international team members can benefit from a larger talent pool, faster time-to-market, and significant cost savings.
However, as startups and scale-ups grow and their staffs expand, the potential for HR issues and compliance violations increases. Navigating the maze of international laws isn’t easy — even small mistakes can lead to compliance issues down the road.
Those who take the time and effort to mitigate and adequately manage these employment-related risks will ensure that they don’t face a pile of unexpected legal fees — or worse, a severe issue that results in lawsuits, damaged relationships with employees, or regulatory fines. This is especially true for startups and scale-ups taking on remote employees when your company is growing too fast and needs to figure out how to hire overseas.
As technology companies expand globally, they must manage HR risks carefully. There are several ways to enable overseas employment, with different risk tolerance, benefits, and drawbacks. Each company must decide which approach is best for it. We’ll discuss how to mitigate the risks of a multi-location workforce during global expansion.
3 Options for Multi-location International Employment
Businesses establishing a global presence face the challenge of managing and scaling an employee base with no common borders or language. To successfully expand abroad, companies have several options for enabling hiring in international markets.
The most commonly used ways are by doing the following:
Establishing an overseas entity
Selecting independent contractors to handle tasks remotely.
Risks and Drawbacks of Setting Up a Foreign Entity
Traditionally, setting up a foreign entity has been the most common approach. It requires a significant upfront investment but can be a good option for companies committed to operating in a country for at least five years. It also works well for companies that plan to employ dozens of workers or acquire physical assets in-country. However, the approval process can take months, and recent global events have led many countries to halt approvals for new foreign entities.
As a stand-alone solution, foreign entities still work well for small companies operating in a single country. But they are becoming less common as companies with global ambitions increasingly look to more agile and faster approaches.
Cultural norms, employee expectations, and economic climates vary widely from country to country. Yet many companies fail to conduct due diligence before establishing a legal entity in a new locale. The result is that they come unprepared for the HR-related challenges that inevitably arise when expanding into global markets.
Risks and Drawbacks of Working with Independent Contractors
Tech companies always try to find cheaper and easier ways to expand their business. Using independent contractors to launch in a new country is one solution. While it sounds like a simple solution, and these workers provide flexibility and cost savings, there are more than a few legal and compliance risks that companies need to consider before leaping. One of the most significant risks is misclassifying contractors, leading to severe penalties. The company must be careful not to fall into this trap.
Penalties are harsher than you might think. If contractors working for your business are considered to be permanent employees and are therefore misclassified, labor authorities will consider them to be full-time and backdate payroll taxes onto your business — as well as on the workers themselves. Getting compliant can be difficult — it requires a lot of effort and time, which costs money. It’s better to take a proactive approach by outsourcing to a reliable Global Employer of Record partner.
Benefits of Working with a Global EOR (Employer of Record)
You have a lot on your plate as an entrepreneur and business leader. But, what you probably don’t have time or expertise to manage is your company’s global employment risks.
From managing multi-location employment and talent risk to mitigating local compliance risk when expanding internationally, outsourcing your global employment management to an Employer of Record Partner can save you time and money while controlling your legal compliance. Why subject yourself to all of the risks and complexities listed below when a global EOR partner can handle them?
Global Expansion: Top 20 Challenges for Startup and Scaleup Founders
Recruitment in international markets
Mitigating multi-location employment risks, such as permanent establishment risk, worker misclassification risk, under-taxation, and regulatory non-compliance risk)
Establishing a foreign entity requires significant investment in time, money, and long-term commitments.
Misclassifying overseas employees as independent contractors could put tech companies at risk of incurring severe foreign penalties.
Managing employee immigration and relocation
Monitoring country-specific employment laws and regulations
Finding the most cost-efficient ways to pay foreign employees
Foreign taxation tracking and adherence
Labour law regulations monitoring and compliance
Complying with foreign regulations
Managing different payroll processes in multiple locations
Finding expert consultancy in international markets
Communicating long-distance with clients
Lack of government support
Need to navigate the risks of finding a reliable local EOR/PEO partner
Dealing with hidden costs and non-transparent pricing models
Lack of adherence to information security standards
Foreign employment delays and bottlenecks
Lack of full in-country HR support
Need to broaden competitive horizons beyond home countries
Managing hidden business risks when establishing a presence in multiple countries.
How Global Employer of Record (EOR) Partner Can Solve Major Challenges Founders Face
Startup founders should consider hiring a global EOR Partner since if a business owner isn’t careful with their human resources, they could end up in financial trouble. If you’re not familiar with EOR solutions yet, it’s worth learning how they can help ease some pressures around managing HR risk during global expansion!
A comprehensive array of Employer of Record (EOR) services can help manage HR risk in your company’s global expansion journey – whether a startup, scale-up, or enterprise-grade company.
The EOR service provider is a legal employer of your international workforce and pays employee taxes, social security, and other benefits on behalf of your company. Additionally, the EOR already has a registered business in the country of interest, meaning your business can expand faster and more flexibly. This can be particularly beneficial when requiring a contingency workforce to meet business demands.
Employer of Record (EOR) services are crucial for your international expansion strategy. Collaborating with an Employer of Record (EOR) partner allows you to manage global employment risk better and reduce the administrative and tax burden that multi-location employment can create. An experienced and reliable EOR partner can help you keep costs low, maximize productivity, and ensure that your international teams are compliant and adequately compensated.
Typically, this is done by taking over the responsibility of hiring workers from you and paying them directly. Still, an Employer of Record (EOR) partner may also assist with payroll processing, tax withholding, filing, insurance administration, compliance reporting, etc. EOR service providers like Acumen International offer these services to technology businesses looking to expand internationally faster without building out their workforce infrastructure in every location where they operate.
Global Employment Journey — Recruitment. Onboarding. Management. Retention. Termination
A Global Employer of Record ensures labour, tax, and immigration compliance and provides legal guidance at every step of the Global Employment Journey.
Quick and Easy Foreign Market Entry with a Global Employer of Record Services
1. Immigration Services to Support Global Employment via Global EOR Model
Employing international talent can be a real hassle. You have to figure out what immigration documents you need to hire them, which documents the local governments require from you, and how exactly you will fund hiring your international talent. A Global Employer of Record (EOR) is a third-party entity that can help you manage any of those headaches, including:
Immigration requirements
Visa applications
Extensions of stay
Work permit sponsorships
Local labour law compliance.
2. Streamlined Onboarding, Benefit & Payroll Management with a Global Employer of Record
As your company grows, it can be helpful to streamline the process of onboarding new employees. An Employer of Record can help you minimize costs and increase efficiency by creating an easy, streamlined process for new international hires and HR staff. You’ll avoid losing valuable time and money searching for information or documents that could have been collected earlier.
Benefits packages are another area where streamlining the process can be helpful. Benefits are often complex (especially those mandatory employee benefits you must provide in certain countries). Therefore, your EOR partner can make it easy for employees to understand what benefits they are entitled to and avoid having employees feel confused about their benefits.
Finally, payroll management also needs careful attention when expanding globally. There are various laws worldwide concerning how much tax an employee owes on income earned overseas (this is known as “double taxation”). Streamlining this process with your EOR partner means making sure all payroll records are up-to-date, so there aren’t any errors when calculating taxes owed by employees who work abroad, which could result in penalties being applied.
3. In-country Labor and Tax Law Compliance
As you expand your business globally, it is essential to understand each country’s local labor laws and regulations. You must comply with these laws, affecting your employees’ working conditions and rights. If you do not meet these standards, you will be at risk of fines from various government agencies. In addition, if an adverse situation occurs with one or more of your employees due to this breach in compliance, it could have repercussions for your company’s reputation worldwide.
To avoid this fate, founders and company leaders in charge of international operations need to understand the various compliance requirements that come into play during global expansion. The good news is that Acumen International, your Global EOR partner, can help you navigate them across 190 countries.
When setting up an international operation, it is important to consult legal counsel or a Global Employer or Record who has experience dealing with these issues so that you do not run afoul of the law by inadvertently violating any employment.
Compliance with labour laws and tax regulations can be complex because they are often inconsistent from country to country, state to state, or city. As a result of these inconsistencies, employers must ensure that their global human resource policies are consistent with local laws wherever their employees or independent contractors work.
When it comes to taxes, there is no universal agreement on how they should be calculated or collected. In many countries worldwide, income taxes are deducted from employees’ paychecks before they receive them. This is known as the “withholding” tax. In some countries, employers are responsible for collecting withholding tax directly from their employees and submitting it to the government along with their tax filings. Many countries also have strict rules about when employment-related taxes must be paid and what forms must be filed.
In some cases, these requirements change depending on which country the employee is working in.
Multinational employers should know the tax implications of hiring foreign workers in different countries. Some cases may withhold taxes on employee salaries and bonuses that must be paid to foreign governments. Employers must regularly send this withholding amount to the appropriate state tax authority annually. The employer may also pay income tax on these funds locally or in another country. In addition, many countries impose social security taxes on employees, which can result in double taxation if not properly managed. Employers should consult with their accountants or seek to the advice of a Global Employer of Record partner to learn how to address these issues.
4. Employee Benefit and Insurance Administration
As you expand your business from one country to another, you’ll want to ensure your employees are cared for. You won’t be able to manage everything by yourself, so you need an Employer of Record (EOR) partner to help with employee benefits management.
Your EOR Partner partner should be able to assist with the following:
Health Insurance
Health insurance is crucial in international expansion because it helps ensure employee retention and reduces absenteeism.
Life Insurance
This type of insurance provides financial protection for the family of a deceased employee. It can also provide financial support when someone is disabled by illness or injury.
Disability Insurance
Disability coverage pays out benefits when an employee becomes disabled due to an injury sustained while working at their job site (or while travelling on business). This coverage helps protect against lost income if an employee cannot work due to an illness or accident that prevents them from performing their duties as usual at work — even if they’re still employed with the company!
5. Handling Employment Contracts, Terminations, and Compensations
There are many benefits to outsourcing your company’s foreign employment management, payroll processing, and other HR-related activities to an Employer of Record. When you entrust these core responsibilities to a professional EOR, you can expect more remarkable accuracy and precision in these crucial areas of your business. Meanwhile, your in-house team can focus on other aspects of the business. Acumen International Global EOR can help you navigate those details.
Employee Contracts
While you may have a standardized employee contract, it’s essential to understand what steps should be taken when hiring abroad. Are there special employment laws? What about holiday pay or sick leave requirements? Acumen International Global EOR can help navigate those details.
Employee Terminations
If an employee is terminated from their position with your organization abroad, it could lead to legal complications. It’s crucial for both parties involved to fully understand how these situations are handled under local laws so they can avoid issues down the road.
Compensation Programs
Companies’ compensation programs vary depending on where they operate — including compensation benefits such as health insurance plans and retirement contributions (if any). Some countries don’t require employers to provide these benefits at all! Be sure everyone knows what options exist before deciding what kind of compensation programs should be offered while expanding internationally.
Benefits of Global Employer of Record: What Acumen International Can Bring to the Table
The benefits of Global Employer of Record are the following:
No need to set up a new entity in every country where you have operations. You are not required to hire local employees or worry about local compliance requirements.
The ability to scale your business quickly by hiring employees in multiple countries without setting up a new entity in each country.
A single point of contact for all employment-related questions and concerns.
A single point of contact for all tax compliance questions and concerns.
No need to worry about managing multiple payroll systems, tax filing requirements, or employee benefits programs across multiple countries since everything is handled by Acumen Global Employer of Record (EOR).
Headquartered in London, UK, Acumen International, a Global Employer of Record (EOR) and Professional Employer Organization (PEO) service provider, was founded in 2001. The company gives mid-sized and enterprise companies the power and flexibility to grow internationally with streamlined and simplified global labour expansion.
Acumen International helps solve the frustrations faced by founders and leaders of technology companies looking to expand globally quickly but cannot or do not want to take on the liability, costs, burden of direct employer status, or other risks associated with operating in individual countries. International employers can also use our global resources to test a new market quickly before establishing a local legal entity.
Comprehensive Employer of Record (EOR) Packages and Budget-friendly Rates
With affordable packages and budget-friendly rates, Acumen International can offer secure, efficient global HR services to manage Global Payroll, HR & Benefits Administrations for businesses that need international talent but don’t have the resources or skills to handle it themselves.
Our full-service management solutions — from legal talent employment to benefits management, from compliance to payroll and taxation — are tailored to each client’s needs.
Acumen International’s unique and integrated approach allows us to offer a comprehensive array of EOR functions, including:
Processing business immigration requirements
Visa applications & extensions
Work permit sponsorships
Streamline onboarding, benefits, payroll, PTO
Local labour and employment tax law compliance
Audit-proof compliance requirements
Employee benefit management
Handling employment contracts, terminations, and compensation
Processing medical insurance and benefits
Payroll, including year-end tax statements
Relocation services & housing
Benefit management
Special needs or requirements
Multi-country employment without limitations
Handling contract workers and foreign workforce management
Compliant employment or termination within 72 hours.
Let Acumen Global EOR Streamline Your Global Expansion
As you can see, Global EOR is an option for business owners who want to expand their operations internationally. It’s a revolutionary way to internationalize your business without setting up a new entity, hiring local employees in each country where you have operations, or worrying about the legal and regulatory complexities of operating in multiple jurisdictions.
Acumen Global EOR can help you by removing some of the burdens of your busy schedule and the risks involved. Rest easy knowing that everything is taken care of. Global hiring is no longer a hassle! With Acumen Global Employer of Record, you can employ, manage, and pay your employees in over 190 countries. No entity is needed. Start international operations with no delay.
To learn more about how Global Employer of Record can help your organization grow into new markets, contact Acumen International today to discuss how we can help you achieve your goals.
Designing an employee benefits program for a globally distributed workforce requires a strategic approach to ensure it is attractive, competitive, and compliant across multiple jurisdictions. An effective employee benefits program involves several key steps to ensure it meets the needs of full-time employees and aligns with the company’s goals and budget. Here’s a comprehensive guide… Read more How to Design an Employee Benefits Program Worldwide
An effective employee benefits program involves several key steps to ensure it meets the needs of full-time employees and aligns with the company’s goals and budget.
Here’s a comprehensive guide to designing an employee benefits program worldwide.
1. Understand Global and Local Needs
Global Consistency
Core Benefits: Identify core benefits that will be offered globally, ensuring consistency across all locations.
Company Culture: Align the benefits program with the company’s culture and values.
Assess the Budget
Understand the Budget: Determine how much the company can afford to spend on benefits.
Identify Company Goals: Align the benefits program with the company’s objectives, such as attracting top talent, improving employee retention, or enhancing productivity.
Local Customisation
Local Regulations: Research and comply with local laws and regulations regarding mandatory benefits.
Local Preferences: Understand cultural preferences and market standards in each country to tailor additional benefits.
2. Conduct Employee Surveys and Focus Groups
Aligning organizational objectives, market dynamics, legal standards, and employee expectations is essential to effectively managing employee compensation and benefits. This approach should foster employee satisfaction and business success. Essential components include competitive benchmarking, clear compensation structures, flexible employee benefits, ensuring equity and fairness, performance-based rewards, and regular evaluations.
1. Understand Employee Needs
Global Survey: Conduct surveys to understand what types of voluntary benefits (perks) employees value in different regions.
Local Focus Groups: Hold focus groups or one-on-one interviews in various locations to gather detailed employee insights on what benefits they value most.
Analyse Demographics: Consider the demographics of your workforce, such as age, family status, and health needs, to tailor the benefits accordingly.
2. Compliance and Legal Considerations
Legal Advisors: Engage local legal advisors in each country to ensure compliance with national and regional laws.
Comply with Regulations: Ensure the benefits program complies with local, state, and federal laws regarding mandatory benefits like health insurance, retirement plans, and paid leave.
Regular Audits: Implement regular compliance audits to keep up the employee benefits program with changing regulations.
3. Choose the Types of Employee Benefits
Mandatory Benefits: Include legally required benefits like social security contributions, workers’ compensation, statutory sick pay, and more.
Voluntary Benefits: Choose additional benefits that can attract and retain employees, such as:
Health Insurance
Retirement Plans
Paid Time Off (PTO)
Life and Disability Insurance
Wellness Programs
Professional Development Opportunities
Flexible Working Arrangements
Childcare Assistance
Transportation Benefits.
5. Tailored Local Benefits
Paid Time Off: Align PTO (Paid Time Off) policies with local norms and legal requirements.
Parental Leave: Customize parental leave policies to meet or exceed local regulations.
Professional Development: Offer training and development programs relevant to local industries and career growth paths.
Flexible Work Options: Provide flexible work arrangements tailored to local work culture and practices.
6. Flexible Employee Benefits Package
Cafeteria Plan: Implement a flexible benefits plan that allows employees to choose from various benefits provided by the company that best suit their needs.
Points System: Use a points-based system where employees can allocate points to various benefits.
5. Design the Employee Benefits Package
Flexibility and Choice: Consider offering a flexible employee benefits package (cafeteria plan) where employees can choose the benefits that best meet their needs.
Competitive Analysis: Compare your benefits package with those offered by your competitors to ensure it remains competitive within your industry and country.
Regular Updates: Keep employees informed about any changes to the benefits program.
Open Enrollment Periods: Hold regular enrollment periods during which employees can sign up for or change their benefits.
Collaborate with your marketing team to communicate these offerings effectively to ensure employees fully understand and take advantage of their benefits. Shift your perspective from HR to a more sales-oriented approach, aiming to educate employees about the available benefits. If employees are unaware of or do not comprehend their benefits, the investment in these programs will not yield the desired return.
7. Implement and Administer the Employee Benefits Program
Choose Employee Benefits Providers: Select reputable benefits providers for health insurance, retirement plans, and other services.
Administrative Tools: Use employee benefits administration software to manage enrollment, track usage, and handle compliance.
Support System: Provide resources and support for employees to understand and use their benefits, such as an HR help desk or online portal.
8. Employee Support and Engagement
Onboarding: Include comprehensive employee benefits education in the onboarding process.
Regular Updates: Provide regular updates and resources to help employees understand and maximise their employee benefits.
Feedback Mechanisms: Implement ongoing feedback systems to continually improve the employee benefits program.
9. Monitoring and Evaluation
Track Participation and Employee Benefits Usage: Monitor how employees use the benefits and their satisfaction levels.
Metrics and KPIs: Establish key performance indicators to measure the effectiveness and utilisation of the benefits program.
Gather Feedback: Continuously collect employee feedback to identify areas for improvement in the employee benefits program.
Annual Reviews: Conduct annual reviews of the benefits program to assess its relevance, competitiveness, and employee satisfaction.
Benchmarking: Regularly benchmark against industry standards and competitor offerings to stay competitive.
Adjust as Needed: Regularly review and adjust the employee benefits program to ensure it remains relevant, competitive, and cost-effective.
A key strategy for managing employee benefits and compensation is to benchmark and analyse your offerings regularly. Collaborate with leadership and finance teams to ensure your employee benefits package is competitive in the market, effectively attracting and retaining talent. This approach should balance budget constraints, compliance requirements, and principles of equity and fairness.
10. Promote Wellness and Diversity
Wellness Programs: Implement global employee wellness initiatives tailored to local contexts, such as mental health support, fitness challenges, and health screenings.
Diversity and Inclusion: Ensure the benefits program supports a diverse workforce, offering inclusive benefits that cater to different needs and backgrounds.
Engagement Activities: Organise activities and events that promote a positive work culture and enhance employee engagement across locations.
Managing Employee Benefits Program with Global Employer of Record (EOR)
Partnering with a Global Employer of Record can significantly streamline the process of designing and implementing an effective employee benefits program for a globally distributed workforce. By leveraging their expertise, local knowledge, and administrative capabilities, a Global EOR can help create a compliant, competitive, and tailored program for employees in different regions, ultimately contributing to a more satisfied and engaged global workforce.
How a Global EOR Can Help Design and Implement an Employee Benefits Program
A Global Employer of Record (EOR) can be an invaluable partner in designing and implementing a comprehensive employee benefits program for a globally distributed workforce. Here’s how a Global Employer of Record can help:
1. Expertise in Local Regulations
Legal Compliance: Global EORs have extensive knowledge of local labour laws and regulations in various countries. They ensure your employee benefits program complies with all legal requirements, avoiding potential legal issues and penalties.
Up-to-date Information: A Global Employer of Record stays current with changes in local regulations, ensuring that your employee benefits program remains compliant as laws evolve.
2. Simplified Employee Benefits Administration with Employer of Record
Centralised Employee Benefits Management: A Global EOR provides a single point of contact for managing employee benefits across multiple jurisdictions, simplifying the administration process and making it cost-effective.
Payroll Integration: A Global Employer of Record integrates employee benefits with payroll, ensuring accurate and timely processing of benefits and deductions.
3. Local Market Insights
Cultural Understanding: A Global Employer of Record (EOR) understands local cultural nuances and employee expectations, helping to design attractive and relevant benefits in each market.
Competitive Benchmarking: Global Employer of Record (EOR) can provide insights into industry standards and competitor offerings in different regions, helping to create a competitive employee benefits package.
4. Cost Efficiency of Employee Benefits Programs
Negotiated Rates: A Global Employer of Record (EOR) often has established relationships with local employee benefits providers and can negotiate better rates for health insurance, retirement plans, and other benefits.
Economies of Scale: By leveraging their existing infrastructure and network, Global EORs can reduce the overall cost of administering a global employee benefits program.
For third-party employee benefits included in your total rewards package, it is crucial to keep these providers informed with the latest headcount, particularly if it leads to cost savings. Many third-party benefit providers offer discounted rates based on your company’s size.
5. Flexibility and Customisation of Benefits for Full-time Employees
Tailored Solutions: A Global EOR can help design flexible benefits packages that cater to the diverse needs of a global workforce, including options for different regions and individual preferences.
Scalability: A Global Employer of Record (EOR) can provide scalable solutions that can grow with your company, making it easier to expand into new markets and offer consistent benefits to new employees.
6. Enhanced Employee Experience
Seamless Onboarding: Global EORs manage the onboarding process, ensuring new employees understand their benefits and how to utilise them effectively.
Support Services: A Global EOR can offer ongoing support to employees, helping them navigate their benefits, resolve issues, and maximise the value of their benefits package.
7. Risk Management by a Global Employer of Record
Compliance Assurance: A Global Employer of Record (EOR) assumes 100% responsibility for compliance, reducing the risk of legal and financial penalties associated with non-compliance.
Consistent Policies: Global EORs help maintain consistent benefits policies across different regions, ensuring fairness and equity within the organization.
Example of Global EOR Support in Designing a Global Benefits Program
Core Services Provided by a Global Employer of Record (EOR)
Compliance Management: Ensures adherence to local labour laws, tax regulations, and mandatory benefits requirements.
EmployeeBenefits Administration: Manages enrollment, renewal, and employee benefits administration.
Payroll Services: Integrates employee benefits with in-country payroll for seamless processing.
Employee Support: Provides resources to help employees understand and utilise their benefits.
Specific EOR Contributions across Locations
In the UK, the Employer of Record ensures compliance with UK-specific regulations, such as National Insurance contributions, statutory sick pay, and pension scheme requirements.
In the USA, the Employer of Record manages the complexities of 401(k) plans, health savings accounts, and state-specific health insurance mandates.
In Germany, the Employer of Record administers company-sponsored health insurance, manages statutory vacation entitlements, and ensures compliance with robust parental leave policies.
In India: The EOR handles provident fund contributions, negotiates with local health insurance providers, and manages culturally relevant benefits such as festival bonuses.
Example of a Global Employee Benefits Program
Core Employee Benefits (Global)
Health Insurance: Comprehensive global coverage with local adaptions.
Retirement Savings: Global retirement savings plan with local compliance.
Life and Disability Insurance: Standardised policies with local variations.
Localised Benefits for Full-time Employees
UK: Private health insurance, enhanced pension schemes, 28 days of paid annual leave.
USA: 401(k) plans, health savings accounts (HSAs), flexible PTO.
Germany: Company-sponsored health insurance, 30 days of paid leave, robust parental leave policies.
India: Health insurance includes family coverage, provident fund contributions, and festival bonuses.
By balancing global consistency with local customisation, a globally distributed employee benefits program can meet the diverse needs of your global workforce while ensuring compliance and competitiveness across multiple jurisdictions.
Embrace a Holistic Approach to Employee Benefits and Compensation
A comprehensive approach should be part of an overall rewards strategy that supports employee well-being, offers flexible work options, guarantees equitable pay, and ensures a fair work environment. Promote your employee benefits package as a key element of your organisation’s commitment to a positive and supportive employee experience worldwide.
Global Payroll Calculator – Your Precision Tool for Global Employment Cost Analysis
The Global Payroll Calculator (GPC) offers a sophisticated solution for instantly calculating employment costs across 190 countries, streamlining your global hiring strategy and ensuring cost-effective decisions.
Key Features & Benefits for International Hiring
Instant Cost Calculations: Quickly determine total employment costs, factoring in real-time tax rates and benefits for local and foreign talent in 190 countries.
Precision & Clarity: Achieve precise payroll calculations with detailed breakdowns of all payroll variables, ensuring transparency and preventing unexpected costs.
Cross-Country Comparisons: Utilise Global Payroll Calculator’s capability to perform instant comparisons between countries, helping you identify the most advantageous locations for hiring.
Core Capabilities
Total Employment Cost Analysis:
Monthly and yearly costs.
Gross-to-net and net-to-gross calculations.
Detailed breakdowns, including employer liability and employee taxes.
Full Tax Breakdown:
Comprehensive coverage of social contributions, personal income tax, and automated tax caps.
Employer and employee tax splits with allowances and holiday entitlements.
Built-in HR Compliance:
Ongoing validation against trusted government sources.
Updates in real-time to reflect the latest tax and labour laws.
Advantages of Global Payroll Calculator for Employers
For Employers:
Manage complex global payroll budgets effectively.
Identify tax-friendly, cost-effective global talent hotspots.
Ensure compliance with international regulations to avoid legal issues.
For Agencies:
Overcome data complexity and reduce proposal inefficiency.
Navigate global compliance challenges, enhancing accuracy and reputational trust.
Unique Solutions for Global Expansion Challenges
Express Global Employment Support: Backed by 20+ years of expertise, Global Payroll Calculator is integrated with global EOR solutions to support your international workforce management.
Robust Methodology: Standardises diverse data into a clear, unified format, enhancing decision-making clarity across multiple jurisdictions.
With Global Payroll Calculator, you gain a powerful tool at your fingertips, designed to optimise your global employment strategies and ensure that your international operations are cost-effective and compliant. Enjoy a free trial to experience firsthand how GPC can transform your global payroll processes.
The oil and gas industry is one of the world’s most dynamic and challenging sectors; it continues to attract significant investment, albeit with some fluctuations. Despite the evolving energy landscape and the push towards renewable resources, the oil and gas industry remains a crucial part of the global economy. Startups in this sector are driving… Read more Global Employer of Record Services for Oil and Gas Industry
The oil and gas industry is one of the world’s most dynamic and challenging sectors; it continues to attract significant investment, albeit with some fluctuations.
Despite the evolving energy landscape and the push towards renewable resources, the oil and gas industry remains a crucial part of the global economy. Startups in this sector are driving innovation, improving efficiency, and addressing environmental challenges, making it an attractive area for investment. This influx of investment fuels industry growth and generates numerous employment opportunities across various functions and regions.
A Global Employer of Record talent engagement model can be a flexible and low-investment solution for engaging the workforce for cross-border projects, ensuring compliance, and streamlining operations in the oil and gas industry.
Investment Trends in Oil and Gas Startups: 2023/2024
In the first quarter of 2023, oil and gas companies participated in 32 startup funding rounds, totalling an estimated $1.23 billion. This marked a notable decrease compared to the same period in 2022, which saw 46 deals valued at approximately $2.39 billion.
While 2023 experienced a slowdown, some investors expect a generally favourable investment climate in 2024. Certain companies plan to maintain their usual investment pace, while others are cautious, having slowed down investments in 2023 but potentially increasing activity in the latter half of 2024.
Employment Challenges in the Oil and Gas Industry
As investment flows into oil and gas startups, the demand for skilled professionals in the sector is set to rise. However, due to its global operations and the nature of its projects, the oil and gas sector faces unique employment challenges.
These challenges include:
Frequent and Urgent Employment Needs: The industry requires rapid hiring to meet project deadlines and operational demands.
Compliance with Diverse Regulations: Operating in multiple countries involves navigating a complex web of local labour laws and regulations.
Diverse Professional Requirements: The industry needs a wide range of skilled professionals, from engineers to geologists to support staff.
Remote and Hazardous Locations: Many projects in remote or high-risk areas require special attention to health and safety regulations.
How Acumen International Supports Growing Employment Needs of the Oil and Gas Industry
Acumen International is well-positioned to support companies in this dynamic environment. A Global Employer of Record (EOR) is a third-party service provider managing legal employment responsibilities for companies expanding internationally. This includes handling payroll, taxes, benefits, and compliance with local labour laws.
Acumen International, a leader in Global Employer of Record (EOR) services, simplifies global expansion, allowing oil and gas companies to scale their workforce in response to industry developments.
From securing work permits and visas to managing payroll and ensuring legal compliance, Acumen International is your trusted Employer of Record partner in navigating the complexities of global employment in the thriving oil and gas sector.
Manage teams globally with ease — our services extend across 190 countries, covering developed, remote, and challenging regions.
Here’s how Acumen International addresses the specific global employment challenges faced by this industry:
1. Borderless Expansion, No Entity Needed
The oil and gas industry must often deploy workers quickly to meet project timelines. We simplify global expansion in 190 countries without establishing local entities. Our solution enables quick and compliant onboarding and distributed global workforce management, allowing you to scale operations rapidly and reducing costs and administrative burdens.
2. Local Expertise. Global Reach
Our extensive global network and local insights enable you to access top talent worldwide. With operations in over 190 countries, Acumen International has in-depth knowledge of local employment laws and practices. This expertise ensures that companies remain compliant with all local regulations, mitigating the risk of fines and legal issues. Acumen handles payroll, taxes, and benefits administration, ensuring accuracy and compliance.
3. Diverse Talent Acquisition
The oil and gas sector requires a diverse range of professionals, from technical experts to administrative support. Acumen International’s extensive network and recruitment capabilities enable companies to source and hire top talent from around the globe. By managing the entire hiring process, Acumen ensures that the right professionals are in place and ready to contribute to project success.
4. Comprehensive Immigration Support
Navigating the complexities of immigration and securing work permits can delay project timelines. Our global mobility support is about turning complexity into simplicity. We provide comprehensive immigration support, handle visa applications, sponsor work permits, and resolve other travel logistics issues.
Our Global Mobility Services streamline the global hiring processes, allowing employees to start work promptly and ensuring compliance with local immigration laws. We expedite onboarding and immigration procedures, ensuring your global talent is ready to engage and deliver results swiftly. By eliminating red tape and administrative burdens, your team can focus on what they do best, propelling your business forward in every corner of the globe.
Working in remote and hazardous locations requires strict adherence to health and safety regulations. Acumen International ensures that all employment practices comply with local health and safety standards, providing employees with necessary health insurance and support. This focus on safety protects both the workforce and the company from potential liabilities.
Global Payroll Calculator: Your Precision Tool for Cross-border Hiring Cost Analysis
In addition to providing comprehensive Global Employer of Record services, Acumen International offers the Global Payroll Calculator (GPC), a sophisticated tool designed to streamline global hiring strategies and ensure cost-effective decisions for the oil and gas industry.
Key Features & Benefits for International Hiring
Instant Cost Calculations: The Global Payroll Calculator allows companies to quickly determine total employment costs, factoring in real-time tax rates and benefits for local and foreign talent across 190 countries. This feature is crucial for the oil and gas industry, where rapid workforce deployment is often necessary.
Precision & Clarity: Achieve precise payroll calculations with detailed breakdowns of all payroll variables. This transparency helps prevent unexpected costs, enabling better financial planning and management.
Cross-Country Comparisons: The Global Payroll Calculator’s capability to perform instant comparisons between countries helps companies identify the most advantageous locations for hiring. This especially benefits oil and gas firms looking to optimise their global operations.
Core Capabilities
Total Employment Cost Analysis
Monthly and yearly costs.
Gross-to-net and net-to-gross calculations.
Detailed breakdowns, including employer liability and employee taxes.
Full Tax Breakdown
Comprehensive coverage of social contributions, personal income tax, and automated tax caps.
Employer and employee tax splits with allowances and holiday entitlements.
Built-in HR Compliance
Ongoing validation against trusted government sources.
Real-time updates reflecting the latest tax and labour laws.
Identify tax-friendly, cost-effective global talent hotspots.
Ensure compliance with international regulations to avoid legal issues.
Unique Solutions for Global Expansion Challenges
Express Global Employment Support: Backed by over 20 years of expertise, the Global Payroll Calculator is integrated with Acumen’s global EOR solutions to support your international workforce management.
Robust Methodology: Standardises diverse data into a clear, unified format, enhancing decision-making clarity across multiple jurisdictions.
With the Global Payroll Calculator, oil and gas companies gain a powerful tool designed to optimise global employment strategies and ensure that international operations are cost-effective and compliant.
Experience firsthand how the GPC can transform your global payroll processes with a Free Trial, and see how Acumen International can help your business thrive in the competitive oil and gas industry.
The Future of Global Employment in Oil and Gas
The need for flexible, compliant, and efficient workforce management solutions will only grow as the oil and gas industry continues to evolve. Acumen International is at the forefront of this evolution, providing innovative Global Employer of Record services that empower companies to navigate the complexities of global employment easily.
By leveraging Acumen International’s expertise, oil and gas companies can ensure they remain competitive, compliant, and capable of attracting top talent worldwide.
Welcome to the Employee Benefits Guide for Global Employers operating across multiple jurisdictions, presented by Express Global Employment, your trusted global employer of Record. Many businesses operate across borders today, managing a diverse workforce and navigating complex regulatory landscapes. As CEOs, HR Directors, Finance Leaders, and global employers, you understand the importance of attracting and… Read more Employee Benefits 2024: The Ultimate Guide
Welcome to the Employee Benefits Guide for Global Employers operating across multiple jurisdictions, presented by Express Global Employment, your trusted global employer of Record.
Many businesses operate across borders today, managing a diverse workforce and navigating complex regulatory landscapes. As CEOs, HR Directors, Finance Leaders, and global employers, you understand the importance of attracting and retaining top talent while complying with varying labour laws worldwide.
We present this comprehensive Employee Benefits Guide, offering expert guidance on global employee benefits provisioning best practices.
Inside our Employee Benefits Guide 2024, we delve into the critical aspects of benefits provisioning, from mandatory benefits that ensure compliance with local labour laws to the strategic selection of voluntary benefits that elevate your organisation to an employer of choice worldwide. We provide expertise and clarity, helping you make informed decisions that align with your company’s vision, values, and budget.
What Are Employee Benefits?
Employee benefits, or perks or fringe benefits, are various forms of non-wage compensation provided to employees in addition to their regular salaries or wages.
These benefits are designed to enhance the overall compensation package, improve employee satisfaction, and contribute to their well-being. They can include a range of financial, health, and lifestyle advantages that support employees both in their professional and personal lives.
Employee benefits are far more than just contractual obligations – they are the heart and soul of a thriving workforce. A carefully designed benefits package can transcend borders, resonate with employees of different cultures, and contribute to a more engaged and motivated team. It is a key factor in creating an inclusive and supportive work environment where employees feel valued and empowered.
Types of Employee Benefits
Employee benefits are various types of non-wage compensation provided to employees in addition to their normal salaries or wages. These benefits are designed to attract and retain employees, boost morale, and enhance overall job satisfaction. Here are some common types of employee benefits:
Health Insurance: Covers medical expenses for employees, including doctor’s visits, hospital stays, and surgeries. Often includes dental and vision coverage as well.
Retirement Plans: Includes pension schemes, 401(k) plans, or other retirement savings programmes that help employees save for their future.
Paid Time Off (PTO): Includes holidays, sick leave, vacation days, and sometimes personal days that employees can use as they see fit.
Life Insurance: Provides a financial benefit to an employee’s family or designated beneficiary in the event of the employee’s death.
Disability Insurance: Offers income protection to employees who cannot work due to illness or injury.
Employee Assistance Programs (EAPs): Provide confidential support for personal issues, including mental health services, counselling, and financial advice.
Flexible Working Arrangements: Options such as telecommuting, flexible working hours, and job sharing to help employees balance their work and personal lives.
Professional Development: Includes training programmes, tuition reimbursement, and career advancement and skills development opportunities.
Wellness Programs: Initiatives aimed at promoting healthy lifestyles, such as gym memberships, health screenings, and wellness challenges.
Childcare Assistance: Subsidies or on-site childcare facilities to support employees with young children.
Transportation Benefits: Includes company cars, commuting subsidies, or access to public transport passes.
Bonuses and Incentives: Financial rewards based on performance, company profitability, or meeting certain targets.
Stock Options: Opportunities for employees to buy company shares at a discounted rate, aligning their interests with those of the company.
These benefits can vary widely depending on the employer, industry, and country. Employers often offer a combination of these benefits to create a comprehensive compensation package that meets the needs of their workforce.
Mandatory Employee Benefits: Harnessing Global Employment Compliance
Understanding and providing mandatory benefits is an essential responsibility for employers in global employment. As businesses expand their operations across borders, they encounter a complex tapestry of social security, healthcare, disability, and retirement systems that vary from country to country.
This section of the Employee Benefits Guide for Global Employers illuminates the significance of these mandatory benefits for employers and their valued employees while embracing diversity and inclusion.
Diversity and inclusion are not only moral imperatives but also strategic advantages. Employers foster a sense of belonging by offering inclusive mandatory benefits and creating a fair and respectful workplace. This section explores how optimizing global benefits provision through diversity and inclusion benefits employers and employees.
Mandatory Benefit
Employers’ Obligations
Benefits for Employees
Social Security
Fulfil legal requirements by contributing to social security schemes.
Financial protection during illness, disability, and retirement. Increased job satisfaction and loyalty.
Healthcare
Provide access to healthcare benefits, promoting a healthier and more productive workforce.
Peace of mind, improved work-life balance, and overall well-being.
Disability Benefits
Offer disability coverage, supporting employees during difficult times.
Essential income protection during unexpected disabilities. Financial security during recovery and rehabilitation.
Retirement Plans
Provide retirement plans to ensure long-term employee welfare.
Enables employees to plan for a secure financial future during retirement.
Leaves and PTO
Offer various leave types such as vacation, sick, bereavement, parental, military, jury duty leave, etc.
Supports work-life balance, time to rejuvenate, and attend to personal matters.
Severance Payment
Provide severance payment to employees upon termination under certain circumstances.
Financial support during job loss and transition periods.
Notice Periods
Comply with legal notice periods for termination or resignation.
Allows time for both parties to prepare for changes and seek new opportunities.
Other Statutory Benefits
Adhere to specific statutory benefits mandated by local laws and regulations.
Compliance with local labour laws, promoting fairness and employee rights.
It is important to note that mandatory benefits can indeed vary significantly based on a country’s economic development, labour laws, and cultural norms. As global employers, understanding and adhering to these diverse regulations ensures compliance and fosters a positive work environment for employees across borders.
Voluntary (Optional) Employee Benefits
Having explored the vital role of mandatory benefits in ensuring the well-being and security of your global workforce, we now delve into the world of voluntary employee benefits. These offerings extend beyond legal obligations, empowering you to design a benefits package that resonates with the unique needs of your diverse employees.
At Acumen International, we go beyond legal obligations, empowering you to craft a truly exceptional benefits package tailored to your diverse employees’ unique needs.
From innovative healthcare solutions and wellness programs to professional development initiatives, this section presents an array of opportunities to enhance employee health, productivity, and personal growth.
We aim to provide valuable insights and practical guidance, enabling you to create a benefits program that attracts and retains top talent and reflects your organizational values. Offering voluntary benefits is a powerful way to demonstrate your commitment to your employees’ holistic well-being and professional success.
Voluntary Benefit
Employers’ Incentives
Advantages for Employees
Retirement Savings Plans
Attract and retain top talent by offering an appealing retirement savings plan.
Opportunities to build a secure financial future, fostering peace of mind and financial independence.
Health and Wellness Programs
Enhance employee health and productivity by providing wellness initiatives.
Improved physical and mental well-being, reduced healthcare costs, and a positive work-life balance.
Employee Assistance Programs (EAPs)
Support employees during challenging times by offering counselling and resources.
Access to confidential counselling, guidance, and support, promoting overall emotional well-being.
Professional Development
Invest in employee growth and skill development through training programs.
Enhanced job satisfaction, career advancement opportunities, and increased loyalty to the organization.
Flexible Work Arrangements
Promote work-life balance and accommodate diverse employee needs.
Increased job satisfaction, reduced stress, and improved productivity through customized work schedules.
Childcare Assistance
Assist employees with childcare expenses to alleviate work-life challenges.
Reduced financial burden, enhanced focus at work, and a supportive environment for working parents.
Commuter Benefits
Offer cost-effective commuting options, such as public transport subsidies.
Savings on transportation expenses and reduced environmental impact, promoting employee well-being.
Employee Discounts
Collaborate with vendors to provide exclusive discounts and perks to employees.
Enhanced employee morale, increased job satisfaction, and a sense of value and appreciation.
Importance of Employee Benefits
Employee benefits play a crucial role in:
Attracting and Retaining Talent: Competitive benefits packages can make a company more attractive to potential hires.
Enhancing Job Satisfaction: Benefits contribute to employees’ overall well-being and job satisfaction.
Improving Productivity: Health and wellness programs can lead to healthier, more productive employees.
Boosting Morale: Benefits like flexible working arrangements can improve work-life balance and morale.
Employee Benefits Solution by Express Global Employment
Tailored Employment Solutions, Global Impact: Our benefits packages are crafted to meet local needs while adhering to global standards, ensuring employees feel valued and supported worldwide by a Global Employer of Record.
Compliance and Consistency: We navigate complex employment laws, ensuring benefits offerings comply with local regulations and safeguarding your organization and employees.
Employee-Centric Focus: We embrace diversity and offer a range of voluntary benefits, empowering employees with choices that foster engagement and loyalty.
Seamless Experience, Everywhere: Benefit from streamlined processes that provide employees with a seamless experience, regardless of location.
Strategic Partnerships: Access cost-effective, top-tier benefits solutions through our network of renowned vendors and stay ahead of industry trends.
Empowering Global Employers: Receive expert insights and best practices to make informed decisions with our comprehensive handbook and personalized guidance.
Agility and Adaptability: We proactively navigate market shifts and regulatory changes, enhancing the employee experience in an ever-evolving global landscape.
Seamless Onboarding and Offboarding: Prioritise a positive employee journey with clear guidance and support throughout their employment lifecycle.
Introducing the Global Payroll Calculator (GPC)
Harness the power of seamless global talent acquisition with our innovative Global Payroll Calculator (GPC), designed to provide instant and actionable insights into global payroll budgeting and the best hiring locations worldwide.
With GPC, you can effortlessly handle complex payroll calculations, budgeting, and talent insights across borders, saving valuable time and resources. Say goodbye to manual Tax and Labour Code research and welcome automated, accurate, real-time payroll estimations.
Benefits of Global Payroll Calculator
Global Talent Cost Insights: Navigate the complexities of cross-border hiring cost projections easily. Identify the ideal locations for talent without the tedious task of manual tax and labour code research.
Detailed Employment Cost Analysis: This tool provides a comprehensive breakdown of gross-to-net calculations, helping you understand employment costs across 190 countries at a glance.
Full Tax Breakdown: Get a comprehensive view of taxes, including social contributions, income tax, and more, for better financial planning.
No more sifting through constantly evolving labour laws. GPC keeps you updated with real-time regulations and a detailed breakdown of taxes and contributions across 190 countries.
Expertise-Infused Tool: Built upon our vast industry knowledge of Express Global Employment, ensuring accuracy and efficiency.
Practical Talent Insights: Quickly gauge cost projections and identify hiring potentials across 190 countries without the hassle.
Total Tax and Contributions Breakdown: Get a comprehensive view of taxes, including social contributions, income tax, and more, for better financial planning.
Efficient Payroll Estimation: Move from manual tax and labour research to automated, real-time calculations.
Cross-country Comparison: Instantly compare employment costs across multiple countries to identify cost-effective talent hotspots.
Transparent Cost Breakdown: Get a thorough tax perspective instantly from gross-to-net calculations upfront.
In-built Compliance: Navigate through evolving labour laws and tax regulations with up-to-date, reliable data across 190 countries.
Experience the practicality and ease of managing global payroll and talent acquisition with GPC. We’re confident it will significantly enhance your operational efficiency and decision-making process.
Designing an effective employee benefits program involves several key steps to ensure it meets the needs of employees and aligns with the company’s goals and budget. Here’s a comprehensive guide to designing an employee benefits program:
1. Assess Company Needs and Goals
Understand the Budget: Determine how much the company can afford to spend on benefits.
Identify Company Goals: Align the benefits program with the company’s objectives, such as attracting top talent, improving employee retention, or enhancing productivity.
2. Understand Employee Needs
Conduct Surveys: Use surveys, focus groups, or one-on-one interviews to gather input from employees on what benefits they value most.
Analyse Demographics: Consider the demographics of your workforce, such as age, family status, and health needs, to tailor the benefits accordingly.
3. Research Legal Requirements
Comply with Regulations: Ensure the benefits program complies with local, state, and federal laws regarding mandatory benefits like health insurance, retirement plans, and paid leave.
Stay Updated: Regularly review changes in legislation to keep the benefits program compliant.
4. Choose the Types of Benefits
Mandatory Benefits: Include legally required employee benefits like social security contributions, workers’ compensation, and statutory sick pay.
Voluntary Benefits: Choose additional benefits that can attract and retain employees, such as:
Health Insurance
Retirement Plans
Paid Time Off (PTO)
Life and Disability Insurance
Wellness Programs
Professional Development Opportunities
Flexible Working Arrangements
Childcare Assistance
Transportation Benefits
5. Design the Benefits Package
Flexibility and Choice: Consider offering a flexible benefits package (cafeteria plan) where employees can choose the benefits that best meet their needs.
Competitive Analysis: Compare your benefits package with those of competitors to ensure it is competitive within your industry.
6. Communicate the Benefits
Clear Communication: Develop clear, easy-to-understand materials explaining the benefits package.
Regular Updates: Keep employees informed about any changes to the benefits program.
Open Enrollment Periods: Hold regular enrollment periods where employees can sign up for or make changes to their benefits.
7. Implement and Administer the Program
Choose Providers: Select reputable benefits providers for health insurance, retirement plans, and other services.
Administrative Tools: Use benefits administration software to manage enrollment, track usage, and handle compliance.
Support System: Provide resources and support for employees to understand and use their benefits, such as an HR help desk or online portal.
8. Monitor and Evaluate
Track Participation and Usage: Monitor how employees are using the benefits and their satisfaction levels.
Gather Feedback: Continuously collect feedback from employees to identify areas for improvement.
Adjust as Needed: Regularly review and adjust the benefits program to ensure it remains relevant, competitive, and cost-effective.
9. Promote Wellness and Engagement
Wellness Initiatives: Promote wellness programs encouraging healthy lifestyles, such as fitness challenges, health screenings, and mental health support.
Engagement Activities: Organise activities and events that promote a positive work culture and enhance employee engagement.
10. Review and Update
Annual Reviews: Conduct an annual review of the benefits program to assess its effectiveness and make necessary adjustments.
Benchmarking: Regularly benchmark your benefits program against industry standards to ensure it remains competitive.
Ukraine remains resolute and determined despite facing severe adversities due russia’s aggressive actions. From the deliberate bombing of civilians in cities, towns, seaports, and even atomic power plants to the catastrophic decimation of cities like Mariupol, the scale of devastation is heart-wrenching. The malevolence didn’t stop in cities; hundreds of towns and villages also bore… Read more The Global Employer of Record: Ukraine’s Beacon in Turbulent Times
Ukraine remains resolute and determined despite facing severe adversities due russia’s aggressive actions. From the deliberate bombing of civilians in cities, towns, seaports, and even atomic power plants to the catastrophic decimation of cities like Mariupol, the scale of devastation is heart-wrenching. The malevolence didn’t stop in cities; hundreds of towns and villages also bore the aggression’s brunt. In a harrowing incident, the Kakhovka Dam, under the control of the russian military since their invasion, was breached in June 2023.
This widespread destruction has forced over 8 million Ukrainians – women, children, and the elderly – to seek refuge in safer areas, leaving behind their homes and the life they once knew.
This population exodus disrupted individual lives and has led many companies to see their core talents scattered, jeopardising critical operations and projects and putting Ukraine’s entire national economy at grave risk. People are irreplaceable as the very lifeblood of business and the economy. Their displacement has left a void that has threatened both the business continuity of individual companies and the nation’s broader economic framework.
Many companies, witnessing their key talents flee to safer regions, grappled with the looming danger of stalling critical operations and projects. However, amid these trying times, Express Global Employment’s unique third-party cross-border employment (Global Employer of Record) model emerged as a pivotal solution to navigate these challenging waters.
Redefining Business Continuity: Ukraine’s Response to Global Workforce Challenges
The resilience of Ukrainians was recently celebrated at the “TOP 100 USA Entrepreneurs with Ukrainian origins” Award ceremony in New York, USA. This event highlighted the unwavering spirit and significant contributions of Ukrainian entrepreneurs to the global business landscape. Among the honorees, Nick Ganzha, the founder and CEO of Express Global Employment, received special attention for his entrepreneurial success and timely and critical support to the Ukrainian business community.
The recognition of Express Global Employment speaks volumes. Beyond our business milestones, it emphasizes our unique role as the sole global employment solutions provider addressing the Ukrainian workforce displacement crisis.
Express Global Employment also recognised the significance of the “TOP 100 USA Entrepreneurs with Ukrainian origins” event in New York, USA. It provided us a platform to raise awareness about Ukraine’s global employment challenges and illustrate our company’s commitment to aiding Ukraine and its people.
Our services empower Ukrainian businesses to integrate their dispersed talent abroad seamlessly and cost-effectively. With the unpredictable movement of valuable talent to various global destinations, this approach is essential for maintaining uninterrupted business operations.
Navigating the Global Employment Landscape: The EOR Advantage
Given the tragic aftermath of russia’s relentless aggression against Ukraine, it’s more vital than ever to have nimble and quick-acting business strategies in place. The Global Employer of Record (EOR) model is a beacon of hope in a rapidly shifting employment landscape. Far from being a mere industry catchphrase, the Global EOR model presents a transformative approach to addressing massive workforce displacement in Ukraine. It allows companies to hire, compensate, and retain their key talent in foreign territories without the complexity and bureaucracy of establishing a foreign legal entity. It’s more than just a convenience; it’s a pivotal tool for ensuring business resilience and continuity amid geopolitical upheavals.
Express Global Employment is a shining example of the effectiveness of this model. With a strong presence in 190 countries, we’ve stepped up since the very outset of the war in Ukraine. By assisting national and multinational businesses, we’ve ensured the retention of irreplaceable talents and saved jobs for displaced individuals, especially women with children. Our efforts have ensured that crucial projects continue without interruption, highlighting the resilience and adaptability of the Ukrainian spirit in the face of adversity.
Express Global Employment: A Commitment to Serve Ukraine and its People
Rooted in Ukraine and globally active for decades, Express Global Employment remains committed to offering vital solutions for businesses during these challenging times. With Nick Ganzha at the helm, the company’s primary focus has always been to serve — whether addressing clients’ immediate needs or responding to the broader challenges that the current situation in Ukraine presents.
Nick Ganzha’s dedication to Ukraine goes beyond business. Actively supporting Ukraine in its fight against full-scale russian aggression, Nick’s profound patriotism and love for his homeland have translated into substantial donations. Having already contributed over $200,000 to support Ukraine’s cause, Nick commits to continuing these donations until Victory is achieved.
Nick Ganzha, the founder of Express Global Employment, shared these profound words.
Express Global Employment originated in Ukraine, driven by a clear vision. I envisioned the ecosystem where businesses irrespective of their size or financial backing could seamlessly tap into any global market. Where geographical boundaries would not restrict the quest for the best talent, because now the entire world is your talent pool. To me success isn’t defined by the profit margins or market dominance.
It is about the aspirations we bring to life and the lasting impact we create. Each day, helping Ukrainian and international entrepreneurs join the global business landscape, I see I’m living my dream. Now as millions of Ukrainians and all the people of the free world unite in the spirit and purpose, we inch closer to our most profound collective dream —Ukraine achieves Victory, standing tall and free, forever!
We Wish We Knew!’ – The Power of the Third-Party Employment Approach in Trying Times
As millions of Ukrainians sought safety away from home, critical employees of our client – a prominent enterprise company- were displaced. The loss was felt deeply in numbers and years of irreplaceable expertise and intricate industry knowledge.
To compound the crisis, the company faced many challenges: the fluctuating demand for their products, interruptions in sourcing raw materials, and disrupted production and logistics chains. These adversities necessitated an agile rethinking of strategies. Realising the risk of depending heavily on a singular market, the management wisely chose diversification, eyeing opportunities in neighbouring countries.
Our engagement with a leading Ukrainian enterprise epitomises this insight. They found themselves in a unique predicament: some of the company’s key employees, integral to its core operations, had fled to various countries—Spain, Portugal, Slovakia, Poland, and Austria. These individuals were invaluable to our client enterprise, and their sudden absence posed a considerable challenge and potential disruptions.
The dilemma was about more than just replacing talent. It was about swiftly and compliantly re-employing these pivotal team members in their new locations without the bureaucratic and financial complexities of establishing multiple foreign legal entities. This is where Express Global Employment’s extensive expertise, global coverage, infrastructure, and agility of the Global Employer of Record model came into play.
Re-Employing Key Talent Across Europe
We acted promptly and with precision. In Spain, we streamlined the re-employment of one of their client’s key personnel. We meticulously handled every step of the process, from crafting the employment contract to ensuring comprehensive travel and benefit provisions. And, to our mutual satisfaction, the whole engagement was wrapped up in just a few days.
The momentum was sustained. Shortly after that, we onboarded another key team member in Portugal. Moreover, beyond aiding their expansion into new territories, we also played a crucial role in retaining the talents who had left Ukraine. This was particularly evident as we collaborated on retaining a vital team member in Slovakia. Within a month, we concluded another project in Poland, and currently, there’s keen interest in employing talent in Austria.
The tangible outcomes spoke volumes: our enterprise-grade client marked their presence in two new markets in just two weeks. Moreover, our intervention ensured the retention and productive engagement of the employes the company risked losing.
Hiring Globally: A Paradigm Shift for Ukrainian Enterprises
But beyond this particular success story, a broader realisation dawned upon us. Our approach was revolutionary for many Ukrainian companies accustomed to the conventional foreign entity establishment model.
The exclamation from our client’s HR director—”We wish we had known about it earlier!”—underscored this sentiment. Recognising this, we are now driven with an added purpose: to evangelise and popularise the third-party global employment model amongst a broader spectrum of Ukrainian business owners and the C-suite, ensuring they grasp its transformative potential.
Empowering Ukraine’s Future Through Adaptive Strategies
Ukrainian businesses have shown great resilience in these challenging times. Looking forward, mere persistence isn’t enough. Innovative strategies like the third-party global employment model are key to a fast-changing global scene.
By embracing such models, Ukrainian businesses can overcome geographic limitations, maintain their treasured workforce, and venture confidently into new territories. As Ukraine moves towards Victory over russian aggression, it isn’t just about reclaiming national stability but ensuring its businesses remain intricately woven into the fabric of the global economy with its remote work paradigm.
The message for Ukrainian entrepreneurs and businesses is resounding: change is inevitable. Yet, with smart strategies and partnerships, challenges become opportunities for growth. With innovation and Ukraine’s enduring spirit, our nation will thrive on both the domestic and global fronts.
Welcome to the May edition of “The Global Talent Horizon.” This month, we explore how Acumen International alleviates the complexities of global business expansion. Our expertise in placing foreign talent, combined with superior customer service, innovative platforms, and cutting-edge technology, ensures comprehensive EOR solutions. Discover how our commitment to excellence simplifies your journey into new… Read more Global Expansion Made Easy: Your Trusted EOR Partner
Welcome to the May edition of “The Global Talent Horizon.” This month, we explore how Acumen International alleviates the complexities of global business expansion. Our expertise in placing foreign talent, combined with superior customer service, innovative platforms, and cutting-edge technology, ensures comprehensive EOR solutions.
Discover how our commitment to excellence simplifies your journey into new markets, positioning Acumen as your trusted ally in fostering global growth through expertly managed, stress-free international talent acquisition.
Navigating International Expansion in 2024: Technology and Strategy Insights
A recent Forbes article highlights key trends for businesses strategising their international operations in 2024. At Acumen International, we align with these insights by providing comprehensive EOR solutions that simplify your global hiring efforts.
Key insights include;
capitalising on green and digital transformation policies,
leveraging flexible talent hubs and
engaging with innovation ecosystems.
Our strategic foresight ensures your expansion is both current and forward-thinking.
Debunking Global Expansion Myths: True Expertise Unlocked
Expanding internationally can be fraught with myths that can deter companies. Acumen International dispels these myths, offering clarity and expert support to ensure your global expansion is successful and stress-free.
Quick market entry is always possible.
Reality: Visa and immigration processes vary widely and can delay plans. Acumen ensures you navigate these waters with expert precision, planning for realistic timelines.
It’s too complex and risky.
Reality: With Acumen’s expert EOR solutions, we handle the complexities of compliance, payroll, and local regulations, ensuring a smooth transition into new markets.
You must incorporate locally to operate.
Reality: With Acumen’s EOR services, start operating in new markets without immediate incorporation, testing the waters before making large commitments.
International hiring is necessary for global growth.
Reality: Bring your trusted team along! Acumen supports your expat visa and immigration needs, keeping your core team intact.
EORs only handle administrative tasks.
Reality: Acumen provides comprehensive end-to-end solutions far beyond mere paperwork processing. We help you with everything from strategic planning to full operational deployment.
With Acumen’s expert Global EOR solutions, we handle the complexities of compliance, payroll, and local regulations, allowing you to focus on strategic growth.
Small Countries, Big Impact: Discover Hidden Gems for Remote Talent
Small nations often pack a significant punch in the global talent pool. Acumen International highlights exceptional opportunities for hiring remote talent in lesser-known yet advantageous countries. These countries offer favourable tax regimes and high quality of life, making them attractive for remote workers.
Discover Andorra: Remote Talent Paradise is ideal for businesses valuing privacy and innovation. Learn more about Andorra >>
Luxembourg: Small Country, Big Talent A hub of multilingual professionals perfect for international businesses. Learn more about Luxembourg >>
Liechtenstein: Strategic Talent Acquisition Benefit from high-skilled remote talent in a central European location. Learn more about Liechtenstein >>
Welcome to the Team: Mike Flowers, Leading US Operations
Acumen International welcomes @Mike Flowers as the Head of US Operations. With 87% of U.S. companies agreeing that international expansion is crucial for long-term growth, Mike’s leadership ensures that our US clients benefit from strategic insights and global experience. His expertise enriches our robust offering, allowing US businesses to navigate new markets confidently.
Stay informed with the latest developments in global HR legislation to ensure your business remains compliant and ahead of the curve.
EU AI Act: Regulating Artificial Intelligence
The EU Council has approved the AI Act, the world’s first major law regulating artificial intelligence. This law sets comprehensive rules surrounding AI technology and applies a risk-based approach, prohibiting applications deemed “unacceptable” and imposing stringent requirements on high-risk systems.
Employer Impact: This has major implications for any entity developing, using, or reselling AI in the EU, particularly for U.S. tech firms.
Employer Actions: Ensure compliance with the new regulations, focusing on transparency, risk management, and cybersecurity. Acumen’s EOR services can help navigate these changes effectively.
Singapore Tightens Rules for Hiring Foreign Professionals
Starting next year, Singapore will raise the salary criteria for foreign professionals applying for employment passes. The new minimum salary will be S$5,600, with higher thresholds for the financial sector. This move aims to ensure high-quality employment pass holders and maintain a level playing field for locals.
Employer Impact: Stricter hiring criteria may limit the pool of eligible foreign professionals.
Employer Actions: Review hiring strategies and salary structures to comply with the new requirements. Acumen can help manage these changes and streamline the hiring process in Singapore.
EU Platform Work Directive: Protecting Platform Workers
The EU Parliament has adopted the Platform Work Directive, which aims to improve the working conditions of platform workers and regulate the use of algorithms in the workplace. The directive introduces a presumption of employment, ensuring the correct classification of workers and protecting against unfair algorithmic decisions.
Employer Impact: The directive requires the reclassification of platform workers and adherence to new rules on algorithmic management and data protection.
Employer Actions: Implement changes to comply with the directive, ensuring human oversight in decision-making processes and robust data protection measures. Acumen’s Contractor Management services can assist in navigating these regulatory changes.
Acumen International reaffirms its commitment to valuing human interaction and innovation as we explore avenues for seamless global expansion. Our expertise ensures your business can expand internationally with peace of mind and reassurance. Experience the difference a well-managed, people-powered approach can make to your international expansion ambitions.
As more companies look to international markets to expand their businesses, there has been an explosion of Global Employer of Record (EOR) companies, the vast majority of which are SaaS-based models. This surge reflects the evolving landscape of global business expansion and underscores the critical need for a marriage of technology and on-ground experience when… Read more Choosing the Right Global EOR Partner: Key Questions to Ask Before You Decide
As more companies look to international markets to expand their businesses, there has been an explosion of Global Employer of Record (EOR) companies, the vast majority of which are SaaS-based models. This surge reflects the evolving landscape of global business expansion and underscores the critical need for a marriage of technology and on-ground experience when selecting the perfect Global EOR partner.
For businesses navigating this complex landscape, choosing the right Global EOR partner can provide seamless integration of international employees, ensure compliance with local laws and optimise operational efficiencies. But with so many options available, how do you choose the best Global EOR company for your needs?
Essential questions to ask to help you make an informed decision
1. What experience does the EOR Prospect have in the market you are looking to enter?
Understanding the experience level of your Global EOR partner in the specific country where you plan to hire is critical. It is essential to know how well they understand the local labour laws, culture and business environment.
2. What on-the-ground experience does your Global EOR partner have in that country?
Understanding the on-the-ground experience of your Global EOR partner in the target country is essential. While EOR companies may not maintain their own local entities in every market, a robust network of seasoned, well-established partners is critical.
It’s crucial to verify that your EOR provider, like Acumen International, leverages a network of trusted and thoroughly vetted local partners with extensive regional experience and compliance knowledge. This ensures that service quality and legal compliance are uncompromised, maintaining high standards of operational excellence wherever you choose to expand.
3. Can they provide details of the staffing and operations of their local entity?
Ask about the structure and staffing of their local operations. Who manages their entity, and what experience and qualifications do these professionals have? Understanding who will handle your operations locally provides insights into the operational reliability and expertise of the Global EOR company. Having an effective EOR team on the ground will be especially important should any challenges occur moving forward.
4. What is their track record of hiring in your desired country?
Inquire about the EOR’s previous experience with companies hiring in the target country. Ask for specific examples, including how they addressed challenges and any pain points encountered during the process.
5. What are the steps to establish and dissolve a local entity in your target country?
6. What employment models does the Global Employer of Record partner offer?
Different business needs require different employment models. Whether it’s EOR, contracting, Professional Employer Organization (PEO), or Agent of Record (AOR) services, ensure the EOR can offer the solution that aligns perfectly with your business needs.
7. Do you require recruitment services?
If your global expansion plans include searching for and hiring local talent, check if your Global EOR partner provides recruitment services. This can significantly streamline the process of finding and hiring the right talent.
8. How does the Global EOR partner support the immigration and visa processes?
Finally, if your expansion involves relocating existing employees or hiring international talent, understanding the Global EOR’s capability to handle immigration support and visa processes is essential. Effective on-ground support in this area can save considerable time and reduce compliance risk.
Selecting a Global EOR partner is a strategic decision that requires thorough vetting. By asking these detailed questions, you can gauge whether an EOR provider can meet your specific international employment needs. Remember, the perfect EOR partner should offer a strong and intuitive technology platform but, more importantly, robust on-the-ground support and experience to ensure a smooth and compliant operation across borders.
According to a Wells Fargo survey (20 Dec 2023), “87 percent of U.S. companies agree that international business expansion is needed for long-term growth, with emerging markets providing the greatest opportunities. Acumen International is committed to helping US firms with their global expansion and has hired Mike Flowers as the Head of our US Operations. Mike brings… Read more Acumen International Welcomes Mike Flowers to Lead US Operations
According to a Wells Fargo survey (20 Dec 2023), “87 percent of U.S. companies agree that international business expansion is needed for long-term growth, with emerging markets providing the greatest opportunities.
Acumen International is committed to helping US firms with their global expansion and has hired Mike Flowers as the Head of our US Operations. Mike brings a wealth of expertise and a proven track record in Employer of Record Services, making him the perfect leader to spearhead our initiatives and build on Acumen International’s thirteen years of experience in the US market.
US Expertise with Global Reach
With Mike at the helm, Acumen International is uniquely positioned to offer US businesses the best of both worlds: deep local knowledge backed by extensive global employment experience. Mike’s leadership ensures that our US clients will benefit from strategic insights that only a global employment organisation with 23 years’ of experience can provide.
Why Should US Companies Choose Acumen International?
Global Experience, Local Insight: Mike’s expertise enriches our already robust offering, ensuring that our US clients can confidently draw on Acumen’s 23 years of experience to navigate new market development. Whether it’s understanding complex local regulations or managing cross-border teams.
Unparalleled Global Network: Acumen’s reach extends across most markets worldwide, including remote and challenging regions. This unparalleled network and knowledge open doors for our clients in virtually any location they choose to pursue, providing a strategic advantage in global market expansion.
Comprehensive Service Offering: Acumen’s breadth of services covers all aspects of global expansion. From recruitment and immigration support to international payroll and compliance, we handle the intricacies of international employment, allowing our clients to focus on their core business activities.
Flexible Approach to Employment Agreements
At Acumen International, we understand that one size does not fit all when it comes to global employment. We are committed to a flexible approach in crafting employment agreements, ensuring that each solution is bespoke , whilst ensuring all agreements are fully compliant with all laws and regulations.
👉We invite you to reach out to explore how Acumen International can help your business achieve its global aspirations. Contact us today to start your journey towards international success.
Worker misclassification is the practice of companies inappropriately classifying workers as independent contractors rather than employees to avoid costs and administrative burdens associated with the latter. Companies do this to save money on things like benefits, payroll taxes, and unemployment insurance. Worker misclassification refers to an employment situation in which either an employer or an… Read more How to Avoid Employee Misclassification Risk?
Worker misclassification is the practice of companies inappropriately classifying workers as independent contractors rather than employees to avoid costs and administrative burdens associated with the latter. Companies do this to save money on things like benefits, payroll taxes, and unemployment insurance.
Worker misclassification refers to an employment situation in which either an employer or an employee intentionally misrepresents the true nature of their working relationship.
Independent Contractors vs Full-Time Employees: How to Distinguish between Them
The distinction between independent contractors and full-time employees is important because it affects issues such as tax obligations, benefits, and labor laws. Here are some factors that can help distinguish between the two:
1. Control over Work
Does the company have the right to direct how, when, and where the worker does his or her job?
If the worker is free from control and direction in carrying out the duties under the contract and in practice, then the worker is likely an independent contractor.
At the same time, full-time employees typically have more control and are subject to the direction and control of their employer.
2. Skill Level
How much training was required for a position? – The more training a company requires its employees to have, the less likely that company is going to hire an independent contractor.
The skill level of an independent contractor is often directly related to the type of work they do, in that there’s a certain expectation that they have a more specialized level of expertise than a full-time employee.
An independent contractor is hired with their specialized skills in mind, while a full-time employee is generally hired to perform a specific job function within your company.
3. Financial Control & Tax Obligations
Are the business aspects of a worker’s job controlled by an employer or are they in control of their own finances?
Tax obligations are one of the major differences between independent contractors and full-time employees. Independent contractors are responsible for paying their own taxes, while employers are required to withhold taxes from the pay of full-time employees.
4. Benefits
Full-time employees are often eligible for benefits such as health insurance, retirement plans, and paid time off,
When an employee is misclassified, that person may not have access to various benefits, such as health insurance and pension plans. Independent contractors are typically responsible for their own benefits and social security.
5. Duration of Work
Full-time employees are typically hired for a longer period of time, while independent contractors are often hired for specific projects or short-term work.
6. Type of Relationship
Is there a written contract or agreement that outlines what will be done and how much will be paid?
When you treat someone as an independent contractor, they are not part of your company’s payroll. Rather, they operate as freelancers paid for their services—no matter how many hours they log in an average week. Independent contractors are often hired for specific projects or jobs that will end at some point and are not an ongoing source of work. In general, if a person does other work besides what you bring them in for (such as taking additional jobs from other employers or working independently), she’s more likely to be considered an independent contractor than a full-time employee.
Visual Comparison of Independent Contractors and Employees: Understanding the Key Differences and Factors to Consider
The chart below represents a comparison between an independent contractor and an employee regarding various factors.
Several factors differentiate independent contractors from employees. These include factors such as tax responsibilities, control over work, flexibility, benefits, and job security. The chart highlights that while independent contractors have more flexibility and control over their work, they do not receive the same level of benefits and job or social security as employees.
11 Practical Steps for Properly Classifying Workers
Employers should carefully evaluate each of these factors when classifying their workers. It’s important to note that misclassifying workers can result in legal and financial consequences for the employer, including fines, back pay, and penalties.
or C-level executives of businesses operating internationally, it is crucial to be aware of the differences in worker classification and the potential implications on your business. With the increasing number of cross-border workers and remote work arrangements, navigating international labor laws and regulations can be challenging. Misclassifying workers as independent contractors or employees can result in costly legal and tax consequences, including fines, penalties, and back taxes owed.
To avoid these risks, it is recommended that C-level executives consult with legal and tax professionals who specialize in international labor law. These professionals can guide compliance requirements and help ensure your business adheres to local laws and regulations.
In addition, it is important to regularly review and update worker classifications as job responsibilities, reporting structures, and other factors may change over time. This can help mitigate risks and ensure that your business is operating in compliance with relevant laws and regulations.
Here are some practical steps that employers can take to ensure they are properly classifying their workers. By taking these steps, employers can ensure that they properly classify their workers and avoid potential legal and financial consequences.
Understand the difference between employees and independent contractors: The first step is to understand the legal and tax differences between employees and independent contractors. E
Review job descriptions and employment agreements to accurately reflect the worker’s status as independent contractors or employees.
Review the worker’s responsibilities, work schedule, and the level of control the employer has over their work.
Develop clear and consistent policies: Develop clear policies and guidelines for employee classification and apply them consistently across the organization. Ensure that all workers understand their classification and the expectations associated with their role.
Consult with legal or tax professionals to ensure local laws and regulations compliance.
Regularly review and update worker classifications as necessary, as job responsibilities and other factors may change over time.
Use a worker classification tool. Various worker classification tools are available, including the IRS’s “Independent Contractor or Employee” questionnaire. These tools can help determine whether a worker should be classified as an employee or an independent contractor.
Review contracts and agreements with independent contractors to ensure they are properly classified and their contracts reflect their status.
Provide training for managers and supervisors on worker classification and the importance of proper classification. This can help prevent misclassification from occurring in the first place.
Keep accurate records: Keep accurate records of all workers, including their classification, hours worked, and payments made. This will help you demonstrate compliance in the event of an audit or legal dispute.
Seek legal guidance. If you are unsure how to classify a worker, seek legal guidance from an experienced employment attorney. They can help you navigate the complex legal and regulatory landscape and minimize the risk of misclassification.
By following these tips and best practices, you can minimize the risk of worker misclassification and ensure that your organization is in compliance with all relevant laws and regulations.
What Are the Laws that Determine or Regulate Employee Misclassification?
If you use a temporary service to fill your staffing gaps, avoiding worker misclassification is critical. This means that you must ensure that you are properly classifying the workers you’ve hired and that you’re meeting all of your legal obligations with regard to payroll tax withholding, workers’ compensation insurance coverage, and other factors.
Worker classification laws and regulations vary across different countries, and it’s important for employers operating globally to be aware of the laws and regulations that apply to their particular jurisdiction. Here are some examples of laws and regulations related to worker classification in other countries:
Canada
In Canada, worker classification is determined by the Canada Revenue Agency (CRA). The CRA looks at factors such as control over the worker, ownership of tools and equipment, and the worker’s chance of profit or risk of loss. Misclassifying a worker can result in significant financial penalties in Canada.
United Kingdom
In the UK, worker classification is determined by employment law and tax law. The key factor in determining worker status is the employer’s level of control over the worker. Other factors include the degree of integration into the employer’s business, the worker’s ability to substitute someone else for doing the work, and the financial risk the worker bears. Misclassifying a worker can result in financial penalties and legal action.
Here are some links to relevant laws and regulations in the UK regarding worker classification:
Employment Rights Act 1996 sets out the legal definitions of UK employees, workers, and self-employed individuals. It also outlines the rights and protections afforded to each category of worker.
IR35 Legislation: This legislation applies to workers who provide services through an intermediary, such as a limited or personal service company. It is designed to prevent tax avoidance by workers who should be classified as employees for tax purposes.
The National Minimum Wage Regulations: These regulations set out the minimum wage rates employers must pay to workers in the UK based on their age and employment status.
The Working Time Regulations 1998: These regulations set out the maximum number of hours workers can work per week, rest breaks, and annual leave entitlements.
It’s worth noting that this list is not exhaustive, and other laws and regulations may be relevant to worker classification in specific industries or sectors.
Australia
In Australia, worker classification is determined by the Fair Work Act. The Act distinguishes between employees, independent contractors, and “sham” contractors who are classified as independent contractors but are actually employees. Misclassifying a worker can result in legal action and financial penalties.
Fair Work Act 2009 is Australia’s main legislation governing employment and workplace relations. It sets out the rights and responsibilities of employees and employers and distinguishes between employees and independent contractors.
Independent Contractors Act 2006: This act provides additional protections for independent contractors in Australia, including protections against unfair contracts and treatment.
Fair Work Ombudsman: The Fair Work Ombudsman is the government agency responsible for enforcing workplace laws in Australia. Their website provides information on worker rights and entitlements, including determining whether a worker is an employee or an independent contractor.
Australian Taxation Office: The Australian Taxation Office (ATO) administers tax and superannuation laws in Australia. Their website provides information on worker classification for tax purposes, including information on determining whether a worker is an employee or a contractor.
European Union
The European Union has established rules regarding worker classification and the protection of workers’ rights. The rules vary by country, but generally, worker classification is determined by factors such as the degree of control the employer has over the worker, the worker’s ability to substitute someone else for doing the work, and the level of financial risk the worker bears. Here are some links to relevant laws and regulations in the European Union regarding worker classification.
EU Labour Law. This website provides an overview of EU labour law and regulations, including information on worker classification and employment contracts.
Directive 2003/88/EC. This directive establishes minimum standards for working conditions in the EU, including maximum working hours, minimum rest periods, and annual leave entitlements.
Directive 2014/67/EU. This directive guides the enforcement of EU rules on the posting of workers, including rules on worker classification and the protection of workers’ rights.
European Labour Authority. The European Labour Authority is the EU agency responsible for promoting and enforcing EU labour laws and regulations. Their website provides information on worker rights and protections, including information on worker classification.
European Trade Union Confederation: The European Trade Union Confederation is the umbrella organization for trade unions in the EU. Their website provides information on worker rights and protections, including information on worker classification and the protection of workers’ rights.
Understanding Benefits and Risks of Hiring Independent Contractors and Full-time Employees
Hiring independent contractors or full-time employees across borders can have benefits and risks, which should be carefully considered before deciding. Here are some points to keep in mind.
Benefits of Hiring Independent Contractors
1. Access to a Global Talent Pool
Hiring independent contractors from other countries can provide access to a wider range of skills and expertise than may be available locally.
2. Cost Savings
Independent contractors may be willing to work for lower rates than local employees, which can help businesses save on labor costs.
3. Flexibility
Independent contractors can be hired project-by-project, allowing businesses to adapt to changing workloads or market conditions.
Risks of Hiring Independent Contractors
1. Legal and Regulatory Compliance
Hiring independent contractors across borders can be complex from a legal and regulatory perspective. Different countries may have different laws governing employment relationships and tax obligations.
2. Communication and Cultural Barriers
Working with independent contractors from different countries may require navigating language and cultural differences, creating communication challenges and misunderstandings.
3. Data Security
Sharing confidential information with independent contractors in other countries can pose security risks, as different countries may have different privacy and data protection laws.
Benefits of Hiring Full-time Employees
1. Long-term Commitment
Hiring full-time employees across borders can provide a more stable and long-term commitment to the business, which can help build relationships and foster loyalty.
2. Cultural Diversity
Having employees from different countries can bring diverse perspectives and ideas to the business, leading to innovation and creativity.
3. Stronger Communication
Having employees in different countries can facilitate stronger communication and collaboration across borders, which can help businesses operate more efficiently and effectively.
Risks of Hiring Full-time Employees
1. Legal and Tax Compliance
Hiring full-time employees overseas can be complex from a legal and regulatory perspective, as different countries may have different employment laws and tax obligations.
2. Administrative Burden
Hiring full-time employees internationally s can require significant administrative work, such as obtaining work visas and complying with local labor laws.
3. Cost
Hiring full-time employees across borders can be more expensive than hiring independent contractors, as businesses may need to provide additional benefits such as health insurance and retirement plans.
Overall, when considering whether to hire independent contractors or full-time employees when going global, businesses should carefully evaluate the benefits and risks in light of their specific needs and circumstances. Consulting with legal and tax experts can also help businesses navigate the complexities of international employment relationships.
What Are the Consequences and Liabilities of Misclassifying Employees?
Misclassifying employees as independent contractors can result in various consequences and liabilities for employers, including:
Back taxes: Employers may have to pay back taxes at the national, state, and local levels.
Back benefits: Employers may be responsible for providing backdated benefits to the employee, such as medical insurance, worker’s compensation, vacation pay, and sick leave.
Legal penalties: Employers may be subject to legal fines, including liquidated damages and attorney fees. In some cases, misclassification can lead to class action lawsuits.
Damage to reputation: In addition to financial and legal repercussions, employers risk damage to their reputation among peers and potential hires.
How Global Employer of Record Can Help Address Worker Misclassification Risk?
Global Employer of Record (EOR) service providers can help employers operating internationally address the risk of worker misclassification by providing expert guidance and support on compliance with local labor laws and regulations. Here are some ways that EOR service providers can help.
1. Compliance with Local Laws in 190 Countries
Global Employer of Record has expertise in local labor laws and regulations and can help employers ensure compliance with worker classification rules in different jurisdictions. They can guide whether a worker should be classified as an employee or an independent contractor. They can also assist with the necessary paperwork and documentation to ensure compliance.
2. Worker Misclassification Risk Management
Global EOR service providers can help employers manage the risks associated with worker misclassification by supporting tax compliance, workers’ compensation insurance, and other regulatory requirements. They can also help employers stay up-to-date with changes to labor laws and regulations in different countries.
3. Flexibility
A Global EOR can offer flexible employment solutions for international workers, such as short-term assignments, contract work, or permanent employment, depending on the needs of the employer and the worker. This flexibility can help employers manage their workforce more effectively while minimizing the risk of worker misclassification.
5. Administrative Support
A Global Employer of Record can handle administrative tasks related to employment, such as payroll processing, benefits administration, and compliance reporting. This can help employers focus on their core business activities while ensuring that their international workforce is managed effectively and compliantly.
Global EOR can help employers navigate the complex and ever-changing landscape of worker classification laws and regulations across different jurisdictions. By leveraging the expertise and support of a Global EOR, employers can reduce the risk of worker misclassification and ensure compliance with local labor laws and regulations.
Understanding worker classification and its implications is critical to managing a successful international business. By staying informed and seeking expert advice when needed, C-level executives can help protect their businesses and avoid costly legal and financial consequences.
By partnering with a Global EOR, businesses operating internationally can ensure compliance with local labor laws and regulations and avoid the risks associated with worker misclassification. A Global EOR can help with everything from onboarding and payroll management to tax compliance and HR support.
Benefits of the Global EOR Talent Engagement Model
Reduced risk of worker misclassification and associated legal and financial consequences.
Compliance with local labor laws and regulations, including tax compliance.
Access to global talent without the need for setting up a legal entity in foreign jurisdictions.
Improved flexibility and scalability for global talent engagement.
Overall, the Global EOR talent engagement model can help businesses minimize the risks associated with engaging global talent while providing a streamlined and compliant solution for managing a global workforce.
In the rapidly evolving landscape of global payroll management, the nexus between technology, user needs, and regulatory shifts is driving revolutionary changes. Today’s organisations are focused on ensuring accuracy and compliance in their payroll processes, enhancing user experiences, and meeting the diverse demands of a global workforce. This article encapsulates 25 emerging trends shaping the… Read more Global Payroll Management: a Look into 25 Emerging Trends
In the rapidly evolving landscape of global payroll management, the nexus between technology, user needs, and regulatory shifts is driving revolutionary changes. Today’s organisations are focused on ensuring accuracy and compliance in their payroll processes, enhancing user experiences, and meeting the diverse demands of a global workforce.
This article encapsulates 25 emerging trends shaping the contemporary world of payroll management. From harnessing the power of cloud technologies and AI to adapting to the rise of the gig economy, these trends provide a comprehensive glimpse into the future of payroll. Let’s delve deeper into each trend to understand its significance and the value it brings to modern businesses.
Navigating a Global and Diverse Work Landscape
The era of globalisation has ushered in a new set of challenges and opportunities for businesses, especially when it comes to managing payroll across multiple jurisdictions. Global employers are not merely grappling with numbers—they’re crafting strategies that address regional disparities, workforce diversities, and ever-evolving regulatory environments.
1. Globalisation of Payroll
Insight: A globally integrated payroll system is not just a matter of convenience—it’s a linchpin for cohesive business operations and informed strategic decisions. A singular view can highlight disparities, identify cost-saving opportunities, and foster organisational alignment.
Actionable Strategy: Embrace a global payroll platform that provides centralised reporting. Yet ensure that it remains agile enough to address local regulatory shifts. Integrate real-time analytics to monitor cross-border transactions and facilitate instant financial decision-making actively.
2. Customisation
Insight: Payroll isn’t one-size-fits-all. Regional nuances, from holidays to union rules, can significantly affect payroll. Understanding these distinctions is crucial to ensure compliance and employee satisfaction.
Actionable Strategy: Regularly collaborate with regional teams and third-party local experts. This knowledge sharing will ensure payroll systems are appropriately customised and infuse global strategies with regional insights.
3. Gig Economy Adaptation
Insight: The gig economy is rewriting the rules of employment and compensation. It’s not just about processing payments differently—it’s about understanding how non-traditional employment impacts benefits, talent retention, and legal liabilities.
Actionable Strategy: Establish clear protocols for freelance and contract-based engagements. Develop a comprehensive understanding of how gig workers fit into your global workforce strategy and what their inclusion means for financial forecasting.
4. Centralisation
Insight: While centralising payroll operations can offer better control, balancing this against the need for regional expertise is crucial. Centralised processes disregarding regional nuances can lead to compliance oversights and financial missteps.
Actionable Strategy: Implement an integrated model where regional expertise centres complement central oversight. This approach combines the efficiency of centralisation with the nuanced understanding of decentralisation.
The Digital Revolution in Payroll
As the digital age continues its relentless march forward, no business operation remains untouched, and payroll is no exception. Technological advancements are not just about automating routine tasks; they are fundamentally altering how companies think about and manage their payroll operations. For businesses looking to thrive, understanding these shifts is not just beneficial—it’s imperative.
5. Cloud-Based Systems
Insight: Shifting from traditional on-premises systems to cloud-based platforms isn’t merely a trend—it’s a necessary evolution. The cloud offers unparalleled scalability, flexibility, and security, facilitating seamless operations irrespective of a company’s size or geographic spread.
Actionable Strategy: Prioritise transitioning to a cloud-first approach for payroll. Its flexibility regarding access, backups, and updates makes it a worthy investment for future-proofing payroll operations.
6. AI and Machine Learning
Insight: AI and ML are much more than buzzwords. They’re tools that can predict payroll anomalies, optimise salary distributions, and even forecast hiring needs based on financial data.
Actionable Strategy: Integrate AI-driven analytics into your payroll processes. Leveraging predictive analytics can proactively address potential issues, ensuring smoother payroll cycles and more informed financial decisions.
7. Real-Time Analytics
Insight: In an age where data drives decisions, having access to real-time payroll analytics is invaluable. It empowers HR and finance teams to make informed, timely decisions directly impacting the company’s bottom line.
Actionable Strategy: Equip your payroll systems with robust analytics tools. Review this data regularly to identify trends, efficiencies, and areas for improvement.
8. Mobile Accessibility
Insight: The modern workforce is mobile-first. Ensuring payroll information and functionalities are accessible on mobile devices is not a luxury—it’s an expectation.
Actionable Strategy: Opt for payroll solutions that offer comprehensive mobile applications. This enhances user experience and ensures consistent access, irrespective of location.
9. Integrated Systems
Insight: Siloed operations are a relic of the past. Integrated systems that combine HR, finance, and even CRM functionalities can streamline operations, improve data accuracy, and enhance inter-departmental collaboration.
Actionable Strategy: Work towards systems integration. Ensuring that different tools speak to each other reduces redundancies and paves the way for a holistic view of company operations.
10. SaaS Payroll Solutions
Insight: The shift to Software as a Service (SaaS) isn’t just about cost-effectiveness. It ensures payroll systems are always updated, compliant, and scalable based on ever-changing business needs.
Actionable Strategy: Consider transitioning to a SaaS model for payroll. The regular updates, built-in compliance checks, and scalability make it a strategic choice for modern businesses.
11. Use of APIs
Insight: In an interconnected digital ecosystem, APIs are the bridges that connect different software solutions, enabling them to work together harmoniously.
Actionable Strategy: When selecting payroll software, prioritise solutions that offer robust API integrations. This ensures that your payroll system can easily connect with other business tools, enhancing overall efficiency.
12. Blockchain Technology
Insight: Beyond cryptocurrency, blockchain’s transparent and immutable nature has vast potential in payroll—particularly in fraud prevention and ensuring transactional transparency across borders.
Actionable Strategy: Stay updated on emerging blockchain-based payroll solutions. While this field is nascent, early adoption could offer a competitive edge regarding security and transparency.
Employee-Centric Payroll Innovations
The employee experience is undergoing a radical transformation. Today’s workforce seeks compensation, empowerment, flexibility, and tools to contribute to their well-being. Innovative payroll solutions are emerging that place employees at the centre, recognising that a satisfied and empowered workforce can greatly contribute to business success.
13. Self-Service Portals
Insight: Gone are the days when employees would wait for HR to address their payroll queries. Today’s workforce seeks autonomy in managing payroll details, from checking payslips to updating tax information.
Actionable Strategy: Implement comprehensive self-service portals that offer a blend of autonomy and security. Regular feedback loops can help refine the portal’s features based on employee preferences.
14. Enhanced User Experience
Insight: User experience in payroll systems is no longer a back-end concern. A system that’s intuitive, responsive, and easy to navigate can significantly boost employee satisfaction and reduce the need for frequent support.
Actionable Strategy: Prioritise UX design in your payroll solutions. Regular usability testing and gathering employee feedback can ensure the system remains both functional and user-friendly.
15. On-Demand Pay
Insight: With instant transfers and digital wallets, the modern financial ecosystem has ushered in an era where waiting for a monthly paycheck seems archaic. Employees increasingly prefer accessing their earnings as and when they need them.
Actionable Strategy: Explore partnerships with platforms that offer on-demand pay facilities. While ensuring financial feasibility, such initiatives can greatly enhance the company’s value proposition to its workforce.
16. Continuous Payroll
Insight: Traditional payroll cycles are giving way to real-time payment structures. This shift caters to immediate financial needs and aligns with the gig economy’s payment models.
Actionable Strategy: Investigate the feasibility of real-time payment structures. If a complete shift seems challenging, consider hybrid models that offer both traditional and real-time payment options.
17. Employee Financial Wellness
Insight: Financial wellness goes beyond just earning a paycheck. Tools that aid employees in budgeting, savings, and investments contribute to their overall well-being, leading to increased productivity and loyalty.
Actionable Strategy: Integrate financial wellness tools and educational resources into your payroll systems. Collaborate with financial experts to conduct regular workshops and offer personalised financial guidance.
Efficiency and Accuracy Enhancements
In the complex world of payroll management, efficiency and accuracy are paramount. With businesses expanding globally and compliance norms becoming more stringent, the margin for error is shrinking. The solution? Technological innovations that prioritise both efficiency and precision.
18. Automation of Routine Tasks
Insight: Manual processes in payroll are not only time-consuming but are susceptible to human errors. Automation ensures consistency, speeds up processes, and reduces the potential for inaccuracies.
Actionable Strategy: Identify repetitive and time-intensive tasks within the payroll process. Implement automation tools, ensuring that they’re configured to align with company policies and local compliance requirements.
19. Predictive Analytics
Insight: Payroll isn’t just about disbursing salaries; it’s also about forecasting financial liabilities, budgeting, and future planning. Based on current and historical data, predictive analytics provides a window into future trends.
Actionable Strategy: Embed predictive analytics capabilities into your payroll system. Regularly review its forecasts, adjusting for external economic or industry-specific variables to ensure financial preparedness.
20. Advanced Reporting
Insight: As businesses grow, so does the complexity of their payroll data. Advanced reporting tools simplify and transform this data into actionable insights, helping businesses make strategic decisions.
Actionable Strategy: Opt for payroll solutions offering various reporting features. Ensure teams are trained to interpret these reports, translating data into actionable business strategies.
21. Payroll Fraud Detection
Insight: Payroll fraud, be it from internal or external sources, can have significant financial and reputational repercussions. Modern payroll systems have sophisticated tools to detect and prevent fraudulent activities.
Actionable Strategy: Incorporate AI-driven fraud detection tools into your payroll systems. Regular audits and real-time monitoring can act as robust deterrents against potential fraud.
Compliance and Payroll Security
In the age of digitisation and globalisation, the payroll landscape is undergoing significant shifts, not just in terms of technology but also in its responsibility towards data integrity, legal mandates, and environmental stewardship.
23. Data Security
Insight: As payroll systems become increasingly digital, they also become prime targets for cyber threats. Safeguarding sensitive employee data is not only a best practice but a foundational trust factor between employers and employees.
Actionable Strategy: Employ multi-layered security approaches like encryption, two-factor authentication, and regular security audits. Stay updated with global cybersecurity best practices and ensure they are integrated into the payroll system.
23. Regulatory Compliance
Insight: As businesses expand across borders, they face complex regulations that change frequently and vary by region. Non-compliance can result in financial penalties and damage to reputation.
Actionable Strategy: Invest in payroll solutions designed to adapt to varying regulations. Conduct regular training sessions to keep the HR and payroll teams abreast of international and local compliance requirements.
24. Outsourcing Payroll
Insight: The complexity of modern payroll and the demands for accuracy and compliance have led many companies to rely on external experts who specialise in these areas.
Actionable Strategy: If considering outsourcing, perform thorough due diligence to select a provider that aligns with your company’s needs, values, and operational footprint.
25. Sustainable Payroll
Insight: The global call for sustainability is resonating within the payroll sector. Eco-friendly practices reflect corporate responsibility and can result in operational cost savings.
Actionable Strategy: Promote paperless payroll processes, utilize energy-efficient infrastructure, and support digital methods of communication and documentation.
Looking Beyond Today: The Future of Global Payroll
For global employers navigating the intricate web of payroll management, the current trends and innovations represent just the beginning. The fusion of technology, employee expectations, and regulatory dynamics is reshaping the fabric of payroll processes. But what lies ahead?
The next wave of payroll transformation will likely be characterised by even deeper artificial intelligence integrations, pushing the boundaries of predictive analytics and personalised employee experiences. Global employers should anticipate the rise of more universal compliance standards, especially as businesses continue to transcend traditional geographical boundaries. This may streamline multi-country operations, offering a more unified approach to global payroll management.
Additionally, the definition of ’employee’ might evolve, given the rise of gig economies, remote work, and unconventional work structures. Payroll systems must be agile and accommodate diverse employment models, from full-time contracts to micro-tasks.
Furthermore, as sustainability influences corporate strategies, eco-conscious payroll practices may become a standard expectation, not just an added advantage. This would be driven by environmental imperatives and a new generation of employees prioritising eco-responsibility.
For global employers, the message is clear: Embrace the present innovations, but always keep an eye on the horizon. The world of payroll is not static; it’s dynamic and ever-evolving and holds promise for those willing to adapt, innovate, and lead.
Simplify Your M&A Operations with a Global Employer of Record
HR’s Role in Smooth Mergers and Acquisitions Transitions The success of mergers and acquisitions (M&A) depends on speed, but HR teams are often left in the dark until the last minute. This can make it challenging for HR teams to adapt and prepare for the changes that come with the deal. As a result, the… Read more Simplify Your Mergers and Acquisitions Operations with a Global Employer of Record
HR’s Role in Smooth Mergers and Acquisitions Transitions
The success of mergers and acquisitions (M&A) depends on speed, but HR teams are often left in the dark until the last minute. This can make it challenging for HR teams to adapt and prepare for the changes that come with the deal. As a result, the HR team must work quickly and efficiently across multiple locations to ensure a seamless transition and prevent any negative impact on the deal.
In addition to the time constraints, HR must also navigate the complex legal and compliance requirements of multiple markets where they may have limited knowledge. They must also quickly integrate new systems and processes, often with a limited runway.
Furthermore, HR is tasked with supporting and training a new workforce with different cultural norms and expectations. Failure to adequately engage the new workforce can lead to low morale, decreased productivity, and increased turnover rates.
To succeed in Mergers and Acquisitions M&A deals, HR leaders must be able to manage the challenges of a fast-moving, complex environment while still delivering results. However, it is important to consider the risks and challenges that may arise if HR operations are not effectively managed across multiple jurisdictions.
Global Employer of Record companies can maximize success during times of change, such as mergers and acquisitions, business restructuring, or close-downs.
Inadequate HR management during a merger or acquisition for global employers can result in various challenges, such as non-compliance issues, difficulties in managing employees, risks of litigation, inconsistent HR operations, and limited access to top talent in different regions.
This article will discuss the benefits of working with a Global Employer of Record service during times of change and how a Global EOR can mitigate these risks and ensure effective HR operations across multiple jurisdictions.
During Mergers and Acquisitions, business restructuring, or close-downs, a Global EOR can help ensure a smooth transition for employees, provide clear communication and handle any issues that may arise.
Navigating HR Challenges during Mergers and Acquisitions
Labour, Tax, and Immigration Compliance Issues
Compliance issues are one of the main risks of not having comprehensive HR management across locations. Each country has its own labour, tax, and immigration laws and regulations pertaining to employment, and failing to comply with these laws can lead to costly fines and legal disputes. International Employers could face difficulties staying up to date with the intricate and constantly evolving laws in different jurisdictions without the assistance of a global EOR.
Employee Management during Mergers and Acquisitions (M&A) Operations
M&A and other business transitioning processes can create significant challenges for employers with employees in multiple jurisdictions. From global payroll and benefits to employer and employee taxes, there are numerous aspects of global HR operations to consider.
Managing employees across multiple jurisdictions can be complex and challenging, particularly regarding global payroll, benefits, employer and employee taxes, and other aspects of global HR operations. Without the guidance and expertise of the Global Employer of Record, international employers may struggle to manage employees effectively, which can lead to high turnover rates and low employee morale.
Risk of Litigation: Don’t Let Poor HR Management Ruin Your Mergers and Acquisitions Deal
Neglecting HR management during M&A can lead to several problems, including non-compliance with local laws, disengaged employees, and the departure of valuable personnel. Poor HR management can increase employers’ litigation risk, particularly if employees feel their rights have been violated. This can include issues such as wrongful termination and more. These consequences can harm the reputations of both the acquiring and acquired companies, ultimately putting the deal’s success at risk.
Moreover, many countries have mandatory benefits requirements, such as health insurance, pensions, and paid time off. Employers may struggle to navigate these requirements without proper guidance, resulting in legal disputes and unhappy employees across jurisdictions.
Working with a Global EOR with expertise in managing global HR compliance and benefits can mitigate these risks by ensuring employers comply with in-country regulations and avoid costly legal issues.
Lack of Consistency
Employers operating in multiple jurisdictions may struggle to maintain a standardized approach to HR operations if they lack consistent HR management. This can cause confusion and frustration among employees and lead to potential legal issues if employment practices vary across regions.
Inconsistent HR practices and policies can create significant challenges for companies undergoing an M&A deal, potentially leading to reputation damage and legal issues.
However, by partnering with a Global EOR, employers can ensure a standardized and compliant approach to HR management, mitigating these risks and increasing the likelihood of a successful M&A deal.
Limited Talent Pool
During M&A or other business transitioning, international employers will likely face challenges in attracting and retaining top talent in different regions. This challenge becomes more pronounced in countries where skilled workers are scarce or where talent competition is fierce.
Engaging with a Global EOR can assist employers in retaining and attracting top talent by providing competitive compensation and benefits packages and fostering a supportive and positive work environment.
Benefits of Partnering with a Global Employer of Record to Support Mergers and Acquisitions (M&A) Operations
If your business is undergoing any transition, such as a merger or acquisition (M&A) or a shutdown, it’s crucial to understand the benefits of teaming up with a Global Employer of Record (EOR) service. A Global EOR can help ensure a smooth transition by providing valuable support and solutions. Here are several ways that a Global EOR can prove advantageous during times of change.
Employee Transfer and Management
In the case of an M&A, a Global EOR can help transfer employees from one company to another. This includes ensuring a smooth transition for employees, providing clear communication, and handling any issues that may arise. In addition, a Global EOR can also manage employees during business close-downs, including handling severance payments and termination procedures following all in-country labour and tax laws.
Compliance with Local Laws and Regulations
During M&A or business close-downs, significant legal and compliance issues may be considered. Firstly, a Global EOR can help international employers navigate the complex and rapidly evolving landscape of global employment laws and regulations. This can be particularly challenging for employers operating in multiple jurisdictions, as they must comply with the different legal requirements and cultural norms of each country in which they operate.
A Global EOR can help ensure compliance with local labour and tax laws and regulations, including compliant employment contracts, tax filings, and benefits administration. By working with a Global EOR, businesses can avoid legal issues and fines that may arise if compliance issues are not handled correctly.
The deep global employment expertise of the Global EOR and their in-country best practices can help international employers remain compliant with all applicable laws and regulations, reducing the risk of costly legal disputes or regulatory penalties.
Minimising Risk and Cost during Business Transitions with Global EOR Solutions
A Global Employer of Record can help minimise the risk of legal issues and associated costs during business transitions by providing expert guidance on compliance issues across multiple jurisdictions. They can ensure that all employment contracts, benefits, and tax obligations comply with local laws and regulations, reducing the risk of fines and penalties.
In M&A situations, a Global EOR can conduct due diligence to identify and address compliance issues and provide ongoing support to ensure a smooth transition.
Maximizing Business Agility with a Global EOR’s Flexible Talent Engagement Model
A Global Employer of Record can offer various global employment solutions to help businesses navigate through M&A or business close-downs. With a flexible global talent engagement model, businesses can scale up or down quickly to meet new demands while minimizing the risk of financial penalties associated with non-compliance. This is achieved through the Global EOR’s expertise in managing compliance issues and navigating the complexities of HR operations across multiple jurisdictions. By partnering with a Global EOR, businesses can benefit from streamlined HR processes, including payroll, benefits administration, and employee onboarding and offboarding.
How Acumen International Can Facilitate M&A Operations
As a leading global EOR, Acumen International has the expertise and experience to help businesses navigate the complexities of M&A operations. With our extensive network of local partners and their in-depth knowledge of local laws and regulations, we can ensure a smooth and seamless transition during times of change, such as M&A or business restructuring. This can help minimize disruptions to operations and maintain productivity while also ensuring compliance with local laws and regulations.
Partnering with Acumen International can also help businesses save time and resources by streamlining HR processes and minimizing administrative burdens. Our comprehensive global employment solutions, including payroll management, employee benefits, and HR compliance, can help businesses focus on core activities and strategic initiatives rather than being bogged down by administrative tasks.
In this candid conversation, we dive into the transformative journey of Acumen International, exploring the nuances of adapting to a hybrid workforce model and the strategic moves that set the company apart in the global employment solution arena. Abid Hamid, Non-Executive Director at Acumen, shares his first-hand insights with a blend of professional acumen and… Read more Navigating New Horizons: Interview with Abid Hamid, NED at Acumen International
In this candid conversation, we dive into the transformative journey of Acumen International, exploring the nuances of adapting to a hybrid workforce model and the strategic moves that set the company apart in the global employment solution arena. Abid Hamid, Non-Executive Director at Acumen, shares his first-hand insights with a blend of professional acumen and personal flair.
Q: Can you share a brief overview of the global meet-up in Cyprus and how it symbolised a new chapter for Acumen International?
A: Cyprus was an opportunity for our dispersed team, scattered by the war in Ukraine, to come together. It was a rare chance for face-to-face connections that we’ve been missing, making it more than just a corporate meet-up. It marked a new chapter of resilience and unity.
Q: What were the key challenges and triumphs experienced by Acumen in relocating the team and adapting to remote work over the past two years?
A: No one has a continuity plan for war breaking out. But we adapted to it incredibly well. Anyone who wanted to move could do so. We ended up scattered across the globe. And yet, the business didn’t just survive; it thrived. That’s a testament to our resilience. Despite everything, we supported our clients without missing a beat, showing the true strength of our business fabric.
Q: What crucial learnings from Acumen’s remote work adaptation can you pass on to businesses currently exploring or optimising remote workforce models?
A: After AI, remote work is probably the most talked about item at board meetings across the world, but the problem when expanding internationally, is how to retain a culture. With Acumen’s Global Payroll Calculator (GPC), the world becomes your talent pool. Imagine you’re a US company needing web developers. With the GPC, you input your budget, and you can compare five different countries instantly. It’s like having the world at your fingertips, offering you the best talent, regardless of geography.
I think the only problem we have, is that while you can hire anyone from anywhere, maintaining company culture becomes the new challenge. Ensuring that someone joining from halfway across the world feels as connected and invested as someone in your local office is critical.
The advent of remote work has levelled the playing field regarding cultural differences. Entering a new market, such as opening an office in India or Malaysia, for instance, brings its own set of challenges and learnings. But remote work has, in many ways, made understanding and bridging these cultural gaps easier. The key lies in not just leveraging tools like the GPC for global hiring but in deeply investing in the cultural integration of your global workforce.
Q: Following Acumen’s launch of the Contractor Solution to support the global trend of hybrid workforces, how do you envision companies effectively leveraging a mix of freelance and full-time talent?
A: The future is hybrid, no doubt. With Acumen’s Contractor Solution, we’re essentially giving expanding businesses a new toolkit. Whether you need someone for six months or a permanent team member, we’re providing global employment solutions for all options. Our expertise in knowing the legalities and nuances of 190 markets can help our clients make informed choices. Many countries, especially around Europe, have strict rules when it comes to contracting, so it’s important that our clients understand this and can see all the best options available.
We’re not just offering services; we’re enabling decision-making with a comprehensive understanding. It’s about flexibility, but also about compliance and making the right decision for your needs.
Q: With the evolving nature of work, what strategies do you recommend for businesses to remain agile and competitive in leveraging global talent?
A: Talent is what makes a company grow. Today, you’re not limited to your local talent pool; you’ve got access to talent across the whole world. But diving into global hiring is not just about finding cheaper alternatives; it’s about finding the best fit for your needs. The right partner can demystify the process, ensuring compliance, quality, and cost-effectiveness. It’s about broadening your horizons and making choices that align with your strategic vision.
Acumen can step in to de-risk the global hiring process. We offer tools and insights that simplify complex decisions, like choosing between hiring locally or venturing into new markets like Chile or Bulgaria. Our job is to remove the intimidation factor from global hiring, ensuring compliance with regulations, transparency, and quality every step of the way.
Q: What advice would you give leaders managing the transition to a hybrid or fully remote workforce model?
A: Dive deep and understand what you’re getting into. Don’t shy away from seeking help. The shift to remote or hybrid models is laden with nuances—from legal and tax implications to cultural integration. It’s about understanding the playing field and making informed decisions. Markets like South Africa offer highly skilled, English-speaking specialists available in the same time zone at a lesser cost than someone in the UK. Find a specialist like Acumen who can talk you through it and find a solution that works for you. And remember, cost isn’t the sole factor; it’s the value that matters.
Q: How does Acumen plan to support businesses in navigating the shift towards more flexible, hybrid workforce models in the coming years?
A: At Acumen International, our approach goes beyond offering mere global employment services; we offer full consultation solutions. With over two decades under our belt, we are committed to education, risk management, and strategic advice. Throughout this, we have navigated the complexities of global employment, enabling us to offer unmatched insights and practical advice.
This vast amount of knowledge we have, allows us to guide businesses with confidence, backed by real-world proof points of our expertise. Whether it’s explaining the intricacies of compliance across different jurisdictions or tailoring workforce solutions that fit a company’s unique needs when entering a new market..
When you engage with Acumen, you’re not just leveraging our services; you’re tapping into a rich history of expertise and a proven track record.
A subsidiary, a representative office, or any other term you want to use, describes the foreign arm of a multinational company that does business in said country. Technically, a given company could have as many legal entities as it has in countries it does business in, one in the Philippines, one in the UAE, and… Read more Legal Entity Setup Overseas: Is It Really What You’re Looking For?
A subsidiary, a representative office, or any other term you want to use, describes the foreign arm of a multinational company that does business in said country. Technically, a given company could have as many legal entities as it has in countries it does business in, one in the Philippines, one in the UAE, and one in Spain, for example.
One thing that is going to have a significant ripple effect on your foreign branch is what structure you decide to take. Whether you go into incorporation or create a stand-alone subsidiary impacts your tax liability, business capabilities, and more. Here’s a look at all the major entities that can employ staff and what sets them apart:
Selecting the Ideal Overseas Legal Entity Set Up Option
When your company leadership decides to expand into a new country, one of the first things you’re likely to hear is how important it is for you to start a new legal entity in that country. Short-term employee trips may be satisfactory for exploratory visits, but a formal legal entity is needed for significant business relationships. So, with this in mind, here’s a closer look at what it takes to set up a foreign business entity and when you should look into employment without establishment in a country of your choice.
Establish Entry and Exit Strategies Beforehand
The business world is always moving forward. To stay ahead of the competition, it is essential to grow quickly and make decisions without hesitation. This can sometimes lead to businesses expanding without a well-thought-out plan, but taking advantage of opportunities as they arise is often necessary.
Different businesses have different strategies for entering and exiting countries. However, ad-hoc strategies are more likely to lead to miscommunication and problems. Businesses must have a fully realized strategy before entering or exiting countries. By doing more planning and preparation, the process will be more straightforward.
If your business can rapidly enter and exit markets, it will be much easier to be agile and responsive to fluctuations in demand. This flexibility reduces the chances of disruptive bottlenecks and helps ensure continued growth.
Understanding the Concept of Permanent Establishment
There is no one-size-fits-all when choosing the suitable business model for your company. It depends on your business activities, budget, employment plans, time constraints, and risk tolerance.
When organizations consider expanding their operations internationally, they must decide whether to establish a legal entity in-country. If your organization has determined the time is right for global expansion, and you’ve decided the location(s) targeted, you will need to consider establishing a legal entity in-country. Deciding whether to set up a legal entity in the host country and, if so, what type of entity to set up will be critical to protecting your organization’s bottom line and reputation.
What Is a Permanent Establishment?
A permanent establishment (PE) is a fixed place of business that can be a branch office or an independent office to conduct business activities and generate profits in a foreign country. The PE is subject to tax on its income derived from within the host country, even though it may be part of an integrated enterprise with operations outside the host country. The PE can also be taxed on its income from outside the host country if it has obtained substantial benefits from being present in the host country and carrying out business activities there.
Permanent Establishment Management Control
The critical question is whether your organization wants to control its business operations in that country or prefers to outsource all aspects except managing assets and collecting profits.
A foreign legal entity might be best suited if you want to maintain direct control over everything from accounting procedures to staff management. However, an alternative setup option may be right for you if you want to outsource some aspects of your operations other than managing assets and collecting profits.
Some countries require you to have a percentage of local ownership to do business. This makes the LLC an appealing option. As a limited liability company, shareholder exposure is limited based on the investment.
Permanent Establishment Timeframe
Establishing a legal entity is a critical first step. Depending on the country, the type of legal entity selected, and other factors, this process can take anywhere from two weeks to six months. Some countries allow businesses to establish an entity without having a physical office space or local bank account – these are typically the faster options.
Before you embark on any foreign venture, ask yourself the following questions.
20 Questions to Ask Before Choosing a Foreign Legal Entity Set Up
What activities do you see your company performing in the host country, now and in the future?
How many employees or contractors will you engage in the host country?
What will the partners’ level of involvement be in the host country?
What are your long-term plans for operating in the host country? Do you plan to expand your business there?
Would you like to buy or lease office space in the host country?
What is your timeframe for operating in the host country?
What revenue model do you plan to use?
Are marketing and PR any significant advantages to operating as a local company?
What potential tax implications will your company have if it expands into the host country?
Could any taxes be levied on specific industries or types of investment?
Would there be any unusual withholding taxes on fund transfers or sales of goods?
What initial capital and governance requirements must be met to establish a new business in a foreign country?
What is the ideal number of shareholders to distribute ownership among?
Who will act as a local director?
What level of freedom will local management have?
Do your employees in the host country have a designated workspace from which they will operate? This could be their home office or other formal business accommodation.
Are your employees in the country extensively involved in sales or contract negotiations? They don’t need the power to sign contracts to qualify as being involved in contract negotiations.
Do your employees’ job titles or descriptions pertain to revenue generation?
Do your employees receive compensation related to sales, such as commissions or bonuses for meeting sales targets?
Do they receive compensation based on sales, such as commissions or bonuses for their sales performance?
3 Options for Multi-location International Employment
Businesses establishing a global presence face the challenge of managing and scaling an employee base with no common borders or language. To successfully expand abroad, companies have several options for enabling hiring in international markets.
There are six key things to consider when choosing an employment method for your company’s global expansion:
Budget and time frame
Tax implications
Compliance
Employment liability
IP protection
Asset acquisition.
The most commonly used foreign market entry modes are the following:
Overseas Permanent Establishment (a representative office, a branch, a subsidiary, and other foreign legal entity types )
Selecting independent contractors to handle tasks remotely.
Work with a global EOR (Employer of Record) and GEO (Global Professional Employer Organisation) Partner.
The legal entity available to you will differ depending on the country, but there are generally three most common Permanent Establishment options:
a representative office;
a branch;
a subsidiary.
Representative Office
What is a Representative Office?
If you’re looking to establish a presence in a new country with little to no revenue generation, a Representative Office (RO) may be the way to go. A Representative Office is the most limited of all options on this list, generally designed to allow a company to do marketing and other non-transactional practices.
Representative Offices are relatively quick and easy to set up. Your staff can be involved in brand promotion, customer service, or distributor support—but not direct sales or contract negotiations. Due to these limitations, an RO may not be the best option if you’re looking to grow your business rapidly in a new market.
When Open a Representative Office?
If your organization is considering establishing a Representative Office, some circumstances might make it a worthwhile investment. For example, if you need to conduct market research or attend trade shows to gauge potential interest in your product or service in a new territory or if you have customers or distributors who would benefit from regular in-person communication and support. Another reason you might need a Representative Office is to oversee local or regional brand promotion.
Branch
What Is a Branch?
A branch office is a company’s division that operates in a different geographical area from the parent company. This allows the business to serve a specific market or region more effectively. For example, a company headquartered in New York may have an office in Tokyo to serve the Japanese market or an office in Munich to serve the German market.
When Open a Branch?
Opening a branch office in another country can have profound implications for your company. First and foremost, you will not be protected from any legal obligations arising from the branch’s activities. Secondly, any profits generated by the branch will be subject to host-country taxes. Before deciding to open a foreign branch, be sure to research the host country’s tax laws and transfer pricing arrangements.
A branch office keeps many of the benefits of a subsidiary and is generally easier to register or capitalize. The trade-off here is that the laws of some countries mean you can only do marketing and sales work from a branch office.
Branch offices can have some disadvantages, but there are also situations where registering one may be the right decision for your organization. You should consider establishing a branch office if the following circumstances apply:
You will be involved in many activities in your host country beyond marketing. These activities are essential for sales and transactions but do not directly or indirectly generate revenue. Therefore, you need staff on the ground to carry out these essential tasks.
After careful consideration, you have concluded that the host country’s tax laws will protect the parent company from liability and have little impact on your overall profitability.
You have an excellent opportunity to move quickly and capture a market before the competition. You don’t want to spend time establishing a subsidiary entity type, so take advantage of this chance now.
You don’t plan to stay in the host country for very long.
Subsidiary
What Is a Subsidiary?
A subsidiary company is a separate legal entity from its parent company. A parent company usually establishes a subsidiary to conduct business in the host country. The main advantage of having a subsidiary is that it provides a layer of protection for the parent company from any liabilities arising from the subsidiary’s activities.
While setting up a subsidiary can be time-consuming and require significant financial investment, the advantages often far outweigh the challenges and costs. Subsidiaries can help limit the parent company’s tax exposure by shielding profits from taxes in the host country, which can provide excellent stability and security for the business.
A subsidiary is the most formal structure possible, which brings some key benefits, like having 100% foreign ownership. The trade-off is that it is also the most expensive and challenging to set up. Note that some countries require capitalization for any subsidiaries.
When Open a Subsidiary?
Businesses should consider establishing a subsidiary when the following circumstances exist:
Your plans involve staying in the host country for an extended period.
You have big plans for your business in the host country, and you’re confident that the profits will be high enough to justify setting up a subsidiary there.
Registering your company locally will improve its image and bolster its marketing and sales efforts. This move will help communicate to your customers that you are invested in the community and increase confidence in your brand.
If a company decides to open a branch office or another type of non-subsidiary entity in another country, that company will be required to pay taxes on its earnings in that country according to the tax laws of the host country.
Advantages and Disadvantages of Each Legal Entity Type
Entity Type
Advantages
Disadvantages
Representative Office
No in-country Corporate Tax
Less regulatory oversight
Short set-up time
Cannot perform core business activities, sell, or transact business
Grey-area activities, such as marketing and service activities, may trigger the permanent establishment
Branch
Can engage in the core business, sales, and transactional activities
No share in the capital is required in most jurisdictions
Greater flexibility to enter or exit markets
Relatively short set-up time across most of the jurisdictions
Subjects parent company to legal obligations arising from branch activities
Can expose parent company profits to host-country taxes
Set-up and administration costs can be as expensive as a local subsidiary
Subsidiary
Can engage in the core, sales, and transactional activities
Limits tax and legal liability of host-country activities
The entity can be marketed as a part of the local community
Set-up can be a lengthy process, with multiple government registrations
May require statutory capital investment
May require local directors
Subject to host-country regulatory oversight
Pros and Cons of Setting Up a Business Entity
One topic that isn’t discussed as much as it should be is whether setting up a business entity can help or hinder expansion plans. Here are some examples of positives and negatives in this regard.
Pros of Setting Up a Business Entity
Compliance
This is probably the apparent advantage. You can’t legally hire and manage employees unless you have some form of legal entity. There are alternatives that are arguably better suited for many companies, though. We will discuss those later.
Flexibility
Depending on your setup format, your company will have much more versatility in business actions in the new country. If you are willing to make the investment to set up a full subsidiary, you have an entirely separate legal entity to work with.
Cons of Setting Up a Business Entity
Outright Restrictions
In some countries, like Saudi Arabia, there are limits on who can open a business in certain industries. For example, if you wanted to get into oil there, you would need to partner with a local. Naturally, finding a business partner you want to work with takes time.
Bureaucracy
Setting up a foreign branch or representative office still requires you to fill out various forms and communicate with different government agencies in your country of choice. Language and cultural barriers can make these complicated and slow things down even more.
Different Entry Requirements & Costs for Opening a Company in Several Countries
Permanent Establishment Risk: Addressing the Concerns
You may think you can conduct business overseas without registering a legal entity, but you would be wrong. You might need to register your business even if you only send an employee on a temporary assignment or establish a small promotional office. Failing to do so can result in severe consequences.
Different countries have different tax laws, and a multinational company must consider all of these when conducting business. The tax authorities of a particular country can determine which elements of the company’s economic activity take place in that country and how much profit is attributable to them. This process can be complex, but ensuring that the company complies with all applicable laws is essential.
Flying Under the Radar of Local Tax Authorities
An organisation’s sustained physical presence in a country can trigger a taxable presence, or a “permanent establishment” (PE), in that country. This may occur if the organization generates revenue directly from activities in that country or if the organization’s activities contribute to the revenue of a group entity in that country.
As an organization operating overseas, it is crucial to be cautious of triggering a Permanent Establishment (PE) under local laws, as this can expose your company to unexpected tax liabilities, fines, and reputational damage. Failure to properly register a Permanent Establishment can have severe consequences for your business, so it is essential to understand the requirements of each country in which you operate.
The OECD is using Action 7 of BEPS to tackle common tax-avoidance strategies used by multinational corporations to avoid paying taxes in the countries where they do business. The organization is trying to stop companies from sidestepping local tax authorities by establishing related distributors rather than agencies or commissionaires.
Triggering Permanent Establishment Risk
A business is taxed based on the geographic location of its income-earning activities. To ensure Fair Taxation of the Digital Economy, on 21 March 2018, the European Commission proposed new rules to ensure that digital business activities are taxed in a fair and growth-friendly way in the EU. The penalties for noncompliance are steep (20% penalty on top of the 3% tax, plus fines).
As businesses look to expand into new markets, they must be aware of their tax liability in each country with a customer base. They must also be aware of the compliance obligations in each country where they sell their products. Suppose you are selling digitally and don’t already have this in-house expertise or don’t work with a global PEO & EOR partner. In that case, you need to start thinking about addressing this challenge immediately.
As it turns out, the trigger of a taxable presence in another country is not just an abstract challenge but a real non-compliance risk. Business in another country can come with hidden risks – like inadvertently triggering a taxable presence.
Acumen International has experience dealing with this problem – we were approached by a client who had unwittingly violated PE laws abroad. Two of the company’s employees were placed in one of the EU countries, working from home. However, since they weren’t generating much revenue directly in that country, the company decided to do their payroll registration instead of registering a complete corporate legal entity.
One year later, the local state tax authorities came knocking to say that an employee’s job title containing the word “sales” meant the company should have registered in-country as a business, resulting in higher employer payroll taxes. Ultimately, the company owed over €20,000 in back taxes and fines.
Non-compliance with local PE requirements can have dire consequences for businesses. The company took steps to mitigate the damages, but the message is still pretty clear: adhere to the requirements or face serious repercussions.
A company set up in a foreign country can be justified as one with an international headcount of over 20 employees. If you’re dealing with a smaller headcount, a global PEO solution will be able to satisfy your needs cost-effectively.
A company setup is closely connected with ongoing expenses that must be considered during decision-making. A business’s cost to invest borders on $20K for legal company setup, with an additional $40 thousand annually spent for maintenance. The process will take three to four months, and this time must also be allocated.
A global PEO tackles this pain point by cutting you as much as 60% of expenditures while still providing you with the desired result: presence in a new country and active operations.
Third-party Global Employment Solutions: Be as Agile and Super Protected with a Global PEO and EOR Partner
Before hiring global talent, you must set up your business entity and jump through all the associated hoops. This can include paying taxes, setting up a compliant payroll system, and sometimes applying for a social security number from the tax authorities. These additional steps can take anywhere from a few weeks to several months.
Many companies see the decision to set up subsidiary companies as a critical function of doing business abroad. However, as we’ve pointed out, there are pros and cons to this approach.
Rather than go through the bureaucratic process, you can use a global Employer of Record solutions provider like Acumen International. We can help you in over 190 different countries. By taking the burden off your hands, we serve as an alternative, agile approach that supports modern global employment needs.
Global PEO and EOR — Alternative Options To Setting Up A Legal Entity Overseas
As your business expands globally, it is essential to be agile to make the best decisions for your company. Markets and consumer demand constantly change, so being as flexible as possible is vital. The more agile you are, the easier it will be to make the right choices for your business.
Outsourcing can be an excellent way for organizations to save money and increase efficiency. By carefully selecting which global employment functions to outsource and working with a trusted partner, businesses can reap the benefits of outsourcing without putting themselves at risk. Outsourced standard functions include payroll, benefits, and absence management, but deciding which functions to outsource should be made case-by-case. With careful planning and execution, outsourcing can help your organization run more smoothly and save money in the long run.
When expanding your business into new countries, there are many benefits to using a global PEO (Professional Employment Organization) or EOR (Employer of Record). A Global PEO and EOR Partners can handle all the immigration, hiring, payroll, tax, and HR compliance for you, freeing up your time to focus on other aspects of running your business. And if you ever need to leave the country, you can do so without being tied down by any long-term commitments.
The main benefit of using a global PEO versus a new entity for your business setup abroad is a lack of administrative cost and burden. Your global PEO provider will handle the complex logistics of staying compliant and managing your international employees without a legal entity. However, you ultimately have the final say on what gets done. Also, by going this alternative way, you still get the most considerable benefit that setting up a foreign entity could give you – expanding your presence in a new and lucrative market.
18 Burdens a Global PEO Can Relieve for Your In-House HR Department
Drafting compliant employment contracts to adhere to local labor and tax regulations in 190 countries
Lengthy onboarding
Complex and risky offboarding
Background checks
Workforce compensation administration
Ongoing compliance monitoring and guidance
Guidance on best practices of voluntary benefits provisioning
Immigration and relocation support for your ex-pat workforce, such as visa sponsorship and securing work permits
Lack of institutional knowledge.
IP right protection
Lack of local and international legal support
Convert local contractors into full-time employees
Business Transitions: acquisitions, mergers, close-downs
The need to deal with multiple global employment service providers.
Difference between an EOR and a PEO. Global Employment Risk Mitigation Strategy
Both PEOs and EORs work differently. However, an EOR is a company that takes on the legal risks of employing your workers, including finance, legal & compliance, and safety risks, saving you from any potential problems down the line. This means that all of the responsibilities that come with being an employer are shifted to them — from tax reporting to handling any injuries or issues on the job. You’ll have none of these hassles but will take responsibility for managing your employees’ tasks and performance.
ATTRIBUTE
PEO
EOR
Employment Model
Co-employer
Sole Employer
Permanent Establishment Factor
Can only work with clients who have a registered in-country (state) entity
Facilitates foreign expansion without setting up an entity
Key Services
Global employment, payroll, benefits, immigration (visa, work permits), mobility
Global employment, payroll, benefits, immigration (visa, work permits), mobility
Responsibilities
Responsible for the entire array of HR functions
Responsible for a portion of HR functions
Tax Administration
Depending on local tax regulations may require taxes to be filed under the client’s taxpayer ID
Files taxes under own Taxpayer ID Number
Payroll Funding
Requires advanced payments from the client
Provides payroll funding
Local Entity Establishment
Required
Optional
Local Entity Ownership
Does not own the entities. Instead, a global PEO partners with a local or global third-party provider. A PEO does not allow you to hire in other countries where you do not have a local entity.
100 % owns legal entities in the country of service. Allows to hire a workforce in other countries without setting up a business entity
Liability
Shares responsibilities and liabilities
EOR assumes all responsibilities and liabilities. It hires employees in the new country under its local business entity and takes on all of the legal risks.
Legal Advice
Optional
100% compliance required
Global Labour & HR Compliance
Optional
100% compliance required
Insurance
May require the client to provide their own insurance.
Provides general liability (GL) and workers’ compensation (WC) insurance coverage.
Benefits
Provides higher quality employee benefits at competitive prices
Provides higher quality employee benefits at competitive prices
Employment Agreement
The client must draft and sign the employment agreement with an employee.
Drafts and signs the employment agreement directly.
Pricing Structure
Fixed monthly fee per employee
Percentage of payroll plus applicable taxes
Fixed monthly fee per employee
Percentage of payroll plus applicable taxes
Global Employment Services: How a Global PEO and EOR can Help You in Business Transition
Acumen International PEO offers a unique blend of experience and service suite, providing global employment opportunities that are genuinely global-ready. If your company is transitioning, such as going through an acquisition or merger, or experiencing a company liquidation, Acumen International can find a legal and compliant solution to hire your employees—anywhere in the world! Many companies struggle with handling the employees being left behind during these times of transition. It’s common for employees to feel insecure about their future employment prospects, particularly when they have been forced out of their positions.
This can also be problematic for companies, who will likely have open positions that need filling but still have lingering contracts to fulfill. In both cases, having a resource like Acumen International PEO can ensure that the company’s business continues without being negatively affected by the change. When you’re working with Acumen International, we take care of all the paperwork and legal obligations so that you can focus on completing your transition plans. We also handle everything from payroll to benefits and even complete payroll tax administration for all our employees worldwide. This gives employers peace of mind that all their international obligations are fulfilled while allowing them to focus on their transition plans.
A reduction in the workplace can be a scary time for employees. Global PEO can provide outplacement services to help reduce the risk and ensure that downsized employees have some assistance while searching for a new employer.
Legally Compliant, Cost Effective & Hassle-Free Mode of Market Entry
Acumen International is a global employment (PEO and EOR) company that provides services to expanding businesses. Acumen understands how employers can benefit from outsourcing their human resources management and the challenges an employer faces during this period of change. Acumen can help minimise these risks by offering businesses compliant and secure global employment services.
Acumen International’s global PEO and EOR services can help you by providing faster access to qualified talent in your industry. Our PEO and EOR services can help you get a presence in 190 countries quickly and easily without worrying about compliance with labour and tax regulations.
Are you an employer looking to hire looking for qualified talent in your industry but don’t want to go through the hassle of setting up a foreign legal entity? If so, you may need to partner with a global Employer of Record (EOR).
8 Scenarios When You Might Need a Global PEO and EOR Partner
You have hired an employee but are unhappy with your current employment service provider.
You’ve decided to hire an independent contractor instead of a full-time employee, but you’re unsure if you comply with local laws and regulations.
You are currently looking to improve the quality of your employment services.
You can no longer afford to maintain a whole legal operation via your entity in the target country.
You have a temporary project or one that doesn’t require you to open a legal entity in the target country.
You need to hire a foreign workforce for your new project.
To expand your business, you will need a mix of local and foreign employees. Those who are familiar with the local market will be able to help reduce the learning curve.
International employers’ biggest challenge is supporting their organization’s employees when their business restructures or reorganizes. A global Employer of Record can support your business upon mergers, acquisitions or close-downs. When you manage the employee relations aspects during any business transitions (M&As or close-downs), you want to ensure that the process is seamless and 100% compliant.
In an era where technology continues to shape the landscape of global business, the need for a human touch remains paramount. Acumen International stands at the forefront of this intersection, championing a human-centred approach to global employment solutions. At the helm of these efforts is Maria Savva, Global Operations Director, whose insights and leadership have… Read more A human-centered approach in global employment
In an era where technology continues to shape the landscape of global business, the need for a human touch remains paramount. Acumen International stands at the forefront of this intersection, championing a human-centred approach to global employment solutions.
At the helm of these efforts is Maria Savva, Global Operations Director, whose insights and leadership have been pivotal in steering Acumen’s course towards enhancing client experience through technology.
Q: Could you share your perspective on the recent global meet-up in Cyprus and how it’s influencing Acumen’s direction, particularly in blending human interactions with technology?
A:The Cyprus meet-up was nothing short of amazing. For many of us, it was the first time we met in person, which brought an invaluable dimension to our teamwork and problem-solving abilities. The CEO’s presentation gave us insight into Acumen’s evolution as a global employment organisation across 190 countries and solidified our vision for the future. This experience united us, building trust and a strong team spirit. It was a crucial step in our journey, especially as we aim to further humanise technology in our operations.
Q: As the Global Operations Director overseeing customer-facing teams, how do your interactions with clients inform and shape Acumen’s technology roadmap?
A: Our approach is rooted in active listening. By engaging directly with our clients, we grasp their expectations and explore how we can exceed them. This interaction is the cornerstone of how we evolve our technology. Feedback varies; while some clients prefer regular updates through calls, others may not wish to dedicate as much time. Regardless of the method, we prioritise understanding their needs, which informs our technological advancements and innovations, like the Global Payroll Calculator. This tool is a reflection of our commitment to not just meeting but exceeding client expectations with our global employment services.
Q: Which of Acumen’s products are you excited about, and why?
A: I’m particularly proud of our Global Payroll Calculator and Navigator. These tools provide specific, country-level legal insights, which are instrumental in making informed decisions when expanding your team internationally. What sets us apart is our holistic approach. We offer a unique combination of human interaction, customised solutions, knowledge, and technological tools, which is something our competitors often lack. This blend ensures that our clients can always reach a real person with their queries, whether they’re about legislation, compliance, or budget concerns, setting us apart as a leading global employment company.
Q: How does the feedback loop with clients help refine Acumen’s services and technological solutions?
A: Our dialogue with clients provides critical insights that help us tailor and refine our technology. For example, integrating data input features specifically requested by our clients’ finance teams allows us to offer bespoke services that significantly enhance their operational efficiency. This ongoing feedback is vital for continuous improvement and innovation in our offerings, cementing our status as a premier employer of record services provider.
Q: What strategies do you employ to ensure Acumen’s team exceeds client expectations through technology and personalised service?
A: Our primary strategy is to be available, transparent, accountable, and easy to engage with. We foster a culture of mutual learning between our team and clients, which enhances our service delivery. We emphasise on hiring skilled and empathetic individuals who care deeply about clients and our team and understand the significance of their work, which is central to our ethos. This approach not only meets but often exceeds client expectations, underlining our role as a comprehensive Global Employer of Record (EOR).
Q: How important is it for the Acumen team to deeply understand the intricacies involved with global employment?
A: The human experience is indispensable in our line of work. Clients appreciate the ability to speak to a human who not only understands their issue but can also empathise and offer solutions. This level of responsiveness and empathy cannot be replicated by technology alone. It’s the human touch that often makes the difference, providing reassurance and clarity in complex situations, especially in the realm of global employment outsourcing.
Q: Acumen’s long history and global reach give it a competitive edge. Could you discuss the key services you’re particularly proud of?
A: Our extensive experience, covering over 20 years and operations across 190 markets, gives us a profound understanding of global employment intricacies. As one of the first companies in this space, we established a robust framework early on. This foundation, enriched by decades of experience, has only added value to our offerings over the years. We’re able to provide comprehensive services, including Employer of Record and all-encompassing immigration solutions.
I’m particularly proud of our ability to help our clients deal with complex circumstances, showcasing our adeptness at navigating intricate regulatory landscapes. Our long-standing position and accumulated expertise in the market enable us to deliver unparalleled service and support to our clients, affirming our commitment to excellence and innovation in the global employment sector.
Q: Finally, what achievements under your leadership have made you most proud?
A: First of all, I’m proud of our team. I have an amazing team that supports our company on all levels, including clients, partners, colleagues, and management. Our client-centric approach, combined with our technological tools, has not only sped up processes but also deepened our team’s understanding and increased efficiency, making Acumen a formidable player in the tech and global employment sectors.
The root cause of employee misclassification is often a mix of financial motivations, regulatory complexity, the desire for flexibility, and sometimes a lack of awareness or deliberate avoidance of legal obligations. Addressing these underlying causes requires a clear understanding of employment laws, a commitment to compliance, and, often, a willingness to invest in the proper… Read more How To Convert Independent Contractors into Employees
The root cause of employee misclassification is often a mix of financial motivations, regulatory complexity, the desire for flexibility, and sometimes a lack of awareness or deliberate avoidance of legal obligations. Addressing these underlying causes requires a clear understanding of employment laws, a commitment to compliance, and, often, a willingness to invest in the proper classification of workers to avoid the long-term risks and costs associated with misclassification.
In this article, we address a significant shift in today’s work environment: the transition of workers from contractor roles to full-time employment. Its aim is to provide organisations with practical advice and strategies for managing this transition effectively, ensuring legal compliance and operational efficiency.
Neglecting the significance of tax compliance can lead to various risks for a business. Not only does it carry the possibility of legal repercussions, but it can also harm a company’s reputation and disrupt its operations. Moreover, compliance plays a crucial role in shaping economies and societal norms. However, achieving compliance is becoming progressively challenging in today’s complex regulatory landscape.
The shift from contractors to full-time employees is increasingly significant in a rapidly transforming global workforce. This shift marks a strategic pivot for businesses worldwide, driven by evolving regulations, changing workforce expectations, and the need for enhanced compliance.
Let’s delve into the crucial trends shaping this transition, offering essential insights for organisations navigating this change:
Increasing Regulatory Complexity: Globally, countries are experiencing more intricate compliance requirements. This complexity, varying significantly from region to region, makes ensuring compliance increasingly challenging and necessitates robust governance frameworks.
Varied Legal Interpretations and Lack of Clarity: Differences in legal interpretations and insufficient clarity in employment and tax laws can create compliance issues worldwide. This includes varying definitions and standards in labour laws, tax regulations, and employment benefits.
Intensified Audits and Regulatory Scrutiny: Increased regulatory scrutiny, technological advancements, and compliance with changing labour laws drive a global trend towards more rigorous audits. These audits often extend beyond basic legislation adherence to include standards like equity, diversity, and inclusion.
Evolution of Employee Compensation Structures: Globally, companies are rethinking compensation structures to meet evolving talent expectations and align with business goals. This shift has led to a greater focus from tax authorities on how compensation is structured and reported.
Rise in Workforce Mobility: Increased global mobility, including remote work, short-term international assignments, and virtual engagements, presents operational challenges in managing employment tax compliance and payroll obligations.
Enhanced Focus on Corporate Tax Risk Management: Tax regulators worldwide focus more on corporate tax risk management and governance, indicating a potential shift towards more stringent workforce tax issues in the future.
Need for Adaptive, Tax-effective Governance Frameworks: Organisations must understand their current compliance status and develop governance strategies that align with their business goals and risk appetite. This includes regularly updating tax policies, training teams, and implementing efficient tax technology and controls.
Anticipation of Tax Reforms and Legislative Changes: Many countries are likely to experience reforms in workforce taxation, particularly concerning classifications of employees versus contractors and the tax implications of various types of employee compensation.
Growing Concern for Employee Rights and Protections: There’s an increasing global focus on improving protections for workers, including independent contractors and contingent workers, which affects how businesses classify and manage different types of workers.
Transitioning Disguised Employees across Jurisdictions
Imagine a Hypothetical Scenario
You’re an employer juggling the complexity of a multinational workforce, and a hidden concern lurks beneath the surface—disguised employees. This raises critical questions: Why resort to this strategy, and how daunting is the path to compliance? Let’s delve into the motivations, triggers for change, and intricate landscape awaiting a transition project.
Why Contractors as Disguised Employees? (Motives)
Cost Savings: Avoiding employer taxes and benefits for disguised employees can translate to significant short-term financial gains.
Flexibility: Contractors offer freedom from rigid employment structures and easier termination than formal employees.
Specialised Skills: Securing specific skills through contractors bypasses lengthy recruitment processes for temporary needs.
Tax Optimisation: Companies with a global presence can gain a strategic advantage by utilising contractors across multiple jurisdictions with lower tax rates.
Triggers for Transitioning
Legal and Regulatory Risks: Increased scrutiny of disguised employees can expose companies to heavy penalties and reputational damage.
Employee Dissatisfaction: Disparity in benefits and rights between contractor and employee classifications can lead to resentment and legal challenges.
Talent Management Issues: Difficulty attracting, managing, and retaining top talent under contractor arrangements can hamper long-term growth.
Operational Inefficiencies: Lack of standardised processes and integration for disguised employees can create administrative burdens.
Lack of in-house resources to manage global talent and ensure legal compliance.
Company restructuring.
Transitioning to Compliance: What to Prepare for
Cost Impact and Unplanned Extra Cost: Increased payroll costs due to employee withholding taxes, employer social security contributions, and statutory benefits (varying across jurisdictions).
Termination Management: Navigating notice periods, severance payments, and potential legal claims during employment transition (also differing by country) and getting consent to the transfer as per legal requirements (depending on the country)
Project Framework: Develop a comprehensive plan with cost estimations, legal considerations, communication strategies, and timelines for each jurisdiction involved.
General red tape may affect the overall project timelines.
A Roadmap for a Successful Contractor-into-Employee Transition
Navigating this transition is not a mere checkbox exercise but a strategic move towards a stable, sustainable, and ethical workforce. By understanding the motivations, triggers, and consequences, you can chart a course towards compliance, mitigating risks while reaping the benefits of a truly engaged and empowered global workforce.
Avoiding Potential Threats
Under-taxation: Ensure accurate classification and tax payments to avoid penalties and reputational damage.
Permanent Establishment Risk: Manage cross-border operations to avoid permanent establishment risk and unintended tax liabilities in foreign jurisdictions.
Potential Penalties: Proactively address compliance issues to avoid financial repercussions and legal disputes.
Damaged Reputation: Maintain ethical practices and transparency to safeguard brand image.
Achieving Sustainable Goals
Business Security: Foster legal and operational stability by adhering to employment regulations.
Sustainability: Build a long-term, secure workforce through fair practices and talent development.
Talent Retention: Attract and retain top talent by offering competitive benefits and opportunities.
Fair Pay: Pay employees equitably, regardless of classification, to improve morale and productivity.
Scalability.
Growing businesses must compare and contrast key global employment variables across different countries when transitioning from contractors to full-time employees. By examining Payroll and Tax Implications, Statutory Benefits and Contributions, and Termination Conditions, specifically in Germany, Poland, France, the Philippines, and Argentina, we can gain valuable insights into how these variables differ and their consequent impact on an organisation’s financial planning and overall strategy.
This comparative analysis is not just about understanding individual costs; it’s about viewing these variables through a broader lens to appreciate their cumulative effect on the bottom line and strategic operations.
The data provided in these tables is essential for businesses operating across borders. They compare key employment factors in different countries, helping companies to navigate the financial liabilities and legal obligations in diverse markets. With this comprehensive overview, employers can better anticipate the challenges and opportunities of global expansion, ensuring a balanced approach to workforce management that aligns with both financial realities and long-term goals.
Action Plan for Transitioning Contractors to Full-Time Employees across Multiple Countries
Step 1: Audit of Current Employment Landscape
Gather Data: Collect comprehensive data on all contractors currently engaged in different countries, including their roles, positions, and contract terms.
Assess Compliance Risks: Evaluate the current contractor arrangements for compliance risks, particularly on misclassification issues.
Identify Key Transition Candidates: Based on the audit, identify contractors who should be transitioned to full-time roles to mitigate risks or align with strategic goals.
Step 2: Transitioning Process – Estimating Costs
Develop Cost Models Use Table:
Global Salary and Tax Implications to estimate changes in payroll costs.
Calculate potential employer burden and employee tax rates for each jurisdiction.
Benefits and Contributions Analysis:
Assess additional costs for statutory benefits using Table: Statutory Benefits and Contributions.
Termination and Severance Assessment:
Evaluate potential costs for terminations or severance using Table: Termination Conditions.
Total Cost Estimation:
Compile the data to provide a comprehensive cost estimation for the transition.
Step 3: Weighing Choices – Financial and Legal Planning for C-Suite
Compare Contractor vs. Full-Time Costs: Analyse the financial impact of transitioning contractors to full-time employees versus maintaining current arrangements.
Legal Compliance Check: Ensure the transition plan adheres to each country’s local employment laws and tax regulations.
Strategic Alignment: The transition plan should be aligned with the company’s broader strategic goals, such as talent retention or market expansion.
Step 4: Implementation Plan
Draft Transition Agreements: Prepare legal documents for transitioning identified contractors to full-time roles.
Communicate with Stakeholders: Communicate the transition plan to all relevant parties, including contractors, management, and HR teams.
Set Up Payroll and Benefits: Align with HR and payroll teams to integrate new full-time employees into existing systems.
Step 5: Ongoing Compliance and Management
Regular Audits: Conduct regular audits to ensure compliance with employment and tax laws.
Adjustments and Optimisation: Continuously review and optimise the employment structure in response to changes in laws, business needs, and workforce dynamics.
Step 6: Review and Feedback
Gather Feedback: Collect feedback from newly transitioned employees and management to assess the effectiveness of the transition.
Evaluate Impact: Assess the impact of the transition on business operations, compliance, and employee engagement.
Plan for Future Transitions: Use learnings to refine the process for future transitions.
Global Payroll Calculator – Your Precision Tool for Global Employment Cost Analysis
The Global Payroll Calculator (GPC) offers a sophisticated solution for instantly calculating employment costs across 190 countries, streamlining your global hiring strategy and ensuring cost-effective decisions.
Key Features & Benefits
Instant Cost Calculations: Quickly determine total employment costs, factoring in real-time tax rates and benefits for local and foreign talent in 190 countries.
Precision & Clarity: Achieve precise payroll calculations with detailed breakdowns of all payroll variables, ensuring transparency and preventing unexpected employment costs.
Cross-Country Comparisons: Utilise GPC’s capability to perform instant comparisons between countries, helping you identify the most advantageous locations for hiring.
Core Capabilities
Total Employment Cost Analysis
Monthly and yearly costs.
Gross-to-net and net-to-gross calculations.
Detailed breakdowns, including employer liability and employee taxes.
Full Tax Breakdown
Comprehensive coverage of social contributions, personal income tax, and automated tax caps.
Employer and employee tax splits with allowances and holiday entitlements.
Built-in Compliance
Ongoing validation against trusted government sources across 190 countries.
Updates in real-time to reflect the latest tax and labour laws.
Advantages of Global Payroll Calculator for Employers
Manage complex global payroll budgets effectively.
Identify tax-friendly, cost-effective global talent hotspots.
Ensure compliance with international regulations to avoid legal issues.
Unique Solutions for Global Expansion Challenges
Express Global Employment Support: Backed by 20+ years of Acumen International’s expertise, the Global Payroll Calculator is integrated with our global EOR solutions to support your international workforce management.
Robust Methodology: Standardises diverse data into a unified format, enhancing decision-making clarity across multiple jurisdictions.
With Global Payroll Calculator, you gain a powerful tool designed to optimise your global employment strategies and ensure that your international operations are cost-effective and compliant.
Closing Words
Transitioning contractors to full-time employees requires careful strategic planning and compliance with evolving regulations. The insights offered here serve as a guide for businesses looking to navigate this transition smoothly. If you need further help transferring contractors into full-time employees, contact Acumen International.
Contents Introduction Welcome to our March newsletter, where we’re exploring a theme close to our heart and critical to our mission: Humanised Technology. As the digital age propels us forward, Acumen International stands at the crossroads of innovation and personalised service, championing a service model that marries cutting-edge technology with the invaluable element of human… Read more Global Employment Newsletter. March 2024. Blending Tech Innovation with Personalised Support
Contents
Introduction
What is Humanised Technology?
How we maintain a truly customer-focused EOR business.
Interview with the CEO Nick Ghanzha, Navigating the Future of Work.
Spotlight on Portugal: A Hidden Gem for Tech Talent.
What’s New in Global HR Legislation.
Summary & Close
Introduction
Welcome to our March newsletter, where we’re exploring a theme close to our heart and critical to our mission: Humanised Technology. As the digital age propels us forward, Acumen International stands at the crossroads of innovation and personalised service, championing a service model that marries cutting-edge technology with the invaluable element of human touch.
This month, we’re busy developing groundbreaking technology innovations designed to improve efficiency and ensure our clients feel supported, understood, and valued at every step.
Join us in discovering how technology and human focus converge at Acumen for a truly unparalleled service experience.
What is Humanised Technology?
Following our global meet-up in Cyprus, we’re thrilled to share how our technology roadmap is shaping the future of global employment services. Humanised Technology at Acumen means blending our technological advancements with deep human insight and expertise. Our focus remains steadfast: to enhance, not replace, the human element in our services.
Maria Savva , our Global Operations Director, puts it best:
“We offer companies the chance to reach out to employees globally with a personal touch that understands the needs of our clients deeply. We pride ourselves on exceeding expectations through our commitment to excellence and personalised care.”
Read on to dive deeper into this exciting topic.
Insight: Maintaining a Customer-Focused EOR Business
In a world veering towards impersonal tech-driven solutions, Acumen International stands out by maintaining a truly customer-focused approach. Our unwavering commitment to our customers has defined our 23-year journey as a client-first focused business. We match technological capabilities with unparalleled support, ensuring our interactions foster solid partnerships throughout clients’ global employment journeys.
The Virtue of Organic Growth: Our growth is driven by customer revenue, emphasising sustainable development and agility. This approach ensures that our innovations meet the real-world needs of our clients, aligning with our commitment to prioritise customer satisfaction. Our CEO, Nick Ganzha, states, “We are a human-focused business supported by technology where we can tailor our solutions to the specific client needs and provide them with the solutions no platform can provide.”
Prioritising Customers in the SaaS Journey: The evolving HR tech landscape underscores the importance of a customer-first strategy. Our solutions are designed to effectively address specific customer challenges, fostering loyalty and ensuring sustainable competitive advantage.
The Centrality of Customer Needs: Understanding and addressing client challenges is pivotal. Our tailored solutions and support are aimed at enhancing the customer buying experience, fostering a culture of trust and reliability.
As we forge into 2024, we are poised to launch new innovative tools that perfectly balance advanced technology with our unmatched personalised support.
Interview: Navigating the Future of Work with Nick Ganzha, CEO
In an enlightening discussion, Nick Ganzha , CEO of Acumen International, shares the company’s strategic vision and innovative approaches in the realm of global employment.
Here are the condensed highlights of our conversation:
Cyprus Leadership Meet-Up: The primary objective was to embrace Acumen’s shift towards humanised technology, focusing on tailoring solutions to specific client needs. It served as a reunion to celebrate achievements, welcome new members, and outline actionable steps to improve Employer of Record Services.
Global Remote Workforce Transition: Here, Nick highlights the viability of remote work, emphasising the need for strategic human capital management and the importance of corporate social responsibility, especially in response to global crises.
Future Employment Trends:
The evolution of PEOs/EORs towards providing strategic business support.
The shift towards flexible, hybrid work models and the central role of trust within organisations.
The critical integration of technology to support human-centric productivity.
Adapting Strategies:
Emphasising technology that supports human efforts and addressing global workforce challenges.
Navigating economic uncertainties with resilient global employment strategies and tackling skill shortages.
Vision for Global Employment:
Transforming global mobility programs and emphasising skill-based hiring.
Adapting to employment shifts with flexible, compliant strategies.
Leveraging technology to enhance business competitiveness.
🎤 Read the full interview with Nick Ganzha >>>Read now
Spotlight on Portugal: A Hidden Gem for Tech Talent
Portugal is emerging as a prime destination for tech talent, blending cost efficiency with a vibrant culture and exceptional work-life balance. Here’s why Portugal stands out in the global tech landscape, and how Acumen’s Solutions are perfectly poised to support your hiring needs:
Why Portugal is Your Next Tech Talent Hub:
Cost Benefits for Employers: Save on taxes and incorporation costs, maximising your budget to attract top-tier talent without excessive overheads.
Work-Life Harmony: Portugal’s culture fosters productivity and creativity thanks to its enviable lifestyle and work-life balance.
Local Talent Commitment: With 50% of IT professionals preferring to stay in Portugal, employers have access to a pool of dedicated local talent.
Competitive Salaries in a Lower Cost Environment: The average salary for tech professionals (46K EUR) in Portugal goes further due to the lower cost of living, enhancing your return on investment.
Portugal not only offers a strategic advantage with its burgeoning tech talent pool but, combined with Acumen’s comprehensive Global EOR and Contractor Solutions, makes scaling your team or launching new projects more effective and efficient than ever.
Stay informed with the latest developments in global HR legislation to ensure your business remains compliant and ahead of the curve.
🇦🇺 Australia Introduces ‘Right to Disconnect’
Australia is set to empower its workforce with a ‘right to disconnect’ law, aiming to protect employees from working unpaid overtime and ensuring they are not obligated to be online outside working hours. This move is part of a broader effort to enhance work-life balance and is expected to come with fines for non-complying employers.
Employer Actions: Review and adjust work policies to comply with the new legislation, ensuring respectful communication practices outside of standard working hours.
🇸🇰 Slovakia Streamlines Employment for Third-Country Nationals
The Slovak government is easing the process for employing third-country nationals (TCNs) in the transportation and industry sectors, increasing the total number of employment visas issued. This initiative is designed to address labour shortages by facilitating the recruitment of foreign talent.
Employer Impact: Expanded talent pool and simplified hiring process for employers in critical sectors.
Employer Action: Consider leveraging this new policy via Acumen’s PEO Service to support hiring Expats in Slovakia
Hungary’s new immigration law, effective March 1, introduces 24 types of residence permits, including eight dedicated to employment. It also tightens conditions for TCNs and eliminates the flexible “residence permit for other purposes.”
Employer Impact: More defined pathways for hiring international talent but with increased regulatory complexity.
Employer Actions: Assess the new categories to identify applicable permits for future hires and adjust recruitment strategies accordingly. Acumen can support with work permits and immigration support.
As we embrace the synergy of technology and personalised support, Acumen International reaffirms its dedication to empowering clients while ensuring they feel valued and supported. This month, we invite you to discover the difference that humanised technology can make in your global employment journey.
Thank you for being with us this month. Here’s to pioneering a future where technology enhances human connection, making global employment more efficient and human.
In a revealing conversation, Nick Ganzha, CEO of Acumen International, shares insights into the company’s innovative approach to global employment and technology. He delves into Acumen’s strategic vision, its response to the challenges of remote work, and the trends shaping the future of the global workforce. Q: Can you outline the main objectives of the… Read more Navigating Change: An Interview with Acumen International’s CEO, Nick Ganzha
In a revealing conversation, Nick Ganzha, CEO of Acumen International, shares insights into the company’s innovative approach to global employment and technology. He delves into Acumen’s strategic vision, its response to the challenges of remote work, and the trends shaping the future of the global workforce.
Q: Can you outline the main objectives of the recent leadership meet-up in Cyprus?
A: Our primary goal was to introduce Acumen’s shift towards humanised technology, defining our objectives and roadmap. We are a human focused business supported by technology where we can tailor our solutions to the specific client needs and provide them with the solutions no platform can provide.
It was also a moment to reunite our team, celebrate our long-awaited reunion, welcome new members, and reflect on our remote working experiences. We also outlined actionable steps to improve our overall Employer of Record Services based on our comprehensive experience in the Global EOR market.
Q: After such an unprecedented few years, how did it feel to meet up with the team again?
A: Meeting with the team again stirred a complex blend of emotions. It felt as though everything had changed yet remained the same. The team’s unwavering dedication and level of engagement were palpable, but there was an underlying need to realign these qualities with our new strategic goals and the evolving market demands.
To evolve the concept of unity, it was more than just unveiling a new strategy and roadmap. It involves engaging with and listening to our global team’s feedback and their perceptions of market needs. This approach has proved immensely effective in transforming our team into passionate advocates and active participants in implementing our ideas, particularly our shift towards a technology orientation. We discussed how each individual and department could actively contribute to fostering a digital-first culture. This initiative aims to develop an organisation that is not only adaptive and digitally fluent but also deeply human-centric, ensuring that every voice is heard and valued.
This reunion was a poignant reminder of the resilience, adaptability, and collective spirit of our team. It reinforced the importance of embracing change, fostering open communication, and uniting behind a shared vision. As we look to the future, it’s clear that our journey towards integrating technology and human-centricity is not just about responding to immediate challenges but shaping the future of global employment in a way that is inclusive, innovative, and aligned with the evolving needs of the workforce and the market.
Q: What have you learned from the transition to a global remote workforce, and how will this shape your services moving forward?
A: The shift to a global remote workforce highlighted the value and staying power of such a model. The geopolitical challenges, especially the Russian war against Ukraine, tested our resilience and adaptability.
The transition has been illuminating on multiple fronts. Here are the key learnings and how they will influence our future direction:
Global Remote Workforce Viability:
The shift affirmed the sustainability and benefits of a global remote workforce, emphasising that this trend will persist.
Leveraging opportunities across countries, we recognised the immense value and potential of tapping into a global talent pool.
Rethinking the People Business:
The concept of (Global) PEO was re-evaluated, transforming into a leverage to retain the key dispersed personnel.
We faced an unprecedented Ukrainian talent exodus and responded by providing solutions for employing and re-employing talent globally, becoming the #1 go-to partner for Ukrainian businesses and a primary international employment provider.
CSR and Personal Responsibility:
My commitment to corporate social responsibility intensified, leading to significant participation in CSR initiatives supporting Ukraine.
This personal responsibility transformed into a broader commitment, rallying our employees around these causes.
Testing Our Own Solutions:
Amid the war, we were able to test our EOR solutions first-hand, employing our staff through our services in various locations. This experience broadened our Global EOR expertise, proving the effectiveness of our services under extreme conditions.
Going Global as a Survival Strategy:
The necessity of going global, once a choice, has now become a survival strategy for businesses.
This realisation underpins our strategy moving forward, emphasising our role in guiding businesses through arising upheavals and global employment complexities
Future Direction:
Our experiences will inform our product and service development, offering insights to our global clientele on navigating global employment challenges.
We aim to share our journey and solutions, ensuring businesses don’t have to navigate these challenges alone—Acumen is there to guide them.
Our approach going forward is to harness these learnings, continuing to innovate and adapt in a way that supports our clients and their employees around the world.
Q: Can you share insights or trends from the meet-up that will influence the global employment landscape?
A: The global employment landscape is on the cusp of significant transformation, with several key trends emerging from our discussions:
Evolution of Professional Employer Organisations (PEOs): PEOs are transitioning from providing purely operational support to playing strategic roles within businesses. The 3Sixty Insights Global Executive Advisory Council highlights this focusing on the shift from tactical work in human capital management to strategic approach. This is about a (Global) PEO/EOR that has the expertise to help businesses approach their HCM strategically. It evokes a broader concept of a PEO not only taking care of operational HR for employers and mitigating risk, but also capable of transforming their entire strategic vision, decision-making and execution on their organisational strategy wherever it intersects with the company’s people.
Flexible and Hybrid Workforces: The tenure of full-time employees is reducing, with the average being one to two years, whereas sought-after consultants are extending, signalling a trend towards more flexible, hybrid work models. This adaptability in the workforce is driving changes, making flexibility a critical component of modern work environments.
Trust as a Core Value: Trust is becoming a central element of organisational success, not just in client relationships but also internally. The 2024 Global Talent Trends study by Mercer emphasises this, noting that fostering a climate of trust through fair pay, equity, and inclusion is top of mind for leaders in 2024 and beyond. This trend indicates a broader shift towards more transparent, equitable, and inclusive workplace cultures.
Technological Integration and Human-Centricity: The integration of technology and AI in the workplace is advancing rapidly, with a significant impact on productivity and employee engagement. A LinkedIn poll by The HR World suggests that “8 in 10 use AI to assist their work,” highlighting the growing reliance on technology to support various work processes. However, the emphasis remains on driving human-centric productivity, ensuring that technological advancements enhance rather than replace the human element.
Addressing Global Workforce Well-being: The well-being and mental health of the globally distributed workforce are gaining prominence. Organisations are increasingly focusing on creating supportive environments that cater to the diverse needs of their employees, recognising the importance of mental health in achieving overall productivity and satisfaction.
These trends suggest a future where businesses must be agile, embracing new operational models and technologies while maintaining a strong focus on trust, inclusivity, and the well-being of their workforce. Here at [Acumen International], we’re poised to support businesses through these changes, offering strategic insights and solutions tailored to the evolving global employment landscape.
Q: How does Acumen plan to adapt its strategies in response to these trends?
A: As we navigate the complexities of the global employment landscape, we are focused on adapting our strategies to address both current trends and the underlying challenges of the labour market. Our approach encompasses several key dimensions:
Embracing Technology with a Human Focus: Recognising the integral role of technology in today’s work environments, we are committed to developing technological solutions that not only meet our client’s needs but also enhance and support human efforts. Our aim is to ensure that technology serves humanity, reinforcing the value of human input rather than diminishing it. This perspective is crucial in addressing challenges presented by economic cycles, company growth, and the changes that accompany mergers and acquisitions.
Addressing Labour Market Imbalances: The International Labour Organization (ILO) has highlighted the structural imbalances in the world’s labour market, a view supported by insights from the Geopolitical Futures article on “Employment Returns to Pre-Pandemic Levels.” Global employment may have bounced back to pre-pandemic figures, yet the persistence of labour market imbalances, slowing productivity growth and the increasing number of workers in extreme poverty underline the structural issues facing the global workforce. In response, Acumen is focusing on strategies that not only bridge these imbalances but also anticipate and mitigate the impacts on both workers and organisations.
Navigating Economic and Geopolitical Uncertainties: The current geopolitical landscape, marked by conflicts and trade tensions, contributes to the uncertainty affecting the global labour market. These factors, coupled with aggressive actions by central banks and the deceleration of global economic growth, underscore the need for resilient and adaptable employment strategies. We are poised to guide businesses through these uncertainties, offering solutions that foster stability and loyalty among workers and organisations alike.
Tackling Productivity and Skill Shortages: Despite the return to pre-pandemic employment levels, concerns about labour and skills shortages persist. The exit of a significant segment of youth from the labour market and the challenges of reintegration highlight the need for innovative employment solutions. We can help our clients identify and fill these skill gaps, leveraging our [global employment solutions] to address labour shortages and enhance productivity.
Future Proofing Against Economic Slowdowns: With the global economy expected to slow further, the resilience of the labour market is more critical than ever. Acumen’s [global employment services] are designed not only to weather these slowdowns but also to emerge stronger, with a focus on sustainable growth.
By focusing on technology integration with a human-centric approach, we aim to maintain and strengthen the loyalty and resilience of workers and organisations worldwide.
Q: Finally, how does Acumen envision its role in shaping the future of [global employment] and supporting businesses through these changes?
A: Acumen International is strategically positioned to lead and shape the future of [global employment] by addressing and anticipating the evolving needs of the [global workforce] and the businesses that rely on it. Our approach is multifaceted, focusing on several key areas:
Redefining Global Mobility Programs: We are committed to transforming global mobility programs from reactive to proactive strategies. This involves streamlining and simplifying immigration processes and making talent attraction, acquisition, management, and retention more efficient. The goal is to turn these programs into strategic advantages for businesses, enabling them to be more agile.
Emphasising Skill-Based Hiring: Echoing the sentiment from a Forbes article on “The Freelance Revolution In 2024,” we recognise the growing importance of freelancers and the shift towards a more flexible workforce. This aligns with our belief in hiring based on skills, not geography, allowing businesses to tap into a global talent pool and adapt to market needs with a blend of permanent and temporary workers.
Addressing Employment Shifts and Contractor Convergence: As noted in one of our latest posts about freelance revolution and hybrid workforces, the opportunities hybrid teams open up for global employers are becoming increasingly significant. This shift, driven by evolving legal regulations and changing workforce expectations, necessitates enhanced compliance and flexibility in talent management strategies. Our EOR and Contractor Solutions are designed to provide businesses with the flexibility and growth at all stages needed to thrive in the current economic climate.
Leveraging Technology for Efficiency: With the development of our industry-leading technology solutions, leveraging AI and tapping into expert networks, we offer solutions that enhance efficiency and help businesses become more competitive and attractive as employers.
Our goal is to provide and hone our solutions and product portfolio, allowing businesses to access a global talent pool and offer compelling employee value propositions, making them the best companies to work for in an ever-evolving global market.
This conversation with Nick Ganzha highlights Acumen International’s proactive approach to global employment challenges and its commitment to innovation and human-centric solutions. As the world of work continues to evolve, Acumen’s strategies and insights offer valuable guidance for businesses navigating the complexities of the global workforce.
Compensating independent contractors globally is easy now
A Solution To Hire Independent Contractors Globally An Agent of Record, also known as an Independent Contractor Solution, enables companies that are hiring the global workforce to gain a strategic advantage in the freelance market while reaping the benefits of global talent pools. The shifting dynamics in the global workforce challenge global employers to leverage… Read more What is an Agent of Record
A Solution To Hire Independent Contractors Globally
An Agent of Record, also known as an Independent Contractor Solution, enables companies that are hiring the global workforce to gain a strategic advantage in the freelance market while reaping the benefits of global talent pools.
The shifting dynamics in the global workforce challenge global employers to leverage various opportunities available with hybrid teams. Using an Agent of Record Solution (AOR), global employers can engage global talent resources for short-term projects or as part of a strategy to explore new markets or potential permanent hires. This gives organizations the freedom to take on more projects requiring specific qualifications, providing cost savings and flexibility in global talent acquisition.
At Acumen International, we are champions of the opportunities available with hybrid teams and can support you with our global employment solutions, regardless of the complexity.
How An Independent Contractor Solution Can Empower Your Business
Compliance Assurance: Effortlessly navigate global talent pools, select independents you want to work with and easily onboard and pay global contractors in international or local currencies.
Cost Efficiency: Realise savings by avoiding the costs of the direct hire and minimise financial output at the start of a project. Easily transition freelancers into full-time employees with Acumen International’s support.
Flexibility & Scalability: Meet market demands by hiring independent contractors globally for short-term or exceptional projects like trial runs, per diem work, or shift tasks, all without long-term commitments.
Expert Support: Benefit from the expertise of a dedicated Acumen’s manager who will facilitate communication and oversee project completion, ensuring your intellectual property is safe and protected, and quality standards are met.
Contract-to-Employee Pathway: With over two decades of experience, we specialise in transitioning contractors to full-time employment offering a smooth transition for your expanding team. Rely on us to guide you through various in-country legislative nuances and procedures related with contractor to full-time employee transfers, which our team knows and can assist with.
Independent Contractor Solution vs. Umbrella Company
Unlike traditional umbrella companies that only act as intermediaries to arrange payouts, an Independent Contractor Solution provides a full spectrum of services to enable employers to legally deploy and pay their global workers internationally without legal risks to the company and risk to the intellectual products that you develop.
From ensuring global tax compliance to offering a complete service with global HR strategy support, we go beyond contractual management to deliver a comprehensive and compliant solution tailored to your global hiring needs. We will allocate a dedicated manager to your projects to help you manage worker communication in various time zones and ensure invoice approvals and payouts are run smoothly.
At Acumen International, we understand the shifting dynamics of the global workforce and are champions of the opportunities available with hybrid teams. Leverage our international employment solutions and talent acquisition expertise for agile, global workforce integration.
Globalization has resulted in national economies and markets becoming intertwined. Due to a surge in economic integration in recent years, it has become evident that current international tax regulations, established over one hundred years ago, are no longer adequate. This lack of adaptation to modernity allows for BEPS (base erosion and profit shifting), which undermines… Read more How to Avoid Permanent Establishment Risk
Globalization has resulted in national economies and markets becoming intertwined. Due to a surge in economic integration in recent years, it has become evident that current international tax regulations, established over one hundred years ago, are no longer adequate.
This lack of adaptation to modernity allows for BEPS (base erosion and profit shifting), which undermines trust in taxation systems and creates inequalities as profits are not taxed accurately. Tax policymakers and governments must act quickly to address this problem and restore confidence in their tax systems. They can do this by ensuring taxes are collected in the locations where value is generated.
Currently, regulations are the primary method used to define whether or not a company is engaged in PE activity. Tax treaties may also specify what constitutes a Permanent Establishment (PE). In addition, some countries tax laws may specify what activities constitute a permanent establishment (PE) for their jurisdiction.
What Is a Permanent Establishment?
Harmonization of tax laws has led to many countries adopting the Organisation for Economic Co-operation and Development Model Tax Convention, which puts certain restrictions on when businesses will be considered permanent establishments (PEs) in another country. In brief, an organization will have a permanent establishment (PE) if any of the following applies:
1. The business has a physical presence in a foreign country.
2. The business is regularly present through employees or agents.
3. A sale is made from a fixed place of business.
4. The business is engaged in continuous and systematic activities in the foreign country.
Understanding the Concept of Permanent Establishment
Permanent Establishment (PE) is a concept in international taxation that refers to a fixed place of business through which an enterprise carries out its business activities. A PE can be a branch, office, factory, warehouse, or any other fixed place of business where the enterprise carries out its business activities, either wholly or partially.
When an enterprise operates through a (Permanent Establishment) PE in a country other than its home country, it may become subject to the tax laws of that country. This means that the income generated by a PE is potentially taxable in the country where the business is located and in the country where the business is incorporated.
Only income attributable to local activity should be subject to local tax, which can be determined through a profit attribution exercise. However, consideration must also be given to whether there is an applicable double tax treaty between the two countries.
Generating Taxable Income
For example, suppose you have a sales force that calls on customers in a foreign country on behalf of your organization. In that case, that presence is considered a Permanent Establishment, and you must pay tax for the income your salespeople generate.
If an enterprise is found to have a PE in a foreign country, it may be subject to tax on the profits earned in that country, as well as penalties and interest for failing to comply with the tax laws of that country.
To avoid permanent establishment risk, enterprises must carefully assess their business activities in foreign countries and ensure that they do not create a fixed place of business or exceed the allowable time limit for employee presence in that country.
They should also seek professional advice to understand the tax laws of foreign countries where they operate.
Permanent Establishment (PE) Management Control refers to the extent to which the enterprise maintains direct control over the business operations in a foreign country.
If an enterprise wants to maintain direct control over everything from accounting procedures to staff management, it may choose to establish a foreign legal entity. This option allows the enterprise greater control over its operations in the foreign country, including hiring and managing employees, implementing its accounting procedures, and maintaining its banking relationships.
However, establishing a foreign legal entity can be costly and time-consuming. In addition, it requires the enterprise to comply with the legal and regulatory requirements of the foreign country, which may differ significantly from those of the home country.
Alternatively, an enterprise may outsource some operations, except for managing assets and collecting profits. This option allows businesses to focus on their core competencies while outsourcing non-core activities to specialised service providers.
Permanent Establishment Risk: Addressing the Concerns
Permanent Establishment (PE) requires the most due diligence in tax risk management.
You may think you can conduct business overseas without registering a legal entity, but you would be wrong. You might need to register your business even if you only send an employee on a temporary assignment or establish a small promotional office. Failing to do so can result in severe consequences.
Different countries have different tax laws, and a multinational company must consider all of these when conducting business. The tax authorities of a particular country can determine which elements of the company’s economic activity take place in a particular country and how much profit is attributable to them.
This process can be complex, but ensuring the company complies with all applicable laws is essential.
25 Questions to Help You Assess Permanent Establishment Risk
Here are some additional questions that can help assess and avoid Permanent Establishment (PE) Risk:
1. Have you identified all the business activities that your company will perform in the target country?
2. Will your company have a fixed place of business in the target country, such as an office, warehouse, or factory?
3. Will your employees or contractors spend significant time in the target country?
4. Will your company have the authority to sign contracts or make decisions for your clients or customers in the host country?
5. Will your company have the authority to negotiate or conclude contracts for your clients or customers in the target country?
6. Will your company have the authority to bind your clients or customers in the target country?
7. Will your company be able to manage or supervise employees or contractors in the target country?
8. Will your company have the authority to provide after-sales services or technical support in the target country?
9. Will your company be able to receive payments or handle financial transactions in the target country?
10. Will your company have the authority to conduct research and development activities in the target country?
11. Will your company have the authority to control the use or disposal of assets in the target country?
12. Will your company have the authority to make decisions on pricing, marketing, or distribution of goods or services in the target country?
13. Will your company have the authority to manage or oversee the supply chain in the target country?
14. Will your company have the authority to perform any other significant business functions in the target country?
15. Have you reviewed the tax laws and regulations of the target country to understand the criteria for determining whether a PE exists?
16. Have you reviewed the tax treaty between your home country and the target country to understand the provisions related to PE?
17. Have you considered the potential impact of transfer pricing regulations on your operations in the target country?
18. Have you assessed the potential penalties and fines for non-compliance with tax laws and regulations in the target country?
19. Have you considered the potential reputational risks associated with being deemed to have a PE in the target country?
20. Have you established a risk management plan to address PE risk, including strategies for minimizing risk, monitoring compliance, and managing potential disputes with tax authorities?
21. Are your employees in the target country extensively involved in sales or contract negotiations? They don’t need the power to sign contracts to qualify as being involved in contract negotiations.
22. Do your employees’ job titles or descriptions pertain to revenue generation?
23. Do your employees receive compensation related to sales, such as commissions or bonuses, for meeting sales targets?
24. Do they receive compensation based on sales, such as commissions or bonuses for their sales performance?
25. Have you reviewed the contractual agreements between your company and your clients or customers in the target country to understand the scope of your authority and obligations and whether they could create a PE?
Attributable Activity Test to Determine Permanent Establishment
Let’s explore how to avoid permanent establishment risk using Global Employer of Record services. Unlike the standard “permanent establishment” definition, which focuses on whether an entity is carrying on business through a fixed place of business, the definition of permanent establishment for income tax purposes is broader. There are two main tests for determining if an organization has a PE.
The Attributable Activity Test is one of the criteria used to determine whether a foreign company has a Permanent Establishment (PE) in a host country for tax purposes. This test determines whether the activities performed by the foreign company in the host country are sufficient to create a PE, even if there is no physical presence or fixed place of business in the host country.
The Attributable Activity Test focuses on the activities “attributable” to the foreign company in the host country. These activities are those that are carried out on behalf of the foreign company by its employees, agents, or other representatives in the host country.
To determine whether the foreign company has a PE under the Attributable Activity Test, the tax authorities will typically consider the following factors:
Whether the activities performed by the foreign company in the host country are “core” activities that are essential to the company’s business.
Whether the activities are performed for a “sufficient” period, there is no fixed rule for what constitutes a “sufficient” period. Still, it generally means that the activities must be ongoing and regular rather than occasional or sporadic.
Whether the activities are performed with a “sufficient” degree of authority, the foreign company’s employees, agents, or other representatives must have the power to make decisions on behalf of the company that affect its business operations in the host country.
Whether the activities are performed with a “sufficient” degree of continuity. To establish a significant connection between the foreign company and the host country, the activities must be performed over a long period.
Activities that Can Create a Permanent Establishment under the Attributable Activity Test
Negotiating contracts or concluding sales agreements on behalf of the foreign company.
Providing technical assistance or after-sales support services to customers in the host country.
Performing marketing or advertising activities directed at customers in the host country.
Conducting research and development activities related to the company’s business operations in the host country.
Providing management or supervisory services to local employees or agents of the foreign company.
Providing training or education services to customers or employees in the host country.
It is important to note that the Attributable Activity Test is only one of several criteria tax authorities may use to determine whether a foreign company has a PE in a host country. Other factors that may be considered include the existence of a fixed place of business, the level of control and management exercised by the foreign company over its operations in the host country, and the nature and extent of the company’s activities in the host country.
5 Ways Minimize PE Risks with a Global Employer of Record
As a business owner, you may feel overwhelmed by the tax implications of expanding your business overseas. However, new ideas exist to reduce complexity and ease the burden on busy entrepreneurs.
Using a Global Employer of Record (EOR) can be an effective way for multinational employers to prevent or address Permanent Establishment (PE) risks. This third-party global employment solution enables compliance with local employment and tax laws while avoiding the establishment of a legal entity and taxable presence in the country.
1. No Establishment of a Foreign Legal Entity
The Global EOR model enables multinational employers to engage workers in different countries without establishing a legal entity. This helps to reduce the risk of creating a taxable presence in the country and triggering a PE.
2. Compliance with Local Employment Laws
The Global Employer of Record (EOR) handles employment’s legal and administrative aspects, including compliance with local labour laws and regulations. This ensures that the client company is not inadvertently creating a PE through non-compliance with local employment laws.
3. Tax Compliance
The Global Employer of Record (EOR) can also handle tax compliance, including payroll taxes and social security contributions. This ensures the company is not creating a PE through non-compliance with local tax laws.
4. Permanent Establishment Risk Mitigation
Using a Global Employer of Record (EOR), talent engagement model can help multinational employers mitigate the risk of a PE by ensuring that all legal and tax obligations are met. This helps to minimize the potential negative impact on the company’s reputation, financial statements, and regulatory compliance.
5. Flexibility of Global Moves
The Global Employer of Record (EOR) model allows multinational employers to engage workers flexibly in different countries. This helps minimize the risk of creating a PE by permanently establishing a business presence in the country.
How to Pro-actively Address Challenges of Permanent Establishment Risk
The challenge of Permanent Establishment (PE) risk can be addressed through a combination of preventive and corrective measures. Below are some suggestions to resolve the fundamental challenges of PE risk:
Conduct a comprehensive risk assessment: This involves reviewing business operations and transactions to identify potential PE risks. It is important to consider the different types of taxes that could be affected, including corporate income tax, indirect tax (VAT/GST), and payroll taxes. The risk assessment should also consider the potential impact on the company’s reputation, financial statements, and regulatory compliance.
Develop and implement a PE risk management strategy: The strategy should be tailored to the company’s specific operations and risks. This may involve implementing policies and procedures to ensure compliance with tax laws and regulations, including appropriate VAT registrations and payroll reporting. The strategy should also include ongoing monitoring of changes in tax laws and regulations and changes in the company’s business operations.
Maintain accurate and complete records: Good record-keeping is essential to demonstrate compliance with tax laws and regulations. This includes maintaining records of all transactions, contracts, and agreements relating to the company’s operations in each jurisdiction.
Engage in open and transparent communication with tax authorities: It is important to establish good relationships with tax authorities and be transparent about the company’s operations and tax position. This can help prevent misunderstandings and reduce the risk of audits and penalties.
Seek professional advice: Given the complexity of tax laws and labour regulations, it may be beneficial to seek professional advice from tax and global employment experts. This can help ensure that the company complies with all applicable tax laws and regulations and can help to identify potential risks and opportunities for optimization.
Companies expanding globally by taking a proactive approach to Permanent (PE) risk management can minimize the potential negative impact on their reputation, financial performance, and compliance obligations.
Benefits of Pro-active Permanent Establishment Risk Management
Concluding Thoughts on How to Avoid Permanent Establishment Risk
Managing Permanent Establishment (PE) risk is a smart business move for organizations with international operations. By proactively managing PE risk, companies can promote tax compliance, expand globally tax-compliantly, and avoid penalties and interest charges from tax authorities.
This approach provides a greater sense of security on a challenging issue and helps to prevent unnecessary taxation and interest payments due to mistakes or lack of awareness.
By controlling Permanent Establishment risk, companies can minimise potential negative impacts on their reputation, financial performance, and regulatory compliance while maximizing the benefits of their global operations.
In the ever-evolving landscape of Global Employment services, the trend has sharply turned towards technology-driven solutions. However, the rise of investment-backed SaaS companies offering ‘self-serve’ global EOR models, while impressive in their technological reach, often overlooks the critical element of customer service. This disconnect poses a high risk, particularly when navigating the intricacies of legally… Read more How We Maintain a Truly Customer-Focused EOR Business
In the ever-evolving landscape of Global Employment services, the trend has sharply turned towards technology-driven solutions. However, the rise of investment-backed SaaS companies offering ‘self-serve’ global EOR models, while impressive in their technological reach, often overlooks the critical element of customer service. This disconnect poses a high risk, particularly when navigating the intricacies of legally compliant onboarding of global workers and HR issues—a realm where personalized guidance is not just valuable but necessary.
Acumen International bucks this trend. Our journey for the last 23 years as a bootstrap business, growing organically and successfully, has been grounded in our unwavering commitment to our customers. We have matched the competition in technological capabilities, yet where we truly excel is in supporting and fronting this technology with people, both the client and the employee that we employ for the client. Our approach ensures that every interaction is not just a transaction but a partnership towards achieving global employment services success.
The Virtue of Bootstrapping
Bootstrapping in the business world represents a commitment to growth driven by customer revenue rather than external funding. This approach emphasizes sustainable development, allowing companies like ours to remain agile and responsive to customer needs. By prioritizing our client’s needs over fund-raising ambition, we ensure that every innovation and service enhancement aligns with our global clientele’s real-world applications and burning needs.
In the Forbes article “A Founder’s Perspective On Bootstrapping Over Raising Venture Capital” (April 2023), Eddie Lou, co-founder of CodaPet and OneGoal, and an active angel investor, shares his journey. He emphasizes the freedom and focus bootstrapping has allowed in prioritizing customer needs. “Bootstrapping… allows entrepreneurs to maintain complete control over their business decisions without having to answer to outside investors who may have a different agenda. By keeping their equity and decision-making power intact, founders have the freedom to chart their own course and pursue their vision on their own terms.”
Prioritising Customers in the SaaS Journey
The future of HR tech and SaaS leans towards a customer-first approach. Industry experts argue the importance of keeping customers at the forefront of business strategy, suggesting that the true value of SaaS solutions lies in their ability to solve specific customer problems effectively. This philosophy not only enhances the customer experience but also fosters loyalty and long-term relationships, ensuring that businesses remain competitive and is sustainable in a rapidly evolving market.
Frank V. Cespedes and Jacco van der Kooij discuss the importance of keeping customers at the core of business strategies in the Harvard Business Review article, “The Rebirth of Software as a Service” (April 2023). They argue that a customer-led model enhances long-term growth and sustainability, “Some SaaS firms correctly refer to their service groups as Customer Success (CS) teams, because they are vital in closing a sale, onboarding customers, business reviews that track on-going product impact, and the expansion phases of the customer lifecycle.”
The Centrality of Customer Needs in Global Employment
Keeping customer needs at the core of business operations is essential for success. According to industry leaders, understanding and addressing the unique challenges faced by clients is the cornerstone of a truly customer-led buying experience. By offering tailored solutions and support, companies can create a more personalized and effective buying journey, enhancing customer satisfaction and fostering a culture of trust and reliability
In an article published by G2 entitled “Why Customer-Led Buying Is the Way Forward for SaaS” (October 2023) Mads Fosselius emphasizes the significance of a customer-led buying experience, allowing customers to interact with the product on their terms. “Ensuring that the customer’s needs are always kept as the core focus is the primary goal of the customer-led buying approach, and it does this by handling a balance of sales-led and product-led strategies. When successful, it allows brands to foster a sustainable model for long-term growth.”
In embracing these insights, Acumen International has solidified its position as a leader in delivering Employer of Record solutions. In year 2024, we plan to launch the HR platform and tools that will help us balance cutting-edge technology with unmatched personalized support. Our dedication to understanding and addressing the unique needs of our clients, informed by direct feedback and engagement, shape our technology roadmap and operational strategies. This ensures we not only meet but exceed the expectations set by our clients, reinforcing our commitment to their success.
As we look towards the future, we remain steadfast in our belief that technology, no matter how advanced, should enhance rather than replace the human touch. Our focus on developing our business with our customer’s priorities at the forefront, not those of our investors, distinguishes us in the market and underpins our success in maintaining a truly customer-focused global EOR business.
The Global Talent HorizonUnlocking the potential of a world without work borders Welcome to February’s edition of our newsletter, where we focus on the transformative power of hybrid workforces — a blend of permanent and temporary talent across the globe — to drive unparalleled business resilience and agility in today’s ever-evolving marketplace. This month, we… Read more Global Employment Tax and Compliance Newsletter. February 2024
The Global Talent Horizon Unlocking the potential of a world without work borders
Welcome to February’s edition of our newsletter, where we focus on the transformative power of hybrid workforces — a blend of permanent and temporary talent across the globe — to drive unparalleled business resilience and agility in today’s ever-evolving marketplace.
This month, we shine the spotlight on our groundbreaking Contractor Solution, which is set to redefine global freelance talent management. Join us as we journey to Cyprus with our Senior Leadership team, to celebrate past achievements and envision a boundless future.
Explore the strategic benefits of a hybrid workforce and unveil flexibility as your ultimate global market asset.
The Future is Freelance: Embracing the 2024 Workforce Revolution
The freelance revolution is reshaping the 2024 workforce, offering businesses unprecedented growth and flexibility. As highlighted by @Forbes, this shift towards a freelance-dominated economy is not just imminent; it’s strategic.
Forbes Insights at a Glance
Economic Growth: With a forecasted 2.6% GDP growth in 2024 by Goldman Sachs, the freelance market is vibrant and expanding.
Surge in Freelancing: Post-COVID, there’s been a 130% increase in freelancers: evidence of a growing workforce ready to innovate.
Industry Optimism: Leaders of freelance platforms anticipate substantial growth, especially in tech, marketing, and consulting.
Expert Networks: These networks are becoming a billion-dollar industry, offering short-term, high-value engagements.
This data underscores the strategic advantage for businesses to tap into the global freelance talent pool, which promises flexibility and access to the best expertise.
Explore how the freelance revolution is powering the future of work in Forbes’ article Read More.
Hybrid Work Is Here: The Benefits of a Full-Time and Freelance HR Strategy
The future of work is flexible, adaptive, and inclusive of diverse working styles. By integrating freelancers alongside full-time staff, businesses can unlock a host of benefits, enhancing their competitiveness and agility in the global market. Here’s why a hybrid workforce strategy is your key to a thriving, dynamic business environment:
Increased Flexibility: Quickly scale your workforce up or down based on current business needs without the overheads associated with full-time hires.
Diverse Skill Sets: Access a broad range of skills and expertise on-demand, allowing for innovation and creativity in tackling projects and challenges.
Cost Efficiency: Save on long-term labour costs by hiring freelancers for project-specific work, and optimising budget allocation for growth initiatives.
Market Responsiveness: Respond swiftly to market trends and demands by leveraging the agility of freelancers to pivot strategies and operations as needed.
Talent Trial and Integration: Assess freelancers in real-world projects before committing to full-time roles, ensuring a good fit with company culture and work ethic.
Global Talent Pool Access: Break geographical barriers by engaging with top talent from around the world, enriching your team with global perspectives and expertise.
Embracing a hybrid workforce model means being at the forefront of workforce innovation, ready to leverage the collective strengths of both full-time employees and freelancers.
Are you ready to transform your workforce and embrace the future of work to explore how our strategic approaches can empower your global team?
Announcement: Introducing Contractor Solution
Our Contractor Solution acts as your single global partner, ensuring seamless freelance engagement across 190 markets. This service ensures compliance and risk mitigation and offers a pathway from contract roles to full-time positions, embodying the essence of a truly hybrid workforce strategy.
Top 5 Benefits:
Compliance Assurance: Navigate international labour laws with ease.
Cost Efficiency: Save on the expenses of establishing foreign entities.
Flexibility & Scalability: Adapt to market demands with global freelance talent.
Expert Support: Benefit from dedicated Acumen management for project success.
Contract-to-Employee Pathway: Smooth transition for growing teams.
The Top 5 Countries to Find Freelancers and Digital Nomads
In the evolving landscape of the global talent economy, the significance of location has never been more pronounced. A growing number of countries offer incentives to freelancers and digital nomads catering to their unique working lifestyles.
These incentives not only simplify the process of working remotely but also enrich the professional and personal lives of modern workers. Below, we explore the top five freelancer-friendly countries leading the charge in welcoming global talent.
Spain & Portugal: Known for their vibrant cultures and stunning landscapes, both Spain and Portugal offer a special visa for digital nomads, alongside tax benefits for non-residents, making them an attractive destination for freelancers seeking a blend of work and leisure.
Estonia: A pioneer in digital governance, Estonia’s e-Residency programme allows global entrepreneurs to easily start and manage an EU-based company online, making it a haven for digital nomads looking to expand their business footprint.
Georgia: The Remotely from Georgia programme invites freelancers and remote workers from 95 countries to stay and work in Georgia for up to one year. Georgia offers a blend of rich culture and a supportive environment for digital nomads.
Romania: Through its IT park scheme, Romania offers significant tax incentives for IT contractors. It is a cost-efficient haven for tech talent. It offers benefits for reinvestment and R&D activities, making it an emerging hub for digital nomads and remote workers in the tech industry.
Mexico: Offering a Temporary Resident Visa specifically for remote workers and digital nomads, Mexico is appealing with its low cost of living, beautiful locale, and the opportunity to stay for up to four years with the possibility of renewal.
These countries are gateways to new ways of living and working. By offering tailored incentives like special visas, tax benefits, and supportive digital infrastructures, they are becoming hotspots for freelancers and digital nomads ready to explore the world without pausing their careers.
Eager to tap into the global talent pool and expand your team’s horizons?
Contact us today to discover how we can help you navigate the global talent economy and find the perfect blend of talent for your projects.
How To Convert Independent Contractors into Employees
Today’s evolving work environment demands strategic workforce transformations. In our latest article, How To Convert Independent Contractors into Employees, we’ve delved into the shift from contractor roles to permanent employment, emphasising compliance, adaptation, and meeting modern workforce expectations.
This transition is critical for maintaining legal compliance and operational efficiency amidst increasing regulatory complexity and global workforce mobility.
Contractor Management: Key Insights
Regulatory Complexity: Navigating a labyrinth of global compliance requirements challenges businesses to maintain robust governance frameworks.
Workforce Mobility: The rise in remote and international work arrangements presents unique compliance and operational hurdles.
Strategic Adaptation: Organisations must regularly update their governance strategies to align with business goals and mitigate risks.
Embracing this shift ensures compliance and positions businesses for sustainable growth and enhanced talent management.
Discover comprehensive strategies for a seamless transition in an interview by Natali Oprya, Acumen’s VP of Marketing Strategy.
In a landmark gathering, Acumen International’s team met in Nicosia, Cyprus, for the Global Meet-up, marking a pivotal moment of reflection and forward planning. This gathering, a first since our transition to a fully remote model due to the Russian invasion of Ukraine in February 2022, was as much of a reunion as well as a strategic session held by the company’s CEO, Nick Ganzha and the celebration of our resilience and innovation.
Born from our direct experiences and the evolving needs of our clients, this solution underscores our commitment to compliant, efficient workforce management across borders. Nick’s announcement of the strategy in our Cyprus gathering not only solidified our resolve but also set a clear direction for Acumen’s future, with a focus on expanding our service offerings to meet the demands of a dynamic global employment landscape.
What’s New in Global HR Legislation
Stay informed with the latest in global HR legislation to keep your business compliant and forward-thinking.
Germany Eases Citizenship for Global Talent
Summary: Germany reduces citizenship residency requirements from eight to five years, three for highly integrated non-EU citizens, to attract skilled workers.
Employer Impact: Opens up a new talent pool, especially in sectors with labour shortages.
Employer Actions: Support foreign workers’ citizenship efforts through integration courses and stay updated on the law.
Dive into the full FT article for more on Germany’s law and its impact on talent strategy.
EU Gig Economy Directive Affects UK Firms
Summary: The EU’s new directive mandates full employment status under certain criteria, changing gig economy operations.
Employer Impact: Requires reevaluation of workforce classification and management.
Employer Actions: Assess business models against EU rules, ensure transparency in algorithmic decision-making, and monitor UK legislative developments.
Summary: The updated Equity Action Plan from the U.S. Department of Labor aims to improve job equity and accessibility.
Employer Impact: Encourages equitable job opportunities for all workers.
Employer Actions: Review hiring practices for inclusivity, partner with diversity-supporting organisations, and utilise federal equity programs.
Learn more about how the Equity Action Plan affects your business practices.
Summary & Close
As we navigate the complexities of the global employment landscape, flexibility remains our guiding principle. Our journey to Cyprus reaffirmed our commitment to breaking barriers and embracing a future where hybrid workforces are both a possibility and a necessity for growth and innovation.
Thank you for joining us this month. We look forward to continuing this journey, shaping a resilient and agile global workforce.
Stay updated with the latest news and updates from Acumen International.
As the curtains closed on this weekend’s Global Meet-up in Cyprus and the team is back home now, we’re filled with inspiration and gratitude from an incredibly valuable and enlightening trip and a strategic session with our CEO Nick Ganzha✨ Nick shared Acumen’s evolution from its 2001 inception, moving from staffing to a global EOR solution by… Read more Cyprus Event Highlights: Next Growth Phase and Board Introduction
As the curtains closed on this weekend’s Global Meet-up in Cyprus and the team is back home now, we’re filled with inspiration and gratitude from an incredibly valuable and enlightening trip and a strategic session with our CEO Nick Ganzha✨
Nick shared Acumen’s evolution from its 2001 inception, moving from staffing to a global EOR solution by 2011. From operating in 15 countries in 2015 to 33 countries in 2016 and 190 by now, we’ve achieved global reach, fulfilling our dream of being a global company aiding businesses in expanding internationally.
Looking ahead, we unveiled a refreshed strategy and technology offering that will better serve our clients alongside our core EOR service. In addition, the announcement of an expanded company board marks a fresh strategic direction. Abid Hamid, Maria Savva, Sergiy Gerenko, Oleg Pichkur.
🌟 Stay tuned for more news on our new-look board as we embark on this exciting phase of growth and innovation.
An international workforce can open new doors for you. Recruiting someone from overseas can also be a smart bet for businesses looking to expand into new markets and hiring skilled international professionals. It might even be that your business needs to meet a certain level of diversity in its workforce to qualify for certain tax… Read more Global Employer of Record with Immigration Support
An international workforce can open new doors for you. Recruiting someone from overseas can also be a smart bet for businesses looking to expand into new markets and hiring skilled international professionals. It might even be that your business needs to meet a certain level of diversity in its workforce to qualify for certain tax breaks. In those cases, hiring foreign nationals can be an easy way to meet your business goals.
Hiring Overseas: the Easiest and Hardest Countries to Get Work Permits for Employees
Generally, easier countries to work in are either already popular business destinations or have minimal requirements to get a work permit for your foreign talent. On the other hand, some countries may have long and complex work permit processing periods or be difficult to access due to existing diplomatic issues or international sanctions.
Countries with a high number of ex-pats and low barriers to entry are popular choices for companies looking to send employees abroad. In some cases, working conditions in this country may encourage companies to rethink their traditional hiring process, which can be time-consuming, complex, and expensive. Acumen’s Employer of Record Solution is designed to alleviate these burdens by streamlining the work permit securing and business immigration processes for both employer companies and employees so that everyone can benefit from successful international assignments.
The Acumen Global Employer of Record Solution provides work permit securing support, is designed to comply with each country’s local business immigration regulations, and is flexible enough to meet the needs of organizations sending employees on short-term or long-term assignments.
The Employer of Record solution is a third-party employment model allowing companies to establish an Employer of Record (EOR) in another country without setting up a legal entity. The global EOR acts as an extension of the company’s existing HR department and assumes responsibility for all employment-related tasks on behalf of the company while enabling faster onboarding. Acumen acts as the Employer of Record (EOR) in every case, helping secure business visas and work permits for our client’s employees. Individuals are then free to enter the country legally and begin working immediately upon arrival.
1. Global Reach: Hire Foreign and Local Talent in 190 countries
Acumen’s Employer of Record (EOR) solution covers more than 190 countries worldwide, giving employers an impressive list of desirable business destinations. We can help with work permits and visas, so we are available where you need us. We’ll take care of all your visas, permits, and other immigration matters so you can focus on running your business.
Employer of Record (EOR) Solution with work permit immigration support streamlines the process of hiring talent abroad and helps achieve 100 compliance with regulatory requirements in different countries.
A global Employer of Record (EOR) service provider is a company that technically “hires” ex-pats in the host country on behalf of your company. Your company still has ultimate control over directives, hiring, and firing; the global EOR solution helps with the legal and compliance side.
2. All Global Employment Services under One Roof
Employing a hybrid talent team comprising foreign and local workforce can be complex and tricky if the staff is scattered across several countries and working on different projects. If you’re a global company with some people working in other countries, you may find they have to be sponsored by a local entity, either a branch of yours or another company.
The process is often tedious and time-consuming, particularly when managing a team of people who need multiple visas and work permits. Global employment needs consolidation is the key to making this process easier—you get all services from a single service provider while reducing your cost, time, and management effort.
3. Guided Support for Business Immigration: Cutting through the Jungle
When a company decides to hire a foreign employee, filing for immigration is often a complicated, convoluted process. It’s easy to make mistakes that could lead to work permit and visa delays or even denials. That’s why our Global EOR solution provides clients with information and guidance at every step of the application process to help them succeed in the immigration process.
One of the biggest challenges employers face is navigating the extensive documentation requirements of the immigration process. Employers must collect dozens of documents from their employees, including proof of citizenship or legal residence, previous employment verification, birth certificates, and other supporting documents.
In addition to collecting these documents from their employees, employers must submit several applications to government agencies to sponsor their employees for employment visas. Employers must ensure they submit the correct applications with all supporting documentation on time or risk delaying the application process.
4. Streamlined Application Processes and Error-free Paperwork
We are here to streamline the paperwork as much as possible, so all our clients have to do is fill out forms, sign documents, and provide proof of employment and other requirements—we provide everything else, including expert advice and support during all stages of the process.
Our staff of immigration experts handles every aspect of the employer of record’s role in a business immigration case, from start to finish. That means all you have to do is provide us with the required documentation, sign the paperwork, and help your employees fill out their forms—that’s it. We’ve streamlined the process so that our clients don’t have to spend hours doing the legwork themselves, but they still get to see their cases through from beginning to end with our help.
When you hire Acumen International Employer of Record to be your point person for immigration needs, we’re here for all your foreign talent immigration needs:
advice on what forms you need to provide and how you need to fill them out;
assistance with gathering documents and completing paperwork;
helping you prepare for any in-person visits or interviews you might have;
coordinating everything with in-country immigration authorities as necessary;
staying with your cases until they’re approved.
5. Minimizing Visa and Work Permit Rejection with a Global Employer of Record
Getting work permits for your ex-pat team is far easier when you have a single entity sponsoring the permits and officially employing them. If you are an employer looking to lower the effort and cost involved in managing your international workforce, look no further. Acumen Global Employer of Record can sponsor visas and work permits for any number of employees, regardless of location.
Employer of Record with Immigration Support Is Not an Immigration Service
Our corporate clients can use our global employment B2B services to help sponsor and manage work permits for their foreign employees. It is necessary to clarify a common misconception that our Employer of Record solution caters to the individual international worker.
This is not the case; our business model is tailor-made for corporate clients who can avail of our services when they need to hire ex-pats for their overseas operations. This means we can sponsor work permits on the companies’ (corporate clients’) behalf so they can officially work with ex-pats whenever and wherever needed.
We need to clarify that a service like Acumen’s global Employer of Record differs significantly from conventional immigration services in function and purpose. Most immigration services are based on providing support for those looking to move abroad and find work. Most of the time, this work is low-skill jobs, and there may be outside factors precipitating the move.
That said, our services are not about connecting international workers to jobs but facilitating global employment needs for employers which already selected candidates. One additional point that bears mentioning is that if a company sponsors a work permit and then employs a person in the country, the chances are higher for them to get a permit.
Acumen International: Employer of Record and Expert Immigration Service Provider
At Acumen International, we pride ourselves on being able to offer a highly affordable and comprehensive immigration solution for international businesses.
Acumen International has over 20 years of experience in handling international immigration matters. With services ranging from Immigration Support, visa processing, and work permit to visa and work permit extensions and renewals, we provide all-in-one global employment solutions in 190 countries at an affordable price, at the speed of light.
Acumen International is the ideal match to secure visas, work permits, hire, payroll, and reward your international talent. We provide comprehensive business support for your company to meet all cross-border employment needs with a single centralised and global hub and avoid the headache of getting different quotes from different providers, sometimes with a language barrier in place. We offer bespoke social business immigration packages for your international talent so that they will not have any immigration, labor, or tax compliance issues when they move abroad.
The Global Employer of Record solution with extensive business immigration support saves your organization time and money while keeping you on top of all legal requirements. Our clients love how much time they save and how easy it is to manage all aspects of their international immigration through us.
Last few years saw an unprecedented change at Acumen. These were monumental years for the entire team! After the pandemic, all our team was used to working remotely and we enjoyed it and reaped the benefits. However, a challenge of a completely different nature turned up. As a result of the Russian invasion in Ukraine… Read more Acumen International’s Cyprus Meet-Up: The Unity of a Global Talent
Last few years saw an unprecedented change at Acumen. These were monumental years for the entire team!
After the pandemic, all our team was used to working remotely and we enjoyed it and reaped the benefits.
However, a challenge of a completely different nature turned up. As a result of the Russian invasion in Ukraine in February 2022, our entire Kyiv office had to relocate to different locations in the country and internationally. For the last few years, we were able to relocate part of the Ukrainian team to Cyprus, and we have extended our local team.
Additionally, we onboarded global talent in many new jurisdictions including the United Kingdom, France, Germany, Spain just to name a few.
While the prospect of massive upheaval could have been daunting, it gave us the chance to gain a true customer perspective of our services, the flexibility, and scrutinise our product offering from a client standpoint.
We managed the challenge – and achieved 98% employee retention, underlining our team’s confidence in the company which was supportive of the whole team no matter the circumstances.
Next week, all of Acumen International’s team will meet at our client service hub in Cyprus, in our office in Nicosia, some for the first time since we embraced the challenge of working fully remotely, with a 100% international team.
Our client service hub is run by a blend of our local Cypriot team and colleagues dispersed from Ukraine with Maria Savva overseeing all projects we manage for the clients.
Over the coming weeks, we’ll reflect on the transformational years 2022 and 2023, and look forward to the future growth. We’ll also be sharing some of the key learnings from our own experience to help other companies maximise the benefits of deploying a global workforce.
Welcome to the January 2024 Edition of the Express Global Employment Newsletter As a leading provider of Global Employer of Record solutions, Express Global Employment is committed to keeping you informed and ahead in the dynamic world of global employment. This month, we delve into significant legislative changes and updates that are reshaping the landscape… Read more Global Employment Tax and Compliance Newsletter. January 2024
Welcome to the January 2024 Edition of the Express Global Employment Newsletter
As a leading provider of Global Employer of Record solutions, Express Global Employment is committed to keeping you informed and ahead in the dynamic world of global employment.
This month, we delve into significant legislative changes and updates that are reshaping the landscape of employment, taxation, and immigration across various jurisdictions.
From the latest adjustments in Ireland’s Special Assignee Relief Programme (SARP) to Germany’s updated social security thresholds and the U.S. Department of Labor’s revised interpretation of independent contractor classification, each section in this edition is designed to provide you with concise yet comprehensive insights. We understand employers’ complexities in navigating international employment laws and aim to offer valuable guidance and clarity.
🇺🇸US Department of Labor’s New Rule on Independent Contractor Classification
Legislation Adopted
The U.S. Department of Labor (DOL) has introduced a final rule revising the interpretation of the Fair Labor Standards Act’s (FLSA) provisions regarding the classification of workers as independent contractors. This new rule, aligning with the agency’s 2022 proposed version, will be effective from March 11.
Key Provisions in a Nutshell
Multifactor Analysis Framework: The rule adopts a multifactor, “totality-of-the-circumstances” approach to determine a worker’s status as an independent contractor.
Six Key Factors: The DOL will evaluate six main aspects, including profit or loss opportunities, investments, permanence of work relationship, control over work performance, integration of work into the business, and the use of skill and initiative.
Implications for Employers & Immediate Actions
The final rule is designed to ensure fair labour practices and proper worker classification. Acting Secretary of Labor Julie Su emphasizes that this rule aims to safeguard minimum wage and overtime protections under the FLSA, especially for vulnerable workers often affected by misclassification.
Review Worker Classifications: Employers should reassess their labour practices to align with the new classification criteria.
Prepare for Compliance: Adjust operational and HR processes to comply with the multifactor framework.
Legal Challenges Anticipation: The DOL is prepared to defend this rule against potential legal challenges, citing thorough procedural adherence and a solid legal foundation.
Monitoring and Training: Employers need to stay updated on the rule’s implications and provide adequate training to HR and management teams.
🇵🇭Philippines’ New Tax Law: Simplifying Compliance with the Ease of Paying Taxes Act
The Ease of Paying Taxes Act represents a significant step towards simplifying and modernizing the tax system in the Philippines. It offers increased flexibility and convenience for taxpayers, ensuring easier compliance and potentially reducing administrative burdens for both employees and employers. This law underscores the Philippine government’s commitment to improving the efficiency of its tax administration while protecting taxpayer rights.
Key Provisions in a Nutshell
Electronic and Manual Tax Returns: Individual taxpayers now have the option to file tax returns either electronically or manually.
Flexibility in Tax Payment: Taxes can be paid at any authorized agent bank nationwide, offering greater convenience.
Overseas Filipino Workers (OFWs): OFWs solely earning abroad are exempt from filing Philippine income tax returns.
Understanding the Impact
This Act significantly simplifies tax compliance for employers and individual taxpayers, reducing the risk of penalties associated with tax filing and payment deadlines.
Implications for Employers & Immediate Actions
Adopt Flexible Filing Methods: Employers should adapt to and educate employees about new electronic or manual tax filing options.
Streamline Tax Payments: Leverage the flexibility of paying taxes at any authorized agent bank across the country.
Tax Filing Consolidation for Married Couples: Married individuals must file combined tax returns electronically or manually, with provisions for separate filings when necessary.
Changes in the EOPT Act
Definition of ‘Filing of Return’ Expanded: Includes electronic submissions through authorized tax software providers.
OFW Tax Filing Exemption: Clarifies the non-requirement of tax return filing for OFWs with income solely from abroad.
Flexible Filing Locations: Tax returns can now be filed with any authorized entity, not just where the taxpayer is registered.
Married Individuals’ Filing Options: Allows for electronic or manual filing and includes provisions for separate returns when combined filing is impractical.
New SARP Guidelines in Ireland🇮🇪: Key Changes and Employer Impact
Legislation Adopted
Irish Revenue Updates SARP Guidelines.
Key Provisions in a Nutshell
Updated Guidance: Irish Revenue’s eBrief No.265/23, issued on 20 December 2023, revises the calculation for tax gross-ups for tax-equalised assignees under the Special Assignee Relief Programme (SARP).
SARP e-Filing Facility: A new online filing system for SARP, accessible from 1 January 2024, streamlines the compliance process.
Effective Date: Changes apply from 1 January 2024.
SARP Relief Criteria: This scheme is applicable to employees earning between €75,000 (for those who arrived in Ireland before 1 January 2023) and €1 million and offers significant tax deductions.
Eligibility and Delivery: Targets certain foreign employees in Ireland, with relief provided via payroll or personal tax returns.
Prior Approach: Initially, SARP relief was part of the gross-up calculation, reducing overall costs.
2024 Methodology Change: Now, gross-up is calculated first, with SARP relief applied afterwards, leading to higher costs.
Understanding the Impact
Decreased SARP Benefits: The new calculation method reduces SARP relief, potentially increasing assignment costs in Ireland.
E-Filing Advantages: The e-filing facility is expected to enhance filing efficiency and accuracy.
Impact on Employers: Increased reportable gross income for an employee, resulting in higher net Irish tax costs for employers.
Implications for Employers & Immediate Actions
Budget Review: Employers should reassess budgets for Irish assignments due to the altered SARP benefits.
Understand New Calculations: Grasp the revised gross-up methodology to ensure correct application and compliance.
Adopt e-Filing: Transition to the new SARP e-filing system for a smoother administrative process.
Past Shadow Payroll and Tax Submissions: The updated guidance from Irish Revenue confirms that existing shadow payroll and PAYE returns, incorporating SARP relief up to the 2023 tax year-end, are unaffected. This respects the complexity and past approaches of employers. Employees are not required to amend prior-year tax returns to adjust reported taxable employment income.
🇱🇹Lithuania’s 2024 Social Security and Income Tax Updates
Budget Adjustments: Revise assignment cost projections to align with the updated salary base and tax rates.
Payroll Updates: Ensure payroll systems are calibrated to the new SSC and PIT rates.
Tax Rates in Lithuania 2024
Income Type & Cap
Employer SSC Rate
Employee SSC Rate
PIT Rate
Ffor income up to EUR 114,162
1.77%
19.5% (22.5% with pension fund)
20%
For income exceeding EUR 114,162
1.77%
6.98%
32%
France’s 🇫🇷 Tax Landscape Shifts: New Treaties with Denmark 🇩🇰and Greece🇬🇷, Terminations by Mali and Niger
Legislation Adopted
France has enacted new tax treaties with Denmark and Greece, and Mali and Niger have announced the termination of their respective tax treaties with France. The French law authorising these developments was published on 23 December 2023.
Key Provisions in a Nutshell
Tax Treaty with Denmark: Signed in February 2022, this treaty replaces the 1957 agreement and includes modernised tax provisions.
Tax Treaty with Greece: This new treaty supersedes the 1963 convention, aligning with current OECD standards.
Mali and Niger Treaty Termination: Both countries have unilaterally announced the end of their tax agreements with France.
Understanding the Impact
France-Denmark and France-Greece Treaties: These treaties will enhance cross-border commerce and reduce double taxation, benefiting cross-border employees.
Mali and Niger Terminations: The termination of these treaties may lead to double taxation and increased costs for individuals and businesses involved in cross-border activities between these countries and France.
Implications for Employers & Immediate Actions
Review Cross-Border Transactions: Businesses with operations or employees in Denmark, Greece, Mali, or Niger should assess the implications of these treaty changes.
Adjust Tax Strategies: Adapt tax planning and compliance strategies to align with the new treaties and the absence of treaties with Mali and Niger.
Employee Tax Implications: Consider the impact on cross-border employees, especially with regard to pensions, directors’ fees, and employment income.
Stay Informed: Monitor further guidance and updates from tax authorities regarding these changes.
Tax Treaty with Denmark: Specific Provisions
Wider Tax Coverage:The new Tax Treaty Includes CSG (generalised social contribution)and CRDS (contribution for the repayment of social debt) contributions, not covered by the old convention.
Residency Criteria: Defines “resident” based on tax liability conditions.
Salaried Employment Taxation: Taxable in the state where the professional activity is carried out, with exceptions for short-term assignments.
Directors’ Fees: Taxable in the state of residence of the company.
Pension Income: Generally taxable in the source state.
Tax Treaty with Greece: Key Features
Modern OECD Standards: Addresses a range of income types, including dividends, interest, royalties, and pensions.
Unclear Implications: Awaiting further guidance for expatriates and businesses involved in activities between France and these countries.
Increase in UK Immigration Health Surcharge Starting February 2024
Legislation Adopted
The UK Parliament has approved the Immigration (Health Charge) (Amendment) Order 2024, leading to a significant increase in Immigration Health Surcharge (IHS) fees effective from 6 February 2024.
Key Provisions in a Nutshell
Primary Increase: For most adult UK immigration applicants, including sponsored workers, the annual IHS fee will rise from £624 to £1035 per year.
Students and Youth Mobility: The fees for applicants in these categories will increase from £470 to £776 annually.
Under 18 Applicants: The fee will also increase from £470 to £776 per year.
Implications for Employers & Immediate Actions
This considerable increase in IHS fees will significantly affect employers who support visa application costs for recruiting foreign nationals. Businesses will need to reassess their budgeting strategies and consider the impact on their recruitment and retention policies.
Budget Review: Employers must revisit their financial planning to accommodate the increased IHS fees.
Changes to Wage Reporting for Inbound Workers in Belgium 🇧🇪
Changes in Reporting Requirements: Employers must now include additional information on the wage statement form 281.10/20 for inbound taxpayers and researchers.
New Tax Regime: The new tax regime, launched in early 2022, replaced Belgium’s 38-year-old expat tax regime and offers significant tax benefits for qualifying inbound employees.
Understanding the Impact
This legislative update requires employers to adapt their administrative processes to comply with the modified wage statement reporting requirements for inbound taxpayers and researchers under the new tax regime.
Implications for Employers & Immediate Actions
Adjustment to Reporting Processes: Employers should revise their wage reporting systems to include the necessary additional entries on the wage statement 281.10/20.
Understanding the Tax Regime: Familiarize with the conditions and benefits of the new tax regime for inbound taxpayers and researchers.
Qualification Criteria: Ensure both the employer and the employee meet the specific conditions to qualify for the regime.
Key Criteria
The inbound taxpayer must not have been a Belgian resident, lived within 150 km of the Belgian border, or been subject to tax as a nonresident for professional income in Belgium for the 60 months prior to starting employment in Belgium.
The taxpayer must earn a gross remuneration exceeding EUR 75,000 annually for services rendered in Belgium (exemption for inbound researchers).
Tax-Free Allowances: Utilize the provision allowing certain employer-incurred expenses to be considered tax-free, capped at 30% of the gross remuneration with a maximum of EUR 90,000 annually.
Singapore’s 🇸🇬 IRAS Revises Voluntary Disclosure Program
End of Global Settlement Approach: IRAS will no longer accept single adjustments by employers for under-reporting cases.
Direct Engagement with Individuals: Notices of Assessment (NOAs) will be issued directly to individuals for any under-reported income.
Implications for Employers & Immediate Actions
IRAS’s updated approach to the Voluntary Disclosure Program marks a significant change in tax resolution procedures in Singapore. Employers must adapt to these changes, ensuring precise income reporting and preparing for increased employee involvement in tax matters. This transition reflects a broader trend towards individual accountability and accuracy in tax reporting, vital for the proper administration of income-based government programs.
This shift in approach underscores the critical need for precise income reporting for each individual, given its implications on other income-based benefits and levies. It signifies a heightened focus on individual accountability in tax reporting.
Review Reporting Practices: Employers should scrutinize their current tax reporting methods to ensure accuracy and compliance.
Prepare for Individual Assessments: Anticipate and plan for the direct involvement of employees in the tax remediation process.
Employee Communication: Develop clear communication strategies to inform and assist employees who may receive NOAs.
Alignment with IRAS Requirements: Align internal processes with the new IRAS approach, ensuring that individual income data is accurately captured and reported.
Specific Changes in VDP
Prior Global Settlement: Previously, employers could settle under-reported taxes collectively without involving individual employees directly.
Shift to Individual NOAs: IRAS will issue NOAs to individuals to correct any under-reported income, even if the employer settles the tax dues.
Increased Accuracy in Income Data: The new approach aims to ensure accurate individual income data, which is crucial for determining entitlements to government payments and benefits.
Italy’s Updated Expatriate Tax Regime 🇮🇹
Legislation Adopted
The Italian government has enacted the Decreto Legislativo, effective from 29 December 2023, revising the expatriate tax regime. This law introduces stricter conditions for expatriate taxpayers to benefit from tax relief.
Key Provisions in a Nutshell
New Relief Limitations: Tax relief for eligible expatriates is now capped at 50% with a maximum income limit of EUR 600,000.
Eligibility Criteria: The regime is now restricted to highly qualified or specialised individuals, including those eligible for a Schengen Blue Card.
Inter-Company Transfer Conditions: The final law allows for inter-company transfers under more stringent conditions than initially proposed.
Duration and Residency Requirements: Expatriates must have non-resident status in Italy for three years prior and commit to a four-year residency in Italy.
Implications for Employers & Immediate Actions
These changes necessitate a review of assignment policies and tax planning for both current and future employees in Italy. Employers must adjust strategies to meet the new regime’s stringent requirements.
Policy Revision: Update assignment policies for Italy, considering the new regime’s stricter conditions.
Employee Eligibility Check: Ensure potential and current assignees meet the new criteria, including residency and qualification requirements.
Tax Planning: Adjust financial planning for assignments to Italy to account for the reduced tax relief benefits.
Stay Informed: Keep abreast of any further clarifications or guidance on the implementation of the new law.
Background: Transition from Old to New Regime
Italy’s previous liberal expatriate tax regime, offering up to 70% income reduction, has transitioned to a more restrictive framework. The new law introduces relief modifications, residency prerequisites, and special rules for employees working in Italy for the same or a group employer. Transitional concessions have been provided for those who moved to Italy in 2023 under the old regime’s expectations.
UK’s New Approach to Reporting Employee Benefits-in-Kind
Mandatory Payroll Reporting: Income Tax and Class 1A NICs on benefits-in-kind are to be reported through payroll software.
Elimination of Forms P11D and P11D(b): The change is expected to remove the need for reporting benefits on these forms.
Expected Consultation: Further details and a consultation document will be released later in 2024.
Implications for Employers & Immediate Actions
This update is significant for UK employers who have traditionally managed the annual task of reporting employee benefits using Forms P11D and P11D(b). The proposed change aims to streamline the process, reducing administrative complexities and simplifying compliance.
The U.K. has historically required annual reporting of benefits provided to employees, including globally mobile staff, using specific forms. The new proposals mark a shift from this longstanding practice, building on the voluntary payrolling of benefits-in-kind introduced in 2016. The change represents a move towards more efficient, integrated tax and NIC reporting processes.
Preparation for Change: Employers should start preparing for the integration of benefits-in-kind reporting into their payroll systems.
Review of Current Reporting Practices: Assess and update current processes and systems in anticipation of the new reporting requirements.
Stay Informed: Keep abreast of upcoming consultation documents and further details from HMRC to understand the full scope and requirements of the change.
Training and Awareness: Ensure payroll and HR teams are trained and aware of the upcoming changes to transition to the new system smoothly.
🇫🇷France’s 2024 Finance and Social Security Laws: Key Changes for Employers and Employees
Legislation Adopted
France’s Finance Law for 2024 and the Social Security Financing Law for 2024 introduce significant measures impacting employers and employees. These laws, published in late December 2023, have been validated by the French Constitutional Court.
Key Provisions in a Nutshell
Finance Law
Adjustment of Tax Brackets: Personal income tax brackets have been adjusted for inflation with increased thresholds and rates.
Transportation Cost Exemption: Eligible home-workplace transportation costs are exempt from certain contributions and income tax, with increased exemption limits.
Exit Tax Reporting Rules: Modifications in reporting rules for taxpayers subject to exit tax upon leaving France.
New Offense of Aggravated Tax Fraud: Introduces penalties affecting income tax reductions or credits.
Budgeting and Payroll Adjustments: Employers should review and adjust their budget and payroll systems to reflect the new tax brackets and transportation cost exemptions.
Compliance with Exit Tax Rules: Ensure compliance with the modified reporting requirements for the exit tax.
Monitoring Aggravated Tax Fraud Rules: Stay informed about the new aggravated tax fraud offence to avoid penalties.
Foreign Company Registration: Foreign companies without a French establishment must adapt to the new registration process for social security purposes.
Detailed Income Tax Bracket Changes in France for 2024
The Finance Law’s adjustment to personal income tax brackets are as follows:
Income (EUR)
Rate (%)
Up to 11,294
0
11,294-28,797
11
28,797-82,341
30
82,341-177,106
41
Over 177,106
45
Germany’s 🇩🇪Social Security Updates for 2024: Wage Thresholds and Health Insurance Contributions
Revision of social security contribution thresholds in Germany.
Increment in the average additional contribution rate for statutory health insurance.
Implications for Employers & Immediate Actions
These updates necessitate employer vigilance in payroll adjustments and compliance with social security legislation to avoid penalties.
Payroll Adjustments: Employers must modify payroll systems to align with the new thresholds and rates.
Compliance with Legislation: Ensuring accurate and timely social security contributions is crucial to avoid penalties.
2024 Social Security Thresholds
Region
Pension and Unemployment Insurance
Health and Nursing Care Insurance
West
Monthly: €7,550, Yearly: €90,600
Monthly & Yearly: €5,175
East
Monthly: €7,450, Yearly: €89,400
Monthly & Yearly: €5,175
Contribution Rates per Social Security Branch (2024)
Insurance Type
Employee’s Portion
Employer’s Portion
Total
Pension Insurance
9.30%
9.30%
18.60%
Unemployment Insurance
1.30%
1.30%
2.60%
Health Insurance*
7.30%
7.30%
14.60%
Nursing Care Insurance**
2.3% (Saxony 2.8%)
1.7% (Saxony 1.2%)
4.00%
Note 1: Health Insurance: The average additional contribution rate is 1.7% (0.1% higher than in 2023).
Note 2: Nursing Care Insurance: Rates assume employees without children. Contributions vary for employees with children.
Chile’s 🇨🇱 National Immigration Policy: A New Framework for Migration Management
Legislation Adopted
The Chilean government has enacted a new National Immigration Policy through Decree N 181, effective immediately. The policy addresses recent migratory trends and enhances national security and migrant welfare.
The new Chilean National Immigration Policy represents a significant shift towards more organized and humane immigration management, emphasising both national security and the well-being of migrants. It requires employers to be proactive in adapting their hiring and management strategies to align with the new regulatory environment.
Key Provisions in a Nutshell
Introduction of the National Immigration Policy to manage immigration more effectively.
Alignment with Chile’s constitution and international agreements.
Streamlined immigration processes and regularization of migrants with irregular status.
Preference for residency applications initiated abroad for specific categories.
Implications for Employers & Immediate Actions
This comprehensive policy aims to revamp Chile’s approach to immigration, ensuring controlled, secure immigration and facilitating access to essential public services for migrants.
Adaptation to New Immigration Policy: Employers must align with the new immigration framework for recruiting and managing foreign talent.
Prioritising Overseas Applications: Focus on hiring foreign nationals with work contracts from abroad or those contributing to sectors with labour shortages.
Monitoring Student and Researcher Categories: Employers should be aware of new subcategories for students, academics, and researchers.
Aspects of the New Immigration Policy
Human Rights and Interculturality Focus: Emphasising respect for human rights and cultural diversity in immigration management.
Regularisation of Migrants: Efforts to legalize the status of irregular migrants in Chile.
Modernisation of Immigration Systems: Upgrades to information and processing systems for efficient handling of residence permit applications.
Training and Coordination: Training for public agents and collaboration with international organisations for better immigration governance.
Inclusive Services: Provision of services in multiple languages to cater to non-Spanish-speaking migrants.
Efficiency in Visa Processing: Expected reduction in visa application processing time and improved access to immigration information.
Economic Development Focus: Encouraging immigration of highly qualified foreign nationals to support Chile’s economic growth.
Malaysia’s 🇲🇾Immigration Updates: Visa and Digital Arrival Card Changes
Legislation Adopted
Malaysia has introduced significant changes to its immigration procedures, impacting entry visas and the introduction of the Malaysia Digital Arrival Card (MDAC).
Key Provisions in a Nutshell
Visa Liberalisation Plan: From 1 December 2023 to 31 December 2024, passport holders from China and India can enjoy a 30-day visa exemption for social visits or tourism.
Malaysia Digital Arrival Card (MDAC): Mandatory online MDAC submission for all foreign nationals, effective 1 January 2024, with specific exemptions.
Implications for Employers & Immediate Actions
These recent updates by Malaysia’s immigration authorities are key for companies managing expatriate hires and receiving foreign visitors. Understanding and adhering to these changes will ensure smooth entry processes and compliance with Malaysia’s immigration laws.
These updates streamline entry procedures for certain visitors while enhancing overall immigration process efficiency. The adoption of the MDAC is a move towards digitisation, simplifying entry for most travellers.
Visa Exemption Awareness: Employers should inform relevant staff and visitors from China and India about the 30-day visa exemption for specific purposes.
MDAC Compliance: Ensure all non-exempt foreign nationals complete the MDAC online before arrival in Malaysia.
Long-term Pass Holders: Clarify with Long-term Pass holders (e.g., Employment Pass, Dependent Pass holders) that they are exempt from the MDAC requirement.
Communication and Planning: To ensure compliance and hassle-free travel, update travel policies and communicate these changes to all relevant stakeholders.
Detailed Aspects of the Immigration Updates
Visa Exemption Criteria: Visa exemptions apply to social visits and tourism only. Other purposes like employment require a single-entry visa.
MDAC Application Window: Foreign nationals can submit the MDAC up to three days before arriving in Malaysia.
MDAC Exemptions: Singapore passport holders, Diplomatic/Official passport holders, Permanent Residents, and Long-term Pass holders are exempt from the MDAC requirement.
Newly Approved Long-term Pass Endorsement: Individuals arriving to endorse a new Long-term Pass must complete the MDAC, as they are not exempt.
Wrapping Up This Month’s Global Employment Insights
As we conclude this edition of our newsletter, we hope the insights and updates have been both enlightening and beneficial. Navigating the complexities of global employment laws and regulations is a challenging yet crucial aspect of international business, and our goal is to equip you with the knowledge to do so effectively.
Remember, the landscape of global employment is ever-evolving. Staying informed and adaptable is key to managing your workforce across borders successfully. At Express Global Employment, we’re dedicated to providing you with the tools and information you need to thrive in this dynamic environment.
We look forward to continuing to serve as your guide through the intricacies of global employment. Should you have any questions or need further assistance, our team of experts is always here to support you.
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Welcome to the final 2023 edition of the Global Employment Tax and Compliance Newsletter. This year has been a journey of discovery and adaptation in the world of global employment, and our 12th edition is no exception. We’ve consistently strived to bring cutting-edge insights and analysis to the forefront, empowering global employment professionals to navigate… Read more Global Employment Tax and Compliance Newsletter. December 2023
Welcome to the final 2023 edition of the Global Employment Tax and Compliance Newsletter. This year has been a journey of discovery and adaptation in the world of global employment, and our 12th edition is no exception. We’ve consistently strived to bring cutting-edge insights and analysis to the forefront, empowering global employment professionals to navigate the complexities of an ever-evolving landscape.
As we culminate this year’s series, this edition encapsulates the latest legislative updates and reflects on the strides we’ve collectively made in shaping effective global employment strategies. The diverse changes and challenges we’ve examined throughout the year, from tax reforms to visa policies, have enhanced our collective expertise.
Our ambition has always been to transcend beyond mere compliance updates. We aim to provoke thought, foster innovation, and inspire strategic thinking in managing global workforces. The remarkable increase in our LinkedIn community and subscriber base is a testament to the value we’ve created together.
As we enter a new year, we carry insights, experiences, and lessons from 2023. Let’s continue to collaborate, innovate, and elevate the standards of global employment practices.
🇧🇪-🇳🇱 Clarifying Permanent Establishment in Remote Work: New Belgium-Netherlands Agreement
Legislation Adopted
On 23 November 2023, Belgium and the Netherlands ratified a Competent Authority Agreement to interpret Article 5 of their Income Tax Treaty, specifically addressing the impact of remote working on establishing a permanent tax presence.
Key Provisions in a Nutshell
Scope of Agreement: Guidelines on how remote working affects the creation of a permanent establishment for taxation. Determining if home-working leads to a permanent establishment is crucial, impacting cross-border employees’ corporate and income tax calculations.
Home-Working Scenarios: Differentiation between occasional, regular, and consistent home-working and their impact on establishing a permanent establishment.
Practical Guideline: Working from home 50% or less of the time does not constitute a permanent establishment. Over 50% may lead to a permanent establishment, dependent on certain conditions.
Effective Date: Applicable from 8 December 2023.
Understanding the Impact
This Agreement marks a crucial development in the growing hybrid work model, offering clarity on tax obligations and permanent establishment related to remote working for cross-border employees between Belgium and the Netherlands.
Implications for Employers & Immediate Actions
Policy Review: Assess remote working policies in light of these new guidelines.
Tax Compliance: Adjust tax reporting and compliance strategies for employees working remotely.
Individual Assessment: Examine the working patterns of cross-border employees to understand potential tax implications under the new Agreement.
Ongoing Discussions Monitoring: Stay informed about ongoing discussions between Belgium and the Netherlands, particularly regarding income tax implications for cross-border employees. These talks may lead to future changes that could impact cross-border employment arrangements.
Assessment of Permanent Representative Status: The Agreement does not address situations involving a permanent representative. Employers must assess if employees working from home with the authority to conclude or negotiate employment contracts could be classified as permanent representatives. This is crucial as it has significant implications for establishing a permanent establishment and the related tax obligations.
🇨🇿 Czech Republic’s Revisions in Taxation of Employee Stock Plans
Legislation Adopted
The Czech Republic is considering a bill to revise the taxation on employee stock options and shares. Set for potential implementation on 1 January 2024, if passed, the bill is directed at employer-provided stock benefits.
Key Provisions in a Nutshell
Scope of the Bill: Adjusts taxation on employee stock options and shares, focusing on those acquired in a business corporation that is the employer or a related entity.
Taxation Timing: The amendment specifies when the non-monetary benefit, i.e., employment income from these plans, becomes taxable for the employee.
Defined Taxable Events: Includes termination of employment, changes in tax residency, share or option transactions, option exercises, and reaching a 10-year limit from acquisition.
Option Type Applicability: The bill’s current form does not specify a distinction between transferable and non-transferable options.
Transferable vs. Non-Transferable Options: The amendment does not distinguish between freely transferable and non-transferable options in its current wording.
Understanding the Impact
This legislative change is significant, particularly regarding when and how employee stock options and shares are taxed, affecting both employers and employees, especially in cross-border employment situations.
Implications for Employers & Immediate Actions
Review Employee Plans: Examine existing stock options and share plans for alignment with the new taxation rules.
Inform Employees: Clearly communicate the changes in taxation timing to employees to help them understand the impact on their income.
Legislative Monitoring: Keep track of the bill’s progress to adapt swiftly and ensure compliance.
Seek Clarification on Ambiguities: Consult local tax and employment experts to understand how the lack of distinction in option types affects plan administration.
🇨🇾 Cyprus 2024 Update: Social Insurance Contribution Rates Rise
Legislation Adopted
Effective 1 January 2024, Cyprus has mandated an increase in the Social Insurance Fund contribution rates, per the Social Insurance Law of 59(I)/2010 and its amendments.
Key Provisions in a Nutshell
Employed Persons: Contribution rates for both employers and employees will rise from 8.3% to 8.8% on insurable earnings.
Self-Employed Persons: The contribution rate will increase from 15.6% to 16.6% on insurable earnings.
Insurable Earnings Ceiling: For 2024, the maximum insurable earnings are set at €1,209 per week, €5,239 per month, and €62,868 per annum.
Contribution to Other Funds: Rates for the Redundancy, Training and Development Funds, along with the Social Cohesion Fund (which has no cap on earnings).
Understanding the Impact
These changes will affect cost projections and budgeting for international assignments to and from Cyprus. Employers must consider these rate increases in payroll adjustments and hypothetical tax calculations, particularly for tax-equalised assignees.
Implications for Employers & Immediate Actions
Payroll Adjustment: Update payroll systems to reflect the new contribution rates for both employed and self-employed individuals.
Budget Revisions: Revise budgeting for international assignments in Cyprus to account for increased social insurance contributions.
Communication: Inform stakeholders, including assignees, about the changes to ensure understanding and compliance.
Consultation: Employers and self-employed individuals should seek advice from tax professionals for optimal management of these changes.
Following its recent formation, the Slovak government rapidly introduced a tax reform, leading to the passage of the Amendments Act on 19 December 2023. This act revises several existing tax laws, including the Slovak Income Tax Act, and is set for implementation from the start of 2024, pending presidential approval.
Key Provisions in a Nutshell
Dividend Income Tax Hike: Tax on dividends rises from 7% to 10% for profits accruing in tax periods beginning 1 January 2024 onwards.
Revocation of Tax Exemptions: Specific exemptions on securities sales, company shares disposals, and virtual currency transactions are eliminated.
Adjustment in Self-Employed Taxable Income Cap: The threshold for a 15% tax rate for self-employed individuals increases from €49,790 to €60,000.
Higher Health Insurance Contributions: Employer health insurance contributions are set to rise from 10% to 11% (5.5% for employing disabled persons).
Understanding the Impact
These rapid legislative developments introduce significant changes in Slovakia’s tax landscape. Employers, particularly those under the Slovak social security regime, and individuals with investment income will face higher taxation.
Implications for Employers & Immediate Actions
Prepare for Increased Operational Costs: Factor in the raised healthcare insurance rates in budgeting and payroll.
Investment Income Reassessment: Reevaluate the financial impact due to the removal of specific tax exemptions and increased dividend taxation.
Policy Revision: Update internal tax-related policies, including for international assignees, to align with the new tax regime.
Individual Tax Planning: Advise employees to review their tax situation, especially those with investments affected by the changes.
🇨🇳 China’s Expanded Visa Exemption for Select Countries
Legislation Adopted
China’s Ministry of Foreign Affairs announced an expansion of its unilateral visa exemption policy, effective from 1 December 2023 to 30 November 2024, for travellers from six additional countries.
Key Provisions in a Nutshell
Beneficiary Countries: Germany, France, Italy, the Netherlands, Spain, and Malaysia.
Eligibility Criteria: Visa exemptions apply to citizens holding ordinary passports visiting for business, tourism, visiting relatives, and transit for up to 15 days.
Existing Exemptions: This expansion builds on existing visa exemptions for Singapore and Brunei citizens.
Understanding the Impact
These visa exemptions ease entry into China for short-term stays from the specified countries, promoting business, tourism, and cultural exchanges. However, the duration under visa exemption cannot be extended within China.
Implications for Employers & Immediate Actions
Inform Relevant Stakeholders: Update mobile employees, frequent travellers, and students about the new visa exemption opportunities.
Compliance: Ensure understanding and adherence to the visa exemption conditions, including duration limitations.
Monitor Updates: Stay informed about further immigration policy changes in China and reciprocal visa policies from the affected countries.
Reciprocal Visa Policies
France’s Policy for Chinese Citizens: France now offers a five-year multiple-entry visa for Chinese citizens who have completed a master’s degree and at least one semester of study in France.
Malaysia’s Visa Exemption for Chinese Citizens: From 1 December 2023, Chinese citizens with ordinary passports are exempted from needing a visa for tourism visits to Malaysia for up to 30 days.
China-Singapore Visa Waiver Agreement: An agreement for visa waivers for ordinary passport holders of China and Singapore is under finalisation, with specifics yet to be announced.
🇧🇷 Brazil’s Comprehensive Tax Reform: Impacting Income and Overseas Investments
Legislation Adopted
Brazil’s government has enacted Law No. 14.754/2023, bringing significant changes to the taxation of individual income, including earnings from employment and financial investments abroad, effective from January 1, 2024. This law also includes key reforms in the trust regime and alters the valuation and taxation of foreign assets for Brazilian tax residents.
Key Provisions in a Nutshell
Trust Regime Reforms: Introduces important changes to how trusts are handled for tax purposes.
Valuation of Foreign Assets: Alters rules for valuing foreign assets held by Brazilian tax residents, impacting their tax liabilities.
Broad Tax Treatment Changes: Affects various forms of income, including employment and overseas investments.
Understanding the Impact
The Law marks a significant shift in Brazil’s tax policy, affecting individuals with diverse income sources and investments overseas. The new valuation rules for foreign assets are especially noteworthy.
Implications for Employers & Immediate Actions
Inform and Prepare Assignees: Discuss the applicable tax rates, thresholds, exemptions, and changes in the valuation and reporting of overseas assets with new Brazil-inbound assignees.
Review Assignment Policies: Employers should reassess assignment policies, considering the increased tax responsibilities and potential impacts on assignees.
Seek Expert Guidance: It’s crucial for employers and employees to consult with tax professionals or a Global Mobility Services team to understand the implications and ensure compliance with the new laws.
🇨🇿 Comprehensive Tax and Social Security Reforms in the Czech Republic
Income Tax Rate Changes: The threshold for a 23% tax rate is lowered, impacting higher earners.
Non-Monetary Benefit Limits: Introduction of limits on exemptions for non-financial benefits, including managerial accommodations and meal allowances.
Tax DeductionsRemoved: Removal of specific tax deductions and credits affecting students, families, and union members.
Cap on Securities and Share Exemptions: Restriction on tax exemptions for sales of securities and shares, with a new cap set.
Social Security Contribution Adjustments: Increase in employee and self-employed contribution rates.
Understanding the Impact
These reforms will likely lead to increased taxation for employees, especially international assignees, and heightened social security contributions, affecting the Czech Republic’s employees and self-employed individuals.
Implications for Employers & Immediate Actions
Budget and Policy Adjustments: Employers should reassess their budgeting for assignments and consider revising policies to accommodate increased tax and social security costs.
Employee Communication: Clearly communicate these changes to employees, especially those on international assignments, to manage expectations and ensure compliance.
Monitor Further Developments: Stay alert to any additional guidance or modifications to these reforms.
🇪🇺 EU’s New Directive on Platform Work: Ensuring Fair Employment Status
Legislation Adopted
The European Parliament and Council reached a provisional agreement on the Platform Work Directive on 13 December 2023. This directive, pending formal adoption, targets improved working conditions for individuals engaged in tasks through digital platforms.
Key Provisions in a Nutshell
Employment Status Clarification: Presumption of employment based on certain control indicators.
Algorithmic Transparency: Mandated disclosure of algorithmic decision-making impacting workers.
Human Oversight in Decision-Making: Requirement for human involvement in significant platform decisions.
Data Protection Enhancements: Restrictions on processing sensitive personal data of platform workers.
Intermediary Regulation: Measures to prevent circumvention of rules through intermediaries.
Understanding the Impact
The proposed EU Platform Work Directive can significantly transform the platform economy’s landscape. It’s poised to shift the classification of a substantial number of workers from self-employed to employee status. This change isn’t just a label alteration; it has profound implications for taxation and social security contributions. The directive’s reach extends across various segments of the gig economy, notably impacting sectors like food delivery services. With this shift, many individuals operating as independent contractors could gain full employee rights and protections, altering the financial and operational dynamics for workers and platform operators.
Implications for Employers & Immediate Actions
Reassess Employment Classifications: Review and update employment status in line with new criteria.
Adapt to Transparency Requirements: Revise systems to ensure algorithmic decision-making is transparent.
Incorporate Human Review in Decision Processes: Establish procedures for human oversight in critical decision-making areas.
Monitor and Prepare for Compliance: Keep abreast of developments and prepare for the directive’s effective implementation.
Additional Considerations
Potential Directive Adoption: The directive, likely to be adopted, addresses the employment status of platform workers, with court cases often leading to reclassification from self-employed to employed.
Economic Implications: Observations highlight that the directive may align with the financial strategies of certain member states where service provision taxes are less than those for employment. The anticipated shift from self-employed to employed status for many workers could increase overall tax and social security contributions.
EU Commission’s Analysis: Over 5 million platform workers might be misclassified, and reclassification could significantly increase state revenues.
🇬🇧 United KingdomHMRC Releases Guidance on Digital Platform Reporting Rules
New Reporting Obligations for Digital Platforms
HMRC’s updated guidance, detailed in the International Exchange of Information Manual (IEIM), outlines the UK’s implementation of the OECD’s model reporting rules for digital platforms. These new requirements, effective from 1 January 2024, compel UK-based digital platforms to gather and report to HMRC annual income information for sellers providing personal services, selling goods, or renting out property or transport on their platforms. The initial data reporting is scheduled for January 2025.
Compliance for UK and EU Platforms
The guidance is particularly relevant for UK digital platforms that are also active in the EU. These platforms must be aware of their dual reporting responsibilities, as the EU’s Directive on Administrative Cooperation (DAC7) enforces similar rules from 1 January 2023, a year earlier than the UK’s timeline. The first EU reporting deadline falls in January 2024. Platforms operating in both regions should prepare for each jurisdiction’s nuanced requirements and timelines.
🇬🇧 New UK Tax Treaties with Luxembourg 🇱🇺 and San Marino 🇸🇲
Legislation Adopted
The UK has recently ratified new double tax treaties with Luxembourg and San Marino. The UK-Luxembourg treaty, signed on 7 June 2022, and the UK-San Marino treaty, signed on 17 May 2023, have both been formally ratified and entered into force on 22 November 2023 and 30 November 2023, respectively.
Influences UK income tax and capital gains tax from 6 April 2024.
Understanding the Impact
These treaties are pivotal in preventing double taxation and fiscal evasion and enhancing trade and investment between the UK and these countries. They provide clarity on tax obligations for businesses and individuals engaging in cross-border activities.
Implications for Employers & Immediate Actions
Review International Transactions: Employers with cross-border transactions between the UK and Luxembourg or San Marino should review their structures and transactions to align with the new treaty provisions.
Tax Planning: Consider tax planning opportunities under the new treaties, particularly regarding withholding taxes, capital gains, and corporate taxes.
Update Tax Compliance Protocols: Ensure that payroll and taxation systems are updated to reflect the changes, especially regarding withholding tax obligations.
Communicate with Employees and Stakeholders: Inform employees and relevant stakeholders about how these changes might affect their tax liabilities.
Seek Expert Advice: Consult with tax professionals to understand the detailed implications of these treaties on your business operations.
Monitor Implementation: Keep abreast of how these treaties are implemented in practice, especially in their initial years, to ensure full compliance and to take advantage of potential benefits.
🇺🇸 U.S. Visa Bulletin January 2024: Key Updates
Legislation Adopted
The U.S. Department of State’s January 2024 Visa Bulletin announces significant updates in employment-based visa categories, particularly for EB-1 and EB-3 visas for certain nationalities.
Key Provisions in a Nutshell
EB-1: Progression in cut-off dates for China and India.
EB-2 and EB-3: Changes in cut-off dates for China, India, and other countries.
Other Categories: Adjustments in EB-4, Certain Religious Workers, and EB-5 categories.
Understanding the Impact
These updates reflect ongoing adjustments to the U.S. immigration system, addressing the backlog and demand for employment-based visas. The shift in cut-off dates is a response to changing immigration trends and the need to manage visa allocations efficiently.
Implications for Employers & Immediate Actions
Monitoring Visa Bulletins: Employers should closely monitor monthly bulletins for changes affecting their workforce’s visa status.
Planning and Compliance: Adjustments may be required in workforce planning and compliance strategies, especially for those employing a significant number of employees from China and India.
Communication with Employees: It’s essential to keep affected employees informed about their visa status and potential eligibility or application timeline changes.
Cut-Off Dates for Dates of Final Action Chart for January 2024
This table concisely summarises the cut-off dates for the final action per visa category, as per the January 2024 Visa Bulletin. It’s a helpful guide for employers and individuals planning their visa applications.
Visa Category
All Countries (except China & India)
China
India
EB-1
Current
July 1, 2022
September 1, 2020
EB-2
November 1, 2022
January 1, 2020
March 1, 2012
EB-3 (Professional & Skilled)
August 1, 2022
September 1, 2020
June 1, 2012
EB-3 (Other Workers)
September 1, 2020
January 1, 2017
June 1, 2012
EB-4
May 15, 2019
–
–
Certain Religious Workers
May 15, 2019
–
–
EB-5
Current
December 8, 2015
December 1, 2020
🇬🇧 United Kingdom HMRC’s New IR35 Off-Payroll Working Rules Guidance
Target Audience: Aimed at businesses managing IR35, involving workers who provide services through their own intermediaries. Note: IR35 off-payroll working rules are a set of tax legislation in the UK designed to combat tax avoidance by workers supplying their services to clients via an intermediary, such as a limited company, but who would be an employee if the intermediary was not used. These workers are often referred to as ‘disguised employees’ by HMRC.
Structure: The guidance is divided into 14 distinct sections, each detailing aspects of IR35 compliance.
Understanding the Impact
Purpose: The guidance is designed to clarify good practices for IR35 compliance, helping organisations understand HMRC’s expectations.
Format: Features practical examples of systems and processes deemed effective for adhering to IR35 rules.
Implications for Employers & Immediate Actions
Complementary Nature: These guidelines are to be read alongside existing HMRC off-payroll working guidance, not in isolation.
Integration with Current Practices: Employers should incorporate the guidance into their existing IR35 compliance strategies.
Review and Implementation: Thoroughly review the GfC4 guidelines and integrate the recommended practices for a comprehensive IR35 compliance approach.
Ongoing Compliance: Regularly update and refine IR35 compliance processes in line with HMRC’s evolving guidelines and practices.
From A to Z, we’ve covered it all – from international hiring strategies to visa processes, cultural diversity, and tax reporting. Whether you’re an HR professional, a business owner, or a global executive, this guide is your ultimate resource for success in the global workforce.
Explore expert insights on managing a diverse global team.
Navigate the complexities of international employment with ease.
Leverage the strength of Global EOR for streamlined operations.
Achieve compliance, quality, and efficiency on a global scale.
Embracing the Future of Global Employment
As we draw the curtains on this year’s final edition of the Global Employment Tax and Compliance Newsletter, we want to extend our heartfelt gratitude to each one of you. Your engagement, insights, and feedback have been the driving force behind our continuous evolution and success.
Looking ahead, the landscape of global employment continues to evolve at an unprecedented pace. The challenges and opportunities it presents will undoubtedly require us to stay agile, informed, and proactive.
We eagerly anticipate continuing this journey with you in 2024, further expanding our horizons and deepening our understanding of global employment intricacies. Until then, we wish you a successful wrap-up of this year and a fantastic start to the next.
Forbes Tech 2023 in Lviv emerged as a pivotal gathering for business leaders and tech innovators, offering fresh perspectives on technology’s evolving role in these challenging times. The event brought together tech industry leaders and experts to share insights into digital transformation and the challenges and achievements within their sectors. The strategic panels and sessions… Read more Insights from Ukraine at Forbes Tech 2023
Forbes Tech 2023 in Lviv emerged as a pivotal gathering for business leaders and tech innovators, offering fresh perspectives on technology’s evolving role in these challenging times. The event brought together tech industry leaders and experts to share insights into digital transformation and the challenges and achievements within their sectors.
The strategic panels and sessions at ForbesTech 2023 centred on AI’s transformative impact and its practical applications across various industries, business domains, and everyday life. Amidst the backdrop of war, the conference highlighted the country’s rapid emergence as an innovator in defence technology, reflecting on the vital role of tech advancements.
The discussions illuminated several key trends:
Roman Prokofiev, co-founder of Jooble, emphasised the increasing shift towards continuous learning. He noted that people are currently changing careers approximately 2.5 times in their lifetimes, a rate expected to multiply by 5 to 7 times over the next two to three decades. Roman also reflected on Ukraine’s unique position in the IT sector. ‘We are the IT underdogs,’ he stated, emphasising the extraordinary achievements made in Ukraine despite the challenges.
Vitaly Sedler, co-founder and CEO of Intellias, brought a unique perspective on Ukraine’s role in technology, particularly in defence tech. ‘Ukraine has rapidly emerged as an innovator in defence technology,’ he stated, emphasising the sector’s explosive growth. He further added, ‘Considering our advancements in engineering, I believe we’re on our way to becoming a centre of innovation.’
Oleksandr Konotopskiy, founder and CEO of Ajax Systems, spoke about the significant changes reshaping Ukraine. ‘We’re witnessing tectonic shifts in our country, not just in its demographic composition but in its industrial focus as well,’ he observed. Konotopskiy pointed out Ukraine’s emerging role as a major arms producer, an unimaginable development just two years ago.
Navigating Challenges and Envisioning the Future
In the session titled “First Things First: Challenges, Solutions, Forecasts” at ForbesTech 2023, moderated by Maria Shevchuk, CEO of IT Ukraine Association, Ukrainian tech industry leaders gathered to reflect on the challenging year of 2023 and to share their forecasts for 2024 and beyond.
Our team was inspired by Enkelejd Zotaj, CIO of Raiffeisen Bank Ukraine, after his enlightening session on business digitalisation.
Vitaly Sedler, co-founder and CEO of Intellias, initiated the dialogue with insights into the evolving business environment in Ukraine. He stressed the necessity for businesses to deepen their competencies and innovate to gain new competitive edges.
Oleksandr Konotopskiy, CEO of Ajax Systems, gave a balanced view of Ukraine’s tech future. He sees Ukraine as a rising global innovation hub but admits there are big challenges to overcome. ‘We’re on our way to that status,’ he said, stressing Ukraine needs to look at its global role and attract international talent to become a true innovation hub.
Taras Kytsmey, co-founder and board member of Softserve, then shifted the focus to the interplay between state responsibilities and business roles. He underscored the importance of the state in providing education and businesses in creating employment opportunities and ensuring fair compensation. This, Kytsmey argued, is essential for fostering a sustainable and thriving economic landscape.
The session also featured Volodymyr Krasotin, digital transformation director at the pharmaceutical company Darnitsa, who brought a unique perspective. He humorously introduced Darnitsa as a “well-known IT company that produces medicines,” highlighting the ubiquitous nature of digital transformation across various industries. Volodymyr shared his comprehensive approach to digital transformation, extending beyond his company to include partners and collaborators in shaping the future.
The session concluded by exploring Darnitsa’s approach to handling workforce challenges amid the situation in Ukraine, particularly focusing on its strategy for digital transformation and global hiring practices.
Express Global Employment Solutions for Ukrainian Businesses
In these challenging times, our team at Express Global Employment is dedicated to helping Ukrainian companies navigate the complexities of workforce displacement. We specialise in the Global Employer of Record (EOR) model, which is an essential service for businesses affected by the current situation.
In these challenging times, Express Global Employment serves as a strategic ally to Ukrainian companies with dispersed workforces worldwide. Our Global Employer of Record (EOR) service provides a crucial lifeline, ensuring seamless business continuity and maintaining connections between Ukrainian companies and their global employees.
Express Global Employment solutions are designed to effectively address this issue. We streamline the re-hiring, management, and retention of employees for Ukrainian businesses, even when these workers have had to relocate internationally. Our expertise in handling the complexities of international employment law and administrative processes relieves companies from the burdensome task of establishing their own legal entities in every country where their workforce is now based. Our all-in-one Express Global Employment service is more than just a convenience; it’s a critical component for sustaining business operations.
When key Ukrainian staff members are globally dispersed, Express Global Employment ensures they remain employed and productive within their original Ukrainian companies. This approach is essential in keeping businesses operational and uninterrupted, adapting seamlessly to the workforce’s new geographical distribution. We provide a vital bridge that connects Ukrainian companies with their employees worldwide, maintaining continuity and stability.
Welcome to our November 2023 Global Employment Tax and Compliance Newsletter. This edition is crafted for forward-thinking employers and global employment solution providers, offering a lens into the latest shifts and trends in the global employment landscape. November 2023 has been a month of pivotal changes and strategic adaptations. The global employment domain continues to… Read more Global Employment Tax and Compliance Newsletter. November 2023
Welcome to our November 2023 Global Employment Tax and Compliance Newsletter. This edition is crafted for forward-thinking employers and global employment solution providers, offering a lens into the latest shifts and trends in the global employment landscape.
November 2023 has been a month of pivotal changes and strategic adaptations. The global employment domain continues to evolve rapidly from Italy’s revamped expatriate regime to Australia’s innovative pathways to permanent residency and Belgium’s updated salary thresholds.
These changes, crucial insights from the ILO’s digital employment guidelines, and more are dissected here to provide you with actionable intelligence.
Join us as we navigate these developments, understanding their impact, and exploring strategies for effective compliance and operational agility in the global marketplace.
Thank you for choosing us as your guide in the dynamic world of global employment. Let’s dive in!
Global EOR vs. Local Legal Entity
Explore the “Global Employer of Record vs. Local Legal Entity” Guide
Navigating the complexities of international expansion requires a strategic approach. Our guide, “Global Employer of Record vs. Local Legal Entity,” offers a comparative analysis and strategic insights. It’s an invaluable asset for decision-makers weighing the advantages of an Employer of Record against setting up a local legal entity. Access this essential resource for your global expansion plans here.
🇬🇧 United Kingdom Autumn Statement 2023: Key Updates on National Insurance and Tax Rates
Legislation Adopted
Chancellor Jeremy Hunt’s Autumn Statement, delivered on 22 November 2023, introduces several changes impacting both employees and employers in the UK. Among the most significant is the reduction in National Insurance rates.
Key Provisions in a Nutshell
National Insurance Contributions (NIC): A reduction for employees from 12% to 10% starting 6 January 2024. Employer NIC rates remain unchanged.
Income Tax Rates and Thresholds: No changes have been announced; rates and thresholds remain as previously set.
Scotland and Wales Tax Rates: Updates for 2024/25 to be announced in December 2023.
Self-employed NIC: Class 2 contributions were abolished, and Class 4 was reduced from 9% to 8% from 6 April 2024.
Other Tax Measures: Implementation of Making Tax Digital for Income Tax Self-Assessment in April 2026, abolition of the pension lifetime allowance from April 2024, and adjustments to capital gains and dividend allowances from April 2024.
Tax Category
2023/24
2024/25
Personal Allowance
£12,570 (0%)
£12,570 (0%)
Basic Rate
£0 – £37,700 (20%)
£0 – £37,700 (20%)
Higher Rate
£37,701 – £125,140 (40%)
£37,701 – £125,140 (40%)
Additional Rate
Over £125,140 (45%)
Over £125,140 (45%)
Understanding the Impact
These changes are crucial for employers managing globally mobile employees in the UK. While the overall tax burden in 2024/2025 is expected to remain stable, individuals liable for UK National Insurance will see a noticeable reduction in contributions.
Implications for Employers & Immediate Actions
Budgeting: Employers should adjust their financial planning and payroll systems to accommodate the new NIC rates.
Communication: It’s vital to inform employees, especially those on international assignments, about these changes and their potential impact on net pay.
Compliance: Ensure alignment with the updated tax and NIC rates to maintain compliance and avoid penalties.
Consultation: Consider consulting with tax professionals to understand the broader implications of the Autumn Statement on your business operations.
To ensure full compliance with the evolving UK tax landscape, employers should stay vigilant for further announcements, especially regarding Scottish and Welsh tax rates.
🇬🇧UK Introduces Electronic Travel Authorisation for Non-Visa Nationals
Legislation Adopted
The UK government is rolling out an Electronic Travel Authorisation (ETA) requirement for non-visa nationals planning to visit, transit, or enter the UK for short stays, including up to three months as a Creative Worker.
Key Provisions in a Nutshell
ETA Requirement: Non-visa nationals need an ETA before travelling to the UK.
Exemptions and Initial Roll-Out: Irish residents are exempt. Qatari nationals require an ETA from 15 November 2023, with other non-visa nationals following in 2024.
Cost and Validity: An ETA costs GBP 10 and is valid for two years or until the passport expires, whichever comes first.
Understanding the Impact
This change marks a significant shift in the UK’s travel and immigration policy to enhance security and streamline entry processes.
Implications for Employers & Immediate Actions
Inform and Prepare Travellers: Employers should inform non-visa national employees of this new requirement, especially those frequently travelling to the UK.
Plan for Additional Costs and Time: Factor in the ETA cost and application process time into travel plans and budgets.
Monitor Roll-Out Dates: Stay updated on the phased implementation dates for different nationalities in 2024.
🇪🇺EU Takes Action Against Greece and Italy for Non-Compliance with Family Benefits Rules
Legislation Adopted
The European Commission (EC) has initiated infringement procedures against Greece and sent a reasoned opinion to Italy for failing to comply with EU rules on family benefits.
Key Provisions in a Nutshell
🇬🇷Greece: Current laws require EU nationals to reside in Greece for at least five years and non-EU nationals for 12 years to qualify for family benefits.
🇮🇹Italy: Italy’s law, introduced in March 2022, mandates a minimum two-year residence for eligibility for the new family allowance for dependent children.
EU Regulation Violation
Both countries’ requirements contravene EU rules prohibiting residence conditions for social security benefits, including family benefits.
Understanding the Impact
Amendments to these laws in Greece and Italy would be retroactive, allowing mobile workers previously disqualified due to residence requirements to claim family benefits retrospectively.
Implications for Employers & Immediate Actions
Monitoring Legislative Changes: Stay informed on Greece and Italy’s legislative responses to the EC’s actions.
Advising Mobile Workers: Keep mobile employees updated on potential changes and assist them in filing for retroactive family benefits claims.
Compliance Readiness: Prepare for the administrative aspects of supporting claims if legislative amendments occur.
🇮🇪 Ireland Streamlines Stamp 4 Immigration Permission Process
Elimination of Stamp 4 Support Letter: The need for a Stamp 4 support letter from DETE for certain permit holders will be discontinued.
Direct Application Process: Applications for Stamp 4 immigration permission can be made directly to the Registration Office, ISD.
Eligibility Requirement: Applicants must complete 21 months under an IRP Stamp 1 card in Ireland.
Application Timeline: Applications for Stamp 4 can be submitted 12 weeks before the current IRP Stamp 1 permission expires.
Understanding the Impact
This change simplifies the transition from Stamp 1 to Stamp 4 immigration permission for critical permit holders, making it a single-step process. Stamp 4 permission allows holders to work and live in Ireland without a separate employment permit.
Implications for Employers & Immediate Actions
Inform Relevant Employees: Alert employees holding Critical Skills Employment Permits, Researchers on Hosting Agreements, and Non-Consultant Hospital Doctors about the new process.
Guide Through Application Changes: Assist eligible employees in understanding the streamlined application process and its timeline.
Monitor Application Submissions: Ensure applications are submitted within the new 12-week window before IRP Stamp 1 expiry.
Closed Border Points: Key entry points at Vaalimaa, Nuijamaa, Imatra, and Niirala are closed.
Alternative Crossing Points: Four northeastern border points remain open (Rajajooseppi, Salla, Kuusamo, and Vartius).
Asylum Application Processing: Applications for international protection are now concentrated at Vartius and Salla crossing points.
Understanding the Impact
This closure is a response to the rise in illegal entries, particularly in southeastern Finland. It affects individuals and employees who frequently travel between Finland and Russia, requiring them to adjust to the remaining open border points.
Implications for Employers & Immediate Actions
Communicate Changes: Inform employees, especially those frequently travelling or commuting between Finland and Russia, about the border closures and alternative routes.
Adjust Travel Plans: Reorganize travel logistics and schedules for employees affected by the closures, considering alternative border crossings.
Stay Informed: Keep updated with Finnish government announcements and border security measures, as the situation is subject to ongoing evaluation and potential changes.
🇪🇺 Council of the EU Approves Digitalisation of Schengen Visa Application Process
EU Visa Application Platform: A centralised platform for Schengen visa applications where applicants can submit data, upload documents, and pay fees.
Reduced In-Person Requirements: In-person consulate visits are mainly required for first-time applicants or those with expired biometric data or new travel documents.
Digital Visa Format: Replacing traditional visa stickers with a cryptographically signed barcode.
Understanding the Impact
This digital transformation streamlines the visa application process, making it more efficient for travellers and national administrations. It enhances the speed and effectiveness of application processing.
Implications for Employers & Immediate Actions
Update Travel Policies: Employers should revise their travel policies and guidelines to reflect these new digital visa procedures.
Inform Travelers: Communicate these changes to employees who travel frequently to the Schengen area, emphasising the new platform and reducing the need for in-person visits.
Monitor Implementation: Stay updated on the rollout and implementation timeline of the new digital visa platform to ensure seamless travel planning.
🇺🇸 United States Advances U.S — 🇹🇼Taiwan Double-Tax Mitigation Bill
Legislation Adopted
The “United States-Taiwan Expedited Double-Tax Relief Act” has been approved by the U.S. House Committee on Ways and Means as of November 30, 2023, signalling a significant step towards resolving double taxation issues between the U.S. and Taiwan.
Key Provisions in a Nutshell
Primary Focus: The bill specifically targets permanent establishment, income from employment, and residency issues to mitigate double taxation.
Bilateral Cooperation Required: The bill’s effectiveness hinges on Taiwan’s enactment of reciprocal legislation.
Understanding the Impact
This legislative move is pivotal in alleviating double taxation challenges for American and Taiwanese tax residents. It aims to streamline cross-border financial activities and provide clarity for businesses and individuals engaged in U.S.-Taiwan exchanges.
Implications for Employers & Immediate Actions
Anticipate Taxation Changes: Employers should prepare for potential tax liabilities and compliance changes for U.S. and Taiwanese employees.
Advisory Consultation: Consulting with tax professionals is advisable to understand the implications of the bill’s provisions on your organisation’s operations.
Inform Stakeholders: Keep relevant stakeholders, especially those involved in U.S.-Taiwan operations, updated on this legislation’s progress and potential impacts.
🇨🇱 Chile Approves Tax Treaty with the 🇺🇸 United States
Legislation Adopted
The Chilean Senate has approved the income tax treaty with the United States, completing its legislative journey. This followed its prior approval by the Chilean Chamber of Deputies.
Ratification Process: Awaiting ratification by the President of Chile and the exchange of diplomatic letters between Chile and the U.S.
Expected Enforcement: Anticipated to be in force by January 2024.
Understanding the Impact
The approval of this tax treaty marks a significant development in the economic relationship between Chile and the United States. It is expected to ease cross-border commerce and mobility of employees between the two nations.
Double Taxation Mitigation: The treaty aims to alleviate double taxation issues faced by international assignees, enhancing tax efficiency for individuals and businesses.
Pension Plan Relief: Potential relief for contributions to pension plans, benefiting globally-mobile employees.
Implications for Employers & Immediate Actions
Policy Review: Employers should review their tax and payroll policies for employees working between Chile and the U.S. to align with the new treaty provisions.
Communicate Changes: Inform affected employees, especially those on international assignments, about how the treaty may impact their taxation.
🇨🇭Switzerland Upholds Protection for Ukrainians Until March 2025
Extension of Protection Status: Switzerland will maintain protection status S for Ukrainian displaced people until 4 March 2025, subject to changes in the situation.
Current Beneficiaries: Approximately 66,000 Ukrainians hold protection status S in Switzerland.
Labour Market Integration: The Federal Council aims to increase the employment rate of Ukrainians from 20% to 40% by the end of 2024.
Cantonal Policy Updates: Cantons will face stricter requirements in utilising federal funding, including providing language support and assessing individual support needs.
Criteria for Discontinuing Temporary Protection S Status
Temporary Protection S Status may not be renewed when there is no longer a significant risk for the individuals upon their return to their home countries. This applies when conditions in their country of origin have substantially and lastingly improved, allowing for their safe repatriation.
Understanding the Impact
This extension provides stability and clarity for Ukrainian citizens and Swiss employers. It ensures continued access to education, labour market opportunities, and language courses for Ukrainians in Switzerland.
🇨🇿 Czech Republic Enacts Comprehensive Personal Income Tax and Social Security Reforms
Income Tax Rate Changes: The threshold for the higher tax rate of 23% is lowered to CZK 1,582,812 annually.
Adjustments in Exemptions and Reliefs:
Limits set on non-monetary benefits exemption to half the average wage (CZK 21,983 per year in 2024).
Abolition of the exemption for managers’ accommodations. Restriction on monetary meal allowances and benefits from the cultural and social fund.
Tax Credit Changes: Abolition of certain tax credits, including for students and child pre-school facilities.
Sales of Securities and Shares: Exemptions capped for sales of securities and shares meeting the time test, with an annual limit of CZK 40 million per taxpayer from 1 January 2025.
Other Income Exemption Limit: An annual limit of CZK 50,000 for other income exemptions.
Social Security Contributions: For employees, reintroduction of sickness insurance paid at 0.6%, increasing total contributions to 7.1%. For self-employed persons, an increase in the minimum assessment base and percentage for insurance contributions.
Understanding the Impact
These reforms aim to address financial imbalances in the Czech economy. They will notably impact the taxation of employees, including international assignees, potentially leading to higher taxation and affecting the cost of assignments.
Implications for Employers & Immediate Actions
Review Payroll Policies: Employers should update their payroll systems to accommodate the new tax rates and social security contributions.
Inform Employees: Communicate these changes to employees, particularly those affected by the altered exemptions and increased tax burden.
Tax Planning: Reassess tax planning strategies, especially for tax-equalised assignees, to account for the changes in tax credits and reliefs.
Compliance Check: Ensure all practices comply with the new legislation, paying close attention to the revised thresholds and exemptions.
🇧🇪 Belgium Announces 2024 Minimum Salary Requirements for Non-EEA Nationals
Legislation Adopted
Belgium’s Flemish, Walloon, and Brussels Regions have set new minimum salary thresholds for 2024, applicable to non-European Economic Area (EEA) nationals working in these regions.
Key Provisions in a Nutshell
Effective Date: The new salary requirements are enacted on 1 January 2024.
Regional Variations: Each region has specified different salary thresholds for various categories of employees.
EU Blue Card: €65,053 (Brussels, Wallonia); €55,958 (Flanders)
Medium-Skilled Employees in Bottleneck Professions: Minimum salary as per the sector (Flanders).
Understanding the Impact
Meeting these minimum salary requirements is crucial for obtaining legal work permits for non-EEA nationals in Belgium. Non-compliance can result in significant penalties, including fines and possible imprisonment.
Implications for Employers & Immediate Actions
Review Salary Structures: Employers must ensure their pay scales meet or exceed these new thresholds for non-EEA employees.
Budgeting: Plan for potential salary increases to maintain compliance.
Stay Informed: Keep abreast of any further regional variations or updates to these requirements.
Risk Management: Understand the consequences of non-compliance and implement measures to avoid legal and financial penalties.
ILO Releases Guidelines for Assessing Digital Employment
Key Document Published:
The International Labour Organization (ILO) has published comprehensive Digital Employment Diagnostic Guidelines for evaluating and understanding the complex nature of digital employment.
Key Provisions in a Nutshell
Purpose of Guidelines: To provide a structured approach for policymakers, researchers, statisticians, and practitioners to assess the impact of digitalisation on employment.
Scope of the Document: Covers various aspects, including data collection, impact measurement, and policy development for decent work conditions in the digital economy.
Research and Collaboration: Developed through extensive research, global consultations, and expert collaboration, including a pilot study.
ILO’s Digital Employment Diagnostic Guidelines: Significance and Strategic Response
Awareness and Education: Employers and stakeholders should familiarise themselves with the nuances of digital employment as outlined by the ILO guidelines.
Strategic Planning: Utilise the guidelines to inform strategic planning and decision-making in adapting to the digital economy.
Policy Implementation: Develop or revise internal employment policies and practices per the guidelines to ensure fair and decent working conditions in the digital employment sector.
Data-Driven Approach: Leverage the methodologies suggested by the ILO for accurate data collection and analysis to assess the impact of digitalisation on employment.
Collaboration and Consultation: Engage in multi-stakeholder dialogues and consultations to address the challenges and opportunities presented by digital employment.
🇳🇬 Nigeria Announces Increase in Visa-on-Arrival Biometric Fees
Biometric Fee Increase: A flat rate increase of USD 80 for VOA biometric fees.
Exemption for U.S. Nationals: U.S. nationals are exempt from this fee increase due to the visa fee reciprocity agreement with Nigeria.
New Total Fee: Non-U.S. nationals will now pay USD 170 for VOA, excluding other visa and transaction fees.
Understanding the Impact
This fee increase affects the overall cost for foreign nationals (except U.S. nationals) seeking to enter Nigeria via the VOA program, impacting business travel expenses for individuals and organisations.
Implications for Employers & Immediate Actions
Budget Adjustments: Employers should prepare for increased costs associated with sending representatives to Nigeria.
Inform Travellers: Update travelling employees about the new fee structure to avoid surprises or delays.
VOA Approval Process: Ensure that travellers know the documentation and approval process for VOA, including extensions and associated fees.
🇮🇹 Italy Modifies Expatriate Regime Effective January 2024
Reduced Relief: Relief under the expatriate regime will be limited to 50%, with a maximum income eligibility cap of EUR 600,000.
Residency Requirements: Beneficiaries must have been non-residents for three years prior and commit to a five-year residency in Italy.
Eligibility Criteria: The relief is now restricted to highly qualified or specialised individuals, similar to those eligible for a Schengen Blue Card.
Duration of Relief: The relief applies from the year of establishing tax residency in Italy and for the next four fiscal years.
Condition for Extension: The facility to extend the relief for an additional five years appears to apply only to residents in Italy as of 31 December 2023.
Implications for Employers & Immediate Actions
Policy Review: Employers should reassess their assignment policies for Italy, considering the altered tax relief and residency requirements.
Employee Briefing: Inform current and potential expatriates about the new conditions and how they might affect their tax liabilities.
Eligibility Checks: Establish procedures to ascertain the eligibility of employees for the revised expatriate regime.
Tax Planning: Update tax planning strategies for expatriates in Italy to align with the new regime and avoid potential financial surprises.
🇦🇺 Australia Enhances Employer-Sponsored Permanent Residence Pathways
Legislation Adopted
Following a year-long review and consultations, the Australian government has announced changes to its Migration Program, particularly affecting the Temporary Skill Shortage (Subclass 482) Visa and the Employer Nomination Scheme (Subclass 186).
These changes aim to provide more flexibility and certainty for employers and visa holders, enhancing Australia’s ability to attract and retain skilled workers amid skills shortages.
Key Provisions in a Nutshell
Temporary Skill Shortage (TSS) Visa (Subclass 482) Changes
Removal of the limit on onshore applications under the Short-Term Skilled Occupation List stream.
Previous holders of two Short-Term stream TSS visas must apply outside Australia for a third visa before 25 November 2023.
Onshore renewal is now possible for more than one TSS visa under the Short-Term stream.
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Wrap-Up
As we conclude this November 2023 edition of our Global Employment Tax and Compliance Newsletter, we hope the insights and updates provided have been enlightening and valuable in guiding your strategic decisions in the ever-evolving global employment landscape.
We encourage you to reach out with any questions or for further discussions on how these changes might impact your business. Stay tuned for our next edition, where we will continue to bring you the latest and most relevant information on global employment.
Thank you for joining us on this informative journey. Until next time, we wish you successful and compliant business operations in the dynamic world of global employment.
Technology has come a long way and still has a long way to go in many respects.
“The use of apps in investment ideas is a great way to enjoy the convenience. ”
– Beeige Lunmis
Have you ever thought about a guarantee in which you invest your money and get returns? While people tend to have different ideas on the best ways to invest, some options are now made simpler so that you increase the chances of getting your returns on investment.
Technology has come a long way and still has a long way to go in many respects. It has revolutionised the lives of people all over the world and made life easier in a variety of ways. In the world of business especially, technology has played an undeniable role.
Technology has come a long way and still has a long way to go in many respects. It has revolutionised the lives of people all over the world and made life easier in a variety of ways. In the world of business especially, technology has played an undeniable role.
Lorem Ipsum… Technology has come a long way and still has a long way to go in many respects. It has revolutionised the lives of people all over the world and made life easier in a variety of ways. In the world of business especially, technology has played an undeniable role.
Technology has come a long way and still has a long way to go in many respects. It has revolutionised the lives of people all over the world and made life easier in a variety of ways. In the world of business especially, technology has played an undeniable role.
Technology has come a long way and still has a long way to go in many respects. It has revolutionised the lives of people all over the world and made life easier in a variety of ways. In the world of business especially, technology has played an undeniable role.
Technology has come a long way and still has a long way to go in many respects. It has revolutionised the lives of people all over the world and made life easier in a variety of ways. In the world of business especially, technology has played an undeniable role.
Technology has come a long way and still has a long way to go in many respects. It has revolutionised the lives of people all over the world and made life easier in a variety of ways.
Technology has come a long way and still has a long way to go in many respects. It has revolutionised the lives of people all over the world and made life easier in a variety of ways. In the world of business especially, technology has played an undeniable role.
It is far wiser to do your own installations and ensure that all data flowing through the organization has end-to-end encryption. …
It is very exciting moving into a new office because it often means that your business is expanding or moving up in class to attract high end clients. Whatever the reason it is absolutely critical to keep in mind the necessity of protecting your business data not just for your sake but also for the sake of your employees and clients who have placed their trust in you.
Welcome to the October 2023 edition of the Global Employment Tax and Compliance Newsletter. This month, we have curated a selection of topics at the forefront of regulatory shifts and strategic planning across the world. We’re thrilled to announce that our newsletter now reaches 993 subscribers. Your trust motivates us to keep delivering precise and… Read more Global Employment Tax and Compliance Newsletter. October 2023
Welcome to the October 2023 edition of the Global Employment Tax and Compliance Newsletter. This month, we have curated a selection of topics at the forefront of regulatory shifts and strategic planning across the world.
We’re thrilled to announce that our newsletter now reaches 993 subscribers. Your trust motivates us to keep delivering precise and actionable insights to help you navigate the complexities of international employment, tax, and compliance.
Whether you are an employer adjusting to newly minted regulations or a global employment solutions provider, this edition aims to equip you with the insights you need for operational excellence in a dynamic environment.
🇮🇹Italy Announces Work Visa Quotas for 2023–2025
Overview
In a recent development, the Italian government has published a decree outlining the number of non-EEA workers allowed in the country for the period of 2023 to 2025. The cap is set at 450,000, with 136,000 quotas allocated for 2023 alone. This has important implications for organisations planning their staffing strategies in Italy.
Key Dates
Quota Announcement: 27th September 2023
Official Gazette Publication: 3rd October 2023
Application Timelines
Cooperative Agreement Countries: Subordinate work permit applications from 9am, 2nd December 2023
Other Subordinate Work: Applications from 9am, 4th December 2023
Seasonal Work: Applications from 9am, 12th December 2023
Quota Categories
The 136,000 quotas for 2023 are distributed as follows:
Seasonal Work: 82,550 quotas, focused on agriculture and the hospitality and tourism sectors, reserved for certain nationalities.
Subordinate & Self-Employed Work: 53,450 quotas, further broken down as 52,770 for employee work and 680 for self-employment.
Specific Nationalities: 25,000 quotas for nationals of designated countries, including Albania, Egypt, and India, among others.
Cooperative Agreement Countries: 12,000 quotas reserved for future cooperation agreements.
Special Categories: Specific quotas for Italian ancestry holders in Venezuela, stateless persons, refugees, family care and support services, and more.
Strategic Considerations
Planning ahead in line with these quotas can significantly streamline your immigration and staffing strategy in Italy.
🇪🇺EU Extends Temporary Protection for War-Displaced Ukrainians Through March 2025
Overview
The European Council has agreed to extend temporary protection status for Ukrainians displaced by the ongoing war in their homeland. Initially activated on 4 March 2022, this status has now been extended through 4 March 2025, providing clarity and assurance for both affected individuals and their employers within the EU.
Key Extension Details
Extended Duration: From 4 March 2024 to 4 March 2025
Eligibility: Specific to Ukrainians displaced on or after 24 February 2022 due to military actions.
Why Matters
This decision has immediate and significant consequences:
Labour Market Access: Individuals with this temporary status can work in the EU immediately.
State Benefits: Includes access to social welfare, housing, healthcare, and education.
Employer Assurance: Businesses employing these individuals can plan better, knowing their staff have secured status through March 2025.
Categories Covered
The directive covers:
Ukrainian Nationals: Those residing in Ukraine before the war began on 24 February 2022.
Stateless and Third-Country Nationals: Who had protection in Ukraine prior to the war.
Family Members: Of both the above categories.
Future Considerations
The temporary protection is slated to end in March 2025. Discussions are ongoing about subsequent steps, and organisations should stay alert for updates that may impact staffing strategies.
🇬🇧United Kingdom Issue Updated Travel Advisories for Israel
Overview
In the wake of escalating conflicts between Israel and Hamas, the United Kingdom has updated the travel advisories concerning Israel. To safeguard their citizens, government-supported flights have been organised for the repatriation or relocation to safe third countries of U.K. nationals currently in Israel.
State of Emergency
The U.K. government has announced that a state of emergency is in effect across Israel. Unexpected border closures, both air and land, are a possibility in Israel and the Occupied Palestinian Territories (OPTs).
U.K. Advisory
The U.K. government has updated its travel advice and is requesting British nationals currently in Israel to inform the government and to comply with plans for their safe exit from the country.
Why It’s Important
Security Concerns: The situation is volatile and sudden changes in operational conditions can occur.
Corporate Responsibility: Companies with employees who are U.K. nationals, or third-country nationals, currently in Israel should be vigilant regarding updates in government policies related to safety and travel.
Communication Is Key: It’s crucial for employers to communicate the next steps to their workforce in Israel and to implement emergency plans to ensure their safety.
Key Points to Note
No reported closures of consular offices or embassies.
Israelis can use a valid foreign passport for travel until 31 December 2023.
Work permit applications may face delays due to staffing shortages at Israel’s immigration authorities and consulates.
Israelis have visa-free entry to Schengen countries for a maximum of 90 days in any 180-day period. The legality of remote work during this period should be verified country-by-country.
As the situation remains fluid, it’s advised to watch updates from travel agents, immigration counsel, and global mobility professionals for the most current information.
Operations continue at Ben Gurion Airport, though passengers should be aware that some commercial flights have experienced delays or cancellations.
🇦🇺Australia – U.K. Innovation and Early Careers Skills Exchange Pilot (IECSEP)
Overview
The Innovation and Early Careers Skills Exchange Pilot (IECSEP) is an initiative designed to offer short-term employment opportunities in Australia for innovative and early-career professionals from the United Kingdom. This programme is part of the Australia-United Kingdom Free Trade Agreement (A-UKFTA).
Initially, there will be 1,000 visas made available during the first-year pilot of the IECSEP. This allocation will double to 2,000 visas in the second year, at which point the programme will also be reviewed.
Two Key Streams
Early Careers Stream
Age: 21-45 years
Qualifications: Tertiary education required
Work Experience: At least 3 months in the current organisation
Duration: Up to one year in Australia
Innovation Stream
Age: No age limit
Expertise: Must demonstrate innovative contributions
Sectors: R&D, Renewable Energy, AI, Medical Tech, etc.
Letter of Support: If endorsed, DFAT issues a Letter of Support.
Visa Application: Submit the Letter of Support when applying for the Temporary Work (International Relations) Government Agreement stream (subclass 403) visa.
Eligibility Factors
Financial Self-Sufficiency: Must demonstrate financial ability to support oneself and accompanying family.
Health & Character: All applicants and families must meet standard requirements.
Processing Timelines: DFAT processing times to assess IECSEP applications are currently unavailable. Current processing times for the subclass 403 visa, following lodgement with the Department of Home Affairs, are estimated to be 11 days.
OECD Update on International Tax Reform Provided to G20 Finance Ministers (October 2023)
Understanding the Latest Multilateral Convention by the OECD/G20 Inclusive Framework on International Taxation
Highlights
The OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting has released a new Multilateral Convention. This marks a significant step toward the finalisation of the Two-Pillar Solution, designed to tackle tax issues emerging from the digitalisation and globalisation of the economy.
Overview
The Multilateral Convention to Implement Amount A of Pillar One (MLC) is the latest development from the OECD/G20 Inclusive Framework, aiming to align international tax policies with 21st-century realities. It will soon be discussed at a meeting of G20 Finance Ministers and Central Bank Governors in Morocco.
What MLC Achieves
Reallocation of Tax Rights: Pillar One focuses on reallocating taxing rights over profits to market jurisdictions, targeting large multinational corporations (MNEs) irrespective of their physical presence there.
Elimination of Digital Services Taxes: The MLC works toward repealing and preventing the proliferation of digital services taxes.
Mechanisms Against Double Taxation: It also establishes systems to avoid double taxation, contributing to stability and certainty in international taxation.
Ongoing Discussions
There is a broad consensus on most aspects of the MLC. However, a few issues are still under negotiation among a small number of jurisdictions, who are constructively working to resolve them.
Financial Implications
Pillar One is expected to affect about USD 200 billion in profits annually, leading to global tax revenue gains of between USD 17-32 billion. Low and middle-income countries stand to benefit the most from this redistribution.
Developments on Pillar Two
Subject to Tax Rule (STTR): This treaty-based rule allows developing countries to “tax back” certain intra-group payments taxed at nominal rates below 9%.
Global Minimum Tax: Pillar Two introduces a universal minimum tax of 15% on large MNEs, irrespective of where they operate.
Closing Remarks
The release of the MLC is a monumental step in modernising international tax law. It aligns closely with the Two-Pillar Solution’s objectives to tackle tax complexities arising from globalisation and digitalisation. OECD Secretary-General Mathias Cormann calls it a “fundamental reform” in making international taxation fairer and more relevant in today’s digital age.
🇬🇬New Statutory Minimum Wage Rates in Guernsey Effective from 1 October 2023
Effective from 1 October 2023, Guernsey has updated its statutory minimum wage rates for adults and young persons. These changes also include adjustments to the maximum weekly ‘offset’ rates for accommodation and food provided by employers.
Additional Information
Entitlement: Under Guernsey Law, almost all workers are entitled to a minimum wage. The rules apply uniformly regardless of business size or if a private individual employs the worker.
🇬🇧Navigating Employment Practices Under UK Competition Law: CMA Guidance
Introduction:
The UK’s Competition and Market Authority (CMA) has outlined how competition law impacts employment practices, specifically regarding wage-setting and employee recruitment and retention. The advisory is aimed to help employers stay on the right side of the law.
Risky Behaviours in Labour Markets
No-poaching Agreements: Employers should avoid agreements that promise not to recruit from each other’s staff pools.
Wage-fixing Agreements: Any form of collusion with other businesses to set a standard rate for employee wages is considered illegal.
Information Sharing: The disclosure of sensitive employment conditions between businesses can be a violation of competition law.
Preventive Measures
To avoid breaking the law, the CMA recommends that employers:
Understand the applicability of competition law on no-poaching and wage-fixing agreements.
Educate HR and recruitment staff about competition law.
Implement robust internal reporting mechanisms.
Consequences for Violation
Fines can amount to as much as 10% of a business’s global annual turnover. Individuals may also face penalties, including imprisonment for up to 15 years.
Reporting
The CMA encourages reporting of anti-competitive behaviours and offers leniency options, including reduced fines and immunity from prosecution under certain conditions.
🇳🇱Dutch Senate Turns Down ‘Work Where You Want’ Act
The Dutch Senate has rejected the ‘Work Where You Want’ Act a year after its approval by the Dutch parliament. Despite its dismissal, current law mandates employers to consider requests for remote work, as outlined in the existing Flexible Working Act.
What Was the ‘Work Where You Want’ Act?
The rejected bill aimed to strengthen employees’ rights to work remotely within the European Union. If enacted, employers would have been required to permit remote work, so long as the request aligned with reasonableness and fairness, considering all involved circumstances.
Ambitions of the Rejected Bill
The bill, formally known as the Act Working Wherever You Want, had the ambitious goal of revolutionising workplace flexibility. It was crafted to compel employers to accommodate requests from employees wishing to work remotely within the EU. The requirement for employer compliance hinged on a set of nuanced criteria, namely the balance between employer interests and employee needs, evaluated against a framework of reasonableness and fairness.
Reasons for Senate Rejection
Despite its transformative aims, the Senate struck down the bill, citing multiple concerns. The legislative body argued that the bill’s prescriptive nature would corner employers into an inflexible operational model, hampering their ability to manage business activities effectively. The Senate also questioned the potential adverse effects on employee productivity and workplace morale if the bill were enacted.
Government Commitment to Remote Work Flexibility
Despite the setback, the Dutch government has reaffirmed its commitment to enhancing remote work options. In a recent statement, it declared a vested interest in simplifying remote work conditions for employees while maintaining managerial effectiveness for employers.
Recommendations for Employers
The act could have had far-reaching implications for Dutch businesses. Employers would need to consider foreign employment law and navigate complex tax and social security issues, especially if employees sought to work from other countries. Despite the act’s rejection, employers should still assess workplace adjustment requests as per the Flexible Working Act. Employers should formulate a clear hybrid working policy, including guidelines on how to handle remote work requests.
Spooktacular Feature: Navigate the “Haunted House” of Global Employment with Laughter!
This Halloween, take a break from the ghouls and ghosts to dive into a different kind of adventure—the labyrinth of global employment! If you’ve ever felt navigating international employment laws is like walking through a haunted house 👻, you’ll love our featured video, “Global Employment Adventure: The Fun & Frustration Comedy!”
From the tricks of payroll budgeting in foreign currencies 💱 to the threats of making sense of complex employment laws, this comedy video tackles it all. Think hiring contractors is the magic potion for avoiding complexity? Think again! Misclassifying workers can lead to a real witch-hunt.
But don’t fret; our video introduces you to Express Global Employment, your guiding light 🌟 for compliant and headache-free global expansion.
Watch and learn how to make your employment journey more treat than trick 🍬!
As we draw the curtains on this Halloween edition of our newsletter, we’d like to extend a big thank you for joining us on this global employment adventure 🌍🎬.
We hope the insights and resources we’ve shared, including our feature video, have been enlightening and entertaining.
As the nights grow longer, remember: global expansion doesn’t have to be a haunting experience. Armed with the right information, you can turn any challenge into an opportunity 🌟.
So, here’s to a Halloween filled with more treats than tricks and to a global employment journey that’s more sweet than spooky! 🍬👻
Welcome to the September 2023 Global Employment Tax and Compliance Newsletter edition. This newsletter is tailored for employers operating across jurisdictions and global employment solution providers who play a pivotal role in their success. In the dynamic landscape of global employment, governments worldwide aim to enhance, streamline, harmonise, and customise labour, tax, and immigration laws… Read more Global Employment Tax and Compliance Newsletter. September 2023
Welcome to the September 2023 Global Employment Tax and Compliance Newsletter edition. This newsletter is tailored for employers operating across jurisdictions and global employment solution providers who play a pivotal role in their success.
In the dynamic landscape of global employment, governments worldwide aim to enhance, streamline, harmonise, and customise labour, tax, and immigration laws to align with the evolving needs of their populations and adapt to global trends, such as the rise of remote work. This ongoing process unfolds as employers navigate the complexities of international employment, seeking agile solutions to meet compliance requirements and an ever-changing workforce’s demands.
This edition focuses on the latest developments in employment tax, labour, and immigration laws that emerged by September 2023. Each country’s spotlight dissects these changes, examines their implications for employers, and provides actionable steps for compliance and operational excellence.
Whether you are an employer seeking clarity on a new regulation or a global employment solution provider looking to enhance your client services, this newsletter is designed to meet your needs.
Poland: Home Office and Permanent Establishment (PE) Concerns 🇵🇱
Legislation Adopted
Polish tax authorities (PTA) and administrative courts have recently addressed the risk of creating a Polish permanent establishment (PE) by a Polish employee working in a home office model. This issue has led to key developments in Polish tax regulations.
In recent individual tax rulings, the PTA has argued that an employee’s private home address, when used as a consistent place of work, could be deemed a fixed place of business at the disposal of a foreign enterprise. This interpretation hinges on the intent to work from home regularly. Additionally, the PTA is actively pursuing PE exposure under the dependent agent concept, especially when Polish employees are involved in contract negotiations, offer presentations, or marketing functions on behalf of the enterprise.
Why It Matters
Understanding the implications of home office arrangements on PE status in Poland is crucial for foreign enterprises. This interpretation by the PTA and supported by recent court judgments underscores the material risk of Polish PE exposure for businesses employing Polish workers.
Implications for Employers & Immediate Actions
Businesses should exercise caution when allowing employees to work from home regularly.
Employers should consider home office arrangements’ potential tax and legal implications.
It’s essential to assess the role of Polish employees in contract-related activities and marketing functions.
Seek professional advice to ensure compliance with evolving tax regulations and mitigate PE risks in Poland.
United Kingdom: Immigration and Nationality Fee Increases 🇬🇧
Legislation Adopted
Legislation was introduced in the UK Parliament on September 15, 2023, paving the way for a series of immigration and nationality fee adjustments scheduled for October 4, 2023.
The UK government’s decision to increase these fees is a response to the recommendations of independent pay-review bodies, accepted following the Public Sector Pay debate in Parliament. This decision includes raising visa and Immigration Health Surcharge (IHS) fees to support public sector pay rises.
Why It Matters
For employers recruiting and employing foreign nationals in the UK, these fee increases affect multiple immigration and nationality “routes,” encompassing individuals coming to the UK for work, study, and residence.
Assessing the impact of these fee hikes on recruitment, talent acquisition, and budgetary considerations is essential for employers.
Implications for Employers & Immediate Actions
Employers should evaluate the financial implications of the fee increases on their recruitment and talent management strategies.
Considerations include budget adjustments to accommodate higher immigration and nationality fees and potential effects on workforce planning.
Keep a close eye on forthcoming increases to the Immigration Health Surcharge (IHS) and prepare for potential changes in autumn.
Further Details
The fee adjustments, effective from October 4, 2023, vary based on visa categories, with the IHS increases scheduled for later in the autumn due to the associated legal process.
Impacted visas include those for short stays (up to 6 months), longer-term visits (2-, 5-, and 10-year visas), work, study, and residence. The changes also affect fees for indefinite leave to enter or remain, travel documents, health and care visas, Certificate of Sponsorship, and more.
Be aware of adjustments to priority service fees and reduced fees for the “settlement priority” service. Individuals seeking British citizenship through registration and naturalisation and users of the User Pays Visa Application service will also encounter fee changes.
U.S.-Taiwan Tax Relief: A Step Towards Cross-Border Harmony 🇺🇸 – 🇹🇼
Legislation Adopted
On September 14, 2023, the U.S. Senate Committee on Finance unanimously passed the U.S.-Taiwan Expedited Double-Tax Relief Act, marking a significant development in cross-border taxation.
Key Provisions
This bipartisan bill aims to mitigate double taxation challenges faced by American and Taiwanese tax residents while addressing permanent establishment and residency issues.
It contains a critical reciprocity clause, requiring Taiwan to enact reciprocal legislation to activate its measures.
Why It Matters
The bill promotes cross-border commerce, relieving businesses, investors, and workers of international tax complexities. Including the reciprocity clause ensures fairness in tax treatment for U.S.-based companies and individuals investing and working in Taiwan.
Implications for Employers & Immediate Actions
Employers engaged in cross-border activities between the U.S. and Taiwan should closely monitor this legislation’s progress.
If the bill becomes law, businesses operating in these regions should be prepared to adapt their tax strategies to benefit from reduced double taxation.
Italy Extends Remote Work Provisions 🇮🇹
Effective July 2023, Italy has extended remote work provisions to provide support and flexibility to specific groups of employees:
Vulnerable Employees
Individuals suffering from specified illnesses or conditions are now entitled to work remotely or be assigned different duties based on their job until 30 September 2023. A list of these conditions can be found in the Decree of the Minister of Health from 4 February 2022.
Parents with Children Under Age 14
Parents with children under 14 whose job duties allow remote work can continue working remotely until 31 December 2023. This provision applies when no parent is available to care for the child. Parents who are unemployed or receiving income support benefits are considered available for this purpose. Unlike the 2022 regulations, these parents must not sign an individual remote work agreement.
Labour Law Compliance Requirements
Employers must provide these employees with health and safety information annually. Additionally, they must inform the Ministry of Labor about which employees will be working remotely.
Czech Republic’s ‘Digital Nomad’ Program: Simplifying Work Visas 🇨🇿
The Czech Republic has launched a ‘Digital Nomad’ program, effective from July 1, 2023, to facilitate the entry and stay of highly-skilled IT professionals from specific countries, including Australia, Japan, Canada, South Korea, New Zealand, the United Kingdom, the United States, and Taiwan.
What Employers and IT Professionals Should Know
Previously, digital nomads faced a conundrum when seeking visas to work remotely from the Czech Republic. The absence of a dedicated visa category meant relying on business visas, which often didn’t align with the nature of their work. This led to frequent rejections from Czech authorities due to insufficient justification for their stay or non-compliance with stringent conditions.
The ‘Digital Nomad’ program seeks to simplify the entry and work processes for specific worker categories, aligning them more accurately with their intended purpose of stay. The new program aims to streamline this process.
Changes and Aims of the Digital Nomad Program
The program differentiates between two types of digital nomads: those employed by foreign companies working remotely through telecommunications and computerised means and self-employed freelancers holding a Czech trade license.
In both cases, IT specialists must demonstrate a higher education degree in natural sciences, engineering, technology, mathematics, or three years of relevant IT experience. Additionally, they need to prove a minimum income equivalent to 1.5 times the gross annual salary in the Czech Republic.
This initiative ushers in a new era of economic migration in the Czech Republic, providing a streamlined pathway for IT professionals to contribute their skills while embracing the flexibility of the digital age.
France Enhances Bereavement and Parental Leave 🇫🇷
The French government has recently made significant amendments to the Labor Code, focusing on government-paid bereavement and parental leave. These changes, which took effect on 19 July 2023, aim to support employees during challenging times better.
Bereavement Leave
Government-paid bereavement leave after losing an employee’s child has been extended. Parents with children under 25 now receive 14 days of leave, while parents aged 25 years or older are entitled to 12 business days. This extension acknowledges the diverse needs of parents facing this difficult situation.
Leave for Child’s Diagnosis
The government-paid leave that can be taken following the diagnosis of a child’s disability or serious health condition, such as cancer or neuromuscular diseases, has also been extended. This leave, designed to support parents in managing medical and administrative matters, has increased from two to five business days. It complements the current compassionate leave, which can go up to 310 working days.
Teleworking and Flexible Arrangements
The new law grants working parents the right to request teleworking and flexible working arrangements. While employers can refuse these requests, such refusals must be justified in writing.
Next Steps for Employers
Employers are encouraged to review these changes and ensure compliance by adjusting their HR internal policies, employment agreements, company-level collective bargaining agreements, and family-related benefits and policies as necessary. It’s essential to stay informed and adapt to these enhancements in leave provisions.
European Commission Proposes Digitalization of EU Social Security Coordination 🇪🇺
Legislation Adopted
On September 6, 2023, the European Commission unveiled a dedicated Communication proposing advancements in the digitalisation of social security coordination within the European Union (EU). The primary objective of this proposal is to streamline access to cross-border social security services, making the process faster and more straightforward.
Why It Matters for Employers
The digitalisation of EU social security coordination aims to alleviate administrative burdens linked to social security for individuals and businesses. This initiative is expected to enhance information exchange between national administrations, including healthcare providers and labour inspectorates, especially when processing claims for benefits across borders.
Implications for Employers & Immediate Actions
Companies with employees who frequently travel across EU countries for business or leisure should consider revising or establishing compliance processes for social security. One key point of the digitalisation effort is the issuance and verification of documents like A1 certificates for social security coverage.
Proposed Key Measures
The European Commission has called upon member states to take several actions:
Accelerate EESSI Implementation: Ensure full operation of the Electronic Exchange of Social Security Information (EESSI) by the end of 2024. EESSI facilitates instant cross-border communication between local administrations, reducing reliance on paper-based communication.
Digitalise Access to Benefits: Deliver more social security coordination procedures online, simplifying access to eligible benefits for individuals and businesses.
Introduce EUDI Wallets: Implement EU Digital Identity (EUDI) wallets, enabling EU citizens to carry digital versions of entitlement documents such as A1 certificates and the European Health Insurance Card, instantly verifying them by local authorities.
Employee Benefits Guide
Unlock the world of employee benefits with our ‘Employee Benefits Guide for Global Employers.‘ This resource is your compass for understanding and optimising employee benefits on a global scale.
UK Announces Tripling of Penalties for Employers and Landlords on Illegal Migrants 🇬🇧
Legislation Adopted
On August 7, 2023, the U.K. Home Secretary unveiled plans to triple fines for employers and landlords who knowingly hire or house illegal migrants in the United Kingdom, effective early 2024.
Key Provisions
This announcement is a significant step in the government’s efforts to combat illegal employment and housing of migrants. Minister for Immigration Robert Jenrick emphasised the need for proper checks, stating, “There is no excuse for not conducting the appropriate checks.”
Why It Matters for Employers
Businesses employing overseas nationals in the U.K. will face substantially increased penalties for hiring illegal workers. The consequences include larger fines, potential downgrading or revocation of their sponsorship licenses, and damage to their reputation as offending employers’ details will be made public by the Home Office.
It’s essential to note that illegal workers encompass employees, business travellers, students, and others working in violation of their visa conditions. To mitigate these risks, robust compliance systems must be in place, including conducting thorough pre-travel due diligence and correct right-to-work checks.
Implications for Employers & Immediate Actions
Current Penalties
Penalties Effective 2024
Employers Hiring Illegal Workers
Up to £15,000 per illegal worker (First Offense)
Up to £45,000 per illegal worker (First Breach)
Up to £20,000 per illegal worker (Repeat Offenses)
Up to £60,000 per illegal worker (Repeated Offenses)
Landlords Housing Illegal Lodgers or Renting Illegally
£80 per lodger or £1,000 per occupier (First Offense)
£5,000 per lodger or £10,000 per occupier (First Offense)
£10,000 per lodger and £20,000 per occupier (Repeated Offenses)
Action Steps for Employers
Employers must prioritise compliance with the Home Office right-to-work checking requirements. This includes conducting proper checks on all prospective employees before employment begins and retaining relevant information in the prescribed format.
Ensuring compliance with these measures is essential to avoid the significant penalties associated with employing illegal workers in the U.K.
Employment Contracts Guide
We’re excited to introduce our ‘Employment Contracts Guide for Global Employers.’ This invaluable resource is designed to assist HR professionals, legal teams, and business leaders in understanding the intricacies of employment contracts across different jurisdictions.
Inside this guide, you’ll find:
🌍 Insights into key elements of employment contracts, including terms and conditions, termination clauses, and more.
Whether you’re expanding your workforce into new territories or simply seeking to enhance your understanding of global employment practices, our Employment Contracts Guide is an indispensable tool.
Conclusion
As we conclude this September 2023 edition of our Global Employment Tax and Compliance Newsletter, we hope that the insights and updates provided have been valuable in navigating the ever-evolving landscape of employment laws and regulations around the world.
As we look ahead to the final months of 2023, we encourage you to reach out to our experts for personalized guidance on specific compliance challenges your organization may face. We’re here to support your global employment needs, offering solutions that empower your business to succeed.
Thank you for choosing Express Global Employment as your trusted partner in global workforce management. We look forward to continuing this journey together and assisting you in achieving your international employment goals.
Stay compliant, stay competitive, and stay connected with Express Global Employment.
As businesses venture into international markets and consider employing a global workforce, they often grapple with the complexities of calculating payroll across multiple jurisdictions. Different countries have distinct laws, regulations, and tax-reporting frameworks, creating a labyrinth of challenges for companies. Express Global Employment has developed an innovative solution to facilitate global expansion: Global Payroll Calculator.… Read more Global Payroll Calculator for Global Business Expansion
As businesses venture into international markets and consider employing a global workforce, they often grapple with the complexities of calculating payroll across multiple jurisdictions. Different countries have distinct laws, regulations, and tax-reporting frameworks, creating a labyrinth of challenges for companies. Express Global Employment has developed an innovative solution to facilitate global expansion: Global Payroll Calculator. This tool streamlines international expansion by accurately computing the in-country employment costs for local and expatriate staff in over 190 countries.
Utilising the calculator is straightforward. Enter the essential information, such as the target country, tax year, payment frequency, and expected gross salary and currency for the prospective employee. The tool immediately provides a comprehensive breakdown of the payroll calculations. This includes anticipated employer contributions, standard deductions for the employee, and additional notes tailored to the chosen settings within the calculator.
Designed for diverse professionals, the Global Payroll Calculator is an invaluable asset for companies aiming to globalise their operations or those of their clients. It caters to various sectors, including International HR, Global Recruitment and Staffing Agencies, global talent and HR professionals, Global Employers of Record, Global PEOs, global mobility companies, compensation and benefits specialists, executive search consultants, department heads, financial and budgeting experts, and business owners.
Global Payroll Calculator: Budget Your Global Payroll Accurately
Global Employment: Payroll Challenges & Employer Obligations
Operating a business in foreign markets comes with unique human resources challenges, unlike anything you may have encountered in your domestic markets. Factors such as national health care, work visas, work permits, compliant employment contracts, and risks of unfair dismissal claims can vary significantly from country to country. Understanding these issues is critical to successfully expanding your business into new markets.
When expanding your business into overseas markets, you’ll need to consider your talent engagement strategy carefully. Depending on international and local regulations, you may use local hires, ex-pats, independent contractors, full- and part-time employees, or a mix for your business. Different countries have different employment practices, so research what would work best for your company. Remember that your home country’s practices may not apply in other countries.
Challenge 1: Overseas Employment Contracts
Maintaining accurate employee documentation is critical, as the lack of it could result in unwittingly getting slapped with penalties and fees. When drafting employee contracts, it is crucial to seek legal advice to ensure that they comply with host-country labour laws. In many countries, an employment contract must be written in a language other than English. While a cost may be associated with having a translation, the contract written in the host country’s language will take precedence.
Challenge 2: Employee Misclassification Risk
As an employer, knowing the employment laws and regulations of the country you are doing business is crucial. This is especially true when classifying workers as independent contractors or employees. Independent contractors may seem like a cost-effective solution for businesses. Still, companies should be aware that local authorities in many countries may deem them de facto benefits-eligible employees. Misclassifying a worker can result in significant fines and damage your company’s reputation. This can result in significant fines and reputational damage, so it’s important to ensure you are clear on the legal distinctions between contractors and employees before hiring anyone and budget for full-time employees under host-country laws to avoid those penalties.
Challenge 3: Tax Protection Policies for the Global Workforce
The costs of sending employees on overseas assignments can quickly add up, often totalling two to three times the employee’s salary in their home country. Many businesses establish tax protection policies to alleviate personal tax burdens and attract and retain top international talent. These policies can be complex and costly to manage.
Challenge 4: Budgeting Immigration Cost
International business travel can be an excellent opportunity for employees to broaden their horizons and gain new skills. However, it can also be a logistical nightmare for employers.
Cross-border employee relocation can be a costly and time-consuming process. Planning and budgeting for immigration, relocation expenses, and allowances are essential to ensuring a smooth transition for all involved.
Challenge 5: Budgeting Termination Cost
As an employer operating globally, you must know the laws and regulations regarding employee rights in different countries. Depending on the country, there may be different rules regarding termination of employment, severance pay, and collective bargaining agreements. In some Western European countries, for instance, terminating an employee can cost up to 12 to 18 months of severance. Global employers must plan for this possibility when budgeting for international talent acquisition.
Challenge 6: Budgeting Employee Payroll and Benefits
As more and more companies expand their operations overseas, they are often surprised to learn that the costs of employee benefits can be much higher in foreign countries than at home. Different countries have different laws regulating payroll, extending beyond the typical health insurance contributions, statutory withholdings, and other benefits that can take a big bite out of a company’s bottom line when operating in a new country.
Local labour, tax, and social security laws may also come into play. This can be a significant burden for companies operating in multiple countries.
Challenge 7: Budgeting Taxable Voluntary Benefits
As an overseas employer, you may be required to offer additional compensation in salary increases, profit sharing, holiday payments, bonuses, car allowances, and more. These voluntary benefits can significantly impact your employment contracts, compensation structure, and payroll operations.
Depending on the country where you operate, these benefits may be taxed under different schemes than regular salary. Therefore, reviewing and understanding these benefits is essential to ensure compliance with local and international laws and regulations. For employers, it’s often a matter of getting the budget right: how much can you afford to pay for each of these perks?
This is where the global payroll budget comes in. It takes into account every single employee, every payroll period, and every benefit. You should be able to get a rough estimate of the figures involved without too much effort—but it’s worth getting advice from a payroll advisor or a Global Employer of Record if you need a more detailed breakdown.
Challenge 8: Budgeting Paid Time Off
In today’s economy, being mindful of your company’s payroll budget is more important than ever. Unexpected costs can add up, such as employee vacation and overtime pay. In many countries, employees are entitled to several vacation days and paid time off each year. When you factor in public holidays, paid time off in some countries in Western Europe can come to nearly two months per year for each employee, plus additional time off for overtime worked. Sick leave benefits can also be a considerable cost for employers operating in multiple jurisdictions. In other countries, for example, employees can collect 70 per cent of their salary for up to 105 weeks of sick leave.
Payroll Budgeting Solution: Global Payroll Calculator
How is your global talent compensation policy competitive, and how much will it cost? Global Payroll Calculator (GPC) is a SaaS tool that can help you do this.
Global Payroll Calculator provides a more intelligent way of global talent acquisition and compensation. With detailed data on employer and employee taxes and contributions in 190 countries, Global Payroll Calculator gives users a complete picture of total employment costs. With high accuracy, no hidden costs, and 100% compliance around the world guaranteed, the GPC tool enables users to make intelligent, fast, and informed decisions about locating their businesses or acquiring talent.
So whether you are an employer with a foreign, local, or hybrid workforce that spans multiple countries, an Employer of Record, PEO, or an agency (service provider) assisting with international staffing and recruitment, you can use the Global Payroll Calculator to get accurate worldwide payroll budgeting data and cross-country comparisons in 190 countries. The Payroll Calculator is a valuable resource to get the job done right.
To see further than others and act purposefully and confidently to achieve the goal is Nick Ganzha’s roadmap to success. From an early age, he admired the boundlessness and freedom of the Ukrainian nature, and today, his company, Express Global Employment (Acumen International), allows others to be boundless in their global growth and expansion. His… Read more Boundless Hiring: Nick Ganzha’s Vision for Global Employment
To see further than others and act purposefully and confidently to achieve the goal is Nick Ganzha’s roadmap to success. From an early age, he admired the boundlessness and freedom of the Ukrainian nature, and today, his company, Express Global Employment (Acumen International), allows others to be boundless in their global growth and expansion. His international talent acquisition and management organisation, Express Global Employment, provides global HR and employment solutions that enable companies to hire overseas personnel easily and risk-free (in compliance with all legal norms) without establishing their own legal entities in each country. Global Employer of Record Solutions changes the way companies operate internationally.
The Birth of a Global Employment Industry Pioneer
Nick Ganzha’s business journey began with a Ukrainian staffing and recruitment agency in 2001 when a request came in from Procter & Gamble. The task was challenging because, at that time, the concept of personnel outsourcing didn’t exist in Ukraine. However, Nick had a strong background thanks to his experience at PricewaterhouseCoopers and Accenture, and he created a business model that helped to win the client. As a result, Nick Ganzha is considered the pioneer of staff outsourcing projects in Ukraine.
In fact, what started as a local company has grown into a leading global Employer of Record Solutions provider, operating in 190 countries worldwide.
“Serving our clients, I recognised that companies expanding globally need a trusted partner who could help them navigate the complexities of global employment, tax, and compliance. The critical factor that has contributed to the success of Express Global Employment over the years was my decision 12 years ago to internationalize our business. The journey continued with a simple yet powerful idea: to help businesses achieve global growth.”
From Local to Global
By 2012, Acumen International covered 33 countries where Ganzha’s team provided a complete employment cycle in compliance with local labour legislation. And by 2017, it had already grown into Express Global Employment, covering 190 countries.
It was exciting and challenging as the company built its global network. Nick maintains that international business is always difficult and risky, but with a trusted partner, it turns gratifying.
We Are the Uber of the Global Employment Industry
And Nick Ganzha loves facing challenges. Today, his company is a powerful organization that enables businesses of any size, budget, or growth stage to operate anywhere in the world via global personnel hiring: “Employ based on skills, not on geography. The whole world is now your talent pool,” he says. “It’s vital for businesses to expand their limits to become successful. Finding the right people is crucial for your company’s success. Don’t let your city or country boundaries limit your talent pool.”
One of the factors that makes Nick’s company stand out is that they excel in exotic countries, areas that are either underserved or hard to operate in.
We have a well-established infrastructure in these countries, a global knowledge base, and we can provide services there. This is our strength,” he says. He highlights that this factor enables the company to build partner relationships with competitors: “Express Global Employment offers a very robust and integrated Global EOR solution that even our competitors come to us when they need excellent global HR and compliance support in the most underserved or hard to hire locations.
Nick Ganzha invested much of the company’s efforts, time, and money in gaining expertise and creating a global knowledge base. It was a future-focused investment, so they would be prepared to face any challenges. “A successful person stands out from the rest by being ready to seize opportunities when they arise.”
Express Global Employment provides unique services and tools, such as allowing companies to officially onboard and payroll staff in any of 190 countries within 3-10 working days. Thanks to their Express services, clients can start operating worldwide almost immediately without establishing their own business entities.
Global Payroll Calculator
Moreover, the company has created the innovative Global Payroll Calculator that allows businesses to instantly estimate total employment costs across countries to compare and assess various market entries easily. The Calculator was innovative and won the prestigious GPA Award 2022 for Payroll Innovation. In addition, GPA recognized Acumen International as the 2020 PEO (Professional Employer Organization) of the Year.
The Global Payroll Calculator is a SaaS tool by Express Global Employment that the company has been developing for almost four years. Express Global Employment developed its Global Payroll Calculator covering 190 countries to simplify their sales and service teams’ lives and the daily payroll calculations they make for clients to foster their efficiency. With this, the company streamlined its order-taking and quote formation, making Express Global Employment a client of themselves. “The best possible quality test and success story ever, self-evaluated”, is their tag-line. Today, offering the Calculator to a global audience, Ganzha’s team helps clients automate the way they get their global payroll calculations, providing them with instant insights to:
• Make informed decisions about global hiring;
• Save time & cost on cost-of-hire estimation in 190 countries;
• Allocate budgets for planned global expansion – easily comparing the cost-of-hire in 190 countries and choosing the best to expand their business;
• Attract top global talent, regardless of location: attractive job offers with employees’ net take-home salary calculations.
Innovating the Future of Global Employment
Gradually, Nick’s ideas drew like-minded individuals to work with him, resulting in a powerful team that helps to develop the company – and Express Global Employment is always on the lookout for new talent. Nick says, “When new people come, they bring fresh perspectives, innovative ideas, and a gust of change.” The company’s headquarters is in London, the UK, with a global operations centre in Nicosia, Cyprus. The company also has offices in Ukraine, Estonia, and the United States. Express Global Employment is pioneering in the global employment industry, transforming how international business and hiring are conducted. Today, its solutions support their clients’ global expansion strategies via international talent acquisition and management and revolutionize the global HR and payroll field in 190 countries. Nick Ganzha aims to realize his ideas, helping others experience greater freedom.
International business is always challenging and risky, but with a trusted partner it turns very rewarding. We are your reliable partner in ensuring compliant global talent management in 190 countries.
A Beacon of Corporate Social Responsibility: From Childhood Dreams to Global Impact
Since childhood, he has strived to achieve something remarkable and seemingly unmeasurable, inspired by the great Ukrainian pasture in front of his grandparents’ country house in the Poltava region. Today, Nick Ganzha dreams of peace in Ukraine and helps to bring Victory closer through his unwavering support of Ukrainians during these challenging times. Along with his company, Nick has donated over $200,000 and will continue to donate until the Victory is achieved. What started as Nick’s personal drive has now transformed into the collective engagement of the entire Express team, showcasing their corporate social responsibility as a business before the Ukrainian people and the entire free world.
Since February 24, 2022, Express Global Employment has been assisting Ukrainian and international companies in retaining the talents that were forced to leave Ukraine due to the full-scale russian invasion. With the company’s solid global HR solutions, their client companies can continue to legally employ and pay their employees abroad without establishing a physical office. Thus, they prevent the loss of key personnel, ensure business continuity, and avoid project breaks.
The Victory of Ukraine is inevitable, as the entire Ukrainian nation stands for it, and Nick Ganzha strives to represent this through his business and his life. He is a Ukrainian who is changing the perception of what is possible, globalising business and uniting the world.
Global Employment Solutions — EOR, PEO, and GEO. How to Mix and Match Them What are the key differences between an EOR, a PEO, and a GEO? This Ultimate Guide to EOR, PEO, and GEO provides a brief overview of some critical differences between three of the most popular global employment solutions helping you decide which option… Read more The Ultimate Guide to EOR, PEO, and GEO
Global Employment Solutions — EOR, PEO, and GEO. How to Mix and Match Them
What are the key differences between an EOR, a PEO, and a GEO? This Ultimate Guide to EOR, PEO, and GEO provides a brief overview of some critical differences between three of the most popular global employment solutions helping you decide which option is best for your company.
Acumen International provides an easy guide to give you the confidence that your company will have success expanding globally and is ready for global expansion and international workforces. This Global Employment Solutions Guide will tell you what to expect and how to navigate the challenges and help you create an effective global employment strategy. With our Global Employment Guide, companies can avoid common pitfalls and set themselves up for success in their new venture.
EORs, PEOs, and GEOs are global employment solutions that help companies hire and retain talent around the globe faster and more efficiently. Each operates differently and suits a unique set of hiring and business needs. Each solution has advantages and disadvantages, making it better suited for specific business strategies.
Your company needs to grow its global presence, and you’re wondering how you can do it without risking your current business model, resources, and capital.
Hiring employees worldwide is a big responsibility, so some businesses choose to engage talent through third parties. You could try to go it alone and hire an international team from scratch. Or, you could partner with a professional employment organization, such as PEO (Professional Employment Organization), GEO (Global Employment Organisation), or EOR (Employer of Record). Payroll, HR, legal, and immigration processes are often complex for businesses, but these third-party options can take the administrative burden off companies. So why might a business want to hire through one of these solution providers?
The Ultimate Guide to EOR, PEO, and GEO global talent engagement models covers different aspects. It briefly overviews some critical differences between PEOs, EORs, and GEO — three of the most popular hiring solutions helping you decide which model fits your company best. Finally, it outlines Acumen International’s service portfolio— from the initial planning stages to the implementation of any employment model.
9 Steps to Help You Navigate Through Global Expansion Journey
Determine Your Global Expansion Strategy
Building a Global Expansion Team
Choose the most business-friendly and cost-effective countries
Determine the most effective mode of entry, keeping the ease of exit in mind.
Determine the right talent engagement model
Develop a robust global talent acquisition strategy. Find an experienced and reliable partner
Compliantly hire local and foreign talent in multiple jurisdictions
Create Global HR Compliance and Employment Risk Management Strategies
Maintain reliable talent management systems. Adhere to local labour laws and HR compliance regulations.
Global Talent Retention Programs.
7 Global Employment Challenges to Consider
If you’re thinking about expanding your operations to a global level, you’ll want to consider all the details that go into that decision. That includes everything from choosing the most cost-effective country and the right entity type to preparing for business challenges across borders. Choosing a location that works with your overall strategy and offers lower taxes could be one way to help improve profitability.
As you prepare to expand internationally, it’s crucial to understand how each factor impacts the overall success of your business. Here are some global expansion challenges.:
Every country in the world has its own set of unique laws for businesses.
The legislative and regulatory landscape is ever-evolving. Keeping track of changes is cumbersome.
Global HR Compliance (labour, tax, immigration) laws are ever-evolving and hard to track.
Need to understand the local labour market to hire compliantly and risk-free.
Need to understand local employment and business practices.
Need to understand local competition and benchmark against standard business practices
Working with different languages, time zones, customs, and cultures
No matter which countries you expand to or what type of operation you open, there are some significant issues you will always have to deal with.
Global expansion decisions come with a lot of moving parts. The decision to expand internationally can significantly impact your business, so it’s essential to make sure you handle it correctly.
3 Options for Multi-jurisdiction International Employment
Businesses establishing a global presence face the challenge of managing and scaling an employee base with no common borders or language. To successfully expand abroad, companies have several options for enabling hiring in international markets.
There are six key things to consider when choosing an employment method for your company’s global expansion:
Budget and time frame
Tax implications
Compliance
Employment liability
IP protection
Asset acquisition.
The most commonly used ways are by doing the following:
Overseas Permanent Establishment (a representative office, a branch, a subsidiary, and other foreign legal entity types )
Selecting independent contractors to handle tasks remotely.
Work with a global EOR (Employer of Record) and GEO (Global Professional Employer Organisation) Partner.
Employer of Record: What, Why, How, and When?
What Is an Employer of Record (EOR)?
A professional employer organization (PEO) helps businesses by taking on many employee responsibilities and liabilities. This includes payroll, compensation, benefits administration, and employment taxes. A PEO allows businesses to outsource their human resource functions and focus on their core competencies while accessing their needed workforce.
Why Use an Employer of Record Solution?
Now, more than ever, startups and large corporations alike are struggling with how to hire remote employees and scale their teams globally without running into local labour and tax laws. Employers of Record can help companies achieve their goals while avoiding these legal and HR compliance risks – foreign specialists and knowledge workers fill positions as a service, which gives companies flexible access to talent without hiring them directly.
An Employer of Record (EOR) can also provide a registered entity for running a local, compliant payroll, managing payroll taxes, benefits, deductions, and employee information. An EOR can advise the client on the host country’s required notice periods, termination rules, and severance pay.
An Employer of Record (EOR) like Acumen International can take on all of the responsibilities of hiring an employee for you, including the legal and bureaucratic hurdles, and manage the entire employment process.
The EOR is solely responsible for paying salaries and benefits to employees and ensuring compliance with the host country’s local labour and employment laws. All HR aspects related to hiring an employee abroad are handled by an Employer of Record, which means that the client company does not have to establish a subsidiary or branch office in the target country where it needs to place its employees or contractors. EORs facilitate immigration policies, permits, and work visas for both employers and employees, depending on the conditions of the engagement.
What Services Does Employer of Record (EOR) Provide?
Summing up, the employer of record usually handles part of BPO services, particularly human resources-related issues regarding global remote personnel. These issues include but are not limited to:
Payroll management;
Compliance with local tax rules (file & deposit) of the country where the EOR company is located;
Handling employment contracts:
Background, education, and other checks;
Onboarding and termination processes, as well as employee’s compensation;
Arranging visas and work permits for employees;
Ensuring the working process is organized under local labour laws;
Processing workers’ medical insurance and other benefits (day-offs, bonuses, and more);
Process maps, employment guides, and other documentation.
What Services Does an Employer of Record Not Provide?
On the other hand, here are the services not included in EOR solutions:
Quality control of employees’ work and their promotion;
Decisions regarding contract termination and compensation, except for legal document processing;
Project management.
Who Can Use EOR Services?
An EOR can be hired by any company that wants to expand internationally but does not want to establish a legal entity abroad due to time constraints or high costs associated with setting up an office abroad. International businesses without subsidiaries may also use this service if they hire only one employee abroad for specialized roles, such as business development managers who scout for new business opportunities in foreign markets or sales directors who manage sales teams working remotely from other countries.
Companies that want to hire contractors outside their home jurisdiction can also use employers of record to handle contractual obligations such as compensation packages, tax or benefits administration, and immigration permits required by employees worldwide.
1. EOR Allows to Skip Incorporation and Avoid The Pitfalls of Setting Up a Local Subsidiary
So you can’t be bothered with local incorporation in your target countries. There is no need to go through the hassle and expense of setting up a local entity via incorporation and registration when you can utilize an Employer of Record. The EOR already has a legal entity that can handle all aspects of payroll, employment, and immigration requirements in the host country, negating the need for your company to do so. In addition, the EOR has the network and in-house expertise to ensure full compliance with local labor laws and regulations, making it the best choice for handling these matters.
2. No Immigration Compliance Issues
Immigration compliance is a top concern for multinational companies. With constantly changing immigration policies and increased scrutiny from foreign governments, it is essential to maintain compliance to avoid legal consequences.
If you want to avoid the hassle and stress of constantly changing immigration laws and regulations, consider using a GEO solution with a local EOR. The EOR eliminates any risks associated with remote payroll, overuse of business visas, or multiple entries into the country. The EOR takes care of all work permit and visa requirements, ensuring a hassle-free experience with no complications from immigration authorities.
3. EOR Runs Local Payrolls in The Host Country
As an employer, it is crucial to follow local standards for running payroll and withholding deductions for pensions, health insurance, and taxes. Assigning employees abroad requires setting up a registered entity in the host country to comply with these regulations. The EOR can help ensure a smooth transition for employees.
EOR Solution by Acumen International: Global Employment Done Right and Fast
Acumen International’s EOR solution lets customers tap into the local workforce without setting up a new office or bank account. Acumen will take care of the employee onboarding, payroll, and compliance with local tax laws and regulations, freeing customers to focus on the employee’s day-to-day tasks.
Our global employment cost estimation technology, coupled with our global presence, experience in managing global payroll & local compliance and immigration regulations, and knowledge of local benefits and taxes, allows our clients to optimize the management of their extended workforce. Acumen’s global EOR services are delivered leveraging a single global platform that ensures data accuracy across all countries of operation.
A few potential drawbacks to using an EOR may depend on a company’s employment needs and business strategy. Despite the advantages, companies should be aware of these potential limitations before deciding whether or not to use an EOR.
1. It May Not Be Suitable for More Than 10 Employees or Generating over 100K in Sales
A company expanding into a new country may find that an EOR is not the best solution for more than 15 employees. It may consider incorporating an entity and hiring local experts to help manage the payroll process. In that case, the EOR may only be an interim solution to get employees hired quickly.
Suppose you plan on hiring foreign workers to provide services or generate sales over $100,000 annually in any country. In that case, you should consider setting up an overseas subsidiary or branch office. Doing so will help to mitigate the risk of permanent establishment.
2. Employers Give Up Control of Host Country Payroll Process
Many employers are reticent to cede control of payroll processes in the host country to a local EOR, although this is purely for administrative reasons. This may be a completely novel concept against conventional business thinking regarding direct employment for some companies. While it may be a new concept for some companies, using a local EOR can provide greater business flexibility and freedom.
3. Indirect Relationship between Company and Its Employee
The company relies on the EOR to handle claims since the employment contract is between the EOR and the employee rather than between the company and the employee. While the company does have the rights under its agreement with the employee, these rights are secondary.
Impersonal
PEOs can give your business the personalized attention and care needed to thrive. However, many PEOs are large companies that serve thousands of small businesses. This means that your company and employees could potentially get lost in the shuffle. When looking for a PEO, choose a company that treats its clients right — and gives them the tools, support, and services they need to grow their business. Remember, you always have the option to cancel your services if unsatisfied.
PEO (Professional Employer Organisation): What, Why, How, and When?
What is PEO (Professional Employer Organisation)?
A professional employer organization, or PEO, is a company that provides human resource management services and managed solutions to small, mid-size, and growth businesses. PEOs help businesses grow by taking on many HR-related tasks and responsibilities. Their services include payroll, benefits, HR, tax administration, and regulatory compliance assistance.
PEOs typically enter into a joint-employment relationship with an employer, which gives the PEO responsibility for many employee-related functions such as employee benefits, compensation and payroll administration, workers’ compensation, and employment taxes. PEOs allow businesses to outsource their human resources functions and gain economies of scale by having more benefits options, sometimes at lower rates.
With PEOs, your HR department can function at total capacity. Rather than limiting its scope to the traditional functions of HR, a PEO provides a comprehensive range of HR services tailored to your business needs. With a professional workforce of experts in multiple locations, PEOs ensure that employees work compliantly according to host country laws.
PEO Differentiator
PEOs typically enter into a joint-employment relationship with an employerand generally operate within a single jurisdiction or country, such as PEOs located in the United States.A crucial part of PEO services is assuming responsibility for complying with the laws and regulations governing the payment and reporting of federal and state taxes paid on employee wages.
What Services Does PEO Provide?
If you’re planning to expand your business, you’ll need the help of an expert services partner that can guide you along the way. The team at PEOs usually provides strategic guidance and a wide array of high-quality, cost-effective services tailored to your specific requirements that can help your company grow and scale up safely. Here are some of them:
Human resources administration, including payroll, taxes, and benefits administration; employee training and development; recruitment; employee relations; compliance training; background or education checks; timekeeping services;
Regulatory compliance assistance, including payroll tax law and reporting requirements;
IP protection and offboarding;
Hiring and HR compliance services, helping you navigate through local regulations and avoid prohibited HR practices, including discriminatory job listings, Illegal criminal background checks, misclassified workforce, inaccurate payroll, and tax payments;
Human resource support;
End-to-end talent management, including recruiting, onboarding, engagement, performance management, and termination (upon employer approval);
Liaison with legal counsel on employment issues such as discrimination, wrongful termination, sexual harassment, whistleblower protection, non-compete agreements, severance agreements, and other employment law matters.
Benefits of Using PEO (Professional Employer Organisation)
There are many benefits to partnering with a PEO for businesses expanding to new locations. Perhaps the most significant benefit is that PEOs can provide access to cutting-edge global employment solutions that are usually beyond the reach of many organizations. This can give your organization a significant competitive advantage.
Businesses can benefit from the value propositions that PEOs bring to the table in five different ways
Improving clients’ ability to attract and retain talent.
Enabling clients to focus on their core businesses while PEOs handle HR matters.
Expert HR knowledge and resources to improve their overall business performance.
Reducing HR-related overhead costs.
Eliminating the need to deal with legal compliance and HR issues.
The primary benefit of partnering with a PEO, Professional Employer Organization, is a co-employment relationship that gives you the flexibility to focus your attention on the direction and growth of your business.
A PEO assumes administrative and HR compliance tasks, enabling you to invest more time in strategic decision-making. Professional employer organizations can provide services to business owners and management teams that they wouldn’t otherwise have the time or expertise to run independently.
Co-employment is an excellent way for growth companies to enjoy the benefits of a professional HR solution on a long-term basis while maintaining direct control over day-to-day operations. A PEO is an organization that provides HR and payroll services but doesn’t hire or terminate employees independently. Those responsibilities are shared between the employer and the PEO.
PEOs typically offer Employment Practices Liability Insurance (EPLI) to their clients, which can offer protection if a former employee sues for wrongful termination or discrimination. This type of insurance can be invaluable for businesses, as it can help cover the costs of litigation and potential damages that may be awarded.
Businesses in a PEO arrangement grow 7-9 percent faster, have 10-14 percent lower turnover, and are 50 percent less likely to go out of business.
PEOs can offer a broad array of HR services at a lower cost and offer access to retirement plans to small businesses that may not otherwise sponsor them.
PEOs provide services to 173,000 small and mid-sized businesses, employing 4 million people.
There are 487 PEOs in the United States.
The total employment represented by the PEO industry is roughly the same as the combined number of employees for Walmart (the United States only), Amazon, Kroger’s, and Home Depot.
The PEO industry’s 173,000 clients represent 15 percent of all employers with 10 to 99 employees.
The ROI of using a PEO (in cost savings alone) is 27.3 percent.
Drawbacks to Using PEO (Professional Employer Organisation)
PEOs can be a good fit for businesses of all types and sizes. While this model offers many benefits, it also has drawbacks. Here are some of the disadvantages of using PEOs:
1. Higher costs
The main reason why PEOs cost more than traditional employment is the administrative fees they charge. These fees cover the cost of managing your payroll and other expenses related to hiring employees. On average, these fees range between 10 and 15 percent annually.
2. Lack of control of HR processes and employees
PEOs can be very helpful in managing employee-related activities, but they also lack the flexibility and strength of an in-house team. If you need to change processes or policies, you may have to go through multiple levels of approval before implementing them.
3. No influence on your company culture
A PEO might be able to help you with HR issues, but it probably won’t be able to solve cultural problems that arise within your business. For example, suppose an employee is acting up or causing issues in the office. In that case, an outsourced HR provider may not be able to help you address these issues as effectively as an in-house human resources department would be able to do. The same goes for any other internal problems that arise within your business.
4. The lower value of the In-house HR department
The main disadvantage of using PEO is that you might lose the value of your in-house HR department. You still employ the employees, so all internal policies and procedures are still in effect. If you want to change any of these policies, you must involve the PEO.
Your employees won’t know who’s looking out for them. When an employee has an issue or concern, they might not always know who they should contact at their company or PEO — especially if their employer has multiple locations or works with various providers. This could lead to confusion and frustration among employees who don’t feel like they’re being heard.
Another potential downside is a lack of control and indirect communications. For example, if an employee has a question about their benefits or wants to file a claim for some compensation, they might call their HR representative at the PEO’s office instead of yours. This could mean losing contact with key employees and missing valuable information about your company’s performance.
5. Lack of process customization
A significant advantage of having an in-house HR department is that they can customize people-related processes to fit company culture and needs. With a PEO, these processes will change depending on which partner you select (and whether or not they’ve developed customized processes). If this is important to your company culture or strategy, it may be worth keeping your HR team rather than outsourcing payroll and other services to a PEO.
6. Limited flexibility
Many PEOs have strict rules about when and how you can terminate an employee’s contract with them. In most cases, you must give at least 30 days’ notice before terminating an employee’s agreement with you and pay any applicable taxes and unemployment insurance premiums during that period. This can be problematic if you need to make immediate changes to your staffing levels because it forces you into a situation where you have too few or too many employees at once.
7. Stock options
Considering using a PEO arrangement for your business, it is essential to know
the potential compliance challenges. Stock options can be complicated, and it can be difficult to ensure compliance if the employees are not considered your employees. This should be carefully considered before deciding to use a PEO, as legal complications may be involved.
Tax advisors have noted that it is possible to route significant gains from stock options exercises in other countries through payroll providers (PEOs). PEOs typically charge a percentage of the gross payroll amount, meaning increased earnings from stock options gains can lead to higher PEO costs.
The price of a PEO depends on the specific services it provides and the number of employees you have. When you sign up for a PEO, you must pay setup and ongoing management fees. Some companies also offer discounts for large organizations that use multiple services.
PEO vs. EOR: What’s the Difference Between a PEO & EOR?
Before hiring employees overseas, you should know a few key differences between a Professional Employer Organization (PEO) and an Employer of Record (EOR). While they may seem similar at first glance, they are legally distinct entities with different implications for your business. Understanding the distinction between the two is essential to ensure a smooth and successful international hiring process.
A professional employer organization (PEO) can be a helpful way to outsource some of the administrative tasks associated with running a business, such as a payroll and filing taxes. Co-employment is a term used to describe the relationship between a business and a PEO, where both entities jointly employ workers. This arrangement allows businesses to outsource their HR functions to a PEO. With co-employment, the company and the PEO share responsibility for employment-related obligations. However, it’s important to note that a PEO does not provide access to international hiring if you do not already have a local entity in place. A PEO can be a good option for companies that don’t have an HR department or want to outsource some of their HR functions.
An EOR is a company that takes on the legal risks of employing your workers, including finance, legal & compliance, and safety risks, saving you from any potential problems down the line. This means that all of the responsibilities that come with being an employer are shifted to them — from tax reporting to handling any injuries or issues on the job. You’ll have none of these hassles but will take responsibility for managing your employees’ tasks and performance. Additionally, because an Employer of Record talent engagement model can be used for employees in other countries without setting up a business entity, it is an ideal solution for businesses that want to maintain a presence in multiple countries.
Global PEO and Global EOR Comparison
ATTRIBUTE
PEO
EOR
Employment Model
Co-employer
Sole Employer
Permanent Establishment Factor
Can only work with clients who have a registered in-country (state) entity
Facilitates foreign expansion without setting up an entity
Key Services
Global employment, payroll, benefits, immigration (visa, work permits), mobility
Global employment, payroll, benefits, immigration (visa, work permits), mobility
Responsibilities
Responsible for the entire array of HR functions
Responsible for a portion of HR functions
Tax Administration
Depending on local tax regulations may require taxes to be filed under the client’s taxpayer ID
Files taxes under own Taxpayer ID Number
Payroll Funding
Requires advanced payments from the client
Provides payroll funding
Local Entity Establishment
Required
Optional
Local Entity Ownership
Does not own the entities. Instead, partners with a local or global third-party provider. A PEO does not allow you to hire in countries where you do not have a local entity.
100 % owns legal entities in the country of service. Allows to hire a workforce in other countries without setting up a business entity
Liability
Shares responsibilities and liabilities
Assumes all responsibilities and liabilities. EOR hires the employees in the new country under its local business entity and takes on all of the legal risks.
Legal Advice
Optional
100% compliance required
Global Labour & HR Compliance
Optional
100% compliance required
Insurance
May require the client to provide their own insurance.
Provide general liability (GL) and workers’ compensation (WC) insurance coverage.
Benefits
Provides higher quality employee benefits at competitive prices
Provides higher quality employee benefits at competitive prices
Employment Agreement
The client must draft and sign the employment agreement with an employee.
Drafts and signs the employment agreement directly.
Pricing Structure
– Fixed monthly fee per employee – Percentage of payroll plus applicable taxes
– Fixed monthly fee per employee – Percentage of payroll plus applicable taxes
GEO (Global Employment Organisation): What, Why, How, and When?
Key GEO Drivers
The global economy has been increasingly shifting in recent years, with more businesses expanding their reach to international markets and taking control over risks. This has led to a rise in the demand for Global Employment Organizations (GEOs), which help businesses navigate the complexities of managing employees in multiple countries.
Several key factors are driving this trend. First, there is a growing focus on corporate governance and transparency, as investors and regulators place greater emphasis on these issues. Second, the war for talent has intensified as companies compete for the best workers in an ever-shrinking pool.
Finally, Permanent Establishment risk has become a significant concern for businesses, given the increased scrutiny of multinationals by local tax authorities worldwide. GEOs can provide a valuable service for companies looking to operate internationally, helping them overcome these challenges and maximize their growth potential.
What Is a Global Employer of Record (Global EOR)?
What Is a Global Employer of Record?
When expanding globally, businesses often face the challenge of navigating complex employment laws, tax regulations, and administrative burdens when expanding into new markets. A Global Employer of Record (Global EOR) emerges as a strategic solution, alleviating these complexities and enabling seamless international workforce management.
Unlike a traditional Employer of Record (EOR), which operates within a single country, a Global EOR extends its reach across multiple jurisdictions, offering a unified platform for managing international employees. This centralized approach eliminates the need for companies to establish separate legal entities in each country, streamlining the process of hiring, employing, and managing staff globally.
Global EORs serve as the legal employer for international employees, assuming all responsibilities associated with employment, including payroll, tax withholding, benefits administration, and compliance with local labour laws. This comprehensive support allows companies to focus on their core business objectives without getting bogged down in the intricacies of foreign employment regulations.
The benefits of partnering with a Global EOR extend beyond compliance and administrative relief. Global EORs provide access to a vast network of experienced professionals who possess in-depth knowledge of local employment practices, ensuring that companies adhere to the latest regulatory requirements and avoid costly legal pitfalls.
Moreover, Global EORs offer a cost-effective alternative to establishing local subsidiaries or business units. By centralizing employment functions, companies can avoid the upfront investment and ongoing operational expenses associated with setting up a legal presence in each country.
For companies seeking to test new markets or adopt agile operational strategies, Global EORs prove invaluable. Their flexibility allows companies to quickly deploy and adjust their workforce based on market conditions and business needs, minimizing risk and preserving existing corporate structures.
Businesses expanding globally that don’t want to hire directly or establish foreign legal entities can use Global EORs to comply with local laws quickly and affordably without having to go through the hassle of complying with multiple sets of laws and regulations and risk worker misclassification. With Global EORs, employers can take on ambitious international projects with the best skills available.
How a Global EOR Can Replace Multiple Vendors
Payroll Company: Handle payroll processing, tax withholding, and reporting in compliance with local regulations.
Employee Benefits Broker: Offer comprehensive employee benefits packages that comply with local laws and regulations.
HR Consultants: Provide HR expertise and support, including recruiting, onboarding, and performance management.
Background Checks Vendors: Perform background checks and screening to ensure compliance with local regulations.
IP Attorney: Assist with registering and protecting intellectual property rights in a target country.
Tax Advisor: Provide tax advice and ensure compliance with local tax laws.
Translation Service:Provide translation services to help bridge language barriers.
Legal Advisor: Provide legal expertise and support, including contract review and compliance.
Immigration Advisor: Provide support with work permits and visas for international employees.
A Global Employment Organization (GEO) is a subset of employers of record that perform their duties internationally across multiple jurisdictions worldwide.
When Do You Need GEO (Global Employment Organization)?
There are a variety of situations where GEOs may need to manage a globally distributed workforce. A GEO can facilitate quick employment and promote consecutive global moves.
5 Most Common HR Challenges for Businesses Going Global
An organization wants to hire the best talent from around the world, regardless of location.
An organization offers remote working options, and employees are allowed to work from anywhere they choose.
In the event of mergers, acquisitions, or sales activities, employees may be stranded in an area without a company presence. A GEO can help employ these one-time, third-country nationals in these cases.
When employees are part of a company’s global mobility program or when they work for a company that operates in multiple countries.
An organization must establish tight cost control and management reporting concerning its global mobility program.
What Services Does a GEO (Global Employment Organization) Provide?
A single point of contact for all your cross-border payroll administration. A specialized employer organization (GEO) administers a local payroll through the EOR, which gives employees the confidence they will receive statutory employment benefits and protections. Local payroll management is one of the most challenging aspects of running any business, so working with an experienced GEO with expertise in global payroll is crucial.
A Global Employment Organization (GEO) ensures that the employment contract meets local labor law requirements. A GEO also works with employers to help them understand and comply with employment laws in different countries. The GEO also provides resources and training to employees on their rights and responsibilities under the contract.
A Global Employment Organization (GEO) provides work permits and visas for employees from other countries. This makes it possible for these workers to come to the employer’s country and work there for a set period.
A Global Employment Organization(GEO) guides clients on employment law matters such as notice, severance, termination, and statutory benefits.
Global Employment Organization(GEO) provides communication and coordination between the EOR, client company, and employees through regional account managers, allowing for a more efficient and effective working relationship between all parties involved.
A Global Employment Organization (GEO) strives to create global pay strategies and structures that are fair and competitive. They consider many factors when setting pay levels, such as internal business needs and market rates. They also examine how local taxes and regulations can impact those rates to create a cohesive global model.
A Global Employment Organization (GEO) can help align HR programs with global functions and business needs
9 Benefits of Using a GEO (Global Professional Employment Organisation) Solution
Facilitated and unified global mobility administration
Centralized control over the global workforce
Enhanced international employee and employer compliance
Proactive global workforce cost management
Alignment of global talent with opportunities
Advice on favorable tax, benefit, and social security locations
Reduced permanent establishment exposure risk
Simplified global reward structure and administration
Multi-location compliance risk management.
Global Employment Cost Forecasting
In today’s business world, it’s more important than ever to be mindful of costs when expanding your company internationally. Hiring talent in different countries can be expensive, so you must know each country’s compliance, tax, labour, and immigration requirements. One way to save money when hiring employees or independent contractors is to choose the most cost-effective and business-friendly country. This can help you reduce expenses by up to 50%. Different countries have different labour laws and benefits, so it’s essential to do your research before making a decision. So why not take advantage of our Global Payroll Calculator — the advanced country-by-country employment cost comparison tool? With just a few clicks, you can compare the payroll costs, benefits, employer and employee taxes, and mandatory benefits for 190 countries. The Global Payroll Calculator can make finding cost-effective locations for your next global expansion move much easier. The tool considers local taxes, payroll regulations, benefits, compliance requirements, and other labour-related factors that can impact an employer’s budget. By tracking developments in 190 countries worldwide, the research team behind the calculator strives to keep the data up-to-date so businesses can make informed decisions about expanding their operations internationally.
Acumen International, Your Gateway to the Global Talent Market
Acumen International’s mission is to provide services that make the world smaller. It aims to help businesses of all sizes in any industry reach international growth and expansion through various services.
Are you looking to hire employees quickly and efficiently in any of the 190 countries? Acumen International can help with our Express Global Employment solution. In just 72 hours, businesses can have their globally distributed employees working for them – perfect for when you need to get things up and running immediately. This solution also comes in handy during mergers and acquisitions, helping transfer and retain key personnel during the transition process.
Comprehensive Global EOR and PEO Service Portfolio of Acumen International
Preparation of mandatory documents for in-country employment and payroll;
Compliant client and worker onboarding and offboarding in support of global expansion, remote workforce, or merger & acquisition requirements;
Audit-proof local labour law compliance;
Compliant statutory and voluntary employee benefits provision and management for local and expatriate talent, including health insurance, automotive leasing, office equipment, accommodation on-demand, and related technology requirements;
Coordination of monthly payroll, employee & employer tax payment processing, including year-end tax statements, and consolidated monthly invoicing;
Compensation management, severance, and employee termination services;
Immigration requirements processing, rendering work permit sponsorship, visa applications & extensions, and expatriate support;
Global mobility and relocation services;
Cloud-based Global Payroll Calculator provides total cost of employment estimates for local talent and expatriate personnel;
Local market benchmarking services for clients considering market expansion (e.g., salary, bonus, the total cost of hire, etc.);
Tailored on-demand international recruitment and staffing provided through in-country partners (ICPs).
Summing Up
Hiring needs vary in scope and duration, so the type of employee you choose should be based on your specific needs. PEOs are best for small-scale or short-term hiring, while GEOs are the best choice when you need a larger pool of workers.
Cross-border workers are a crucial part of many international companies. Globalization means organizations have expanded by reaching out to new markets and hiring workers from other countries. That complicates compliance because some organizations employ people in multiple countries and may have employment regulations. Managing these workers can be challenging, but there are ways to make it easier. The three innovative global employment models — GEO, PEO, and EOR can help minimize risk, centralize administration, and streamline operations.
Acumen International Global PEO and EOR solutions can help organizations develop effective global employment programs to ensure compliance with local legislation and provide a comprehensive and cost-effective solution across multiple locations. Acumen International is like a tailor-made suit that fits your business perfectly.
Welcome to the 8th edition of the Express Global Employment Monthly Global Employment Tax & Compliance Newsletter. This August, we delve into labour and tax regulations and compliance shifts from countries like the Netherlands, France, Singapore, Bulgaria, South Africa, the United Kingdom, and more. Get ahead of legislative shifts and fine-tune your global employment strategies… Read more Global Employment Tax and Compliance Newsletter. August 2023
Welcome to the 8th edition of the Express Global Employment Monthly Global Employment Tax & Compliance Newsletter. This August, we delve into labour and tax regulations and compliance shifts from countries like the Netherlands, France, Singapore, Bulgaria, South Africa, the United Kingdom, and more.
Get ahead of legislative shifts and fine-tune your global employment strategies with unmatched depth and clarity.
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As we explore the intricacies of global employment tax and compliance, the importance of having the right tools cannot be overstated. That’s why we’re thrilled to introduce a powerful addition to our suite of services—the Global Payroll Calculator by Express Global Employment.
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3️⃣ Competitive Compensation: Stay ahead of the curve with regularly updated data for crafting attractive packages.
4️⃣ Unified Planning: Integrate the Calculator into your broader global employment strategy.
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This legislative change aims to modernize the workplace and fulfils a 2019 UK government commitment. It shortens the employer response time to two months from three and allows workers to make two yearly requests. The law broadly defines “flexible working, ” including varied work hours and locations.
3. Implications for Employers
The new law poses both benefits and challenges for employers. Research indicates that flexible working boosts talent attraction, employee motivation, and retention. However, employers must now be prepared to handle an increase in flexible working requests and need to respond more quickly.
Key Provisions
Mandatory consultation before rejecting a flexible working request.
Two requests are allowed per 12-month period.
Decision time was reduced from three to two months.
4. Immediate Actions
Employers should promptly review and adjust their work policies to comply with this new legislation to leverage the benefits and avoid penalties.
Australia Country Spotlight: Towards a Unified Labour Hire Regulation Scheme 🇦🇺
1. Legislation in Progress
Australia’s Industrial Relations Ministers have agreed to create a harmonized labour hire regulation model, the Model Harmonised LH Scheme, by the end of October 2023.
2. Why It Matters
This initiative follows the release of a consultation paper in March 2023 by the Department of Employment and Workplace Relations (DEWR), aiming to consolidate existing labour hire licensing schemes from various territories into a single national framework.
3. Implications for Employers
The proposed national scheme suggests:
Uniform rules for labour-hire providers in all Australian industries.
Pre-licensing requirements for providers before offering labour hire services.
A standard license duration of 12 months.
Strict obligations and potential civil and criminal penalties for non-compliance.
While the exact features of the Model Harmonised LH Scheme are still to be confirmed, it is expected to include elements from existing schemes and offer a mechanism for mutual recognition of labour hire licenses across states to ease the regulatory burden.
4. Immediate Actions
Employers and labour hire providers should stay updated on the development of this scheme as it may introduce new compliance requirements and penalties.
South Africa Country Spotlight: Introducing the Trusted Employer Scheme for Streamlined Work Visas 🇿🇦
1. What’s New?
South Africa’s President Cyril Ramaphosa is rejuvenating the work visa system by introducing the Trusted Employer Scheme (TES). Initially proposed in 2017, this scheme aims to simplify the visa application process for skilled foreign labour, aligning it with global best practices.
2. Why It Matters
The TES will significantly cut down administrative hurdles for vetted employers, making bringing in skilled foreign workers easier and more predictable. This initiative aims to share the government and companies’ administrative burden and compliance risks.
3. How It Works
Employers qualifying for TES will benefit from:
Faster visa processing times.
Reduced documentation requirements.
A dedicated account manager at the Department of Home Affairs.
To qualify, companies must demonstrate:
Financial capacity to employ foreign nationals.
Commitment to training South African citizens.
Corporate responsibility.
4. The Points System
Companies will be evaluated based on:
Investment in South Africa.
Workforce composition (at least 60% South African employees).
Sector of operation (priority sectors get additional points).
Skills transfer programs.
5. Implications and Penalties
Companies will handle most compliance obligations, and non-compliance will result in strict penalties, including potential expulsion from the scheme and a ban on hiring foreign workers for up to three years.
6. Application Details
The 30-day window for initial applications.
Only 100 businesses will be accepted first, with a review after 100 days.
Decisions will be made within 60 days, and there is no appeal process.
7. Immediate Actions
Companies interested in easing their visa application processes for foreign employees should prepare to apply for the TES as soon as it’s launched.
Singapore Country Spotlight: Revised S Pass Eligibility and Quotas Starting 2023 🇸🇬
1. Overview
Singapore’s Ministry of Manpower (MOM) is modifying the criteria for S Pass holders. The aim is to enhance the quality of this foreign workforce segment to match the top one-third of local APT workers. The changes began rolling out on September 1, 2022, and will continue to 2025.
2. Salary Requirements
Changes to minimum qualifying salaries for S Pass applicants will happen in phases. Age-dependent salary increases will persist.
Sector
From Sep 2022 (New) / Sep 2023 (Renewals)
From Sep 2023 (New) / Sep 2024 (Renewals)
From Sep 2025 (New) / Sep 2026 (Renewals)
All (except Financial Services)
$3,000 – $4,500
$3,150 – $4,650
At least $3,300 (TBD)
Financial Services
$3,500 – $5,500
$3,650 – $5,650
At least $3,800 (TBD)
Note: Final salary figures will be released based on the local APT wage landscape.
3. Changes in Levy Rates
The S Pass Basic/Tier 1 levy rate will rise in increments as follows:
Current Tier 1 Levy
From Sep 2023
From Sep 2025
$450
$450 to $550
$550 to $650
Note: No changes to Tier 2 levy rates, remaining at $650.
4. S Pass Quotas
Starting January 1, 2023, the S Pass quota will be adjusted:
Manufacturing, Construction, Marine Shipyard, and Process sectors: Down from 18% to 15% of the workforce.
Services sector: No change.
5. Action Items
Employers should adjust their hiring and retention strategies to accommodate these evolving requirements for S Pass holders.
Singapore: Upgraded Medical Insurance Policies for Foreign Workforce 🇸🇬
1. Key Points
Effective Date: July 1, 2023
Policy Update: Enhanced mandatory medical insurance for all Work Permit and S Pass holders, including migrant domestic workers.
Annual Claim Limit: Boosted to S$60,000, with employer co-pay for claims exceeding S$15,000.
2. Summary
Starting July 1, 2023, Singapore’s Ministry of Manpower will bolster the compulsory medical insurance requirements for all Work Permit and S Pass holders. The annual claim limit will be raised to S$60,000. Importantly, employers will be responsible for co-paying claims surpassing S$15,000.
3. Recommended Actions
Review Insurance Policies: Employers should update their insurance packages to meet the elevated claim limits.
Budget for Co-Payments: Prepare for potential co-payments on claims that exceed S$15,000.
4. Employer Risks
Non-compliance with the new medical insurance guidelines could result in penalties. It’s crucial for employers to adapt their insurance policies to align with these changes.
New Zealand Country Spotlight: Important Updates to the Accredited Employer Work Visa Scheme 🇳🇿
1. Overview
New Zealand has recently revised its Accredited Employer Work Visa (AEWV) rules, with significant changes taking effect from November 27, 2023.
2. Five-Year AEWV Grants
Starting November 27, 2023, any worker earning at least the median wage will be eligible for a five-year AEWV.
3. Extending Current AEWVs
AEWV holders with visas granted before November 2023 have the option to extend their visas to a total of five years, provided they meet specific conditions:
Maximum continuous stay requirements
Unchanged job role, location, and employer
Wage not below the initial AEWV application rate
4. Partnerships
Partners of five-year AEWV holders may also be able to extend their Partnership Work Visas, pending policy amendments.
5. Median Wage Increase
Immigration New Zealand plans to hike the median wage to $31.61 (approx. US$18.80), up from the current $29.66, by February 2024.
Current Median Wage
Proposed Median Wage
Effective Date
$29.66
$31.61
February 2024
6. Additional Points
After their visas expire, AEWV holders must spend at least 12 months outside New Zealand before re-entry unless they are on a residence pathway.
7. Action Items
Employers should review their current and future hiring strategies to align with these changes.
Spotlight on France: Key Changes in Employment Tax Obligations for 2024 🇫🇷
France’s Finance Act 2022 has introduced new reporting and taxation changes for employers and employees, slated to take effect primarily from January 1, 2024. These pertain to ‘reportable benefits,’ Special Assignee Relief Programme (SARP), Personal Retirement Savings Account (PRSA), and more.
1. Enhanced Reporting Requirements (ERR)
Starting from January 1, 2024, employers will be obligated to report the following non-taxable benefits in real-time via Revenue Online Service (ROS):
Small Benefits
Remote Working Daily Allowance
Travel and Subsistence
2. Preparation Steps for ERR
Evaluate current data collection methods.
Assess inter-departmental collaboration.
Examine ROS system integration.
Review data quality.
Reconcile payment timelines.
3. Small Benefit Exemption
Effective January 1, 2022, the small benefit exemption has been raised from €500 to €1,000 annually. Employers can now offer up to two tax-free, non-cash annual benefits, capped at €1,000.
4. Special Assignee Relief Programme (SARP)
SARP has been extended until December 31, 2025. Qualifying individuals can now claim 30% tax relief on a basic salary of at least €100,000, up to a limit of €1m. A mandatory PPS number is required to avail of this benefit.
5. Pension Contributions to PRSA
Two noteworthy changes:
Employer contributions no longer count as a Benefit-in-Kind (BIK).
Employer contributions are not considered as employee contributions for tax relief.
6. Shares Options and Revenue Compliance
Revenue has initiated focused compliance activities based on discrepancies identified in annual share reporting forms. Employee obligations now include various reporting and tax-payment requirements.
7. PAYE Revenue Audits
Revenue has resumed PAYE audits. Employers are encouraged to self-review and make necessary corrections to avoid penalties.
Common Audit Areas
BIK on company cars
Employee benefits like vouchers
PAYE application on share awards
Tax-free mileage and subsistence
Contractor status assessment
8. PAYE Settlement Agreements (PSA)
For ‘minor and irregular’ benefits, employers can opt for a PSA to remit the corresponding taxes to Revenue. Applications are due by December 31 of the relevant PAYE year.
9. Action Items
Employers should review and adapt their payroll and benefits policies to align with these legislative updates.
Czech Republic: New Whistleblowing Law Affects Employers with 50+ Employees 🇨🇿
A recent legal change in the Czech Republic mandates employers with 50 or more employees to implement internal systems for whistleblowing. The law aims to align with the EU Whistleblowing Directive. Smaller companies, ranging from 50 to 249 employees, can collaborate with other employers to share these systems.
1. Key Changes
Impact Date: The law takes effect on August 1, 2023.
Employee Count & Deadlines:
Employers with 250+ employees: Must comply by August 1, 2023.
Employers with 50 – 249 employees: Must comply by December 15, 2023.
Employer Risk: Failure to meet these requirements could result in fines up to CZK 1,000,000 (approximately €41,000).
2. Recommended Actions
Policy Update: Review and update, if necessary, existing policies on protected disclosures to ensure compliance with the new law.
Implementation of Reporting Systems: Employers should either set up an independent whistleblowing system or collaborate with other employers to create a shared system, depending on the company size.
Compliance Check: Ensure that all steps are taken to fully comply with the new regulation by the stipulated deadlines to avoid significant financial penalties.
3. Action Items
Companies operating in the Czech Republic should act swiftly to meet the new whistleblowing compliance requirements by the respective deadlines. This involves updating existing reporting channels or setting up new ones in collaboration with other employers, if applicable.
Czech Republic: Upcoming Labour Code Amendment Addresses Remote Work 🇨🇿
A proposed amendment to the Czech Republic’s Labour Code outlines new guidelines for remote work. Employers and employees must note several key changes, including documentation requirements, expense reimbursements, and special provisions for parents with young children.
1. Key Points
Effective Date: The changes will be effective on September 1, 2023.
Written Agreement: Remote work will now require formalized written consent between the employer and employee.
Employer Discretion: Employers may mandate remote work under specific conditions, such as during a pandemic.
Expense Reimbursement: Employees can claim reimbursement for expenses incurred while working remotely, either based on actual costs or a flat hourly rate of a minimum of CZK 2.80 (approximately €0.10).
Special Provisions for Parents: Employees with children under 15 years old are eligible for remote work under certain circumstances.
Employer Risk: Failure to comply with these remote work guidelines could result in fines up to CZK 1,000,000 (approximately €400,000).
2. Recommended Actions
Review Existing Policies: Employers should examine their current remote work arrangements and update them to align with the new guidelines.
Documentation: Ensure written agreements for remote work are in place, as stipulated by the amendment.
Expense Policy Update: Revise expense policies to include options for actual cost reimbursement or flat hourly rates for remote work.
Parental Policies: Create or update policies that cover the right of employees with children under 15 to work remotely under specific circumstances.
Netherlands: New Minimum Wage Rates Effective 2023 🇳🇱
The Netherlands has announced an increase in the minimum monthly wage for employees aged 21 and over. This marks a notable change that employers must be aware of, given the financial and reputational risks associated with non-compliance.
1. Key Details
Effective Date: The new minimum wage comes into force on July 1, 2023.
New Rate: The minimum monthly wage will rise from €1,934.40 to €1,995.00, exclusive of the 8% statutory holiday allowance, for full-time employees aged 21 and over.
Employer Obligations:
Ensure all employees aged 21 and over receive at least the new minimum wage.
Verify compliance for special wage cases, such as when the holiday allowance is bundled into salaries that are three times the minimum wage.
Risks for Employers:
Wage claims from employees, inclusive of a 50% statutory increase.
Fines ranging from €500 to €10,000 per employee from the Labour Authority.
Potential reputational damage.
2. Recommended Actions
Review Current Salaries: Audit existing employee salaries to ensure they meet or exceed the new minimum wage.
Adjust Payroll Systems: Update payroll settings to reflect the new minimum wage from the effective date.
Revisit Special Cases: Double-check salary levels for employees who are exceptions, like those with bundled holiday allowances.
Communication: If applicable, notify employees of the change and how it will affect them.
Netherlands: Changes to Salary and Termination Rules for Post-Retirement Employees 🇳🇱
The Netherlands is modifying its employment laws to affect those who work beyond the state pension age and fall ill. The change significantly shortens these employees’ mandatory duration of continued pay during illness.
1. Key Details
Effective Date: July 1, 2023.
New Duration: Continued salary payment during illness for employees working beyond state pension age will now be 6 weeks, down from 13 weeks.
Transitional Provision: The 13-week period will still apply for those who reach the state pension age by July 1, 2023, and are already ill. For those who fall ill after this date, the new 6-week rule will apply.
Employer Obligations:
Be aware of the reduced 6-week continued pay rule for employees working beyond the state pension age.
The original 13-week rule remains for employees already at state pension age and sick as of July 1, 2023.
Employer Risks:
Overpaying salaries if the updated 6-week rule is not followed.
2. Recommended Actions
Policy Update: Review and amend company policies to align with the new 6-week rule.
Payroll Adjustment: Make necessary adjustments to payroll systems to implement the new rules from July 1, 2023.
Employee Communication: Inform all relevant employees about the changes and how it will affect their continued salary in case of illness.
Netherlands: New Minimum Hourly Wage Law Affects Full-time Workers 🇳🇱
Key Points
Effective Date: January 1, 2024
New Rule: Transition from a minimum monthly to a minimum hourly wage.
Implication: Affects full-time employees, regardless of whether they work 36, 38, or 40-hour weeks.
Bulgaria: Upcoming Changes to National Minimum Salary Calculation 🇧🇬
1. Key Points
Effective Date: Determination by September 1, 2023
New Formula: Minimum salary to be set at 50% of the average gross wage, based on the previous year’s last two quarters and the current year’s first two quarters.
Wage Floor: Minimum salary cannot be lower than the previous year’s rate.
2. Summary
Bulgaria’s Council of Ministers will define the national minimum salary for the next calendar year by September 1, 2023. The new salary will be calculated as half of the 12-month average gross wage, encompassing the final two quarters of the preceding year and the initial two quarters of 2023. Importantly, the newly set minimum salary cannot be lower than the rate established for the prior year.
3. Recommended Actions
Economic Preparedness: Employers should anticipate the financial implications of an increase in the minimum wage.
Document Update: Revise employment contracts or any standard documents that mention the minimum wage to align with the new rate.
4. Employer Risks
Failure to adapt to the new minimum wage criteria could lead to legal repercussions. Employers should proactively adjust their financial planning and employment documents to meet the new guidelines.
Conclusion
In a rapidly evolving global employment landscape, staying abreast of the latest tax and compliance updates is not just an option—it’s a necessity. We hope this month’s Global Employment Tax & Compliance Newsletter has provided actionable insights and a clearer roadmap for international operations. Don’t forget to explore our new Global Payroll Calculator for a comparative analysis that could be a game-changer for your business.
Thank you for allowing us to be your trusted partner in global employment solutions. Stay tuned for next month’s insights as we build a compliant and competitive global workforce together.”
Greetings and welcome to the July 2023 issue of our Global Employment Tax and Compliance Newsletter. As our world rapidly evolves, the arena of international employment, tax, and immigration law keeps pace, consistently offering new challenges and opportunities. In this edition, we dive into many legislative changes spanning multiple corners of the globe. From the… Read more Global Employment Tax and Compliance Newsletter. July 2023
Greetings and welcome to the July 2023 issue of our Global Employment Tax and Compliance Newsletter. As our world rapidly evolves, the arena of international employment, tax, and immigration law keeps pace, consistently offering new challenges and opportunities.
In this edition, we dive into many legislative changes spanning multiple corners of the globe. From the sweeping labour and tax law transformations in the United Kingdom and Ireland to the dynamic alterations to remote work regulations in the United States – particularly New York – this issue leaves no stone unturned. Our journey also takes us to the heart of Europe with a detailed overview of Belgium’s employment laws and crosses oceans to bring you the latest updates from Australia and Malaysia.
Our mission with this Newsletter is more than to inform; we aim to enlighten you, providing you with the insights you need to better comprehend the intricacies of these developments. Whether you are an employer seeking to meet changing obligations across jurisdictions or a global employment professional keeping up with the ever-evolving legal landscape, our expertly curated content is designed to enhance your understanding and preparedness.
As you delve into this month’s edition, we trust you will find the analysis insightful, the updates valuable, and the perspectives thought-provoking. We welcome you to join us in exploring the shifting global regulatory panorama.
Stay tuned, stay informed, and stay ahead of the curve!
🇬🇧 A Sharp Increase in UK Business Immigration Visa Fees Announced
To finance proposed wage enhancements in the public sector, the UK government has declared its intentions to raise various immigration-associated charges significantly.
Changes to Immigration Health Surcharge
An essential modification will be in the Immigration Health Surcharge, an upfront payment due during the visa application for each year of the visa’s validity. The standard rate will experience a jump from £624 to £1,035 per year, and for those under 18 and students, an increase from £470 to £776 per year is planned. To illustrate, a 3-year visa would now necessitate a Health Surcharge of £3,105.
Work and Visit Visa Application Fee Increase
The costs associated with work and visit visa applications are set to climb by 15%. This means that the expense for a 3-year Skilled Worker visa application lodged outside the UK would rise from £625 to £719.
Boost in Other Visa-related Fees
Further increases of at least 20% are expected for fees related to Certificates of Sponsorship, citizenship, settlement, wider entry clearance, study visas, leave to remain, and priority visas. Although no exact date for these increases’ enforcement has been communicated, they’re likely to be implemented in the near future due to the current economic climate.
Implications for Employers
These significant augmentations could drastically affect UK employers who plan to sponsor non-UK/Irish nationals for work in the country, especially when considered alongside the existing Immigration Skills Charge for sponsored work visas, which stands at £1,000 per visa year (£364 per year for small companies and charities).
With these changes, a medium or large employer could potentially shell out a minimum of £7,000 for a single employee’s 3-year sponsored work visa, not including legal advice fees and priority processing charges.
Effects on Sponsored Employees and the Employment Market
While visa costs, except the Immigration Skills Charge, can be shifted to sponsored employees, this might need to be reevaluated given the competitive nature of the recruitment market and the risk of discouraging high-potential candidates. Furthermore, sponsored employees intending to bring dependents to the UK will face these additional costs unless covered by their employers.
Looking Forward
These increased charges should be factored into future recruitment budgets, especially by UK employers heavily dependent on the non-UK/Irish workforce.
🇺🇸 Regulation Updates from New York: Implications for Global Employers
Why New York’s Employment Laws Matter to the World
Even for those outside the United States, changes to employment laws in influential jurisdictions like New York State (NYS) and New York City (NYC) can provide valuable insights into potential global trends. As we see the impact of the pandemic continue to shape workspaces and as Artificial Intelligence (AI) increasingly intertwines with HR functions, these updates offer a glimpse into the future of worldwide employment regulations.
NY Warn Act: Recognizing Remote Work Reality
In response to the pandemic-induced shift towards remote work, the NYS Department of Labor has amended the NY WARN Act, changing how employee count is determined. Remote workers based at the employment site are now considered in the employee count. The updates also streamline the communication method with the Department of Labor, replacing mail and fax notices with electronic submissions via the newly launched WARN Portal.
Increased Transparency & Accountability
The amendments now require employers to provide detailed information about affected employees and changes to how the payment in lieu of notice is treated. Furthermore, invoking exceptions to the NY WARN now includes additional administrative steps, reinforcing accountability.
AI in Hiring: A Brave New World
AI is transforming HR processes globally. NYC’s Local Law 144, regulating AI’s use in employment, came into effect in early 2023. As of July 5, employers must perform an annual “bias audit” on automated employment decision tools (AEDTs) and provide necessary notices before use.
These trends highlight the increasing importance of data transparency, employee rights in the digital workplace, and the potential challenges of AI in HR processes. Understanding these trends as employment laws evolve globally can help employers prepare for the future. Keep an eye on these areas, as the laws in New York often precede broader trends.
🇦🇺 Australia Raises Minimum Wages Effective from July 1, 2023
Australia is initiating significant wage alterations from July 1, 2023, following the Annual Wage Review 2022-23. This change in the wage landscape is poised to have widespread effects on employees and employers.
Key Highlights
National Minimum Wage: It will be increased to $882.80 per week, or $23.23 per hour, impacting all employees not within the scope of an award or registered agreement.
Award Minimum Wages: These will rise by 5.75%, applicable to most employees covered by an award.
National Training Wage: It is set to increase in line with the award minimum wage increases. This includes awards pertinent to the terms under Schedule E of the Miscellaneous Award, which have an operative date of 1 July 2023.
High-Income Threshold and Compensation Cap: These will now be $167,500 and $83,750, respectively, which could affect conditions for higher-income employees.
Sector-specific Changes: Supported Employment Services Award will undergo alterations, and the aged care sector will see a 15% wage boost for direct care and some senior food services employees.
For more detailed information, including new pay rate calculations, visit the official Fair Work Commission website or use the Pay and Conditions Tool. Please note that these changes come into effect from the first pay period starting on or after July 1, 2023.
Keeping abreast of these changes is crucial for maintaining fair and legal business practices. Stay informed, and stay compliant!
🇬🇧Significant Immigration Rule Changes in the UK Effective July 17, 2023
The UK government has introduced significant changes to the Immigration Rules, effective July 17, 2023. These changes touch on various aspects, including student visas, the EU Settlement Scheme, the Shortage Occupation List, and more. Understanding these changes is crucial for employers to maintain legal and compliant practices.
Key Takeaways
🇬🇧 New regulations restrict international students from switching to sponsored worker routes.
A few key points are:
Students cannot switch to a sponsored worker route until they finish their course.
PhD students can switch to a sponsored worker route after 24 months of UK study.
Students can no longer apply for permission to stay as a dependent unless certain conditions are met.
EU Settlement Scheme (EUSS): The scheme underwent several updates, including:
Automatic two-year extension for individuals with pre-settled status.
Automatic conversion of eligible pre-settled-status holders to settled status.
Changes in how late applications to the EUSS are considered.
Shortage Occupation List (SOL): The SOL has been updated to include additional occupations from the construction and fishing industries, which will benefit from lower visa application fees and salary thresholds.
Other Updates
A new “genuineness” requirement for the skilled worker, global business mobility, and scale-up routes.
An extension of the application deadline for the Ukraine Extension Scheme is until May 16, 2024.
Impact and Response
These alterations to the UK immigration regulations carry significant implications for employers. Particularly, changes to student visa rules could affect ongoing graduate recruitment programs. Therefore, an immediate evaluation of these rules is necessary. Employers should consult with immigration counsel to assess the implications of these changes and update their policies accordingly.
🇲🇾 Malaysia Refines Job Advertisement Requirements for Hiring Expatriates
Malaysia’s Social Security Organisation (SOCSO) has rolled out significant modifications to the job advertisement process on the MYFutureJobs portal (MFJ). These updates, coming into effect on 15th June 2023, include the cessation of conditional exemptions for roles with specialised skills and a condensed advertising period, now 14 days.
What This Means for Employers
Advertising jobs on the MFJ portal before hiring expatriates has been a prerequisite for businesses seeking the Employment Pass (EP) for expatriates. The new guidelines, while shortening the advertisement period, have simultaneously eliminated the exemption for positions requiring unique skill sets. Therefore, HR and recruitment teams must stay updated on these changes to plan their expatriate hiring strategies optimally.
Why These Changes
The mandatory advertisement of job vacancies on the MFJ portal, introduced in January 2021, forms part of the Malaysian government’s broader initiative to enhance employment opportunities for local talent. Despite this, the dearth of experienced local talent in certain sectors has necessitated expatriate hiring to bridge the skills gap.
Digging Deeper
Here are the three central changes businesses need to be aware of when planning to hire expatriates:
Advertisement Duration: Businesses must now advertise for at least 14 days, down from the previous 30-day requirement.
Reporting Process: The updated process now permits companies to submit a ‘Hiring Outcome Report’ to SOCSO’s designated email address (papd@perkeso.gov.my) on the eighth day after the job advertisement, facilitating the issuance of a support letter.
Exemptions: The earlier provisions allowing the exemption for specialised or niche skills have been rescinded.
These changes serve as a reminder of the dynamic regulatory environment surrounding employment. Businesses must stay updated on these developments to ensure smooth expatriate hiring processes.
🇬🇧 Changes on the Horizon: New Legislation Impacting Employment in the UK
Several impending legislations will bring forth noteworthy changes to employment practices in the UK, encompassing aspects from redundancy and flexible work arrangements to carer’s leave, neonatal care, and the fight against discrimination at the workplace. Here’s a succinct rundown of these laws:
The Safeguard from Redundancy (Maternity and Family Leave) Act
Scheduled to take effect from July 24, 2023, this Act grants a lifeline to employees at risk of redundancy, providing them the right to suitable job alternatives before redundancy is confirmed. Initially limited to employees on maternity, shared parental, or adoption leave, the Act’s scope has been broadened to protect pregnant employees and those recently back from the leaves described above, as well as those who have experienced a miscarriage. Awaiting precise operational details, expected by April 2024, employers should begin to ponder the potential impacts of these extended protections.
The Employment Relations (Flexible Working) Act
Currently awaiting Royal Assent, this Act proposes several transformative shifts, such as:
Employees are entitled to submit two flexible working requests annually.
Employers are obliged to respond to such requests within two months.
Denial of a request mandates consultation with the employee.
Employees are relieved from explaining the implications of the proposed working arrangement.
However, the Act doesn’t sanction immediate access to flexible working, with employees still requiring 26 weeks of service to submit a request. While not legally mandatory, offering an appeal option if a flexible working request is denied remains recommended.
The Carer’s Leave Act
With around 600 people quitting jobs daily due to the struggle to balance work and unpaid caregiving responsibilities, this Act, likely to be law by April 2024, introduces an annual provision of one week’s unpaid leave for employee caregivers. Leave can be consumed as a single ‘block’ of five days or spread out to suit individual needs. Evidence of how or for whom the leave is used is not required. In anticipation of this law, employers can consider necessary policy adaptations.
The Neonatal Care (Leave and Pay) Act
Enforced in April 2025, this Act grants parents with a newborn in neonatal care up to 12 additional weeks of paid leave, over and above their maternity or paternity leave.
Worker Protection (Amendment of Equality Act 2010) Bill
This Bill heralds significant evolution in the UK’s workplace discrimination law, with fundamental changes including:
Mandating employers to take active steps to prevent sexual harassment at the workplace.
Reviving protection from harassment by third parties, with employers held responsible.
Provide up to a 25% compensation if employers fail to prevent sexual harassment.
In response to this Bill, employers may want to reassess and bolster their existing policies on Bullying and Harassment, fostering a proactive approach to tackling sexual harassment in their organisations.
🇮🇪 Expanding Reporting Duties for Irish Employers – ERR from 2024
In the 2022 Finance Act, Ireland introduced Enhanced Reporting Requirements (ERR) for employers to report specific tax-free benefits provided to employees, known as ‘reportable benefits’. This new mandate is set to kick in on January 1, 2024.
Under the ERR, employers must report tax-exempted ‘small benefits’ such as vouchers or benefits up to a combined value of €1,000 and the daily remote working allowance of €3.20. Additionally, business-related travel and subsistence expense reimbursements fall under this requirement.
Revenue Online Service (ROS) will be the platform of choice for reporting. Employers must submit, correct, and amend ERR data in real-time, before or during employee payment. Employees can view this data through their myAccount from 2024.
This reporting is separate from payroll submissions, intended to protect payroll records’ integrity and avoid accidental creation of new employments for reporting benefits.
To adapt to ERR, employers should start evaluating their existing systems for collating reportable benefits and determine how to integrate current IT systems with Revenue’s online reporting. It’s advisable to review policies on reimbursement of reportable benefits in line with legislation and Revenue guidance.
Remember, this is only Phase I – expect more employee payments and benefits to come within the scope of ERR in the future. Prepare now for a smoother transition when January 2024 arrives.
Employment Law Innovations in Belgium: Strengthening Worker Protections and Toughening Sanctions
In 2023, Belgium’s employment law landscape is set to evolve with many reforms. These are focused on fortifying employment stability, unifying resignation notice periods, and bolstering penalties for non-compliance with social laws. Here are the key details:
Subtitle: “Job Stability for Workers on Successive Temporary Contracts”
Effective from 8th May 2023, Belgium’s Employment Contracts Act of 1978 is adjusted to boost employment stability for individuals on a series of temporary contracts, frequently referred to as “precarious contracts”. Once these contracts surpass two years, the legislation stipulates that conditions typical to a permanent employment contract will take effect. This includes norms associated with a severance payment. For specific exceptions and a deeper understanding, our Belgian employment team is available for guidance.
Uniform Notice Periods Introduced
As of 28th October 2023, blue-collar workers who have been employed since before 1st January 2014 will have a maximum resignation notice period of 13 weeks. The transitional provisions for employees hired before 2014 will be replaced by the standardised notice periods introduced post-2014.
Strengthened Social Penal Code
Belgium is set to revise its Social Penal Code significantly, with increased sanctions for breaches of social legislation, including prison sentences for the most severe infringements. Now, promising a foreigner to work in exchange for payment in Belgium, along with incidents of harassment, sexual harassment, or instances where a worker’s health is endangered, could potentially lead to imprisonment.
Additionally, the practice of ‘social dumping’ – using cheaper labour, for instance, underpaid migrant workers – has been clearly defined and included in the highest level of sanctions. A scientific committee will be formed to aid in the battle against social fraud and dumping. This committee will advise and offer recommendations to shape the inspection services’ strategies and actions.
🇦🇺 Australia Rings in Major Immigration Changes from July 1
The Australian government has recently enacted numerous impactful changes to its immigration policy. These amendments, effective from 1 July 2023, could considerably reshape the landscape for foreign nationals looking to work or live in Australia.
The Implications of Changes
In April 2023, Australian Home Affairs Minister Clare O’Neil announced significant adjustments to the current migration system. These changes aim to facilitate employers in recruiting high-skill overseas workers, provide greater work flexibility for temporary migrants, and retain international students in the country. Consequently, current and prospective visa holders, expatriates, and businesses needing specialized workers may be significantly impacted. Thus, understanding these changes and adhering to the new procedures are essential.
UK Passport Holders: Eased Labor Market Testing
With the enforcement of the Australia-United Kingdom Free Trade Agreement (Australia-U.K. FTA) on 31 May 2023, UK passport holders applying for the Temporary Skill Shortage (TSS) subclass 482 visa are now exempt from the Labour Market Testing (LMT) requirements, paving a smoother path for UK nationals to work in Australia.
Revamped Working Holiday Maker Program for UK Nationals
The Australia-U.K. FTA has also spurred alterations to the Working Holiday Maker (WHM) program and the Youth Mobility Scheme, broadening opportunities for UK nationals. Key amendments include extending the eligible age limit and providing the possibility for multiple Working Holiday visas without specified work prerequisites.
Simplified Australian Citizenship for New Zealand Residents
In a significant step, New Zealand citizens who have resided in Australia for at least four years can now directly apply for Australian citizenship, bypassing the need for a permanent visa first. This change mainly benefits New Zealand citizens with a Special Category Visa (SCV) (subclass 444).
Adjustments in Temporary Skilled Migration Income Threshold (TSMIT) and Visa Filing Fees
Effective 1 July 2023, the TSMIT has increased, and numerous visa application charges (VACs) have also risen. These modifications may affect the cost calculations for individuals and businesses alike, with specific visa fees witnessing significant hikes beyond the consumer price index (CPI).
Elevated Superannuation Guarantee Payments
The Superannuation Guarantee (SG), which mandates employers to contribute a percentage of an employee’s earnings to a retirement fund, has increased from 10.5% to 11% from 1 July 2023. This development impacts subclass 482 visa holders and may add to the cost of international assignments.
Visa Condition Changes for Student Visa Holders and Working Holiday Makers
From 1 July 2023, there have been adjustments to work rights for student visa holders and Working Holiday Makers, primarily in terms of permissible work hours each fortnight. Notably, student visa holders engaged in the ‘aged care’ sector are granted unlimited work rights until 31 December 2023.
Australia’s immigration reform marks a crucial development with potentially far-reaching consequences for individuals and businesses. It further highlights Australia’s dedication to building an environment conducive to attracting and retaining foreign talent.
Harness the Power of the Global Payroll Calculator
Navigating the intricacies of global employment has never been more streamlined, thanks to our Global Payroll Calculator. This essential tool has been designed to optimize global employment operations and guide strategic decision-making on talent acquisition strategy. Here’s a glimpse at the remarkable benefits it brings to the table:
Discover Ideal Talent Pools
Identify the most promising markets for recruiting your global workforce. Global Payroll Calculator tool helps you spot the countries offering the best conditions for your operations.
Easy Cross-country Comparison
Compare employment conditions across a whopping 190 countries effortlessly. With such limitless comparisons at your disposal, making informed decisions becomes as easy as a click.
Stay Compliant with Confidence
With our tool’s detailed tax and compliance data for each country, ensure your operations always stay within the boundaries of the tax and labour law.
Optimize Your Costs
Spot jurisdictions with the best tax rates and social contributions to optimize employment costs. Global Payroll Calculator makes identifying such opportunities straightforward and efficient.
Plan Your Global Payroll Accurately
Utilize the Global Payroll Calculator to craft detailed payroll projections. We enable better strategic global payroll planning and budgeting by offering insights into potential financial commitments.
Spot Employment Patterns
Identify cross-jurisdictional employment patterns and costs that can guide your company’s strategic decisions. The Global Payroll Calculator makes spotting these trends simple and efficient.
Explore the world of global employment with our Global Payroll Calculator and equip your business with the insights it needs to thrive in the international arena.
Nick Ganzha, the visionary founder and CEO of Express Global Employment, a leading global Employer of Record (EOR) and Professional Employer Organization (PEO) covering 190 countries, has been nominated for the prestigious “TOP 100 USA Entrepreneurs with Ukrainian origins” Award. The award ceremony will take place at Cipriani 25, Broadway, Manhattan, New York, USA, and promises to be an exceptional gathering of successful Ukrainian entrepreneurs who have significantly impacted the business landscape in Ukraine and globally.
The “TOP 100 USA Entrepreneurs with Ukrainian Origins” Award celebrates the achievements and contributions of outstanding Ukrainian entrepreneurs who have positively and significantly impacted the business world, both within Ukraine and internationally.
Among the well-deserving nominees, Nick Ganzha stands out for his exceptional accomplishments in transforming Express Global Employment into a leading global employment solutions provider.
Nick Ganzha’s entrepreneurial journey began in 2001 when he founded a Ukrainian staffing and recruitment agency. His expertise and experience gained from working at prominent firms like PricewaterhouseCoopers and Accenture allowed him to pioneer staff outsourcing projects in Ukraine. As a result, he successfully won over clients like Procter & Gamble, setting the foundation for what would eventually become Express Global Employment.
Over the years, Nick’s company has evolved into a powerhouse offering global employment solutions, allowing businesses of all sizes and industries to operate and expand internationally quickly and compliantly. Express Global Employment’s world-class services and solutions, including the innovative Global Payroll Calculator, have earned them recognition and accolades, such as the prestigious GPA Award for Payroll Innovation in 2022.
Nick Ganzha is actively supporting Ukraine in its fight against full-scale russian aggression through significant donations, driven by his deep patriotism, dedication to his homeland, and desire for his country to overcome the russian aggressor. Nick has donated over $200,000 and will continue to donate until Victory is achieved.
His actions have inspired and mobilized the entire Express Global Employment team to join the collective effort. Under Nick’s leadership, Express Global Employment has actively supported various charitable initiatives to help Ukraine. They demonstrate their humanitarian commitment to assisting Ukraine in its fight for peace and sovereignty.
As the guests of the TOP 100 USA Entrepreneurs with Ukrainian Origins Ceremony prepare to honour the nominees that will take place on July 22, 2023, it is a moment of pride for the Ukrainian community and a testament to the resilience of entrepreneurs with Ukrainian roots. This recognition inspires countless aspiring entrepreneurs, exemplifying the boundless opportunities the American and global market offers those with a determined spirit and a vision for success. In celebrating the achievements of Ukrainian entrepreneurs, the USA also celebrates the spirit of entrepreneurship and the enduring strength of the Ukrainian people, who continue to shine on the global stage.
Express Global Employment Provides Crucial Talent Retention Support for Ukrainian and Multinational Employers
Since the start of the full-scale russian invasion of Ukraine on February 24, 2022, Express Global Employment has been at the forefront of assisting both Ukrainian and international companies in retaining vital talent that was compelled to leave the country.
Leveraging its robust global employment solutions, the company enables its clients to employ and payroll their displaced employees abroad quickly, legally, and compliantly, all without the necessity of establishing foreign legal entities.
This strategic approach helps prevent critical talent loss and ensures business continuity while avoiding potential project disruptions. Express Global Employment’s timely and effective support has become an invaluable asset for companies, mitigating challenges during the ongoing war and workforce displacement, empowering them to retain skilled individuals essential to their operations.
About Express Global Employment
Express Global Employment (formerly Acumen International) is a leading global Employer of Record (EOR) and Professional Employer Organization (PEO) operating in 190 countries. Their innovative solutions empower businesses of all sizes to hire and operate worldwide without the need for establishing foreign legal entities.
With Express Global Employment’s comprehensive services, companies of all sizes gain access to an unparalleled international workforce, tapping into a pool of top-tier talent without the burden of complex legal and administrative complexities. This innovative approach empowers organizations to scale and expand their operations seamlessly, maintaining compliance with local regulations, tax laws, and employment standards in each respective country.
Through its widespread network and deep expertise in global workforce management, Express Global Employment has earned a stellar reputation as a trusted partner for businesses looking to navigate the complexities of international expansion quickly and cost-effectively.
About TOP USA Awards
TOP USA Awards Inc. is set to embark on an exciting new project showcasing the entrepreneurial success of Ukrainians in the USA. This initiative aims to spotlight the significant number of Ukrainians who have fearlessly launched their businesses in the American market. By highlighting these success stories, the project seeks to demonstrate the vast opportunities available in the USA for individuals from diverse backgrounds. Through this endeavour, TOP USA Awards Inc. aims to inspire and motivate aspiring entrepreneurs worldwide, showcasing the boundless potential and possibilities the American market offers.
50% of the ticket sales proceeds from the TOP 100 USA Entrepreneurs with Ukrainian Origins Award Ceremony will be donated to the CashForRefugees fund.
About Cash for Refugees (CFR) Fund
Amidst the ongoing full-scale Russian invasion of Ukraine, the Cash for Refugees (CFR) Fund has emerged as a lifeline for those affected by the war. With a steadfast dedication to providing direct assistance, CFR has successfully supported over 15,500 families in Ukraine. What sets CFR apart is its unique approach, where dedicated volunteers conduct in-person interviews and facilitate direct connections between donors and recipients, bypassing middlemen on the ground. With a focus on ensuring immediate impact, CFR provides one-time grants, with a baseline amount of $150, to women with young children and the elderly.
Mainly, CFR focuses on reaching small distant villages in the de-occupied territories, where larger humanitarian organizations may be absent, ensuring that vulnerable populations, such as families with young children and seniors aged 65 and older, receive the much-needed support. Cash for Refugees stands tall in the face of adversity, delivering essential aid to those most in need and providing hope during these challenging times.
We’re thrilled to announce that Acumen International, a global leader in Employer of Record solutions, will participate in the prestigious LEAP HR: Life Sciences East Conference. The event will take place in Boston, USA, from July 18th-20th, 2023. Now in its 8th year, the conference will bring together over 200 senior HR leaders from the… Read more Acumen International Joins Industry Innovators at LEAP HR: Life Sciences East Conference
We’re thrilled to announce that Acumen International, a global leader in Employer of Record solutions, will participate in the prestigious LEAP HR: Life Sciences East Conference. The event will take place in Boston, USA, from July 18th-20th, 2023.
Now in its 8th year, the conference will bring together over 200 senior HR leaders from the life sciences industry to share innovative solutions to the biggest challenges in their domains. These insights will provide an invaluable look into the future of work in the life sciences industry, revealing how organisations are breaking away from traditional HR thinking. These transformative approaches inspire the talent needed to drive their business-critical mission of delivering better drugs and devices to patients faster.
Insightful Agenda and Future of Work
During the three-day event, diverse biotech and pharma organizations will share over 35 case studies that reveal their breakthrough solutions to tackle some of the industry’s toughest challenges. These insights provide an invaluable look into the future of work in the life sciences industry, showcasing how organizations are breaking away from traditional HR thinking. By adopting these transformative approaches, companies inspire and attract the talent needed to support their mission of delivering improved medical products to patients more efficiently.
Express Global Employment: Future-Focused Vision
The LEAP HR: Life Sciences East Conference is not just a platform for discussing HR; it’s an opportunity to shape the future of HR practices in the life sciences industry. HR leaders and professionals understand the significance of staying ahead of the curve in the fast-paced and competitive life sciences domain. By participating in the event, Acumen International aims to play an active role in contributing to the industry’s growth and inspiring other businesses to embrace transformative HR approaches.
Representing Express Global Employment at the LEAP HR: Life Sciences East Conference are Natalie Oprya, Managing Director, and Iryna Oprya, Media Head. They are eager to contribute to discussions, engage with thought leaders, and share Express Global Employment’s future-focused approaches to global talent engagement and retention. With a dedication to assisting organizations in attracting and retaining the best global talent, Express Global Employment aims to align its Employer of Record services with the evolving HR paradigms in the dynamic life sciences industry.
“The LEAP HR conference is a significant event in the life sciences HR calendar. At the LEAP HR conference, we are not just talking about HR – we’re shaping its future. It’s an experience that truly broadens our thinking,” said Natalie Oprya, Managing Director at Express Global Employment. “In these dynamic times, our dedication to assist organizations in attracting and retaining the best of global talent remains steadfast. This conference represents a pivotal opportunity to explore how our Global Employer of Record services can align with these evolving HR paradigms.”
Follow Express Global Employment’s Journey on LinkedIn
For those interested in Express Global Employment’s key takeaways, insights, and inspirations from the LEAP HR: Life Sciences East Conference, the company invites you to follow their journey on LinkedIn. By sharing valuable learnings and experiences from the event, we aim to contribute to a stronger, more engaged global workforce. We hope to inspire other organizations to drive innovation and excellence in global talent management within the life sciences industry.
Welcome to the June Edition of the Global Employment Tax Compliance Newsletter. At Acumen International, we pride ourselves on being your trusted partner, providing comprehensive solutions to simplify your global employment operations. We are dedicated to helping you navigate the complex world of employment tax compliance and immigration regulations, allowing you to focus on what… Read more Global Employment Tax and Compliance Newsletter. June 2023
Welcome to the June Edition of the Global Employment Tax Compliance Newsletter.
At Acumen International, we pride ourselves on being your trusted partner, providing comprehensive solutions to simplify your global employment operations. We are dedicated to helping you navigate the complex world of employment tax compliance and immigration regulations, allowing you to focus on what truly matters – driving success in your global endeavours.
In this edition, we bring you a wealth of expert insights and professional advice tailored to our clients, partners, accountants, global payroll and tax professionals, employment compliance and global mobility experts.
As the world adapts to new challenges, we understand the critical role immigration plays in global workforce management. Our newsletter also features expert advice and tips to ensure smooth immigration processes for your international employees.
We invite you to delve into this edition of our newsletter, where knowledge meets excellence. Stay informed, stay compliant, and stay ahead of the curve with Acumen International.
European Council Council Advances on Platform Workers’ Rights: Negotiations Set to Begin
The European Council has unanimously agreed on its position. It is poised to negotiate with the European Parliament to establish a groundbreaking law extending employment rights to millions of gig workers.
The platform economy has experienced a phenomenal surge in recent years, with revenues soaring from an estimated €3 billion to approximately €14 billion between 2016 and 2020. Projections indicate that platform workers will reach 43 million by 2025.
While digital platforms have yielded benefits for businesses and consumers alike, they have created a grey area regarding employment status for many platform workers. The European Commission estimates that around 5.5 million individuals currently classified as self-employed are, in reality, engaged in de facto employment relationships with digital platforms, entitling them to the same labour and social rights granted to traditional employees under EU law.
Most of the EU’s 28 million platform workers, such as taxi, domestic, and food delivery drivers, are officially classified as self-employed. However, many are subject to the same regulations and constraints as traditional employees, indicating an implicit employment relationship that warrants the labour rights and social protections guaranteed by national and EU laws.
The European Council’s primary objective is to rectify misclassification instances and streamline reclassifying these workers as employees. Under the Council’s general approach, a digital platform will be legally presumed to employ workers (instead of considering them self-employed) if their association with the platform meets at least three out of seven specified criteria.
These criteria include 1) income limitations, 2) work refusal restrictions, and 3) regulations governing appearance or behaviour. In cases where the legal presumption applies, digital platforms will bear the onus of proving, in accordance with national law and practices, that no employment relationship exists.
The proposed directive introduces two crucial enhancements: accurately determining the employment status of individuals engaged in platform work and establishing pioneering EU guidelines for using artificial intelligence in the workplace.
Furthermore, the directive addresses concerns regarding transparency by mandating that workers be informed about the implementation of automated monitoring and decision-making systems. These systems must be supervised by qualified personnel safeguarded against discriminatory treatment, and account suspensions will require human oversight.
Albania Implements Sweeping Changes to Income Tax: Impacts on Corporate, Individual, and Withholding Tax
Albania’s new income tax law, Law No. 29/2023, was published on May 2, 2023, and will take effect on January 1, 2024, replacing the current law from 1998. This new law introduces significant changes to corporate income tax, individual income tax, and withholding tax, including a broader definition of tax residence, stricter requirements for the dividend participation exemption, extended limitations on interest deductibility, specific provisions for long-term contracts, the introduction of an exit tax, and more.
Here are some key changes to Individual Income Tax under the new law.
The new law defines tax residence based on whether an entity is established in Albania or has its place of effective management and control in the country during the tax period. The criteria for management and control in Albania include decision-making, board membership or directors’ residency, and ownership by Albanian residents. In contrast, the current law only considers entities resident in Albania if they have their head office or place of effective management in the country.
2. A revised tax rates system for employment income is introduced, with a top marginal rate of 23%.
3. Controlled foreign company (CFC) rules are introduced, which will subject the income of CFCs to IIT (Individual Income Tax) in Albania, even if the income is not distributed to the Albanian resident shareholder.
4. Employers will withhold the tax on a monthly basis and remit it to the tax authorities by the 20th day of the following month for entities or by the 20th day of each three-month reporting period for self-employed individuals.
5. To facilitate this process, a new form called the “statement on personal status” will be introduced, requiring signatures from both the employer and employee. The employer indicated on the form will calculate the tax due on employment income and deduct 1/12th of the relevant personal allowance from the monthly tax base based on the annual income level. In cases where an employee holds multiple employments, the second employer will apply the progressive tax rates without deducting any personal allowances.
During the transitional period between June 1, 2023, and December 31, 2023, progressive tax rates will apply to employment income. These rates are as follows:
Income earned by self-employed individuals engaged in professional activities will be classified as employment income. These conditions are:
At least 80% of the total income generated is obtained directly or indirectly from a single customer.
At least 90% of the total income generated is derived directly or indirectly from no more than two customers.
However, it is important to note that if the professional services are exclusively provided to nonresident clients, the income generated will be treated as business income, regardless of the abovementioned conditions.
Bulgaria Introduces New Minimum Wage Regulations: Implications for Employers
New regulations on the minimum wage in Bulgaria have been established. The Council of Ministers determines the national minimum salary for each calendar year. By September 1, 2023, the national minimum salary for the upcoming calendar year will be determined.
It will be set at a level equivalent to 50% of the average gross wage over 12 months, considering the last two quarters of the previous year and the first two quarters of the current year. It is crucial to note that the national minimum salary cannot be lower than the rate set for the previous year.
Employers and payroll professionals should be aware of the potential economic impacts of the minimum wage increase. Additionally, they may need to adjust standard employment documents referencing the minimum wage to align with the new regulations.
Czech Republic: Changes to Czech Labour Code: Simplifying Remote Work Agreements and Cost Reimbursement
The Czech parliament is currently discussing a draft amendment to the Labour Code, which the Czech government has approved. The amendment introduces changes related to remote work, including the requirement for written agreements addressing remote work and reimbursement for remote work costs. The bill has undergone significant modifications since its initial publication last autumn. The final wording of the amendment will be determined after the legislative process is completed, and the bill is expected to come into effect in September 2023.
The revised rules for working from home are highly advantageous for employers. The revised rules make mandatory remote working agreements simpler than the original draft and reduce the obligation for employers to reimburse employees for costs associated with working from home. Additionally, employers can now agree with employees not to reimburse these costs, which helps reduce administrative burdens.
Mandatory remote work agreements are expected to be simplified compared to the original draft. The employer’s obligation to accommodate employees caring for children to work from home has been significantly alleviated.
Regarding the entitlement to work from home, employees caring for children under 15 or other dependents and pregnant employees no longer have an automatic right to work from home. Instead, they have the right to apply for remote work, and employers must provide written reasons for refusing their request. The age limit for children cared for by employees has been lowered to children under nine years old.
Under the draft amendment, written agreements for remote work will still be required, but the extensive list of mandatory conditions has been reduced. The agreement should cover communication, work assignments and monitoring, cost reimbursement, and occupational health and safety rules, as Czech law currently lacks regulations for remote workers.
Reimbursing employees’ costs related to working from home has been a contentious issue. The amendment now provides three options: reimbursement of actual costs, provision of a lump sum for increased energy costs determined by a Ministry of Labour decree, or an agreement that limits or excludes cost reimbursement. This change is positive for employers, as it addresses administrative and financial burdens associated with remote work.
Slovakia – New Bilateral Agreement with Austria on Tele-Work and Social Security
Slovakia and Austria have signed a bilateral agreement on telework and social security that allows teleworkers to work up to 40% of their total employment from their home country while maintaining social security coverage in their employer’s country.
The Framework Agreement, signed by the Ministries of Labour in both countries, came into force on June 1, 2023. This agreement addresses the challenges faced by cross-border workers and provides clarity on social security liabilities. It applies to Slovakia and Austria, with specific conditions and requirements. Employers and teleworking employees must stay updated on applicable social security laws and consult professional tax advisers for guidance.
The Framework Agreement specifically applies to Slovakia and Austria, with the employer’s registered office in one country and the employee’s residence in the other. It defines “habitual cross-border telework” as regular employment carried out by the employee in both the employer’s country and their country of residence, using information technology to fulfil assigned tasks. Additional employment or self-employment activities are not permitted, and no third-country element should be involved.
Similar framework agreements have been signed between Austria and the Czech Republic, Austria and Germany.
Uzbekistan Joins OECD/G20 Framework to Combat Tax Evasion and Address Digital Economy Tax Challenges
Uzbekistan has recently joined the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS), demonstrating its commitment to fight against tax evasion and address the tax challenges posed by the digital economy. As a member, Uzbekistan will collaborate with other nations on an equal footing to implement the comprehensive BEPS package, comprising 15 measures to curb tax avoidance and promote tax transparency.
Participating in the two-pillar plan, Uzbekistan will contribute to achieving a fairer distribution of taxing rights for multinational enterprises under Pillar One. This will entail allocating taxing rights on an estimated annual profit of USD 200 billion to market jurisdictions. Implementing Pillar One is expected to yield global tax revenue gains ranging from USD 13-36 billion annually, with developing countries benefiting more than advanced economies.
Pillar Two introduces a global minimum corporate tax rate of 15% for companies with revenue surpassing EUR 750 million. This measure is projected to generate approximately USD 220 billion in annual global revenue gains, equivalent to around 9% of global corporate income tax revenues. Beyond financial benefits, Pillar Two aims to enhance tax stability and certainty for taxpayers and tax administrations.
Sweden – New Work-Permit Application Process
Sweden is revamping its work permit certification scheme with a new process prioritising applications into four categories. This initiative aims to streamline and expedite the processing of work permits, particularly for highly-skilled workers from outside the European Union. The new system replaces the existing certification scheme and introduces specific criteria for each category. Let’s take a closer look at the four priority categories:
The Swedish Migration Agency is actively implementing this new process and establishing new entities within the authority. They are expected to report back to the government by 4 September 2023, with the changes set to become operational by the end of the year. This revamped system aims to enhance efficiency and flexibility, enabling businesses to meet their labour needs more effectively and attract highly qualified talent outside the European Union.
The Impact of the German Whistleblower Protection Act on UK-Based Companies Operating in Germany
The German Whistleblower Protection Act, also known as “Hinweisgeberschutzgesetz” or “HinSchG,” came into effect on 2nd July 2023. This act implements the requirements of the EU Whistleblower Directive (Directive (EU) 2019/1937) and introduces mandatory regulations for whistleblower protection in companies with a minimum of 50 employees.
German companies with at least 250 employees and German subsidiaries of internationally active groups are now required to implement internal reporting systems and channels for reporting whistleblowing or breaches. Companies must act promptly and thoughtfully to ensure compliance, as penalties for non-compliance will be enforced starting from 1st December 2023.
Smaller companies have additional time to comply with the act. Companies with 50 to 249 employees are not obligated to adhere to the requirements until 17th December 2023.
Denmark: Transparent and Predictable Working Conditions
New legislation has been enacted to implement the EU Directive on transparent and predictable working conditions for employees, leading to important modifications in employment practices in Denmark. This legislation expands the scope of employee classification, adjusts the timeframe for providing written information, enhances the disclosure requirements for working conditions, and establishes new minimum standards.
Noteworthy updates include:
Granting employees the right to pursue additional employment unless the employer can provide valid justifications for prohibiting it.
Allowing employees to request alternative types of employment and receive written explanations for the employer’s decision.
Introducing regulations for training during employment.
Ensuring employees receive information about guaranteed working hours when their schedules are unpredictable.
These changes became effective on July 1, 2023. Employers should proactively comply with the new rules by reviewing employment agreements, policies, and procedures. Existing employees employed before July 1, 2023, have the right to request updated employment agreements or additional documentation in line with the new requirements, and employers must respond within eight weeks.
Failure to comply with the legislation may result in compensation payments. The compensation amounts will align with those outlined in the Danish Contracts Act, typically ranging from DKK 5,000 to DKK 10,000. In aggravating circumstances, compensation may reach up to 20 weeks’ salary, while breaches deemed excusable and of minimal significance are subject to a maximum compensation limit of DKK 1,000.
Ensuring Compliance: Saudization Mandate for Sales Professions in Saudi Arabia
A new Ministerial Resolution has been issued in Saudi Arabia, imposing localization requirements on sales positions within establishments. Effective 24th December 2023, the resolution mandates that sales positions in establishments with five or more workers must be localized to 15%. This means that Saudi nationals must fill a certain percentage of these positions.
The resolution applies to specific sales roles, including sales managers, internal sales and customer services directors, and patent specialists. Employers operating in Saudi Arabia are advised to carefully review the requirements outlined in the resolution and take the necessary steps to comply with the localization obligations.
Failure to adhere to the localization requirements can result in financial penalties and potential restrictions on work license renewals. To mitigate these risks, employers should promptly adjust their employment practices to meet the localization quota and ensure continued compliance with Saudi Arabian labour law.
It is crucial for affected employers to familiarize themselves with the details of the resolution and make the required adjustments to their workforce composition. By doing so, they can ensure smooth operations within the Kingdom and maintain a positive relationship with the local authorities.
Lithuania’s National Visa Procedure Overhaul: Key Updates from July 2023
Effective July 1, 2023, Lithuania has implemented changes to issuing national visas. The Migration Department will now handle this procedure, and all applications must be submitted through the Lithuanian Migration Information System (MIGRIS). However, certain categories of foreign nationals will no longer be eligible to apply for a national visa.
The significance of these changes lies in simplifying the application process for national visas, which will resemble that of a residence permit. The new amendments eliminate the issuance of national visas based on work, with the exception of seasonal work, as well as other grounds that duplicate the reasons for granting a temporary residence permit in Lithuania.
What has changed is that from July 1, 2023, foreign nationals not in Lithuania will be required to apply for national visas through an external service provider designated by the Migration Department. Previously, such applications were accepted by Lithuanian diplomatic missions, consular offices, or visa centres abroad chosen by the Ministry of Foreign Affairs.
A new legal act, “Description of the Procedure for Issuing a National Visa” will be enacted on July 1, 2023. This law will outline the process for submitting documents, providing consultations, issuing or refusing national visas, and cancelling and revoking them.
Starting from July 1, 2023, all applications for national visas must be submitted through the Lithuanian Migration Information System (MIGRIS) via the website. The option to fill out applications through the Electronic Application Module (EPM) will no longer be available.
The grounds for granting national visas will also change. According to the Migration Department, as of July 1, 2023, national visas will no longer be issued to the following individuals:
Full-time students intending to study at higher education institutions registered and operating in Lithuania.
Teachers and researchers coming to work in higher education institutions under employment contracts.
Foreign nationals coming to work in professions listed as “missing professions.”
Foreign national employees who possess a work permit issued by the Employment Service.
Citizens of Australia, the United Kingdom, the United States, New Zealand, South Korea, and Canada who previously obtained national visas through a simplified process.
Foreign nationals who have applied to obtain or change an EU citizen’s residence permit or a family member card.
Foreign nationals for whom the Migration Department has decided to issue a residence permit or a family member card of an EU citizen.
To legally enter and stay in Lithuania, foreign nationals falling under these categories will need to apply for a temporary residence permit instead of a national visa.
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Wrap Up
We hope the information shared will help you make informed decisions and stay compliant across multiple jurisdictions.
At Acumen International, we remain committed to providing unparalleled support as your trusted Global Employer of Record partner. As you continue your journey in managing a global workforce, we encourage you to stay connected with Acumen International for ongoing updates, industry news, and expert guidance.
Thank you for being a part of our valued network of clients, partners, and professionals. We look forward to serving you in the future and wish you continued success in all your global endeavours.
The recruitment landscape has undergone a profound transformation in the era of globalisation, with businesses seeking top-tier talent across borders. As a result, specialised recruitment services have emerged as a crucial necessity in sourcing and acquiring exceptional candidates worldwide. In this article, we delve into the advantages and augmentation that Global Employer of Record (EOR)… Read more Augmentation of Global Recruitment Service Providers by Global Employer of Record
The recruitment landscape has undergone a profound transformation in the era of globalisation, with businesses seeking top-tier talent across borders. As a result, specialised recruitment services have emerged as a crucial necessity in sourcing and acquiring exceptional candidates worldwide.
In this article, we delve into the advantages and augmentation that Global Employer of Record (EOR) can offer to global recruitment service providers. Simultaneously, we address these providers’ persistent challenges in the ever-evolving global talent market. By understanding the advantages of leveraging Global EOR services, recruitment professionals can optimise their operations, expand their reach, and offer clients a seamless and compliant global recruitment experience.
Addressing 11 Recruitment Challenges in a Competitive Talent Landscape
In the fast-paced and competitive global talent market, global recruitment service providers face many challenges as they strive to meet the diverse needs of their clients ― employers running international operations across multiple locations. These challenges encompass various aspects of the recruitment process, from sourcing and attracting candidates to ensuring a positive candidate experience and streamlining hiring operations.
We will examine each challenge in detail, exploring the underlying issues, potential impacts, and the importance of addressing these challenges for the success of recruitment service providers. By understanding and analysing these challenges, recruitment professionals can gain valuable insights into the complexities of the global talent landscape, overcome these hurdles and optimise their recruitment efforts.
Precision in Talent Acquisition: Attracting the Perfect Fit Candidates
One of the primary challenges for recruitment service providers is attracting highly qualified candidates who align with their clients’ specific requirements. Attracting suitable candidates is a perennial challenge in talent acquisition. Recruitment service providers face the task of developing targeted sourcing strategies, crafting compelling job advertisements, and utilising various channels to reach potential candidates. In a competitive talent market, standing out and effectively attracting top talent requires innovative approaches and an in-depth understanding of candidate preferences and motivations.
Engaging Qualified Candidates
Engaging qualified candidates goes beyond simply attracting their initial interest. To maintain candidate engagement, global recruitment service providers must foster meaningful interactions throughout the recruitment journey. This includes effective communication, timely feedback, and personalised attention to candidates’ needs and aspirations. Engaging candidates requires building relationships, highlighting the value proposition of the role and the organisation, and addressing their concerns to keep them invested in the opportunity.
Hiring Fast
Hiring swiftly is a critical challenge for recruitment service providers. In today’s fast-paced business environment, delays in the hiring process can result in the loss of highly qualified candidates to competitors. Achieving an expedited recruitment timeline necessitates streamlining internal processes, efficient stakeholder coordination, and leveraging technology to automate candidate screening and evaluation tasks. By minimising bottlenecks and ensuring a well-structured hiring process, recruitment service providers can secure top talent before they explore other opportunities.
Maintaining a Strong Employer Brand through Recruitment Companies
A strong employer brand attracts the best candidates and fosters long-term retention. Values like respect, generosity, and flexibility are fundamental in today’s competitive talent market, where candidates extensively research organisations to find the right fit. Global recruitment service providers assist clients in crafting a compelling employer brand that aligns with these values, serving as an intelligent recruitment strategy.
Collaborating closely with clients, recruitment service providers shape and promote an appealing employer brand that resonates with candidates seeking a supportive work environment. They showcase clients’ positive attributes, unique strengths, and differentiation. By effectively conveying the employer brand, recruitment agencies attract qualified candidates who align with the organisation’s values, establishing it as an employer of choice in the talent market.
Crafting Compelling Employer Value Propositions: Remote Work Flexibility and Employee Benefits
In a competitive talent market, recruitment providers must emphasise remote work flexibility and a comprehensive range of employee benefits in their employer value proposition. Remote work options attract candidates seeking work-life balance while showcasing statutory and voluntary benefits demonstrates the organisation’s commitment to employee well-being. By integrating these crucial elements into the employer value propositions, recruitment agencies position their clients as enticing employers, captivating and retaining exceptional candidates in the fiercely competitive talent landscape.
Talent Mapping for Efficiency: Maximizing Recruitment and Tax Planning
In the global talent market, recruitment service providers are challenged to obtain accurate talent location insights. Understanding the geographic distribution of talent and the total cost of hire is crucial for effective sourcing strategies and empowering tax, payroll, and compensation planning for local and foreign talent hiring.
Global recruitment agencies gather data on regional talent pools, job market dynamics, and payroll and tax considerations to address this challenge. This information guides strategic decision-making, ensuring compliance and optimising talent acquisition efforts. By integrating talent location insights with tax and payroll planning, providers offer valuable guidance to clients, facilitating informed decisions and efficient management of human resources across jurisdictions.
Utilising Data and Analytics
Data and analytics have become invaluable tools in talent acquisition. Recruitment agencies can leverage data to gain insights into candidate preferences, job market trends, and the effectiveness of their attraction strategies. By harnessing these insights, service providers can make data-driven decisions, refine their approaches, and continuously improve their candidate attraction efforts.
Diversification of Recruiting Strategies to Meet the Needs of Global Employers
As global employers expand their operations across borders, they encounter unique challenges in sourcing and attracting talent in different regions and markets. To effectively meet the needs of global employers, recruitment service providers must adapt strategies to cater to different regions, cultures, and talent pools.
Beyond legal obligations, unbiased hiring practices yield business advantages by selecting the most qualified candidates free from prejudiced assumptions. This cultivates an inclusive work environment, exemplifying meritocracy and harnessing the positive impacts of diversity.
Global employers require diversified recruiting strategies to attract talent across multiple locations and diverse markets. Recruitment service providers This involves understanding local labour markets, cultural nuances, tax, immigration, and legal requirements.
Navigating Complex and Evolving Global Employment Laws to Achieve Compliance
Global recruitment agencies face the challenge of navigating intricate and ever-changing employment laws across different countries and regions. Each jurisdiction has its own set of regulations governing various aspects of employment, such as hiring practices, employment contracts, working hours, and termination procedures.
By implementing diversified global recruiting strategies, recruitment agencies help global employers overcome the challenges of operating in diverse markets. Their expertise in local labour dynamics, cultural understanding, and compliance ensures that clients can attract, engage, and hire the right talent in each target market. Through tailored approaches and strategic partnerships, providers maximise their clients’ ability to achieve their global talent acquisition goals and gain a competitive edge in international markets.
Recruiters must stay abreast of legal, tax, immigration, and other employment-related regulatory compliance requirements to ensure compliance and mitigate legal risks for themselves and their clients.
Recruitment agencies must collaborate closely with legal experts to ensure compliance and mitigate risks associated with international recruitment. This collaboration allows them to navigate the intricacies of each market’s legal landscape, ensuring a smooth and legally sound hiring process while safeguarding against potential pitfalls. By prioritising compliance, recruitment agencies can confidently expand their global talent acquisition efforts and deliver exceptional recruitment solutions to their clients.
Talent Scarcity and Skill Gaps in Global Talent Acquisition: Tapping into Global Talent Pools
In global talent acquisition, recruitment service providers face the dual challenges of talent scarcity and skill gaps. Recruiters must adopt proactive measures and strategic approaches to overcome these obstacles, including tapping into global talent pools.
Monitoring trends and implementing targeted sourcing strategies allow recruitment agencies to address talent scarcity and skill gaps by identifying emerging talent pools, niche skill sets, and in-demand expertise. This enables them to engage with potential candidates and establish talent pipelines aligning with clients’ requirements.
Understanding international labour markets, cultural nuances, and legal requirements is also crucial for global talent acquisition success. Recruitment service providers conduct thorough research, leverage local networks, and collaborate with global employment service providers to navigate complex employment laws and compliance obligations.
By consolidating their expertise in talent scarcity and skill gaps with a proactive approach to tapping into global talent pools, recruitment service providers bridge the divide between client demands and the available talent pool. This strategic approach enables them to deliver tailored solutions, attract top talent, and achieve successful outcomes in the global talent landscape.
Balancing Cost-effectiveness and Quality of Recruitment Services
Global recruitment agencies strive to balance cost-effectiveness and the delivery of high-quality recruitment services. They face the challenge of optimising their operational efficiency while not compromising on the quality of talent acquisition. This involves managing resources effectively, leveraging technology and automation where applicable, streamlining processes, and continually evaluating the efficacy of their recruitment methods. Recruitment agencies must also stay competitive in pricing and service offerings to attract and retain clients.
Transforming Global Talent Acquisition: The Strategic Alliance of Global EOR and Recruitment Experts
Within the ever-changing talent ecosystem, global recruitment agencies face many challenges. However, recruiters can effectively tackle and overcome these hurdles by collaborating with Global Employer of Record (Global EOR) services.
Collaborating with a Global Employer of Record (EOR) empowers recruitment service providers with various benefits, transforming their operations and amplifying their success in the global talent market.
In the following sections, we will delve into the benefits and augmentation that global employment service providers bring to global recruitment service providers and the challenges these providers face in the current global talent market.
Accelerated Market Entry and Streamlined Hiring Process
Expanding into new markets requires significant time, resources, and knowledge of local business practices. Leveraging the infrastructure and legal entities provided by Global EORs, recruitment service providers can help expedite market entry for their clients.
Partnering with a Global Employer of Record provides recruitment agency clients access to established legal entities and infrastructure in multiple jurisdictions. This streamlines global expansion, simplifies administrative operations, and ensures employment laws and tax regulations compliance. It empowers clients to focus on their core business while leveraging the expertise and support of a Global EOR for efficient and compliant international employment.
Through this streamlined approach, recruitment agencies can enhance operational efficiency, accelerate time-to-hire, and deliver exceptional recruitment services to clients. By leveraging the infrastructure and expertise of a Global Employer of Record, recruiters can achieve a competitive edge in the talent market and establish themselves as trusted partners in the recruitment process. This allows recruitment agencies to seize opportunities promptly, tap into local talent pools, and expand their clients’ global footprint with agility.
Compliance Expertise: Leveraging Global Employer of Record (Global EOR) Services
When it comes to global recruitment, compliance with labour laws, tax regulations, and immigration requirements is paramount for end employers operating in the global arena. Global Employer of Record (Global EOR) services specialise in navigating compliance’s complex and ever-evolving landscape.
By partnering with a Global EOR, recruitment agencies can provide their clients access to a wealth of compliance expertise. Global EORs deeply understand local labour regulations, including hiring practices, employment contracts, working hours, and termination procedures. They stay up-to-date with the latest changes in labour laws, ensuring that recruitment activities remain compliant in each jurisdiction.
In addition to labour laws, Global EORs also possess comprehensive knowledge of tax regulations and reporting obligations. They understand the intricacies of payroll processing, tax deductions, and compliance with local tax authorities. By handling these responsibilities, Global EORs reduce the burden on recruitment agencies and ensure that their clients remain compliant in their global operations.
Global EORs are well-versed in immigration processes, including work permit requirements and visa procedures. They can provide guidance on securing the necessary documentation for international candidates, ensuring a smooth and compliant immigration process for end employers.
Recruitment agencies can rely on Global EORs to support their clients in meeting their compliance obligations while focusing on delivering exceptional recruitment services.
Global Employment Risk Mitigation
International employment carries inherent risks and liabilities. By engaging a Global EOR, recruitment agencies can offload legal and financial responsibilities associated with employing candidates in foreign jurisdictions. Global EORs act as the legal employer for their clients’ workforce, assuming liabilities related to employment contracts, compliance with local labour, tax, and immigration laws, and ongoing risk management. This partnership helps protect recruitment agencies and their clients from potential legal disputes, lawsuits, and financial liabilities, providing peace of mind and reducing the burden of global employment risk management.
Leveraging Global EORs Expertise for Compelling Employer Value Propositions
By partnering with Global Employer of Record (Global EOR) services, recruitment agencies can tap into the international practices and local knowledge of employee benefits provided to enhance their candidate offerings and stand out in the talent market.
Recruitment agencies can leverage the expertise of Global EORs to navigate the complexities of implementing remote work policies across multiple jurisdictions. By understanding local regulations, tax implications, and best practices, recruitment agencies can design and promote attractive remote work options that align with their clients’ needs and the preferences of exceptional candidates.
Employee benefits are another crucial aspect of a compelling employer value proposition. Candidates today place significant importance on the benefits offered by prospective employers. Global EORs can provide valuable guidance to recruitment agencies on different countries’ statutory and voluntary employee benefits. By incorporating this knowledge into their candidate offerings, recruitment agencies can ensure compliance with local laws while providing comprehensive and attractive benefits packages that enhance their clients’ employer value propositions.
The partnership between recruitment agencies and Global EORs enables the seamless integration of international employment practices and local employee benefits knowledge, resulting in compelling value propositions that meet exceptional candidates’ evolving needs and expectations.
Concluding Thoughts
The collaboration between global recruitment service providers and Global Employer of Record (Global EOR) services offers numerous benefits in the global talent market. By partnering with Global EORs, recruitment agencies streamline hiring processes, ensure compliance, and focus on core recruitment activities. This collaboration accelerates market entry, taps into global talent pools, and expands clients’ global footprint. Additionally, Global EORs mitigate global employment risks and provide expertise in compliance obligations. The augmentation of recruitment service providers by Global EORs empowers them to optimise operations, attract top talent, and achieve successful outcomes for clients.
Welcome to the April 2023 edition of our Global Employment Tax and Compliance Newsletter! We bring you the latest updates and insights on employment tax and compliance regulations worldwide in this issue. Our expert team has been closely monitoring the regulatory landscape to provide you with the most relevant and up-to-date information. This edition will… Read more Global Employment Tax and Compliance Newsletter. April 2023
Welcome to the April 2023 edition of our Global Employment Tax and Compliance Newsletter! We bring you the latest updates and insights on employment tax and compliance regulations worldwide in this issue. Our expert team has been closely monitoring the regulatory landscape to provide you with the most relevant and up-to-date information.
This edition will cover important developments in several countries, including Spain, Poland, China, Singapore, Belgium, Latvia, and the Netherlands.
We will discuss changes to tax rates, social security contributions, and other labour law and compliance requirements that employers must be aware of. Additionally, we will provide guidance on best practices for managing global payroll, ensuring compliance with data protection regulations, and mitigating risks associated with remote work arrangements.
As the employment tax and compliance world evolves rapidly, we understand employers’ challenges in keeping up with these changes. That is why we are committed to providing accurate and actionable information to help you navigate these complex issues confidently.
Thank you for choosing our Global Employment Tax and Compliance Newsletter as your source of information on employment tax and compliance. We hope you find this edition informative and valuable.
🇧🇪 Belgium
Regarding the Right to Disconnect, measures have been introduced in Belgium to promote a healthy work-life balance for employees outside of regular working hours. Employers with a staff of 20 or more individuals are required to develop a policy that outlines the practicalities of implementing the Right to Disconnect, guidelines on the use of digital tools, and education and sensitization actions for employees and managers on the proper usage of digital tools and the potential risks of over-connectivity. This policy must be introduced through a collective labor agreement or, in the absence of such an agreement, through work regulations. The collective labor agreement must be filed with the FPS Employment registry. At the same time, a copy of the work regulations that includes the modalities and implementation must be submitted to the social inspectorate.
🇵🇱 Poland
The Polish parliament has recently passed a bill that modifies the Labor Code, allowing employers to conduct non-invasive testing for the presence of alcohol or intoxicating substances in employees and civil law contractors. The main purpose of these checks is to ensure the safety and well-being of employees and other individuals or to protect property.
The President must sign the Act before it takes effect, and it will become effective 14 days after its publication. The expected impact date is Spring 2023.
Employers in Poland interested in using alcohol or substance-use checks should first determine whether it is necessary to protect the safety and well-being of their employees and others or to protect property. If they decide to conduct these checks, they should establish relevant policies and procedures to ensure that the checks are conducted in a non-invasive manner.
🇵🇱 Poland
The Polish parliament has approved amendments to the Act on Aid to Citizens of Ukraine in connection with the armed conflict on the territory of Ukraine, which provide additional support for Ukrainians and their spouses in obtaining work and residence permits. The changes include:
Extending temporary residence permits until August 24, 2023, if the last day of stay in Poland under the previous provisions of the Act falls between February 24, 2022, and the same date in 2023.
Creating an easier path for Ukrainian citizens to obtain temporary residence permits, even if they don’t meet the typical criteria for this type of permit.
Defining “diia.pl” as an electronic document allowing the Polish border crossing.
The Bill also abolishes almost all special immigration anti-COVID regulations for foreigners of all nationalities, such as extending the deadline for submitting temporary residence applications and the validity of temporary residence permits and cards that expired during the epidemic or state of epidemic emergency up to 30 days after the end of the state of emergency.
The expected impact date for most provisions is Spring, except for the anti-COVID immigration regulations that will come into force on August 24, 2023.
Employers should monitor any new regulations regarding the employment of foreign workers to prepare for potential changes in the work permit process and requirements for verifying the right to stay in Poland.
Employers must ensure their foreign employees have legal residence status to work in Poland. Fines for illegal employment range from PLN 500 (approx. €106.15) to PLN 30,000 (approx. €6,369) per case.
🇸🇬 Singapore
The Ministry of Manpower is set to implement a new evaluative framework called the Complementarity Assessment Framework (COMPASS) for Employment Pass (EP) applicants. The aim is to allow employers to select highly qualified foreign professionals while promoting workforce diversity. COMPASS is a points-based system that evaluates individual and employment-related attributes in EP applications. To qualify for an EP, applicants must meet the increased qualifying salary of S$5,000 per month (S$5,500 per month for employers in the financial services sector) and score at least 40 points under COMPASS.
The impact date for the new framework is September 1, 2023, for new EP applications and September 1, 2024, for renewals. Employers should take note of this new framework and prepare for future EP applications and renewals accordingly.
🇦🇪 UAE
The Abu Dhabi General Market (ADGM) in UAE has recently released guiding principles on whistleblowing, signaling a growing emphasis on transparency and accountability in the region. These principles provide a framework for employees to safely and securely report any wrongdoing, misconduct, or illegal activities within an organization without fear of retaliation.
This move by ADGM is a positive step towards promoting a culture of ethical behavior and corporate social responsibility. The region’s employers should note these guidelines and consider incorporating them into their policies and procedures.
In particular, companies in regulated sectors such as finance, healthcare, and energy should proactively review their existing whistleblowing policies to ensure they align with ADGM’s principles. Employers should also monitor developments in the regulation of whistleblowing and speaking out policies, as it is possible that there may be additional requirements in the future.
Failing to have a robust whistleblowing policy in place could expose employers to significant legal and reputational risks. Organizations must take whistleblowing seriously and create an environment where employees feel comfortable reporting any potential wrongdoing. By doing so, employers can demonstrate their commitment to good governance and protect their reputation as responsible corporate citizens.
🇩🇰 Denmark
The legislation was implemented in Denmark to comply with the EU Directive on transparent and predictable working conditions for employees, which makes several changes, including adjusting the concept of an employee, expanding the scope of covered employees, changing the timescale for providing written information to the employee, listing more working conditions that must be disclosed as a minimum, and setting new minimum requirements for several working conditions.
The impact date for these changes is 1 July 2023, and while employers require no specific action, they should be aware of the changes and ensure compliance.
The penalty for non-compliance is expected to be compensated at a rate reflecting current case law. The compensation in the Danish draft Bill corresponds to the compensation in the current Danish Contracts Act, with a maximum of 13 weeks’ salary and up to 20 weeks’ salary in cases of aggravating circumstances. If the breach is excusable and has been of no specific importance in all other respects, the compensation cannot exceed DKK 1,000. The range of compensation amounts in current case law is typically between DKK 5,000 and DKK 10,000, so employers should comply with the new requirements to avoid potential penalties.
🇱🇻 Latvia
Latvia has amended the Law “On Maternity and Sickness Insurance” to implement the EU Directive on work-life balance for parents and carers. The amendments introduce new provisions, including a minimum two-month parental benefit period for each child’s parent, which cannot be transferred to the other parent.
Parents also have the right to choose the total period for receiving parental benefits for a child’s care, with two options available: 19 months, of which 15 months can be used until the child reaches one and a half years of age, and the non-transferable part can be used by each parent until the child reaches the age of eight, or 13 months, of which nine months can be used until the child reaches one year of age, and each parent can use the non-transferable part until the child reaches the age of eight. Furthermore, if one parent receives maternity benefit, the period of parental benefit (19 or 13 months) will include the period of maternity benefit payment.
For recipients of parental benefits who are employed or self-employed and not on childcare leave, the benefit will be paid at 50% of the parental benefit payable to those on childcare leave, an increase from the current rate of 30%.
These changes are effective from January 1, 2023. Employers must review and update their internal parental benefits policies to ensure compliance with the new requirements.
🇮🇪 Ireland
Effective December 16, 2022, new Regulations have been implemented to transpose the EU Directive on Transparent and Predictable Working Conditions in Ireland. The 2022 Regulations include requirements for more predictable working time, reasonable advance notice for employees with variable schedules, limitations on the duration of probationary periods, and rights for employees to work with other employers outside their schedule. Additionally, on-demand employment contracts will have limited use and duration, written notification of employment terms will be provided within specified timeframes, employees with 26 weeks of service can request a transition to more secure employment, and mandatory training will be offered without cost.
Employers must ensure compliance with the new Regulations, update template contracts accordingly, and be aware of the new employment terms and training requirements. Failure to comply with the provisions of the 2022 Regulations may result in employees filing complaints with the Workplace Relations Commission.
🇨🇳 China
The Revised Law on Protection of Women’s Rights and Interests in the People’s Republic of China imposes new obligations on employers to safeguard female employees’ legal rights and interests. These include measures to prevent sexual harassment, such as formulating internal rules and policies, designating staff responsible for anti-sexual harassment, providing training and education, establishing complaint channels, and handling disputes confidentially. Employers are also prohibited from engaging in discriminatory behaviors during recruitment, such as restricting job positions or setting employment conditions based on gender, marital/childbirth status, or pregnancy testing.
🇪🇸 Spain
The Budget Law sets out the contribution bases and rates for social security, unemployment, termination of activity protection, the Wage Guarantee Fund, and professional training. While there are no changes to contribution rates under the general social security system from those applicable in 2022, the cap on the contribution base for 2023 has increased to €4,495.50 per month. The law also regulates the new intergenerational fairness mechanism, which requires an additional 0.6% contribution (0.5% payable by the employer and 0.1% by the worker) to the contribution base for certain contingencies, including retirement plan coverage.
Employers must take note of the new contribution bases and rates for 2023 and ensure they apply them correctly. Reviewing the contribution base limit to ensure compliance with the new cap is important. Employers should also consider how the new intergenerational fairness mechanism will affect their social security contributions and factor this into their financial planning.
🇪🇸 Spain
The Spanish government has recently announced changes to its expatriate tax regime, commonly called the “Beckham” tax regime. The regime provides for a 24% income tax rate for qualifying expatriate employees with an annual income of up to €600,000. The latest changes are intended to incentivize more expatriates to work in Spain and now apply to individuals with contracts that permit them to work remotely in Spain.
In addition to the remote work provision, the new changes reduce the number of years an individual is required to have been a non-Spanish resident before the assignment from 10 to 5 years. This means that expatriates who have been living in Spain for less than five years can now benefit from the favorable tax regime.
Furthermore, in certain circumstances, spouses and children of expatriate employees can now also benefit from the “Beckham” tax regime. These changes will likely make Spain a more attractive destination for expatriate employees and their families, which could positively impact the country’s economy.
🇳🇱 Netherlands
The Netherlands has recently changed the “30%-scheme,” which provides certain foreign employees with a tax-free allowance of 30% of their income. However, starting from January 1, 2023, employees applying for this scheme will only be able to receive the tax-free allowance on income up to €216,000. This means that income earned beyond this amount will not be eligible for the tax-free allowance.
Additionally, employees already part of the “30%-scheme” before January 1, 2023, will experience a phased reduction in the tax-free allowance. Employers must review their compensation and benefits packages for foreign employees and ensure they comply with these new regulations.
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Dear clients, partners, and the Acumen International team!
As we celebrate our 22nd anniversary at Acumen International, I am reminded of the journey that brought us here. What started as a local staffing and recruitment agency in 2001 has grown into a leading global Employer of Record solutions provider, operating in over 190 countries worldwide. I am proud of our achievements and excited to share our story with you.
Serving our clients, I recognized that companies expanding globally need a trusted partner who could help them navigate the complexities of global employment, tax, and compliance. The key factor that has contributed to the success of Acumen International over the years was my decision 12 years ago to internationalize our business: the journey continued with a simple yet powerful idea: to help businesses achieve global growth.
In 2011, Acumen International entered the Global Employer of Record services market to pursue new opportunities.
Our mission is to give companies an expedited, ‘express’ global footprint through compliant onboarding of international talent without the need to register their own entities overseas. At Acumen, we don’t simply serve our international clients differently. We help them accelerate their success. Be global expansion a car; our global employment solution would be gasoline.
We have helped businesses realize globalization’s potential by showing them how the sharing economy can help them succeed in today’s competitive marketplace.
We hire, provide payroll and offer benefits to locals and expatriates on behalf of our clients – in a compliant, fast, risk-free, and affordable way.
We have always stayed true to our core values: resourcefulness, ambition, diligence, innovation, and a diverse skill set from an international perspective. These principles have served as the driving force behind our achievements and consistently guided us throughout our journey. They continue to inspire us as we look to the future.
Our team comprises professionals with deep expertise in employment law, HR, finance, tax, and compliance, who work together to deliver exceptional results for our clients. There was an incredible display of resilience and dedication from every single member of our Ukrainian team, who kept our business running in the face of the Russian invasion that left us without electricity, heat, or water. We could not have made it through this period without their heroic contributions, and we are truly thankful for that!
Technology has always been at the forefront of Acumen International. Our passion for innovation has led us to invest heavily in technology advancements to increase productivity and drive international growth.
Our recent launch of the Global Payroll Calculator is a testament to this commitment. We proudly offer the most powerful tool in the market for calculating total employment costs across multiple countries.
We have always been fostering strong and meaningful client relationships. We believe that trust, transparency, and open communication are essential for building long-term partnerships. We can deliver comprehensive solutions that meet their unique requirements by truly understanding our clients’ needs and objectives.
Over the past 12 years, we dedicated up to 50 thousand hours to building a global partner network of the utmost professionalism and reliability. I believe having a trusted global partner is crucial for the success of companies of all shapes and sizes. Trust is the main international business currency.
Today our network and global knowledge base cover the most remote, hard-to-reach, or underserved markets.
Combined with our advanced technology solutions and world-class support services, we can now deliver tailor-made solutions that give our clients immediate access to global talent. Whether you’re expanding into a new market or need help navigating complex employment regulations, our team of experts and local partners are ready to support you every step of the way.
Excitement is in the air for what the future holds. Employers operating internationally are turning to Acumen International to help them succeed and streamline global hiring in a world that grows ever more interdependent. We are committed to continuing our journey of innovation and growth, and we look forward to sharing it with you.
I would like to express my gratitude to our clients, partners, and Acumen International team members who have supported our business over the years. Thank you for putting your faith in us. I am thrilled to be able to share this moment with you.
It has been an incredible journey, and there are many great achievements ahead. As we continue to help businesses navigate the maze of global employment and compliance, I invite you to join us on this adventure. Stay tuned for more information about our exciting new initiatives!
Nick Ganzha, Founder and CEO of Acumen International.
It’s time for the March 2023 Edition of our Global Employment Tax and Compliance Newsletter! Let’s dive in! The Global Employer of Record is a cost-effective and risk-free talent engagement model in the world of human resources and payroll management. But what does it mean, why is it important, and what are the benefits? We’ll… Read more Mastering Global Expansion Roadmap with Global Employer of Record
It’s time for the March 2023 Edition of our Global Employment Tax and Compliance Newsletter! Let’s dive in!
The Global Employer of Record is a cost-effective and risk-free talent engagement model in the world of human resources and payroll management. But what does it mean, why is it important, and what are the benefits? We’ll look at all these questions in this week’s newsletter.
A Global Employer of Record is an entity that acts as a legal employer for all local and international employees worldwide — even if they work remotely and/or in multiple countries. The company provides a single point of contact and responsibility for all payroll, benefits, tax administration, and HR functions across multiple jurisdictions.
Using a Global Employer of Record
Global Employer of Record (EOR) solutions provide a quick, simple, and cost-effective way to tap into global talent pools for companies hiring talent outside their target country.
These businesses have an existing local legal entity in your target countries. This simplifies the global expansion process immensely, as your organisation can rely on the Global EOR provider’s employment expertise and infrastructure.
It allows them to streamline onboarding and manage payrolls, tax, and benefits for their clients’ employees. The global EOR is not responsible for overseeing job duties or employee performance; these tasks are left to international employers.
Normally the Global Employer of Record arrangement is only needed for limited periods, generally no more than two years. However, some countries may see it used for extended time frames depending on individual circumstances.
Utilizing a Global EOR solution can be a great HR-team augmentation solution for organizations expanding into new countries – especially those risky or underserved ones.
By employing local and foreign talent through the Global EOR’s legal entity, the organization is unburdened from managing payroll and benefits and navigating the maze of labor and tax law compliance. All of those responsibilities land on the global EOR provider, which would list itself as the legal employer, handling all compensation, benefits, or immigration matters that come along with it. Such services can not merely provide invaluable knowledge regarding worldwide hiring practices and guidance when making decisions around employee compensation structure.
Global Employer of Record: All Services Under One Roof in 190 Countries
In today’s business world, a company can’t reach its full potential if it doesn’t expand into international markets. The biggest challenge is ensuring you have a local employer of record partner in each country you do business in. It’s hard because there are so many things to consider—different tax laws, varying degrees of government involvement in payroll and tax administration, and more—and they can vary from country to country.
You need a partner who knows their way around all those quirks, which can be tricky to find. Even if you find someone, it’s still a lot of work to handle the nuances of multiple countries and ensure that each of your in-country employees is treated fairly and compliantly.
What’s more challenging than finding the right partner? Managing all those relationships with multiple partners across different HR functions, operating in different time zones, and having varying levels of expertise with organizational challenges.
When you think you’ve got it all figured out, there’s some other complication that throws everything off-kilter, like a new tax law or labour regulation, or currency exchange rate.
Why Use Global Employer of Record Services?
It’s a new cost-effective, compliant way of managing payroll, benefits administration, legal matters, and so much more—all from one place. You’ll have access to the entire suite of services that your company needs to stay compliant with a single contract and payment structure. Best of all? It’s all wrapped up in one neat package. That means no more paying for multiple vendors for each service you need. Just one monthly fee, and you’re done!
As a result, companies with global operations can reduce their costs by eliminating multiple vendors, streamlining their reporting and compliance processes, reducing risk exposure by centralizing their HR functions into one entity that understands local regulations better than any other company could, and increasing efficiency by hiring staff who understand how to hire across borders. Acumen International can replace at least 10 local vendors as follows.
Payroll Company
Employee Benefits Broker
HR Consultants
Background Checks Vendors
IP Attorney
Tax Advisor
Translation service
Legal Advisor
Immigration Advisor
HR Compliance Advisor
Global Expansion Risk Control
Your business expanding into new countries and continents can put you at higher risk for costly mistakes and problems.
Let’s face it. Your company could be in trouble when it comes to taxes and adherence to ever-changing compliance requirements. With so many regulations, some are bound to trip you up. And who has the time to stay on top of it all? It’s easy to fall into an under-taxation trap or get caught misclassifying employees as independent contractors (which can result in huge fines in many countries), and you might not even know there’s a problem until it’s too late.
A Global Employer of Record (EOR) helps with compliance issues that could arise from entering new markets. By working with Global EOR, you can ensure your company follows each jurisdiction’s in-country rules and regulations, helping avoid the following risks.
Global Employer of Record Support upon Business Transitioning
As a company, how you will succeed in the global economy is a direct result of your ability to attract and retain top talent. Global expansion via mergers, acquisitions, new ventures, and joint ventures has become the preferred growth strategy for many organizations, but business success does not always translate into business continuity.
While you may be planning for your business to grow and expand into new markets, it doesn’t always happen according to plan. Sometimes the business changes in a way that makes it necessary to close locations or sell off assets, while other times it makes sense to acquire another company. In all of these cases, you’ll have to transfer your employees between companies—a complicated and sometimes intimidating process that can take many months and cause significant challenges for both the employees affected and the business as a whole.
As with most change initiatives, the Global Employer of Record partner’s expertise and engagement are key factors in the success of any business transition. Acumen Global EOR’s employee transition management services support the entire process and help minimize these potential risks in 190 countries.
Our comprehensive business transitioning solutions include:
A market testing vehicle without local incorporation
HR-arm upon global expansion urgent needs
Business in transition – M&As, close-downs, lay-offs, consolidations, other business combinations, and business restructuring events
Expert global employment capabilities in remote, risky, or underserved markets.
Our clients include Fortune 500 companies and small and medium-sized businesses across all industries, including IT, finance, technology-enabled services, manufacturing, retail, distribution, and logistics. The service offerings are designed to help organizations navigate through these transitions without disrupting business operations or negatively impacting employees.
Why Wait? Get Express Quote Today!
Global Employer of Record (EOR) is a flexible, scalable, and adaptable talent engagement model that can support you throughout your global expansion journey. It doesn’t matter if you’re starting from scratch or are looking to expand your business in an already established market. Our Global EOR services can help you at any stage of your international growth.
You’ll find that Acumen International’s approach is uniquely suited to meet the needs of companies entering new markets and those seeking to enter new customer channels, as well as for companies experiencing rapid growth or needing workforce flexibility.
Global Employment: Payroll Challenges & Employer Obligations Operating a business in foreign markets comes with unique human resources challenges, unlike anything you may have encountered in your domestic markets. Factors such as national health care, work visas, work permits, compliant employment contracts, and risks of unfair dismissal claims can vary significantly from country to country.… Read more Global Payroll Calculator: Budget Your Global Payroll and Taxes Accurately. Avoid Hidden Cost
Global Employment: Payroll Challenges & Employer Obligations
Operating a business in foreign markets comes with unique human resources challenges, unlike anything you may have encountered in your domestic markets. Factors such as national health care, work visas, work permits, compliant employment contracts, and risks of unfair dismissal claims can vary significantly from country to country. Having a sound understanding of these issues is critical to successfully expanding your business into new markets.
When expanding your business into overseas markets, you’ll need to consider your talent engagement strategy carefully. Depending on international and local regulations, you may use local hires, ex-pats, independent contractors, full- and part-time employees, or a mix for your business. Different countries have different employment practices, so research what would work best for your company. Remember that your home country’s practices may not apply in other countries.
Challenge 1: Overseas Employment Contracts
Maintaining accurate employee documentation is critical, as the lack of it could result in unwittingly getting slapped with penalties and fees. When drafting employee contracts, it is crucial to seek legal advice to ensure that they comply with host-country labor laws. In many countries, an employment contract must be written in a language other than English. While a cost may be associated with having a translation, the contract written in the host country’s language will take precedence.
Challenge 2: Employee Misclassification Risk
As an employer, knowing the employment laws and regulations of the country you are doing business is crucial. This is especially true when classifying workers as independent contractors or employees. Independent contractors may seem like a cost-effective solution for businesses. Still, companies should be aware that local authorities in many countries may deem them de facto benefits-eligible employees. Misclassifying a worker can result in significant fines and damage your company’s reputation. This can result in significant fines and reputational damage, so it’s important to ensure you are clear on the legal distinctions between contractors and employees before hiring anyone and budget for full-time employees under host-country laws to avoid those penalties.
Challenge 3: Tax Protection Policies for Global Workforce
The costs of sending employees on overseas assignments can quickly add up, often totaling two to three times the employee’s salary in their home country. Many businesses establish tax protection policies to alleviate personal tax burdens and attract and retain top international talent. These policies can be complex and costly to manage.
Challenge 4: Budgeting Immigration Cost
International business travel can be an excellent opportunity for employees to broaden their horizons and gain new skills. However, it can also be a logistical nightmare for employers.
Cross-border employee relocation can be a costly and time-consuming process. Planning and budgeting for immigration, relocation expenses, and allowances are essential to ensuring a smooth transition for all involved.
Challenge 5: Budgeting Termination Cost
As an employer operating globally, you must know the laws and regulations regarding employee rights in different countries. Depending on the country, there may be different rules regarding termination of employment, severance pay, and collective bargaining agreements In some Western European countries, for instance, terminating an employee can cost up to 12 to 18 months of severance. Global employers must plan for this possibility when budgeting for international talent acquisition.
Challenge 6: Budgeting Employee Payroll and Statutory Benefits
As more and more companies expand their operations overseas, they are often surprised to learn that the costs of employee benefits can be much higher in foreign countries than at home. Different countries have different laws regulating payroll, extending beyond the typical health insurance contributions, statutory withholdings, and other benefits that can take a big bite out of a company’s bottom line when operating in a new country.
How do you ensure your payroll across multiple jurisdictions is on track? There are many expenses and costs involved in a payroll process. You must understand the costs and whether they align with your company’s objectives.
In some cases, local labor, tax, and social security laws may also come into play. This can be a significant burden for companies operating in multiple countries.
It also means you can predict your costs and plan ahead for them. A good budget allows you to make informed decisions, identify both risk and opportunity, and react to it appropriately. That’s invaluable in the business world.
But the key point is that a good budget is one that accurately reflects your business environment and conditions. And, importantly, payroll is no different. It’s important, therefore, that you understand how to calculate payroll globally – not just in terms of how much you need to pay employees but also in terms of how to structure your payroll costs accurately.
There are numerous hidden costs in your global payroll – some of which are unavoidable and some of which are avoidable but can lead to problems down the track. For example, there’s the cost of remitting money to overseas employees. There’s tax withholding — and by this, we mean not only the cost of withholding tax but also other costs like the administrative burden on you as an employer or the possibility that local law makes it compulsory (in some places) for employers to withhold certain taxes from employee salaries. Then there’s the cost of handling foreign currency conversions.
In your role as an employer, you might be responsible for various statuary payments, including maternity pay, shared parental pay, paternity pay, adoption pay, and sick pay. When estimating a budget allowance for this purpose, it can be hard to predict these costs accurately.
Challenge 7: Budgeting Taxable Voluntary Benefits
As an overseas employer, you may be required to offer additional compensation in salary increases, profit sharing, holiday payments, bonuses, car allowances, and more. These voluntary benefits can significantly impact your employment contracts, compensation structure, and payroll operations.
Depending on the country where you operate, these benefits may be taxed under different schemes than regular salary. Therefore, reviewing and understanding these benefits is essential to ensure compliance with local and international laws and regulations. For employers, it’s often a matter of getting the budget right: how much can you afford to pay for each of these perks?
This is where the global payroll budget comes in. It takes into account every single employee, every payroll period, and every benefit. You should be able to get a rough estimate of the figures involved without too much effort—but it’s worth getting advice from a payroll advisor or a Global Employer of Record if you need a more detailed breakdown.
Challenge 8: Budgeting Paid Time Off
In today’s economy, being mindful of your company’s payroll budget is more important than ever. Unexpected costs can add up, such as employee vacation and overtime pay. In many countries, employees are entitled to several vacation days and paid time off each year. When you factor in public holidays, paid time off in some countries in Western Europe can come to nearly two months per year for each employee, plus additional time off for overtime worked. Sick leave benefits can also be a considerable cost for employers operating in multiple jurisdictions. In other countries, for example, employees can collect 70 percent of their salary for up to 105 weeks of sick leave.
Payroll Budgeting Solution: Global Payroll Calculator
How is your global talent compensation policy competitive, and how much will it cost? Global Payroll Calculator (GPC) is a SaaS tool that can help you do this.
15 Benefits That Will Save You Time And Money in 2023
Automate and speed up global payroll budgeting routine processes.
Streamline data collection.
Gain valuable insights into the global talent market.
Make informed decisions about talent acquisition.
Get the complete picture of the latest tax benchmarks, labor market, and compliance.
Plan effective global mobility programs.
Explore and benchmark pay practices in the global marketplace.
Gain guidance on what to pay your top talent and hire top-performing employees while maintaining a diverse workforce.
Simplify & streamline payroll planning.
Attract and retain talent in a competitive marketplace.
Know the exact costs to recruit, develop and retain top talent.
Gain greater visibility into and better understand global employment tax and compliance intelligence.
Make data-driven decisions about compensation programs, sourcing strategies, and other talent acquisition.
Develop a strong and cost-effective talent strategy
Conduct service provider quote benchmark analysis. Combat global employment overspending.
Global Payroll Calculator provides a more intelligent way of global talent acquisition and compensation. With detailed data on employer and employee taxes and contributions in 190 countries, Global Payroll Calculator gives users a complete picture of total employment costs. With high accuracy, no hidden costs, and 100% compliance around the world guaranteed, the GPC tool enables users to make intelligent, fast, and informed decisions about locating their businesses or acquiring talent.
So whether you are an employer with a foreign, local, or hybrid workforce that spans multiple countries, an Employer of Record, PEO, or an agency (service provider) assisting with international staffing and recruitment, you can use the Global Payroll Calculator to get accurate worldwide payroll budgeting data and cross-country comparisons in 190 countries. The Payroll Calculator is a valuable resource to get the job done right.
Businesses need to stay on top of global employment and tax regulations. Maintaining a current understanding of global regulations is critical for HR and compliance professionals. The Global Employment Tax and Compliance Intelligence Newsletter is a comprehensive solution that helps businesses comply with global regulations and offers expert analysis of changing legislation in 190 countries.… Read more Global Employment Tax and Compliance Newsletter. February 2023
Businesses need to stay on top of global employment and tax regulations. Maintaining a current understanding of global regulations is critical for HR and compliance professionals.
The Global Employment Tax and Compliance Intelligence Newsletter is a comprehensive solution that helps businesses comply with global regulations and offers expert analysis of changing legislation in 190 countries.
At Acumen International, we make regulatory and legislative changes easy to understand so you can stay on top of changes that may impact your business. Address legal questions on employment and tax topics efficiently and accurately to ensure you confidently surface the information you need and your business proactively anticipates and understands how regulations impact your organization.
Subscribe today to stay current on the latest global employment legal and compliance information and discover how to proactively benefit from regulatory changes and insight.
1. Mongolia 🇲🇳
Effective 1 January 2023, progressive rates of personal income tax are introduced that apply to employment income:
– 10% on annual income up to MNT120,000,000
– 15% on annual income above MNT120,000,000 and up to MNT180,000,000
– 20% on annual income above MNT180,000,000
Effective 1 January 2023, the national minimum wage is increased from MNT420,000 to MNT550,000.
The maximum monthly base (payroll cap) for calculating the employee social security contributions is increased from MKT4,200,000 to MNT5,500,000. As a result, the employee social security contributions are capped at MNT 632,500 per month for 2023.
2. Luxembourg 🇱🇺
Effective 1 February 2023, a new wage indexation applies. Wages and pensions must be raised by 2.5%. The next wage indexation is scheduled for 1 April 2023.
3. France 🇫🇷
For 2023, the personal income tax thresholds are increased as follows:
– exempt from PIT annual income up to EUR10,777
– 11% on annual income above EUR10,777 and up to EUR27,478
– 30% on annual income above EUR27,478 and up to EUR78,570
– 41% on annual income above EUR78,570 and up to EUR168,994
– 45% on annual income above EUR168,994
The maximum amount for a standard deduction of 10% of employment income is increased to EUR13,522
Effective 1 January 2023, the monthly social security ceiling is increased from EUR3,428 to EUR3,666 for Bracket A, and from EUR27,424 to EUR29,328 for Bracket B.
The maximum monthly base (payroll cap) for calculating the employer unemployment insurance contribution is increased from EUR13,712 to EUR14,664.
4. Germany 🇩🇪
For 2023, the personal income tax thresholds are changed as follows:
– exempt from PIT annual income up to EUR10,909
– 14% – 24% (geometrically progressive rates) on annual income above EUR10,909 and up to EUR16,000
– 24% – 42% (geometrically progressive rates) on annual income above EUR16,000 and up to EUR62,809
– 42% on annual income above EUR62,809 and up to EUR277,825
– 45% on annual income above EUR277,825
Effective 1 January 2023, the maximum annual base for calculating the pension and unemployment insurance contributions is increased to EUR85,200 (East) and EUR87,600 (West) for the health and long-term insurance contributions – to EUR59,850.
The standard deduction for employment-related expenses is increased from EUR1,000 to EUR1,230 annually.
The deduction for pension expenses is increased from 94% to 100% of the pension insurance contributions, up to a limit of EUR25,639.
5. Poland 🇵🇱
Effective 1 January 2023, the maximum annual base for calculating the retirement and disability insurance contributions is increased from PLN177,660 to PLN208,050.
6. Singapore 🇸🇬
Commencing 1 January 2024, a significant announcement was made in Singapore – Government-funded paternity leave will be extended from two weeks to four with a voluntary extension of an extra two weeks.
To provide increased assistance to lower- and middle-income working mothers, revisions have been made to the Working Mother’s Child Relief program. Accordingly, eligible individuals may receive further support through this revised initiative.
First child:
From 14 February to 31 December 2023: 15% of the mother’s earned income
From 1 January: S$8,000
Second child:
From 14 February to 31 December 2023: 20% of the mother’s earned income
From 1 January: S$10,000
Third child:
From 14 February to 31 December 2023: 25% of the mother’s earned income
From 1 January: S$12,000
As part of the updated parental leave regulations, parents can access 12 days of unpaid leave per year to care for their infants. This is an increase from the previous six-day allowance.
Business Immigration: News & Compliance
1. Israel 🇮🇱
In a move to modernize its business immigration system, the Israeli government has recently introduced digital work visas for certain categories of employees. Those eligible may obtain B-1 Expert, B-1 Hi-Tech, SEA 90-day, and STEP 90-day visas online when entering the country. Dependents, however, must still adhere to traditional means with a physical B-2 visitor visa stamp on their passports. Despite this transformation, no alterations were made to the overall application process.
2. United Kingdom 🇬🇧
As the UK’s immigration landscape continues to change, many small businesses are taking a closer look at the potential benefits sponsorship offers in 2023. A Home Office sponsor license is now required for companies that wish to recruit non-EU employees through the Skilled Worker visa route. Obtaining sponsor license status grants employers unrestricted access to a vast pool of international talent from around the globe.
When it comes to addressing skills shortages in the future, a survey conducted by the Federation of Small Businesses of the UK has revealed that twice as many small businesses are now turning to sponsorship. Some consider this path undesirable due to its potentially high costs and complex process for gaining and maintaining a sponsor license – yet these employers are taking this route nonetheless.
Regardless of size or industry, any organization can apply for a sponsor license provided all the Home Office’s eligibility requirements are met. Qualifying businesses must have
an established UK base with a fixed address, the capacity to offer jobs that meet Home Office skill and salary criteria;
Availability of systems in place to monitor any sponsored immigrants and personnel who manage sponsorship;
no criminal convictions involving immigration offenses or other transgressions like fraudulence or money laundering.
Sponsor Licence Application Procedure
The requirements for obtaining a sponsorship license include completing an online application form, submitting supporting corporate documents, demonstrating that the company has adequate HR practices to fulfill its licensee duties, appointing personnel who will manage the process, and paying fees. All of these steps comprise the application process for a license.
New Startup Law in Spain to Facilitate Talent Acquisition
The Spanish Congress of Deputies approved new legislation called the Law for the Promotion of the Startup Ecosystem, or Startup Law. During one of their plenary sessions, this law was passed on December 1, 2022.
According to the Spanish Tech Ecosystem Report, the value of the Spanish Startup Ecosystem was 46 mln Euros in 2021.
The new Startup Law in Spain is an ambitious attempt by the government to address the unique challenges that startups encounter when raising capital and recruiting high-skilled workers.
The Startup Law seeks to create a favorable regulatory environment for Spanish startups to foster innovation, create jobs, and spur economic growth. It includes provisions to reduce bureaucracy, offer tax incentives to investors, and make it easier for firms to access financing and global talent.
Objectives of the Startup Law in Spain
Encourage launching or relocating startups in Spain.
Facilitate administrative procedures.
Attract and retain specialized talent to startup companies through more favorable tax considerations for stock options.
Promote the rapprochement between vocational training institutions, universities, and emerging companies.
Support the development poles or centers of attraction for companies and investors in peripheral cities and rural areas.
Promote innovative public procurement with emerging companies.
Bridge the gender gap in the startup ecosystem.
Requirements for Creating a Startup in Spain
According to new legislation, certain criteria must be met to be classified as a startup.
Businesses must have been established no more than five or seven years ago in the biotechnology, energy, and industrial production sectors.
Businesses should have their operations base and most of their staff based in Spain.
Startups cannot issue dividends nor be listed on any stock market.
Their annual turnover must not exceed 5 million euros.
New Work Visa for Remote Talent in Spain
A new visa program has been created to enable foreign nationals to take up residence in Spain while working for a company based elsewhere. Independence professionals can perform part of their work for Spanish businesses, with no more than 20% of their time devoted to such activity. This is not open to regular employees, however.
Qualification Criteria for New Spanish Visa Program
The applicant should have a degree from a prominent university, business school, or professional training program; alternatively, they should demonstrate three years of professional experience.
The employer abroad must have been registered as a business entity for more than one year
Full-time employees must prove that they worked at the company for at least three months before application submission.
Applicants must prove that the foreign employer allows them to work remotely. For independent contractors, it is required that they demonstrate an existing business relationship with one or more companies outside the country, which stretches back over at least three months before applying.
Finally, applicants should prove financial self-sufficiency by having an income double the national minimum wage plus any additional revenue required for family members associated with them.
About Acumen International Employer of Record
Acumen International is a Global Employer of Record that offers a unique Employ to Expand hybrid talent management solution designed to give businesses the tools and services they need to hire, onboard, payroll, and reward employees worldwide — all with a single partner across 190 countries.
With an innovative and flexible Tiered Pricing Model, Acumen International can help its clients hire a local and foreign workforce with minimal cost, risk, and time while ensuring 100% employment and tax compliance.
Global Payroll Calculator by Acumen International is a payroll tax and compliance intelligence tool that supports multinational employers and HR professionals in accurate forecasting their total global employment costs and liabilities.
If you need support with any aspect of global employment or business immigration, Acumen International Employer of Record is here to help.
The global marketplace is becoming increasingly competitive and interconnected. As a result, the importance of businesses meeting the complex compliance requirements in their HR operations has never been higher. News about Global Employment Tax and Compliance is often difficult to find because of the language barriers, time zones, and cross-border legislation complexity. Acumen International solves… Read more Global Employment Tax and Compliance Newsletter. January 2023
The global marketplace is becoming increasingly competitive and interconnected. As a result, the importance of businesses meeting the complex compliance requirements in their HR operations has never been higher.
News about Global Employment Tax and Compliance is often difficult to find because of the language barriers, time zones, and cross-border legislation complexity. Acumen International solves this problem by researching and publishing regular updates in English from our experts worldwide.
This newsletter is intended for global employers and global employment service providers. We hope it will be a helpful resource for companies doing business globally and navigating the complex web of employment taxes and labour laws worldwide.
Navigate the Complex Web of Global Employment Tax and Labour Laws
Our Global Employment Tax and Compliance Newsletter is a bi-weekly publication that keeps you updated and helps track the most significant changes in the legislation and regulations around Global Employment Tax and Compliance in 190 countries.
This Newsletter provides comprehensive information on employment taxes—such as payroll taxes, social security contributions, statutory severance payments, unemployment contributions, etc.—and their associated regulatory developments.
We will also provide tips on complying with the increasing number of immigration and labour law requirements you must deal with when relocating your employees or hiring new employees overseas. We hope this will help you avoid potential legal issues.
Global Employment Tax and Compliance Insights
The Global Employment Tax and Compliance Newsletter by Acumen International covers global employment tax, labour, and immigration compliance from various angles.
Latest Global Employment Tax and Compliance Updates in 15 Countries
The first issue features changes in the 15 countries’ legislation and regulations around Global Employment Tax and Compliance. We have compiled a comprehensive overview of recent alterations to the employment and labour laws that international employers must be aware of. Here is a summary of these key changes to help determine the required action.
1. Malta 🇲🇹
Effective 1 January 2023, the Government of Malta has increased the maximum amounts of social security and maternity fund contributions as follows:
The maximum amount of social security contributions is increased from EUR37.24 to EUR39.28 for individuals born up to 31 December 1961 and from EUR49.97 to EUR51.60 for individuals born from 1 January 1962 onwards, per week per employee.
The maximum amount of maternity fund contributions is increased from EUR1.12 to EUR1.18 for individuals born up to 31 December 1961 and from EUR1.50 to EUR1.55 for individuals born from 1 January 1962 onwards, per week per employee.
2. Singapore 🇸🇬
Effective 1 January 2023, Central Provident Fund (CPF) contribution rates are increased in Singapore.
For employees’ portion:
20% for employees up to 55 years of age
15% for employees 55-60 years of age (previously 14%)
9.5% for employees 60-65 years of age (previously 8.5%)
7% for employees 65-70 years of age (previously 6%)
5% for employees above 70 years of age
For employers’ portion:
17% for employees up to 55 years of age
14.5% for employees 55-60 years of age (previously 14%)
11% for employees 60-65 years of age (previously 10%)
8.5% for employees 65-70 years of age (previously 8%)
7.5% for employees above 70 years of age
3. Serbia 🇷🇸
Effective 1 January 2023, the Serbian Government has announced the following changes:
The maximum monthly base for calculating social security contributions is increased from RSD441,140 to RSD500,360.
The rate for pension and disability insurance on behalf of the employer is decreased from 11% to 10%.
The non-taxable amount for salary tax calculation is increased from RSD19,300 to RSD21,712.
4. South Korea 🇰🇷
Effective 1 January 2023, the South Korean Government has introduced the following changes:
The national health insurance contribution rate is increased from 6.99% to 7.09%.
The long-term care insurance contribution rate increases from 0.8577% to 0.9082%.
The exemption limit for meal allowance is increased from KRW100,000 to KRW200,000 per month.
5. Philippines 🇵🇭
Effective 1 January 2023, the rate for social security insurance for the employee is increased from 4% to 4.5%, on behalf of the employer – from 8% to 9%. The minimum monthly base for calculating social security contributions is PHP4,000; the maximum monthly base is PHP30,000.
Effective 1 January 2023, PIT rates are changed as follows:
– exempt from PIT annual income up to PHP 250,000
– 15% on annual income above PHP 250,000 and up to PHP 400,000
– 20% on annual income above PHP 400,000 and up to PHP 800,000
– 25% on annual income above PHP 800,000 and up to PHP 2,000,000
– 30% on annual income above PHP 2,000,000 and up to PHP 8,000,000
– 35% on annual income above the threshold of PHP 8,000,000.
6. Turkey 🇹🇷
Effective 1 January 2023, the following amendments are introduced:
Tax brackets for PIT are increased:
– 15% on annual income up to TRY70,000
– 20% on annual income above TRY70,000 and up to TRY150,000
– 27% on annual income above TRY150,000 and up to TRY550,000
– 35% on annual income above TRY550,000 and up to TRY1,900,000
– 40% on annual income above the threshold TRY1,900,000
The minimum monthly base for calculating social security contributions is increased to TRY10,008.00; the maximum monthly base is increased to TRY75,060.00.
7. Estonia 🇪🇪
Effective 1 January 2023, the Estonian Government has announced the following changes:
The basic tax exemption is increased from EUR500 to EUR654 per month, from EUR6,000 to EUR7,848 per year.
The minimum amount of public pension and public health insurance contributions payable by the employer is increased from EUR192.72 to EUR215.82 per month.
8. Côte D’Ivoire 🇨🇮
Effective 1 January 2023, the maximum monthly base for calculating pension contributions is increased from XOF2,700,000 to XOF3,375,000, and for calculating family allowance and industrial accident insurance contributions – from XOF70,000 to XOF75,000.
9. Ghana 🇬🇭
Effective 1 January 2023, the rates of income tax and tax brackets for resident individuals have been revised as follows:
– exempt from tax annual income up to GHS4,824
– 5% on annual income above GHS4,824 and up to GHS6,144
– 10% on annual income above GHS6,144 and up to GHS7,704
– 17.5% on annual income above GHS7,704 and up to GHS43,704
– 25% on annual income above GHS43,704 and up to GHS240,444
– 30% on annual income above GHS240,444 and up to GHS6,000,00
– 35% on annual income above GHS6,000,00
Effective 1 January 2023, the minimum monthly base for calculating contributions to the Social Security and National Insurance Trust (SSNIT) is increased from GHS365.33 to GHS401.76, the maximum monthly base – from GHS35,000.00 to GHS42,000.00.
10. Kazakhstan 🇰🇿
Effective 1 January 2023, the following changes are implemented:
– The standard personal allowance is increased from KZT42,882 to KZT48,300 per month (14 times of monthly calculation index of KZT3,450).
– The maximum monthly base for calculating pension fund contributions is increased from KZT3,000,000 to KZT3,500,000 (50 times of monthly minimum wage of KZT70,000).
– The maximum monthly base for calculating health insurance contributions is increased from KZT600,000 to KZT700,000 (10 times of monthly minimum wage of KZT70,000).
– The maximum monthly base for calculating social insurance contributions is increased from KZT420,000 to KZT490,000 (7 times of monthly minimum wage of KZT70,000).
11. Armenia 🇦🇲
Effective 1 January 2023, the following changes are adopted:
The personal income tax rate is reduced from 21% to 20%.
The maximum monthly base (payroll cap) for calculating pension contribution is increased from AMD1,020,000 to AMD1,125,000 (15 times of minimum monthly salary of AMD75,000).
The rates and brackets for the pension contributions are revised as follows:
– 5% of monthly employment income up to AMD500,000
– 10% of monthly employment income (minus AMD25,000) if monthly employment income is above AMD500,000 and up to AMD1,125,000
12. Trinidad & Tobago 🇹🇹
Effective 1 January 2023, a personal allowance is increased from TTD84,000 to TTD90,000.
13. Austria 🇦🇹
Effective 1 January 2023, personal income tax rates are amended as follows:
– exempt from PIT annual income up to EUR11,000
– 20% on annual income above EUR 11,000 and up to EUR 18,000
– 30% on annual income above EUR 18,000 and up to EUR 31,000
– 41% on annual income above EUR 31,000 and up to EUR 60,000
– 48% on annual income above EUR 60,000 and up to EUR 90,000
– 50% on annual income above EUR 90,000 and up to EUR 1,000,000
– 55% on annual income above EUR 1,000,000
The maximum monthly base (payroll cap) for calculating social security contributions is increased from EUR 5,670 to EUR 5,850.
14. Luxembourg 🇱🇺
Effective 1 January 2023, VAT rates are reduced as follows:
– standard rate – from 17% to 16%
– reduced rates – from 14% to 13%, and from 8% to 7%
Effective 1 January 2023, the minimum monthly base for calculating social security contributions is increased from EUR 2,313.38 to EUR 2,387.40, and the maximum monthly base – is from EUR 11,566.88 to EUR 11,936.98.
15. Egypt 🇪🇬
Effective 1 January 2023, the minimum monthly base for calculating social security contributions is increased from EGP1,400 to EGP1,700, and the maximum monthly base is from EGP 9,400 to EGP 10,900.
Harness Payroll and Tax Compliance with Global Payroll Calculator
Operating in multiple jurisdictions, you need guidance on global tax and labour law compliance. You must understand how different regions’ employment taxes impact your company and its global employees.
Most organizations with a global footprint struggle to calculate employment tax because they fear uncertainty and may need access to up-to-date intelligence.
Global Payroll Calculator by Acumen International revolutionizes how businesses leverage global payroll information by streamlining global payroll and tax calculations for 190 countries.
That’s where we come in with the Global Payroll Calculator. Acumen International is an innovative technology company that has created solutions that help businesses like yours navigate the complexities of calculating employment taxes while optimizing their hire cost and avoiding the costs and risks associated with not doing so.
We’ve automated routine processes so that you can speed up data collection, gain valuable insights into the global talent market, make informed decisions about talent acquisition, get the complete picture of the latest tax and employment cost benchmarks, labor law compliance requirements in 190 countries —and much more!
gain guidance on what to pay your top talent while maintaining a diverse workforce;
simplify & streamline payroll planning;
achieve 100% payroll and tax compliance
attract and retain talent in a competitive marketplace.
Every Aspect of Employment Tax and Compliance Covered by Global Payroll Calculator
1. Save Time
Make cross-jurisdictional employer and employee tax research a breeze. Get instant access to trusted commentary and guidance from leading employment tax and compliance experts.
2. Save Money
Navigate the complexities of multi-location employment tax regulations. Reduce the costs associated with outsourcing to third-party local employment tax and compliance advisors.
3. Avoid Risk
Avoid costly HR and tax compliance mistakes by providing accurate and up-to-date tax notes.
4. Budget Payroll
Find out the details you require to budget compliant and accurate payroll: employer’s social security, mandatory benefits, insurance funds, and payroll tax obligations.
5. Expand Confidently
Determine the best country for expansion based on the most favourable tax and social security requirements.
6. Benchmark Vendor Quotes
Conduct service provider quote benchmark analysis. Combat global employment overspending — data validation at your fingertips.
7. Retain Talent
Get up-to-date insights into mandatory benefits in 190 countries. Build a complete picture to develop an effective employee retention strategy.
8. Get Talent Intelligence
Build a strong talent acquisition strategy. Compare talent pools. Calculate and compare foreign and local employee taxes to understand the best place to hire talent. Make informed global hiring decisions.
Acumen’s Global Payroll Calculator Gives You an Edge — No Matter Where You Are
The Global Payroll Calculator by Acumen is a SaaS solution for instant, and accurate cost of employment estimates that offers:
total employment costs estimation (detailed employer & employee taxes and contributions);
locals and expats’ cost of hire estimates in all international currencies;
coverage of 190 countries and cross-country comparison;
time & cost savings due to instant automated estimates and unified data in one place vs. multiple providers.
About Acumen International Employer of Record
Acumen International is a Global Employer of Record that offers a unique Employ to Expand hybrid talent management solution designed to give businesses the tools and services they need to hire, onboard, payroll, and reward employees worldwide — all with a single partner across 190 countries.
With an innovative and flexible Tiered Pricing Model, Acumen International can help its clients hire a local and foreign workforce with minimal cost, risk, and time while ensuring 100% employment and tax compliance.
Global Payroll Calculator by Acumen International is a payroll tax and compliance intelligence tool that supports multinational employers and HR professionals in accurate forecasting their total global employment costs and liabilities.
Hiring top global talent is not easy under any circumstances, but when the heat is on to fill vacancies ASAP, it is easy to go into crisis mode. Operating under duress often leads to costly mistakes that can snowball down the road, putting your business at risk, harming your reputation, and creating unnecessary drama. When… Read more How to Hire Top Global Talent Fast
Hiring top global talent is not easy under any circumstances, but when the heat is on to fill vacancies ASAP, it is easy to go into crisis mode. Operating under duress often leads to costly mistakes that can snowball down the road, putting your business at risk, harming your reputation, and creating unnecessary drama.
When faced with urgent hiring needs, especially when hiring globally, it is important to keep a cool head and not compromise your standards. Quality global talent is out there, you simply need creative solutions to find it. A global PEO can help.
Top 4 Reasons to Hire Top Global Talent Urgently
Every business owner or manager will eventually confront a situation where key personnel needs to be augmented or replaced, or where unforeseen circumstances create immediate hiring needs. Some common urgent hiring scenarios include the following.
1. Mergers or acquisitions
Mergers or acquisitionswhere corporate reshuffling leaves critical gaps in key positions displace key employees, or demands relocation. You may lose some of your most seasoned top talents if they are unwilling to relocate. Or if some of the candidates want to be hired directly by your company while you are terminating your business entity because of the takeover. Either way, you may need to transfer your workforce among departments or even to another entity, and allocate them to the active projects, which can directly impact your company’s bottom line.
2. Urgent global talent onboarding
Urgent global talent onboarding on multiple fronts, where new technologies, new departments, or new products and services require skilled professionals for implementation. Finding qualified candidates with specific skills and enticing them to work for you can be difficult. However, timely onboarding can become crucial in the war for top global minds if you don’t want to lose a valuable candidate to competition.
3. Local compliance threats
Local compliance threats, where international contractors must be rapidly converted to full-time employees to avoid litigation and tax issues related to independent contractor/employee misclassification. Political unrest, economic downturns, or regime changes can make compliance a volatile landscape.
4. Sudden critical growth
Sudden critical growth, where your new company receives more orders than it can handle to keep up with explosive demand for your goods or services. While this is generally a good thing, the urgent need for staffing can be a nightmare.
In such situations, your first impulse may be to scoop up the first warm bodies whose CVs reflect the requisite qualifications. But when it comes to onboarding new hires, hasty decisions often lead to long-term regrets.
What Are the Key Challenges of Hiring Top Global Talent Urgently?
When you have critical positions to fill in multiple countries, the challenge looms even larger. There are numerous potential obstacles to overcome and countless nuances that vary from one country to the next, each requiring a unique approach.
Some common challenges faced by recruiters on an international scale include:
Finding qualified candidates
It is not uncommon for businesses to face a “feast or famine” situation. When you’re not hiring, applicants are beating down your door, but when you desperately need to fill a vacancy, there are no qualified applicants to be found.
Beating competitors’ offers
In many cases, if you have urgent staffing needs, there is a good chance your business rivals are vying aggressively for the same pool of candidates.
Beating competitors’ offers
In many cases, if you have urgent staffing needs, there is a good chance your business rivals are vying aggressively for the same pool of candidates.
Impossible timelines for hiring
Higher-ups often want a position filled yesterday, but international hiring is a long game. There can be scads of red tape that pump the brakes on your hiring machine, delaying the onboarding of essential employees.
A general shortage of skilled candidates
The explosive growth in technology has left companies scrambling to fill high-tech positions in a field where the number of vacant positions exceeds the number of skilled candidates.
Under-informed recruiters
It is not unusual for certain positions to be outside the scope of recruiters’ knowledge. This can pose problems when candidates ask specific or technical questions about the position that recruiters are not equipped to handle.
Employee retention challenges
Chances are your prime candidate pool will be Millennials, born between 1980 and 2000. They have a lot to offer, being tech-savvy, flexible, and forward-thinking. But they are less likely to stay at a single job for decades, and more likely to be lured away within two to three years of hiring. This means that your urgent hiring woes are not likely to go away anytime soon.
If you want to succeed and thrive in the international market, you need the very best talent you can find.
Solutions for Hiring Top Global Talent
Hiring in a hurry is not the optimal scenario, but there are solutions available to accelerate the recruiting and employment process. One of the smartest moves you can make is to align yourself with a global professional employer organization (PEO).
A global PEO can offer HR support for legal onboarding and payrolling selected candidates and can help you recruit international talent if you haven’t found them yourselves. The advantage of working with a global PEO company is that they know how to deftly navigate the often choppy waters of international hiring from one country to the next. A global PEO can expedite foreign employee onboarding procedures including recruiting and arranging local payroll for the desired candidate, so you can fill critical key positions in the least amount of time.
Global PEO Services Include
Local tax compliance
Payroll and tax administration
Legal and regulatory requirements
Insurance and other mandatory and voluntary benefits provision
Workers comp and safety compliance
A global PEO has access to technologies and resources that may not be available to smaller enterprises. Also, they have global expertise that companies that only operate in their home country lack. They can offer your global employees better benefits and incentives, ensure accurate and timely payroll, onboarding, and termination, and provide professional global HR support. Partnering with a global PEO can give your company an advantage over your competitors when it comes to recruiting the world’s top talent.
Acumen: Your Express Global PEO for Immediate Employment Needs
Today’s world is changing at a rapid pace, posing challenges never before experienced by global employers. To stay competitive, businesses need to be nimble and creative, finding unique solutions for new challenges that no company has had to face in the past.
Whether you’re going through a company acquisition and need to transfer the current workforce as a result of restructuring so that there are no breaks in work
Urgent in-country tax compliance threat
Starting your own company abroad but need a stopgap solution meanwhile and want the employees to work for you before incorporation is done
Cannot move the hire date and have a pressing talent gap to be filled in.
Request a tailored quote for your particular case today.
Contact Acumen today and let us take the stress out of global hiring even if you are pressed for time.
There is no question that technology has fueled a global gig economy that enables freelancers and small business contractors to engage with enterprises of all sizes. While some businesses benefit from as-needed services from independent contractors and sales representatives, there are some downsides for both companies and contractors. Many businesses gravitate to traditional employer-employee relationships.… Read more Salaried Employees vs. Independent Sales Reps: Which Is Better?
There is no question that technology has fueled a global gig economy that enables freelancers and small business contractors to engage with enterprises of all sizes. While some businesses benefit from as-needed services from independent contractors and sales representatives, there are some downsides for both companies and contractors. Many businesses gravitate to traditional employer-employee relationships.
Full-time Employee vs. Independent Contractor
While salaried employees and independent contractors perform similar tasks for businesses, several distinct differences define their relationship to and interactions with the employer.
Please mind the ✅ – Benefits and ❌ – Risks connected with both* :
Salaried Employees
Independent Contractors
Working Relationship
✅ Long-term formal employment: Long-term engagement with defined job roles. An employee is hired to perform a specific ongoing role in a company and is given a job description that clearly defines the scope and nature of their work.
Temporary per-project employment: Short-term engagement. While some contractors work for the same company for years on end, their position in the company is fundamentally temporary. The employer is not legally bound to engage the contractor for a defined period of time beyond that agreed upon contractually. Tasks are often fragmented and short-term.
Taxes and contributions
✅ Employers are responsible for withholding a defined percentage of employee wages for federal and state taxes and for Medicare, Social Security, Worker’s Compensation, medical insurance, and other withholdings. They must issue IRS form W-2 to employees by the end of January of the previous year.
❌ Independent contractors are responsible for their own taxes, medical insurance, and other contributions. They must submit IRS form 1099-MISC with their tax returns detailing their year’s earnings and pay self-employment taxes directly to the government.
Control vs. Autonomy
✅ Employer control. An employer retains a high level of control over their salaried employees. They set tasks, monitor time, and oversee work completion. Time-tracking software may be used to ensure productivity. The employer defines decision-making and time management.
Personal autonomy. Contractors typically have less oversight than salaried employees and have more control over their time. While the employer may request specific tasks or projects to be completed, they have less control over how the contractor accomplishes the required work. Retain greater autonomy for time management and decision-making.
Intellectual Property Ownership
✅ Employer retains full IP rights for employee innovations: Employees who develop innovative solutions or work on creative projects cede ownership of their intellectual products to the employer.
❌ Contractor retains IP rights for innovations unless otherwise stipulated: Contractors rarely participate in a company’s production or creative endeavors. If a contractor is inspired while working for a company, they retain ownership of any innovations or creative works that arise as a result.
Commitment
✅ Employee engagement. Employers expect salaried employees to commit fully to the business without conflicts of interest or divided loyalties. Employees may be prohibited from moonlighting with other companies.
❌ Limited commitment. While many contractors develop long-term relationships with the companies they serve, they are free to engage with other companies. They are not obligated to remain loyal to a single entity. A contractor is not a strategic member of a company’s team and makes minimal contributions to its long-term growth.
✅ Team mentality. Employees are expected to share and model the company’s values and commit to its mission. Key professionals become emissaries for the company in the public domain.
Compensation
✅ Long-term compensation. In exchange for their loyalty and commitment to the company, employees are compensated with salaries, insurance benefits, retirement packages, opportunities for professional development, and other perks that make it beneficial to remain with the company long-term.
❌ Short-term compensation. Contractors are typically paid per project and do not enjoy the perks and benefits of full-time salaried employees. They are responsible for their own taxes, insurance, retirement funds, and professional growth.
An employee or a salaried worker pays Federal Insurance Contributions Act (FICA) taxes just like their employer in equal parts.
The contractor, also called a commission-based worker is responsible for paying self-employment (SECA) taxes.
Check the below infographics for greater visibility:
Risks of Hiring Contractors Over Employees
For many businesses expanding overseas, it may seem sensible to start with local independents in the interest of saving money on taxes, benefits and the cost of establishing a legal entity. However, working with foreign independent contractors has multiple inherent risks.
Compliance Risk
Working in foreign nations can present pitfalls that you didn’t see coming. When you employ foreign workers, you must be certain that you fully comply with national and local laws and regulations regarding taxes and employment guidelines. Failure to meet compliance requirements can put you in a legal bind that can be costly and time-consuming.
Financial Risk
Employing foreign independent contractors gives you minimal control over their behavior or activities and how they represent your brand. They may even work for your competitors and promote whichever products bring the highest commission, losing you money in the long run.
Business Risk
Contractors are temporary employees with limited loyalty to any single entity except their own. Your competition can easily poach high performers, and low performers can harm your brand’s image. High turnover can result in loss of leads and customers and have a destabilizing effect on workforce morale.
Full-time Employee vs. Independent Contractor
✅ – Benefits and ❌ – Risks* :
Salaried employees
Independent contractors
Risks
✅ Minimal compliance and business risks. No misclassification risks
❌ May pose high-penalty risks due to misclassification
While using an independent commission-based sales force may be less expensive in the short run, a dedicated sales team that works exclusively for your brand will save you money in the long run. Moreover, the complexities and challenges are magnified if you take on contractors for projects in multiple countries.
Get the Best of Both Worlds with a Global Employer of Record
A Global Employer of Record (EOR) can provide the ideal solution to your overseas staffing problems. A Global Employer of Record (EOR) is a third party that acts on your company’s behalf to onboard and payroll your chosen foreign talent without establishing a foreign entity for your business.
Partnering with a Global Employer of Record (EOR) can benefit your business in multiple ways:
Increase the loyalty of your foreign salesforce without having to set up your own legal entity abroad. Delegate employee management to a Global Employer of Record (EOR) to handle the entire scope of employee hiring, retention, replacement, and compensation.
Build strong brand equity via a globally distributed workforce that represents your company proudly and builds customer relationships across the globe. Retain ownership of your client base after salespeople leave your company.
Protect your company’s security, IP rights, and client database from unscrupulous contractors without loyalty to your brand.
Build a hybrid salesforce that is 100% dedicated to your products and brand. Combining the expertise of independent agents or contractors with the loyalty of salaried employees creates a win-win situation that gives you the best of both worlds while mitigating your compliance, financial and business risks.
A Global Employer of Record (EOR) is less expensive than in-country incorporation, allowing you to exit unlucrative markets easily. You can start with a small team or even one person in multiple countries and go global now without waiting for your business to grow.
Global Employment Solutions at Your Fingertips
Working with a Global Employer of Record (EOR) partner can benefit businesses as they expand into new markets. A Global EOR partner is an entity that takes on the legal responsibility of employing workers in a foreign country on behalf of the business. The Global EOR partner is responsible for all employment-related matters, including payroll, taxes, benefits, and compliance with local labor laws and regulations.
Here are some of the benefits of working with a Global EOR partner:
Benefit
Description
Compliance with local laws
Global EOR partners ensure compliance with local laws and regulations, reducing the risk of legal disputes and fines
Access to top global talent
Global EOR partners have local knowledge and expertise, making it easier for businesses to find and hire the right talent
Faster time to market
Global EOR partners can handle all employment-related matters, reducing the time and resources needed to expand into new markets
Lower costs
Global EOR partners can help businesses save money by reducing the need for businesses to hire additional staff or set up local entities
Reduced risk
Global EOR partners ensure compliance with local laws and regulations, reducing the risk of legal disputes and fines
Compliance with Local Laws and Regulations across 190 Jurisdictions
One of the most significant benefits of working with a Global EOR partner is that they ensure compliance with local laws and regulations. This is especially important in countries with complex and ever-changing labor laws. Global EOR partners have the expertise and resources to navigate the legal landscape, ensuring businesses comply with all local laws and regulations.
Access to Top Global Talent
Working with a Global EOR partner provides businesses access to top global talent. Global EOR partners have local knowledge and expertise, making it easier for businesses to find and hire the right talent. They have established networks of local candidates, which can be especially valuable in markets with tight talent pools.
By working with a Global EOR partner, businesses can expand their talent pool and find the best candidates for their positions. This can help businesses achieve global expansion goals and compete more effectively in the global marketplace.
Faster Time to Market
Working with a Global EOR partner can also help businesses reduce the time and resources needed to expand into new markets. Global EOR partners can handle all employment-related matters, such as payroll, benefits, and compliance, allowing businesses to focus on their core operations.
This can result in faster time to market, as businesses can quickly establish a presence in new markets without having to set up local entities or hire additional staff. This can be particularly beneficial for businesses that must enter new markets quickly to take advantage of market opportunities or stay ahead of competitors.
Lower Costs
Expanding into new markets can be costly, especially if businesses need to hire additional staff or set up local entities. Working with a Global EOR partner can help businesses save money by reducing the need for additional staff or local entities.
Global EOR partners handle all employment-related matters, including payroll, benefits, and compliance, which can significantly reduce the cost of expanding into new markets. This can be particularly valuable for businesses that are expanding into multiple markets simultaneously, as it can help them save time and resources.
Reduced Risk
Expanding into new markets can be risky, particularly if businesses are unfamiliar with local laws and regulations. Working with a Global EOR partner can help businesses reduce the risk of legal disputes and fines by ensuring compliance with local laws and regulations.
Global EOR partners have the expertise and resources to navigate the legal landscape, ensuring businesses comply with all local laws and regulations. This can help businesses avoid costly legal disputes and fines, which can significantly impact their bottom line.
In summary, working with a Global EOR partner can benefit businesses as they expand into new markets. By ensuring compliance with local laws and regulations, providing access to top global talent, reducing time to market, lowering costs, and reducing risk, Global EOR partners can help businesses achieve their global expansion goals and compete more effectively in the global marketplace.
London, UK — Acumen International, a global Employer of Record (EOR) and Professional Employer Organization (PEO) solutions provider, is pleased to announce that it will be a Silver-level Sponsor for the SIA (Staffing Industry Analysts) Executive Forum Europe in London. As digitization increasingly transforms how businesses operate, it’s more important than ever for staffing organizations… Read more Acumen International Is a Silver Sponsor of SIA Executive Forum 2022
London, UK — Acumen International, a global Employer of Record (EOR) and Professional Employer Organization (PEO) solutions provider, is pleased to announce that it will be a Silver-level Sponsor for the SIA (Staffing Industry Analysts) Executive Forum Europe in London.
As digitization increasingly transforms how businesses operate, it’s more important than ever for staffing organizations to stay ahead of emerging trends. This Executive Forum brings together top CEOs, owners, and senior executives of the leading staffing companies worldwide to discuss the most pressing staffing industry and technology issues.
Discussions will focus on how different sectors respond to the digitization and explore opportunities and threats that may impact staffing and recruitment. This is an excellent opportunity to discuss critical technology topics and explore emerging staffing industry threats and opportunities. With insights and perspectives from various countries, this is an essential event for anyone in staffing wanting to stay at the forefront of this rapidly changing landscape.
At Acumen International, we believe that sharing our expertise with colleagues in the staffing industry is vital to promoting leadership in global employment and compliance. We are excited to participate in this year’s annual event — a highly respected gathering of like-minded staffing professionals. We provide technology and global employment solutions at scale, but we have always understood the importance of maintaining the personal touch. That’s why events like this Forum, where we can meet in person and forge genuine connections, are so important. This is an excellent opportunity to network with the top executives in the staffing industry and learn from each other,” said Nick Ganzha, the Founder and CEO of Acumen International.
About Acumen International
Acumen International is a Global Employer of Record that offers a unique Employ to Expand hybrid talent management solution designed to give businesses the tools and services they need to hire, onboard, payroll, and reward employees worldwide — all with a single partner across 190 countries.
With an innovative and flexible Tiered Pricing Model, Acumen International can help its clients hire a local and foreign workforce with minimal cost, risk, and time while ensuring 100% employment and tax compliance.
Global Payroll Calculator by Acumen International is a payroll tax and compliance intelligence tool that supports multinational employers and HR professionals in accurate forecasting total global employment costs and liabilities.
For more information, visit: https://expressglobalemployment.com/
About Staffing Industry Analysts (SIA)
Founded in 1989, Staffing Industry Analysts (SIA) is the global advisor on staffing and workforce solutions. Our proprietary research covers all categories of employed and non-employed work, including temporary staffing, independent contracting, and other types of contingent labor. SIA’s independent and objective analysis provides insights into the services and suppliers operating in the workforce solutions ecosystem, including staffing firms, managed service providers, recruitment process outsourcers, payrolling/compliance firms, and talent acquisition technology specialists such as vendor management systems, online staffing platforms, crowdsourcing, and online work services. We also provide training and accreditation with our unique Certified Contingent Workforce Professional (CCWP) program.
As a division of the international business media company Crain Communications Inc., SIA is headquartered in Mountain View, California, with offices in London, England.
Dublin – September 22, 2022 – Acumen International, a leading global PEO and EOR service provider, announced it received the Payroll Innovation Award 2022 from the Global Payroll Association (GPA) for its Global Payroll Calculator. The Global Payroll Awards 2022 by GPA The Global Payroll Association Awards 2022 is an annual event that recognizes businesses,… Read more Acumen International Wins Global Payroll Association’s Payroll Innovation Award 2022
Dublin – September 22, 2022 – Acumen International, a leading global PEO and EOR service provider, announced it received the Payroll Innovation Award 2022 from the Global Payroll Association (GPA) for its Global Payroll Calculator.
The Global Payroll Awards 2022 by GPA
The Global Payroll Association Awards 2022 is an annual event that recognizes businesses, teams, and individuals who have made significant contributions to the growth and advancement of the global HR and payroll industry. GPA Award nominees are carefully scrutinized, and the best candidates are shortlisted to contend for awards.
We are delighted to announce that Global Payroll Calculator by Acumen International has been honoured as one of the payroll industry’s leaders, winning the prestigious Payroll Innovation Award 2022.
This award is a testament to our dedication to delivering innovative, tailored solutions and outstanding service for the global PEO, EOR, and payroll industries. With this distinction, Acumen International will remain at the forefront of the global employment landscape.
Acumen International Unveils Global Payroll Calculator
The Acumen team has invested long hours, considerable resources, and intellectual capital to examine global payroll challenges and solutions. We looked at options for entity setup, third-party employment, cost calculations, multi-jurisdiction hiring, and compliance issues to reimagine and streamline how global businesses hire and compensate their global workforce.
Acumen’s team of experts brainstormed ways to leverage technology, to reduce the manual, labor-intensive processes required to calculate global employment costs. As a result, Global Payroll Calculator provides automated and technology-enabled global payroll calculations to support HR professionals in achieving the organization’s strategic goals. The tool can replace dozens of providers and spreadsheets.
GPC — Global Payroll Innovation Turning Acumen into Industry Leaders
Acumen International’s Global Payroll Calculator (GPC) earned us a spot on the GPA Awards 2022 shortlist for the Payroll Innovation Award 2022. As an innovative SaaS tool and an integral part of Acumen’s Express Global Employment platform, Acumen’s GPC revolutionizes how businesses leverage global payroll information by streamlining global payroll calculations for countries around the globe.
Acumen’s Global Payroll Calculator Gives You an Edge — No Matter Where You Are
The Global Payroll Calculator by Acumen is a SaaS solution for instant and accurate cost of employment estimates that offers:
total employment costs estimation (detailed employer & employee taxes and contributions);
locals and expats’ cost of hire estimates in all international currencies;
coverage of 190 countries and cross-country comparison;
time & cost savings due to instant automated estimates and unified data in one place vs. multiple providers.
The Global Payroll Calculator is continuously updated to reflect changes in global taxation. GPC helps businesses acquire global talent faster while complying with all applicable laws and tax regulations. GPC empowers international businesses to confidently make well-informed decisions on global hiring and business expansion in just a few clicks.
Melanie Pizzey, CEO and Founder of the Global Payroll Association had this to say about Acumen International:
Year after year, Acumen International has outdone itself in contributing to the growth and success of our industry. The GPA awards were created to recognize businesses like Acumen that set a high bar for performance and leadership. We are pleased and honored to have Acumen International as GPA Awards 2022 winners.
Natali Oprya, Managing Director of Acumen International, commented as follows:
Acumen is thrilled to be GPA Awards 2022 winners. The support and recognition of our industry peers inspire us to continue our work toward finding innovative tools and solutions that meet the changing demands of the global HR and payroll industry. We give our heartfelt thanks and gratitude to the Global Payroll Association for this amazing opportunity.
About Acumen International
Headquartered in the UK, Acumen International is a leading provider of EOR (Employer of Record) and PEO (Professional Employment Organisation) solutions with a global reach in 190 countries.
Acumen International offers innovative SaaS solutions to multinational companies expanding in today’s volatile global market. The company helps clients solve their most complex challenges, streamline global employment, reduce costs, and mitigate compliance risks, providing the peace of mind needed to focus on achieving their strategic objectives.
About GPA Awards
Every year, the GPA recognizes and awards outstanding individuals, teams, and business entities for excellence in the global HR and payroll industry. To be eligible, nominees must demonstrate excellence in their respective categories.
A distinguished panel of judges representing the payroll industry and public sector evaluates nominations to determine those organizations that truly stand out from the competition. This year’s Global Payroll Association Awards winners exemplify outstanding innovation, leadership, and commitment to excellence in the payroll industry.
Dublin – September 22, 2022 – The Acumen International team is excited to participate in the Global Payroll Association’s HR & Payroll Leaders Symposium in Dublin, Ireland. It is an excellent opportunity to meet other global employment professionals, payroll industry leaders, and global payroll experts to discuss the challenges and future of the global payroll… Read more Acumen International Attending the GPA Symposium 2022 in Dublin, Ireland
Dublin – September 22, 2022 – The Acumen International team is excited to participate in the Global Payroll Association’s HR & Payroll Leaders Symposium in Dublin, Ireland. It is an excellent opportunity to meet other global employment professionals, payroll industry leaders, and global payroll experts to discuss the challenges and future of the global payroll industry and to share insights.
Global Payroll Challenges 2022 and Solutions
Events in recent years have upended every aspect of global employment and business expansion, inspiring us to seek innovative solutions to meet the needs of our global clients. Topics at the HR & Payroll Leaders Symposium will cover:
How to change the face of Global Payroll through the use of data.
Top trends and issues of the Global Payroll evolution.
How to close skills and knowledge gaps to build the payroll industry’s future.
Our team is thrilled to meet Symposium speakers and communicate with experts. We are even more proud to present to our industry colleagues and global payroll professionals our innovative Global Payroll Calculator (GPC) – the powerful tool for accurate international payroll budgeting in 190 countries.
Changing Face of Global Payroll: News in First Person
The Global Payroll Association Symposium is a must-attend event for professionals aiming to stay ahead of the curve in the global payroll industry, an opportunity to hear from top speakers about the latest trends and developments in the field and get an insider’s and expert’s view of where the industry is headed.
Melanie Pizzey, the CEO of the Global Payroll Association, made a kick-off speech thanking all the Symposium participants for joining the GPA today to discuss the changing face of global payroll, what revolutionizes the industry, what’s next to come – and where we are all in it.
Melanie gave the stage to the Symposium’s key speakers.
I’ve never met payroll deps who are over-staffed. – says Mary Holland, Chief Customer Officer, Payslip. – They always ask for more people. In payroll, we always keep seeing to it that all is happening the way it should. Like at the hospital – when all the processes and people’s lives are under your control – same here, all payroll specialists work much more than their allocated hours would sustain control. So payroll is a profession, and the future’s in that.
Tiffany Appleby, ISVP, Alliances and Marketing, Immedis, concentrated on top ways to drive workplace happiness.
She talked about change management, technology adoption and the transition of payroll specialists into pay masters, as well as recognizing their important role for companies.
Tiffany mentioned:
Payroll experts have the data and so they can become the kings and queens of the payroll kingdom. And they can use the knowledge and the data they have to make recommendations to their clients about how they can grow by projecting their employee costs
Mary Holland (Chief Customer Officer, Payslip), P Simon Parsons (Director UK Compliance Strategies, SD Worx),Tiffany Appleby (SVP, Alliances and Marketing, Immedis), Lisa Orton (Director, Vialto Partners) and Lee McIntyre- Hamilton, (Global Mobility and International Employment Tax, Keystone Law) discuss the challenges in the Global Payroll Industry.
Acumen International was shortlisted for two prestigious categories of the Global Payroll Association Awards 2022: Employer of Record Organization of the Year 2022 Payroll Innovation Award 2022 The Global Payroll Association (GPA), the leading professional organization for businesses that manage global payroll and international HR, annually recognizes some of the best global payroll and HR… Read more Acumen International Shortlisted for GPA Global Payroll Awards 2022
The Global Payroll Association (GPA), the leading professional organization for businesses that manage global payroll and international HR, annually recognizes some of the best global payroll and HR service providers worldwide at their GPA Summit. This year’s GPA will host the Summit in Dublin, Ireland, on September 22nd, 2022. The Summit provides an opportunity to discuss global employment and payroll industry trends, challenges, and perspectives.
Each year, the GPA recognizes and awards the most prominent individuals, teams, and business entities for excellence in the global HR and payroll space, in 13 distinct categories. To be eligible for the GPA Awards 2022, each company must show excellence across all aspects of its business through various criteria. These include superior performance in the global employment arena, deep global payroll management and compliance expertise, knowledge of local legislation, and a solid commitment to meeting clients’ needs for payroll technology.
It is not the first time that Acumen has earned the recognition of our industry peers for outstanding performance on the HR international, global employment, and payroll stages. The GPA previously recognized Acumen International as a Global PEO of the Year in 2020, but the company has not been content to rest on its laurels. The GPA Award 2022 nominations mark Acumen’s commitment to staying ahead of industry trends and providing comprehensive and innovative solutions for the global employment industry.
To be in the running for both awards is a huge achievement. However, this year the competition is stiffer than ever, with Acumen International up against global giants like Google and Experian. In particular, Acumen’s Global Payroll Calculator (GPC) has caught the attention of industry colleagues as an innovative solution for businesses operating on a global scale.
Global Payroll Innovation Award 2022
Acumen International’s Global Payroll Calculator was selected as a nominee for Payroll Innovation Award 2022 because it represents a fundamental shift in how global payroll information is processed. Through its intuitive interface, combined with advanced data-wrangling capabilities, GPC streamlines and simplifies global payroll calculations from every corner of the globe.
Global payroll administration can be complex and ever-changing, with various rules and regulations that employers must follow to ensure compliance. Determining employment cost and tax liability across multiple jurisdictions requires significant time and effort to calculate and data-wrangle. Different legal entities and filing groups add to the complexity.
Such key variables can include everything from tax apportionment and modifications to employee benefits and compensation provisioning to tax adjustments and paid time off that affect tax filing. Managing all of these elements simultaneously can be a challenge, but it is necessary to maintain a compliant payroll and make sure that everything is accounted for correctly.
Global Payroll Calculator
The GPC considers local taxes, payroll, benefits, hiring practices, compliance requirements, and other labor-related issues, empowering businesses to make well-informed and confident global hiring decisions and accelerate operations.
The Global Payroll Calculator (GPC) by Acumen International, an integral part of the Express Global Employment Platform, is a powerful and easy-to-use SaaS solution that helps international employers instantly and accurately estimate the total employment costs for a local and foreign workforce in 190 countries.
Global Employment Innovations 2022
As the world continues to globalize, businesses must change how they operate to stay ahead of the competition. The C-suite leaders are expected to take a more strategic approach to global expansion and employment.
Acumen International’s team invested significant time, resources, and intellectual capacity into reimagining each step of the global employment journey, including entity setup options, third-party employment models, total employment cost calculations, multi-jurisdiction hiring, and compliant processes.
Acumen’s experts focused heavily on inserting technology tools to supplement human effort, replacing manual input with automation, and allowing global employment professionals to spend their time on high-value areas.
As a result, Acumen International has developed the Express Global Employment (EGE) Platform — a more efficient, cost-effective, and compliant global employment solution for its clients and network partners.
The regulatory employment law landscape is continuously changing and becoming more complex, making it difficult for multinational companies to ensure compliance. The EGE Platform aims to help C-level executives and international employment professionals navigate the complexities of the global expansion journey, make informed decisions, and avoid risks such as tax, non-compliance, employee misclassification, and permanent establishment risks across multiple jurisdictions.
The Express Global Employment Platform is intended to provide expert advice, guidelines, and summaries of the employment laws and compliance regulations for hiring and dismissing employees, managing independent contractors, and immigration rules in 190 countries. The Global Employment Platform eliminates the need for pesky details while ensuring accuracy and employment compliance!
Express Global Employment Platform allows streamlining of global payroll processing, benefits, and tax administration, making it easy to manage employee and contractor information in one place.
Nick Ganzha, CEO and Founder of Acumen International, says:
It is an honor to be shortlisted for the third time for the GPA Awards 2022. No company can be successful without a great team behind it. At Acumen International, we believe that our people are our most valuable asset. We work hard to support, empower and motivate them so they can keep growing. This commitment sets us apart and drives us to achieve more. Acumen International is on a fast track to success.
Our Express Global Employment Platform is a massive leap forward, putting us at the forefront of the global employment industry. We have a robust roadmap for 2022-2023 full of innovations to enhance our current solutions portfolio while working toward new product launches through the end of the year.As a leading Global Employer of Record Service Provider, we continuously extend our product offering to meet the evolving clients’ needs. Our Global Employment Platform is a suite of innovative tools helping companies take their business international. This offering is part of our global strategy: we are now a partner that can offer more than just traditional Employer of Record Services.
About Acumen International
Headquartered in the UK, Acumen International is a leading provider of EOR (Employer of Record) and PEO (Professional Employment Organisation) solutions with a global reach in 190 countries.
Acumen International offers innovative SaaS solutions to multinational companies expanding in today’s volatile global market. The company helps clients solve their most complex challenges, streamline global employment, reduce costs, and mitigate compliance risks, providing the peace of mind needed to focus on achieving their strategic objectives.
About Global Payroll Association (GPA)
The Global Payroll Association (GPA) is the leading professional organization for businesses that manage global payroll and international HR. The GPA is an organization that promotes the advancement of human resource management through educational resources, industry news, and networking opportunities. GPA is dedicated to helping its members find productivity, effectiveness, and professionalism. It has more than 6,000 members in over 80 countries.
Global employment today is a puzzle. Some pieces are missing, some are swapped around, and some are even upside down or inside out. Whether you are a multinational corporation, an international non-profit, or just a business that operates in more than one country, you have probably had the experience of running into some of the… Read more Global Employment Challenges and Solutions
Global employment today is a puzzle. Some pieces are missing, some are swapped around, and some are even upside down or inside out. Whether you are a multinational corporation, an international non-profit, or just a business that operates in more than one country, you have probably had the experience of running into some of the same challenges with global employment.
When hiring a staff to work overseas, some challenges come far beyond the nuts and bolts of finding and vetting candidates. Companies often overlook these challenges when they think only of locally-hired employees, which can have extreme consequences for businesses that employ a workforce internationally.
The employment laws, compliance regulations, legal requirements, and tax implications can be complicated. The laws vary widely by country, making it challenging to structure payroll and employee benefit plans around international operations.
Why is this? Because if you are not careful, you might find yourself unwittingly breaking one employment law regulation or another in your new country. This could lead to fines, other legal issues, and harmful public exposure for your brand. It is not just about being bad for your business, though; it is also about being bad for the people who work in your company.
A global Employer of Record helps solve the global employment puzzle. That’s why companies turn to a global EOR that has experience operating in many countries and can provide expert advice on compliance issues.
1. Local Incorporation Cost and Risk
Different businesses have different strategies for entering and exiting countries. However, ad-hoc strategies are more likely to lead to miscommunication and problems. Businesses must have a fully implemented strategy before entering or exiting countries. By doing more planning and preparation, the process will be more straightforward.
3 Options for Multi-location International Employment
Businesses establishing a global presence face the challenge of managing and scaling an employee base with no common borders or language. To successfully expand abroad, companies have several options for enabling hiring in international markets.
There are six key things to consider when choosing an employment method for your company’s global expansion:
Budget and time frame
Tax implications
Compliance
Employment liability
IP protection
Asset acquisition.
3 Most Common ways of Local Entity Establishment
Overseas Permanent Establishment (a representative office, a branch, a subsidiary, and other foreign legal entity types )
Selecting independent contractors to handle tasks remotely.
Work with a global EOR (Employer of Record) and GEO (Global Professional Employer Organisation) Partner.
You’re expanding your business into new territories with many new challenges. You’re revising your business models to better suit overseas markets, setting up foreign entities to make local hires, and dealing with the tax implications.
Incorporation and payroll registration at the local level are essential. However, the associated costs and time investment required for skilled accounting and legal support can be prohibitive. A Global Employer of Record is the solution that helps you skip the costly and time-consuming tasks of local incorporation and registration. A global EOR ensures compliance without sacrificing flexibility or control of your foreign workforce.
Engaging the services of a global EOR (employer of Record) lets you offload compliance-related concerns and skip the hassle of incorporation.
Skip the paperwork, and skip the hassle. Stop worrying about complex tax rules and legal issues your business faces. Let us help you enter foreign markets with just one payment and a single contract.
The world is becoming increasingly connected, with people and businesses moving across borders to take advantage of opportunities. However, employment and tax legislation have not kept up with this trend, making it difficult for companies to stay compliant.
Employment taxes can be a significant burden for businesses, especially those that hire internationally.
There are many different types of taxes that businesses have to pay, but employment taxes are one of the most important and ever-evolving. These taxes can vary significantly from country to country and can be a large portion of a monthly salary. Not only are the rates different in each country and state, but the tax filing methods can be highly complicated. So it can be challenging to figure out how much you need to withhold from your employees and how much you owe in taxes.
The problem with international employment taxes is they are often much more complicated than domestic ones and can vary even within one country. For example, there are different laws in the US depending on where you live and if you work for the federal government or a private company. In other countries, the applicable taxes may depend on which industry you work for.
3. In-country Employee Registration
Managing payroll in different countries can be a complex and challenging task. Employees may need to be registered and taxed differently in each country, and other laws must be followed. This can make it very hard to keep track of everything and ensure everything is done correctly. However, it is critical to ensure that employees are appropriately registered with the local authorities before they start work. Failing to do so can result in penalties for both the employee and the employer.
In many countries, payroll calculations vary significantly. For example, employees in some countries may receive a 13th and 14th-month salary halfway through the year or at Christmas as standard. Thus, it’s essential to be aware of the payroll practices in your country of employment.
Understanding how payroll calculations work in your new country is important to avoid surprises. Some countries have different rules when it comes to employment contracts. In some cases, you may be responsible for paying your employees for the entire employment contract duration even if they are not performing as expected or you want to end their employment early. This can be a financial shock to foreign employers who are not used to this practice.
For this reason, it is vital to ensure that you review and understand the terms of the employee’s contract before hiring them so you know what to expect.
However, by addressing some key challenges and partnering with a Global PEO, organizations can ensure compliant, accurate, and timely payments.
The financial year for many countries ends in March, and companies with a presence in more than one country need to produce financial reports for each country and send them to the relevant government bodies. With the end of the financial year approaching, accountants are busy preparing reports, some of which can be complex and difficult to navigate as they may be on foreign websites with little or no English language support. You must get these reports lodged on time, as it could result in late payment penalties.
Many of these reports need to be completed in the local language, so it is recommended that you use an accountant specializing in the country you are based in to ensure compliance before lodgement deadlines.
If your company plans to do business in multiple countries, clearly understanding each jurisdiction’s employment and tax laws is essential. Compliance with these laws can be complex and time-consuming, so many businesses outsource payroll management and other HR functions to a global Professional Employer Organisation (PEO). A reputable Global PEO will have experts on staff who are familiar with the specific requirements in each country where you plan to operate.
6. Local Employment Contracts Compliance
As an employer, you need to have local employment contracts that comply with the law of the jurisdiction where your employees work. These contracts should be provided in both English and the local language. Do not simply copy and paste your existing contract template from your home country – this could result in non-compliance and serious legal consequences.
When recruiting employees for your business, it is critical to ensure their employment contract is appropriate for the country where they will be working. A UK employment contract may not be valid in the United States because they are both English-speaking countries.
The language of the employment contract is a crucial detail to keep in mind during the recruitment process, as non-compliance to target country employment laws or any mistakes with the paperwork could cost you money, time, and potentially your business.
The employment termination process can be just as necessary as the hiring process. This part of employment should not be taken lightly as it can have many implications and consequences, both for the employer and the employee. Therefore, it is essential to consider all aspects of the situation before deciding.
The start of termination process begins when the employee signs the employment contract. If the termination guidelines are clear and precise from the outset, then terminating an employee will be much smoother.
When setting out the terms of employment, you must be clear about the notice period (making sure it’s compliant with the country-specific regulations) and what is expected in terms of returning company equipment, knowledge transfer, and a credit card or cash float balance. Non-compete clauses protecting your intellectual property are also important considerations. Doing so will help avoid misunderstandings and potential legal problems down the road.
If an employer does not have clear procedures for the termination of their employment contract, they may face litigation. Employees who feel mistreated may become disgruntled and legally contest the termination. This can be costly and challenging, especially if the dispute is in another country with a different time zone and language.
Employ to Expand: How to Put Together a Hard Puzzle with Acumen International Employer of Record
Many things can go wrong when you try to find employment overseas. Acumen International can help you navigate these challenges. Still, it is essential to know the potential obstacles you may face because if candidates are unhappy at any stage, the whole arrangement can fail.
As a Global Employer of Record, Acumen International enables organizations to quickly and compliantly hire employees in any country. We take care of all the employment-related details so our clients can focus on their business goals.
When deciding to move abroad for work, your selected candidates consider several factors. The visa and work permit process complexities, currency fluctuations, lifestyle choices, and family considerations can all impact their final decision.
As a global PEO and EOR, we understand that you must put your employees first when expanding your business globally. Considering this move’s impact on their lives, it is crucial to think outside the box and ensure they are comfortable and supported at every step.
It has become critical for organizations to understand applicable laws and regulations concerning issues such as minimum wages and benefits, employment standards, immigration, and labor relations in each location. A Global PEO and EOR can play an essential role in helping organizations navigate this complex global employment landscape by offering reliable and country-specific solutions and expert advice on compliance-related matters.
Global Employer of Record Services by Acumen International
Global payroll management;
Compliance with local tax rules (file & deposit) of the country where the EOR company is located;
Handling compliant employment contracts:
Background, education, and other checks;
Compliant onboarding and termination processes, as well as employee compensation;
Arranging visas and work permits for employees;
Ensuring the working process is organized under local labor laws;
Processing workers’ insurance and other benefits (day-offs, bonuses, and more);
Global employment process maps, employment guides, and other documentation.
A Comprehensive Global Employment Solution & a Single Point of Contact
Managing the employment side of your business can be a full-time job in and of itself. There are many options to consider when it comes to finding help, from payroll companies and tax and immigration advisors to employee benefits brokers to human resource consultants.
One alternative to working with numerous vendors is partnering with a Global Employer of Record. A Global EOR can manage all aspects of your business HR resources, from benefits and payroll to unemployment management and safety training. This can free up your time to focus on running your business.
A global Employer of Record can provide a full suite of services to help you replace the following multiple vendors.
Global Payroll Calculator: Instant and Accurate Global Employment Cost Estimation
When hiring employees and contractors across the globe, you may not choose the most cost-effective and business-friendly country.
Do you know which country is the most cost-effective place to hire employees?
What are the costs of entity establishment and legal representation?
What are the payroll costs and management fees?
What are your ongoing annual tax compliance costs?
Are you fully aware of banking implications?
Did you know that labor laws and hidden costs could make your company less efficient when choosing a country to run your business?
Did you know that there could be a more cost-effective country to hire employees in and save up to 50%?
If you are a business with a global footprint, you probably need help to keep up with the intricacies and uncertainties of managing a globally distributed hybrid workforce. This is because countries have different labor laws, compliance, and tax regulations. You need guidance on tax and compliance. You must understand how foreign employment taxes impact your company and its global employees. Most organizations with a worldwide footprint struggle to calculate employment tax because they fear uncertainty and may need access to up-to-date intelligence.
What if, instead of limiting your company’s international expansion by cutting through the jungle of local regulatory compliance, tax, labor, and immigration requirements, you could have all the information of 190 countries at your fingertips?
Global Payroll Calculator: Tax and Compliance Intelligence at Your Fingertips
That’s where we come in. Acumen International is an innovative global employment solutions provider that has created solutions that help businesses like yours navigate the complexities of calculating employment taxes while optimizing their hire cost and avoiding the costs and risks associated with not doing so.
Acumen International offers the Global Payroll Calculator to help businesses understand the tax rates and compliance requirements for hiring a local and foreign workforce. Acumen’s expert team tracks developments in 190 countries around the globe. It provides up-to-date data on local regulations related to tax, payroll regulations, benefits, hiring practices, compliance requirements, and other labor-related factors that impact an employer’s bottom line. This valuable information makes the Global Payroll Calculator an invaluable tool for businesses looking to expand internationally.
Global Payroll Calculator: A Wealth of Capabilities for Payroll 2023 Budgeting
We have automated routine processes so that you can speed up data collection, gain valuable insights into the global talent market, make informed decisions about talent acquisition, get the complete picture of the latest tax benchmarks, labor market trends, compliance trends—and much more!
With us, you will be able to plan global mobility programs; explore pay practices in the global marketplace; gain guidance on what to pay your top talent while maintaining a diverse workforce; simplify & streamline payroll planning, and attract and retain talent in a competitive marketplace.
Global Payroll Calculator helps companies reduce labor costs by providing up-to-date information on hiring, compensation, and tax requirements. It is also an ideal tool for quickly locating employees in any country.
Global EOR (Employer of Record) Services: Save Up to 75% of New Market Expansion Cost
Acumen International Employ to Expand Program is the perfect opportunity for you if you are trying to reach new markets, expand your workforce, and grow your business.
Want to reach emerging markets? Hire a high-performing team focused on productivity and profitability. We make hiring, onboarding, and payrolling your hybrid workforce easy. You get the support you need to manage, reward, and your global workforce with one accountable Global Employer of Record partner across 190 countries.
Our Tiered Pricing Model provides flexible options for international growth with lightweight investment.
Our Global Payroll Calculator automates employer and employee tax calculations worldwide.
The indisputable advantages of partnering with Acumen Global Employer of Record are demonstrated below:
Average Cost & Time
Our Solution *
Time to Market
10+ weeks
72 hours
Legal Advisors Fees
$ 10 000 +
………….
Official Employment & Benefits
$ 20 000 +
………….
Incorporation & Liquidation Costs
$ 11 000 +
………….
Bank Account Setup
$ 2 000 +
………….
Maintenance costs, in-house staff to manage the foreign entity, payroll, taxes, and benefits administration.
$ 25 000+
………….
The approximate total cost of new market entry**
$ 74 000 +
$ 15 000
* Per one Employee ** Costs vary from country to country
Acumen Global Employer of Record can help you solve the complex puzzle of global employment. As a Global EOR partner, we help businesses meet all their HR needs while handling compliance issues in the international arena. By offering comprehensive global employment solutions and reality checks about the compliance aspects of employing staff across the globe, we can be an essential resource for your in-house HR and Management teams.
Contact us to discuss your quick and compliant global employment journey.
Hiring a Global Sales Team vs. Hiring Independent Sales Reps and Self-Employed Agents in Foreign Countries Hiring a Global Sales or IT Team in Foreign Countries: What You Need to Know Need Some Tips on Compliantly Firing a Foreign Sales Rep? Top Benefits of Full-Time Employee vs. Independent Sales Rep Global PEO and EOR Solution… Read more Hiring International Sales and IT Teams in Foreign Countries
Expanding operations into foreign markets is an excellent way to generate revenue by tapping into different monetary resources. In such a case, hiring local salespeople to represent your company in its target market is the best idea.
Successful global expansion is rooted in the efforts of a talented, remote sales force that help you break into the local market, communicate more efficiently with your clients, and consequentially generate maximum revenue.
Hiring a Global Sales Team vs. Hiring Independent Sales Reps and Self-Employed Agents in Foreign Countries
The Difference between International Salesforce Types
Foreign Independent Sales Reps
Direct In-House Sales Forces
Cheapest and free of legal hassles. High risk of employee misclassification with costly penalties for that.
Expensive and only companies with large budgets can afford it. Setting up the company’s legal entity in a foreign country is required.
Reduced team spirit, less engagement with the product, independence of sales reps that will be less likely to work as a team and be productive in the long-term.
High team spirit, product engagement, and high productivity by retaining the best team members long-term.
Hiring a Global Sales or IT Team in Foreign Countries: What You Need to Know
Depending on the needs of your business, you may want to hire an IT team to streamline your software development project or a bunch of salespeople to represent your company in the foreign market, which requires you to keep the following considerations in mind.
How a PEO Can Help Mitigate HR Compliance Risks and Exposures when Hiring International Teams
Activities for your global sales force or IT teams can differ based on your overall strategy, the product your company offers, the specific geography you’re trying to target, and how much involvement you want from your international sales staff. Many employment solutions can only help with a single issue, such as paying salaries to your global sales or IT teams. However, these solutions often do not assist you with the scope of activities specific to these teams. This can be a problem if you need help managing all aspects of your team’s activities.
These include paid travel, car allowances, and mobile phone provisions. In some cases, families may even be relocated to another country if an employee is sent abroad for business development.
Once you have engaged remote salespeople or IT teams and software developers in a legally correct manner to mitigate compliance risks and exposures, it is just as important to decide how you will stop cooperation with them. Whether due to changes in your company or theirs, it is essential to have a plan to end the relationship to protect yourself from any legal issues that could arise.
Need Some Tips on Compliantly Firing a Foreign Sales Rep?
As an employer company, it is often necessary to ‘divorce’ yourself from a salesperson or IT developer whose services are no longer needed. However, it is also essential to protect yourself from any unexpected resignations from your IT team or other staff members. Unexpected resignations can often lead to substantial financial losses for many companies.
As your business grows, you’ll need to evaluate which type of salesforce or IT team members will be the best fit at different stages. Self-employed foreign reps or IT developers can be a good option during the startup phase. However, if you’re looking to serve strategic partners, you’ll likely need fully committed international sales or IT professionals.
There are several reasons why an employer may not be able to fire an employee legally. These include immigration status, retaliation, or refusal of lie detector testing. It is essential to be aware of these before taking any action.
If you have an employee leaving your company, pay them all outstanding wages for work done. This includes any final payments, no matter how poor the quality of the work may have been. If the employee is required to sign any nondisclosure agreements, make sure they do so before leaving.
Top Benefits of Full-Time Employee vs. Independent Sales Rep
Global PEO and EOR Solution for Hiring International Sales and IT Teams
A neutral body that takes over the whole scope of foreign-sales-teams activities on your behalf, regardless of the number of salespeople and countries where you want to hire them, can be the best way to go. Companies of this kind are primarily known as Global Professional Employer Organizations (PEOs). Companies of this type are very broad in character and scope.
Global PEO company is your single partner with international experience and standardized employment reporting procedures.
Acumen International is a Global Professional Employer Organization and Global Employer of Record. Its global network is set up in different countries with established jurisdictions in all matters about HR, taxes, accounting, payrolls, compliance, labor, and employment. It provides an excellent solution that is equally compliant across 190 countries.
At Acumen International, we take on all the legal, financial, and contractual responsibilities for employers and foreign workers. This way, employers only have to sign a single service agreement, and employees only have to sign an employment agreement. We make the whole process simpler and more accessible for everyone involved.
Third-party Global Employment Solutions: Be as Agile as Possible with a Global PEO and EOR Partner
Before thinking about hiring employees, you’ll need to set up your business entity and jump through all the associated hoops. This can include paying taxes, setting up a compliant payroll system, and sometimes applying for a social security number from the tax authorities. These additional steps can take anywhere from a few weeks to several months.
As your business expands globally, it is important to be agile to make the best decisions for your company. Markets and consumer demand are constantly changing, so it is vital to be as flexible as possible. The more agile you are, the easier it will be to make the right choices for your business.
Outsourcing can be an excellent way for organizations to save money and increase efficiency. By carefully selecting which global employment functions to outsource and working with a trusted partner, businesses can reap the benefits of outsourcing without putting themselves at risk. Outsourced standard functions include payroll, benefits, and absence management, but the decision of which functions to outsource should be made case-by-case. With careful planning and execution, outsourcing can help your organization run more smoothly and save money in the long run.
When expanding your business into new countries, there are many benefits to using a global PEO (Professional Employment Organization) or EOR (Employer of Record). A Global PEO and EOR Partners can handle all the immigration, hiring, payroll, tax, and HR compliance for you, freeing up your time to focus on other aspects of running your business. And if you ever need to leave the country, you can do so without being tied down by any long-term commitments.
Benefits of Building an International Sales Team or IT Team with a Global PEO Partner
Quickly and Easily Enter International Markets with PEO: No Entity Setup Needed
Starting a business is costly, whether you use a PEO or set up your legal entity. However, working with a PEO can save you money compared to the latter option. With a PEO, you benefit from their years of experience and knowledge of best practices, which can help reduce costs. In contrast, setting up your legal entity takes up valuable resources and staff time, not to mention the added cost of complying with various regulations. Therefore, working with a PEO is the way to go if you’re looking to cut costs and streamline your operations.
There are many benefits to using a global EOR (Employer of Record) or PEO, including cost savings in entity setup fees. By partnering with an experienced and reputable company, you can leverage existing legal entities in other countries, which can help you save money and time.
When considering the benefits of using a global employer of record, companies can expect to save money when entering or exiting international markets and hire top talent quickly. Additionally, this method allows companies to draft and maintain compliant employment contracts, manage all payroll and tax withholdings, and ensure a quick entry or exit from international markets.
Quick Time to Market and Ability to Hire Top Talent Faster
Global expansion is a complex and time-consuming process with many potential pitfalls. A professional employer organization (PEO) can help you navigate the process and establish a presence in your chosen country quickly and efficiently. By tapping into the global talent pool, you can expand your reach into new markets with a sales force or IT developers that speak the local language and understands the nuances of doing business in that country.
A PEO can help you establish a presence in your chosen country quickly and effectively. Setting up a legal entity can be lengthy, sometimes taking up to 12 months. This can lead to delays and setbacks in your global expansion plans.
This is where a professional employer organization (PEO) can be extremely helpful. Compared to the time and effort required to set up a legal entity, using a PEO is much quicker and easier. This can be crucial when maintaining momentum during your expansion and avoiding the loss of potential candidates, clients, or other opportunities.
Full HR Compliance and Streamlined Employment Processes
No question starting up a legal entity takes significant time and effort. Not to mention, there are always added costs associated with compliance and other red tape issues. However, using a PEO can help alleviate many of these concerns.
A PEO can help ensure HR compliance during your business expansion. On the other hand, setting up a legal entity exposes you to compliance risks that could impede your ability to reach your target market. Countries have different employment laws, which can change suddenly and without warning. This leaves your team scrambling to catch up and adapt business practices, a process that can lead to non-compliance. A PEO, however, has extensive knowledge of employment regulations around the world and can advise on a variety of employment legislation, including:
Compliant employment contracts
PTO (sick pay, holiday pays, etc.)
Parental leaves
Holiday entitlement
Hiring and firing practices (termination, notice period, etc.)
Global PEO Can Protect You from Sales Rep Employment Risks
An employment agreement usually includes a 2-week notice period, which can help companies avoid sudden resignations of employees that might lead to decreases in sales and, subsequently, profit loss.
Many companies have expanded internationally and have found that using a global PEO solution is very beneficial. This is because it allows them to get employees who are fully committed to the company and similar to the sales teams they already have in-house. In addition, it allows them to keep these employees for an extended period, which protects the company from any employment risks. Acumen International is a legal employer and therefore takes on all employment risks. This can save the company a lot of money that would otherwise be spent on setting up expensive business entities overseas.
Global PEO Is a Cost-Effective Global Employment Solution
Compared with traditional direct sales force hiring on own entities, employment using the Global PEO solution is much cheaper, flexible, and risk-free for the employer.
An international workforce that you employ using our Global PEO solution is a kind of hybrid of independent and direct salesforce. Here are the advantages of Sales Rep employees:
Hired compliantly
Dedicated and fully engaged with company product
As the parent company’s employees, they are obliged to fulfill global strategy and advocate the brand, not simply make sales and earn a commission like in case with independent sales reps
Lower expansion cost
Flexibility, lean approach: companies can enter more markets, test the markets before they decide to get established there, and quickly withdraw from unattractive countries.
A substantial benefit of long-term staff is that it gives your company the ability to build strong brand equity and make the company and your product recognizable in the foreign market. With short-term sales reps, you risk losing everything if the person decides to leave. In the long run, strong brand equity allows you to reduce overhead costs so that you invest less in the promotion of your products in the foreign market over time while enjoying the same sales volumes and revenues.
Global Payroll Made Easy and Affordable
One of the most challenging aspects of business management is keeping up with payroll. Maintaining an accurate and up-to-date payroll is vital for any business, large or small. But for businesses with sales or IT employees in multiple countries, keeping track of different payroll laws and regulations can be daunting. This can be even more difficult when you have employees in different countries, each with its unique payroll laws.
When managing payroll for international employees, businesses must be mindful of each country’s different tax, payroll, and employment laws. This can be daunting and time-consuming, with stiff penalties for non-compliance. Acumen International payroll services can help you navigate international payroll and employment laws and take care of all the details, so you can focus on running your business.
Global Employment Cost Assessment
In today’s business world, it’s more important than ever to be mindful of costs when expanding your company internationally. Hiring talent in different countries can be expensive, so you must know each country’s compliance, tax, labor, and immigration requirements. One way to save money when hiring employees or independent contractors is to choose the most cost-effective and business-friendly country. This can help you reduce expenses by up to 50%.
Different countries have different labor laws and benefits, so it’s essential to do your research before making a decision. So why not take advantage of our Global Payroll Calculator — the advanced country-by-country employment cost comparison tool? With just a few clicks, you can compare the payroll costs, benefits, employer and employee taxes, and mandatory benefits for 190 countries. The Global Payroll Calculator can make it much easier to find cost-effective locations for your next global expansion move.
The tool considers local taxes, payroll regulations, benefits, compliance requirements, and other labor-related factors that can impact an employer’s budget. By tracking developments in 190 countries worldwide, the research team behind the calculator strives to keep the data up-to-date so businesses can make informed decisions about expanding their operations internationally.
Get Ready To Conquer The World: How A PEO Can Help You Dominate Any Industry
There are many benefits to using a PEO, including saving on compliance risks and time-consuming set-up processes associated with setting up a new legal entity. PEOs are also cost-effective and quick, making them a great option for businesses looking to start the market quickly and efficiently.
If you’re looking to hire and expand on a global scale, you need a partner that can manage payroll, HR, work visas, and employee benefits compliantly and smoothly. Acumen International is that partner. We have the expertise and experience to navigate the complex international employment laws and visa requirements so you can focus on exploring new business markets. Let us help you realize your global expansion goals.
The Key Challenges of International Expansion Global expansion is a key growth component of many technology companies’ long-term strategies — and for a good reason. Increased market share and revenue led to adopt the strategy. However, the challenge of scaling a business goes beyond a simple hop across the pond. When companies expand internationally, they… Read more Global Expansion: Evaluating Employment Cost and Risk
Global expansion is a key growth component of many technology companies’ long-term strategies — and for a good reason. Increased market share and revenue led to adopt the strategy. However, the challenge of scaling a business goes beyond a simple hop across the pond. When companies expand internationally, they face unique challenges: how to access the best talent pools, understand their obligations under multiple local labour laws and accounting standards, reduce their exposure to foreign employment and compliance risks, and control costs.
Globally-minded companies face many challenges when hiring and managing their employees. Global expansion can also require various complex and risky decisions, such as hiring one remote employee in a foreign country or opening up a fully-staffed subsidiary or branch office.
With the proper knowledge and tools, you can expand internationally without experiencing unnecessary stress and strain on your bottom line.
A Strategic Approach to Enable Global Expansion
Companies with a worldwide footprint often have challenges navigating multiple, disconnected global employment management aspects, such as payroll and benefits, immigration and relocation, and legal and compliance, primarily when growth is driven by their global expansion ambitions or mergers and acquisitions.
As a business owner looking to expand your company’s reach internationally, you know how important it is to have reliable data when making decisions about hiring remote teams. Searching for complete and accurate information can be time-consuming, and you can’t wait days or weeks for answers. Whether your company has already decided to open up new international markets or is simply considering the possibility, you need to be able to base your decisions on accurate and up-to-date information.
The last thing you want is to make choices based on insufficient data. Unfortunately, some resources provide misleading or insufficient information on the taxes and local wages businesses must pay if hired internationally. This can make it difficult to understand the costs involved accurately. That’s why finding a resource that provides reliable, up-to-date information on taxes and wages in different countries is so important.
Business owners and C-level executives — we’re thinking of you! When hiring employees and contractors across the globe, you may not be choosing the most cost-effective country.
Do you know which country is the most cost-effective place to hire employees?
What are the cost of entity establishment and legal representation?
What are the payroll costs and management fees?
What are your ongoing annual tax compliance costs?
Are you fully aware of banking implications?
Did you know that labour laws and hidden costs could make your company less efficient when choosing a country to run your business?
Did you know that there could be a more cost-effective country to hire employees in and save up to 50%? This is because different countries have different labour laws and benefits.
What if, instead of limiting your company’s international expansion by cutting through the jungle of local regulatory compliance, tax, labour, and immigration requirements, you could have all the information of 190 countries at your fingertips?
The Right Global Employment Solution Will Drive Value for Your Business
Acumen International has solved most of the above challenges by Introducing the Express Global Employment Platform which provides companies with the tools to expand abroad while minimizing their risk exposure.
We developed a scalable and fully automated solution that works seamlessly across the organization. Our global employment cost and compliance risk assessment technology can drive value for your business today and tomorrow.
The Express Global Employment Platform is designed to help our clients instantly make complex global hiring and compliance decisions, streamlining and simplifying their international expansion journey.
It also helps companies reduce risk, increase engagement, and remove traditional hiring and compliance friction points such as lengthy paper processes or in-country domestic approvals.
The Platform comprises a Global Payroll Calculator and a set of built-in Navigators. These let you instantly understand global employment, tax, and compliance costs and support your data-driven expansion decisions.
Express Global Employment Platform for Quality Global Expansion Decisions
Express Global Employment Platform is our flagship, unified solution for managing international employment, talent mobility, payroll, benefits, and compliance. Fully automated and fully compliant, Express Global Employment platform powered by our in-house worldwide employment experts and global partner network across 190 countries.
Express Global Employment Platform is intended for organizations of all sizes, from small businesses to global enterprise organizations, helping them grow faster, mitigate risks, lower employment and hiring costs, and scale.
Express Global Employment Platformprovides business owners and leaders with the resources to globalize quickly and easily, suggesting the least complicated way to get started in countries where they want to grow.
Express Global Employment Platform allows easy access to compliance data for employment laws in every country. The platform tracks hiring compliance regulations and taxes, employee compensation methods and benefits, security regulations, and other information that will help businesses expand internationally across 190 countries.
Who Can Use the Express Global Employment Platform?
The platform is designed to provide a comprehensive overview of the global workforce for the following teams:
Founders
Founders: Founders can use EGE to better understand the global hiring process through EGE’s insights on international market expansion opportunities. They can also use EGE as a source of information on international regulatory requirements to help them make strategic decisions about their company’s growth plans.
Operations Team
Operations teams are responsible for making sure that your business can still operate smoothly, even when you’re expanding into new markets or hiring new employees from different countries around the globe. This means that operations teams need tools to manage payroll across borders without access to every country’s disseminated labour law resources.
HR Management Team
The Express Global Employment Platform is for you if you have a multinational organization. It simplifies the legal and operational aspects of global expansion. It’s a one-stop shop for managing your entire international operations from one convenient location.
Legal and Compliance Team
Legal and Compliance teams have access to an online hiring compliance toolkit that guides them through each step of the employment process in every country they operate in. It allows them to manage their HR compliance efficiently through one central location, regardless of the number of employees or locations. The platform facilitates easy navigation, making finding any HR compliance information you need in seconds easy.
Finance Team
Finance Teams can use our integrated financial, tax, and payroll tools to control employee expenses and manage employee payments in multiple jurisdictions.
HR Service Providers
HR Outsourcing
Recruiting
RPO/RBO
Contingency Employment
PEO (Professional Employer Organisation)
EOR (Employer of Record)
GEO (Global Employer of Record)
Payroll provider
HCM
Accountant
Legal
Streamline Your Global Journey with Advanced Global Employment Tools
Express Global Employment Platform tackles the most significant international expansion challenges offering a vast array of built-in tools that can help you control costs associated with your global growth and enhance its efficiency.
The tools can be used together or individually — this allows our clients and network partners to tailor the solution to their needs and eliminate unproductive friction thanks to a single All-in-One EGE Platform.
Global Payroll Calculator
If you’re considering expanding your business by hiring employees in another country or two, you’ll need to know the employment costs. Acumen International has created a Global Payroll Calculator to help you compare the taxes, fees, benefits, and other factors that come into play when making hiring decisions. This tool ensures you’re getting the best bang for your buck regarding new hires.
The Global Payroll Calculator estimates the cost of employing staff in different countries, helps businesses evaluate the employer payroll and tax burden, and understand the compliance requirements for conducting business in a new country.
Global Payroll Calculator is the ideal international employment cost prediction tool to help you estimate the costs of employing staff in other countries, including employer and employee taxes. It allows you to stay on budget and avoid surprises when expanding Internationally.
Our research team tracks developments in 190 countries around the globe. It gathers up-to-date data on local regulations related to tax, payroll regulations, benefits, hiring practices, compliance requirements, and other labour-related factors that impact an employer’s bottom line.
The Global Payroll Calculator leverages unique up-to-date data collected by Acumen’s expert in-house team research of over 1500 official government sources and validated with local lawyers, compliance experts, and accountants.
Global Payroll Calculator helps companies minimize labour costs while providing up-to-date information on hiring, compensation, and tax requirements across 190 countries. It is also ideal for rapid global employment.
An advanced version of the Global Payroll Calculator is integrated with Acumen’s industry-leading Express Global Employment Platform. Global Payroll Calculator provides accurate estimates of an organization’s international intake, accounting for relevant factors Such as salary levels, taxation rules, hiring requirements, and other legal standards across multiple jurisdictions.
Benefits Global Payroll Calculator Brings to the Table
Global Payroll Calculator enables you to explore and test new markets, make informed decisions about where to base your business, plan foreign employment budgets, help minimize payroll tax and employee wage costs, and decide where to establish your business most cost-effectively.
You can get instant estimates of the total employment cost for a local worker or ex-pat in any of your target countries, broken down by all in-country employee and employer taxes.
With Global Payroll Calculator, you have the power to estimate the labour costs of your organization in a matter of minutes — without leaving your desk. Compare the time it takes to produce an employment cost estimation with manual methods or the number of hours spent on finding a local service provider — and you’ll see that this is a tool you couldn’t do without.
Our unique global employment cost estimate tool helps businesses better anticipate the costs of expansion internationally. It also helps reduce the risk of investing in new markets and ultimately enhances your company’s international growth strategy.
There are a lot of tools for managing labour data, but most are either incomplete or complex. You need something simple and easy to use to get a complete picture of labour costs and taxes that can make strategic decisions about hiring across 190 countries. Global Payroll Calculator gives you a tool to make all your estimates and forecasts with only a few clicks.
Expanding your business overseas is a great idea. However, using staff in different countries can be hard to predict the risks and anticipate the costs of expanding operations. Navigating the legal complexities of global employment can be difficult, especially for businesses going abroad for the first time.
The employment law landscape is constantly changing and becoming more complex, making it difficult for multinationals to keep up with compliance.
The Global Hiring Navigator sets out the employment law rules on hiring and dismissal in 190 countries. It is designed to help organizations navigate the complexities of the ever-changing employment law landscape and make informed decisions about hiring and managing employees worldwide.
It contains a summary overview of domestic employment laws without a specific industry focus, helping you find answers to some less obvious or in-depth questions, including the following.
When you hire someone (onboarding), do you need to set up a legal entity?
What is the process of permanent establishment?
Is a written employment contract mandatory? Does it need to be in a country’s official language?
Is it allowed to include probationary periods in the employment contracts?
Is it possible to do hiring checks (reference, education, medical, criminal background checks)? Is consent of the individual required?
Do executives fall under the same employment laws as regular employees? Or are they fall outside the scope of specific labour laws?
Termination of employees (offboarding)
What is the notice period or payment?
How is the payment of a severance regulated?
What procedural requirements may apply (dismissal, approval, etc.) How to anticipate the dismissal cost?
What is the notice period, and how to pay out a severance indemnity?
How do I pay maternity/paternity leave?
What is the vacation accrual or the ability to monetize vacation?
Choosing Your Best Global Hiring Method
You’re about to open your next big step towards global domination in an overseas market. After determining the talent level you need, your next step is to decide which international employment method is best for you.
Whether you’re getting ready to open a location or hire employees, the method you expand into an overseas market is unique and can play a huge role in capturing the market comprehensively.
Foreign Independent Contractors
Non-Resident Employer (NRE)
Foreign Entity Establishment
Global EoR (Employer of Record)
International PEO (Professional Employer Organisation)
There’s no one-size-fits-all approach. Each method supports growth in different ways — from helping you manage your payroll taxes to finding reliable HR partners for your business.
There are a few key things to consider when choosing an employment method for your company’s global expansion:
Budget and time frame
Tax implications
Compliance
Employment liability
IP protection
Asset acquisition.
Global Hiring Navigator will tell you everything you need to know about expanding into foreign markets – from complicated, multi-jurisdiction registration to the pros and cons of any particular hiring method.
Foreign Employment Cost and Risk Control to Gain a Competitive Edge
Finding the correct employment costs data can be confusing and time-consuming, especially if your business is considering expanding internationally.
Employee compensation, payroll taxes, and benefits vary dramatically from country to country. Costs will vary depending on the country you wish to operate in. For example, in Argentina, companies are mandated to pay workers at least two holidays yearly, while UK-based staff are entitled to unlimited paid holidays.
Why pay 100% more for labour when dealing with a foreign entity? Expand into new markets without increased risk, learn legal frameworks that apply to you, and get the support you need. Express Global Employment Platform is a one-stop resource for every aspect of global hiring management and compliance.
There is no need to get a degree in international employment law — the Express Global Employment Platform helps reveal the truth behind common misconceptions about hiring international employees. Use our Global Hiring Navigator to effortlessly navigatethe maze of labour, compliance, and compensation regulations associated with employing staff overseas. You can gain a competitive edge by accurately budgeting for the tax, social security, health care, and retirement payments with foreign employees.
Curated Labor Law and Cost Control Compass
The Global Hiring Navigator is a complete and accurate solution for businesses seeking to alleviate the complexities associated with global hiring and compliance, including immigration and relocation costs, payroll tax, and employee wage rate changes.
Acumen’s research team tracks developments in 190+ countries around the globe. It gathers up-to-date data on local regulations related to tax, hiring practices, compliance requirements, and different legal standards across multiple jurisdictions that impact an employer’s bottom line.
If your business is going to expand internationally, it must ensure that it complies with all applicable employment laws.
With the complexity of employment laws and their different interpretations and local specificities in multiple countries, expanding internationally can be risky if you’re unaware of these risks.
With compliance risks from every corner of the multi-location employment ecosystem, hiring compliance can no longer be just a “Send It to Legal” for review in the final stages of the international expansion journey.
The burden of navigating complex tax, regulatory, and compliance environments. Getting it wrong is costly.
Express Global Employment Platform offers a suite of products to manage and automate compliance processes across your borderless global workforce. It provides an easy way to access compliance data for employment laws across 190 countries, enabling you to identify your crucial employment risk areas.
With Global Compliance Navigator, you’ll get ahead of the game regarding international hiring compliance. It empowers you to identify and mitigate risks related to regulatory compliance, such as employer misclassification risks: We cut through complexity, saving you time, effort, and money.
Express Global Employment Platform helps you keep track of the regulatory landscape and move ahead without worry since all global employment policies and procedures are up to date in 190 countries worldwide.
On top of that, the Express Global Employment Platform empowers you to automate employee and contractor processes, compliance, and tax and benefits administration globally.
Global Mobility Navigator
Global expansion is both an opportunity and a test for companies. On the one hand, it’s a chance for companies to explore new markets and grow their business. On the other hand, failure to do adequate market research or recognize cultural differences can lead to problems. You’ll need the right mix of resources — including finance, HR, legal, compliance, and operations — in your back pocket before embarking on any global expansion plan.
We know that companies and entrepreneurs — those who need the help of foreign talent — can face complex challenges in international employment, immigration, visa process and extensions, work permits, employment options, and other issues related to global mobility. We specialize in global mobility programs that help companies with their employees’ relocation, financial, and compensation aspects. We work with businesses to ensure a successful transition for all parties involved.
We want to change this by providing the Global Mobility Navigator — the solution that makes global employment easier, cheaper, and more efficient.
Mobility Navigator is designed to make the immigration application process a breeze. It gives you the tools to instantly navigate a migration law’s complexity, including high-quality services like legal assistance, visa applications, and work permit sponsorship.
With Mobility Navigator, you can explore your immigration options, information on visa laws and work permit options and regulations, support during employment overseas, and more across 190 countries.
Mobility Navigator streamlines the immigration process for businesses and their international employees. With its intuitive dashboard, Mobility Navigator gives companies complete control over all immigration matters, enabling them to focus on what they do best: running a successful business.
We take the stress out of your journey and ensure you avoid pitfalls and problems for a happy and productive global journey. Relieve the anxiety and planning issues when you relocate or expand internationally. Mobility Navigator is the immigration and workforce relocation partner you need to keep your business afloat!
Acumen International Complete Global EOR and PEO Solution
As your organization looks to expand globally, many potential benefits will be gained. However, many companies face various challenges before these benefits can be realized. By being aware of these potential hurdles, your company can be better prepared to overcome them and reap the rewards of global expansion.
Acumen International is a leading provider of global EOR and PEO services, offering secure and efficient solutions for businesses that manage international payroll, HR & benefits administration across 190 countries. Our full-service management solutions are tailored to each client’s needs and can include everything from legal talent employment to benefits management and compliance to payroll and taxation.
Processing Immigration requirements
Visa applications & extensions
Work permit sponsorships
Streamline onboarding, benefits, payroll, PTO
Local labour law compliance
Audit-proof compliance requirements
Employee benefits management
Handling employment contracts, terminations, and compensation
Processing medical insurances and benefits
Payroll, including year-end tax statements
Relocation services & housing
Benefit management
Special needs or requirements
Multi-country employment without limitations
Handling contract worker and ex-pat workforce management
Compliant employment or termination within 72 hours.
The value exchange between employer and employee is one of the fundamental bedrocks of business. Employers provide financial compensation to employees in exchange for their time, effort, and services. However, in some cases, employees require additional compensation. This is where benefits come in, a set of perks and compensation that can be the difference between… Read more How To Provide International Employees with Benefits
The value exchange between employer and employee is one of the fundamental bedrocks of business. Employers provide financial compensation to employees in exchange for their time, effort, and services. However, in some cases, employees require additional compensation. This is where benefits come in, a set of perks and compensation that can be the difference between drawing in top talent and being forced to assemble a piecemeal team. In the international sphere, things can get even more complicated. Here’s what you need to understand about benefits internationally.
If an employee works overseas, their employer is still required to provide them with mandatory and voluntary benefits. However, the employer can suspend any benefits that are not legally required.
Mandatory Benefits for Employees
Mandatory benefits are the base benefits that must be provided to employees by law. They may include the following.
Health Insurance
Life Insurance
Long-Term Disability Insurance
Voluntary Benefits
Voluntary benefits are additional benefits that can be provided as an incentive for employees to stay with your company but are not currently required by law. Some examples of voluntary benefits that companies offer include
Dental Insurance
Vision Insurance
Accidental Death and Dismemberment Insurance
Company cars and car allowances
Healthcare and Risk Benefits
Employee benefits are a vital part of any business, large or small. By providing benefits, businesses can ensure that their employees are happy and productive. There are many different types of benefits, but some of the most common include:
Employee education plans
Eye care vouchers
Death in service/life assurance
Occupational sick pay
Employee assistance plans
Free flu vaccinations
Financial support for employees who must self-isolate
Programs to encourage physical fitness.
Company Cars and Car Allowances
Different organizations have different approaches to company cars. Some provide them because the employee’s job requires it (e.g., a sales representative). In contrast, others see it as a way to recognize the individual’s status within the organization (e.g., a director).
Employers have a few different options when it comes to paying for employee transportation. Some companies prefer to give a cash allowance to help employees purchase cars or reimburse them via mileage allowances for using their vehicles.
Why Provide Employees With Benefits and Perks?
What exactly makes benefits and perks so crucial for your employees? You can boil this down to three main points.
Employee Confidence and Protection
Part of that value exchange we mentioned earlier is a sense of safety and comfort between both groups. Employers don’t want to constantly look over their shoulders to ensure their teams are working, but employees also need that added confidence. Along with this comes the guarantee of protection the government provides the workforce. Mandatory benefit standards help establish that trust.
Employee Retention and Reduced Turnover
All employers across all niches note the struggle in retaining and attracting talent. It’s become more of a standard now that professionals “job-hop” faster than in the past. One way to avoid this is by providing a comprehensive benefits package. Some people will leave a job with a higher salary for a job with a better benefits package, based on the needs of them and their families. With turnover meaning a loss of money on the employee and training a replacement, you want to ensure you have everything you need.
Outperforming Competition
Even if you don’t have benefits at the front of your mind, your competitors might. We mentioned before how benefits can motivate people to change their careers. A strong set of benefits can give you a leg up to attract top talent for your company.
Basic Employee Benefits Requirements
When providing benefits to your employees, you must keep to the standard of benefits required by law. Failing to do so can lead to financial penalties to varying degrees. For example, failure to comply with local labor regulations in Alberta, Canada, extends from $500 to $6000. The amount depends on the number of cases and repeat offenses. However, this doesn’t include civil suits and the higher amounts you may have to pay.
One of the most prominent historical examples of this was the case against Microsoft in 2000. Having failed to provide benefits for temporary employees properly, Microsoft eventually agreed to pay almost $100 million after an eight-year class-action lawsuit.
So, with this in mind, what are the benefits you need to provide? This will ultimately depend on local regulations (key for international business), but there are a few general benefits you can expect to provide. Here are some of the most common ones:
Medical & Health Insurance
Ideally, you want packages for single people and families to provide top cover.
Life Insurance
This is a major draw if you want to retain family/senior employees. Companies like Prudential or Northwestern mutual are popular.
Disability Insurance
This is particularly important for jobs with a physical component or element of risk (oil workers, construction).
Retirement Plans
IRAs, 401ks, etc.
Holidays, Vacations, Sick Leaves
This helps lower burnout and allows time for employees to spend with family.
Unemployment Insurance
This helps insulate your employees’ confidence if you are in a shaky market.
Other Benefits
Benefits packages vary widely from organization to organization. Some benefits are given to all employees, while others are based on job title, location, or length of service.
Employers often offer a variety of employee benefits to attract and retain top talent. Some expected benefits include unlimited paid time off, conference attendance stipends, holiday parties, concierge services, relaxation apps, and free or discounted meals for staff cafeterias, and nap rooms. By offering these benefits, employers hope to create a positive work environment that employees will enjoy and want to stay with long-term.
This may vary based on niche. For example, a tuition reimbursement program may make sense if you know you will get many young applicants pursuing graduate degrees. Relational compensation may be a good fit if you expand your search nationwide.
As the gig economy grows, policies protecting these workers are more important than ever. This includes those who work for gigs or agencies, as they may be subject to different laws and regulations depending on where they live. Within a country, there may also be remote workers who have different leave and exemption statistics. It is crucial to investigate the appropriate policies for each situation to ensure that all workers are treated fairly.
It’s good to compare your global employment practices with those of other employers in your country or region. This kind of comparison, called employee benefits benchmarking, can help you understand how well you’re implementing global HR best practices and how your organization’s voluntary benefits program stacks up against other employers in the same industry.
Compensating Benefits to International Employees
International companies must pay more attention to benefits due to the high risk of talent withdrawal. Benefits can be one of the most robust options to avoid a rotating door of potential talent. But how exactly do you put this into practice?
Get local taxpayer ID by registering an in-country corporate presence and putting the employee on a local payroll. This works, but it also takes a lot of time.
Keep the person on the home-country payroll. This is only applicable for short-term projects. The employee also requires a visa and pays income tax aside from payroll in a host country.
Compensating employees as independent contractors. This can be quite a risk, causing a contractor/employee misclassification);
Through a third-party provider or local business partner.
Working with a global PEO solution is the best option to minimize many of these issues internationally.
Employee Benefits Trends in 2023
So, keeping this in mind, what are employees interested in regarding benefits off the beaten path? Here’s a rapid-fire look at some of the new trending benefits:
Financial Literacy Programs
As the cost of living increases, people want to get more out of their paychecks.
Remote (Work from Anywhere) Policies
Commute frustration and desire for flexibility are driving interest here.
Office Pet Policies
Pets are playing more and more of a role in the lives of millennial workers. Consider bending this to your benefit.
Wellness Programs
Modern work life has many people stressed. Office yoga or meditation sessions can help a lot.
Partnerships with Local Businesses
Consider working with a popular business near your office to provide employee discounts.
Acumen International is your ideal partner and resource if you are looking for a PEO to try and act on some of these employee benefits trends internationally. We operate globally, with a presence in more than 190 countries. We will handle paying benefits and withholding payroll tax, fully complying with local laws and regulations.
How Global PEO (Professional Employer Organization) Can Help You Administrate Employee Benefits
As an employer, you are responsible for evaluating and understanding the various social security measures available to your employees. By partnering with a global employment solution provider, you can ensure that your employees have access to all the benefits they need, including travel insurance, medical cover, income protection, and more.
Global PEOs are global professional employer organizations. That means they offer comprehensive HR solutions for small businesses across the country. Employers can outsource all their HR needs to an expert who specializes in managing this aspect of their business by paying a single fee per employee. Some services provided by PEOs include
Outsourcing some global employment and HR functions to a PERO means that the business owner is not bogged down with processing payroll, benefits, or securing visas ad work permits. Instead, they have more time to concentrate on other company matters, including big-picture issues.
Benefits Of Working With a Global PEO (Professional Employer Organization)
Global PEOs can provide a broad range of employee benefits that companies that don’t use them may not be able to offer. With the help of a global PEO, you can prevent employee turnover and ensure that your employees are well taken care of while employed with you. Stable employees will be less likely to change companies or leave their jobs altogether.
Global PEO clients can often offer their employees a more comprehensive benefits package than those who don’t. Such benefits may include healthcare, dental, and vision coverage, or retirement plans PEOs also offer retirement plans and other financial benefits.
In addition to managing legal requirements, a Global PEO can help you minimize your tax liability and simplify payroll administration processes. Using a PEO as your single contact for managing payroll and benefits coverage makes things easier because it reduces internal costs—you can focus on doing what you do best. At the same time, the global PEO gets every employee’s need taken care of.
Suppose you’re like many businesses and have trouble keeping track of each country’s requirement for mandatory employee benefits, unemployment claims, workers’ compensation, and other issues. In that case, you may find that using a global PEO saves you time and money. A global PEO will handle all your business-related social security and insurance needs and ensure that your employees get the coverage they need where they live. Because the Global PEO will be able to handle all of the details with one organization, it also helps cut down on internal costs—your company only has to pay one price for each policy rather than dealing with multiple companies across multiple jurisdictions.
When you’re looking to expand your business internationally, there are a lot of factors to consider. One of the most important considerations is how you will comply with complex local laws and regulations. Having a solid global HR compliance strategy in place is essential for expanding without running into problems. In this brief, we’ll examine… Read more Global HR Compliance Is Key for Successful Global Expansion
When you’re looking to expand your business internationally, there are a lot of factors to consider. One of the most important considerations is how you will comply with complex local laws and regulations. Having a solid global HR compliance strategy in place is essential for expanding without running into problems. In this brief, we’ll examine how a PEO (Professional Employer Organization) and EOR (Employer of Record) can help you navigate these tricky territories.
Every international project relating to global expansion requires certain information before, during, and after it is started. This helps companies already operating or planning to expand globally make sure that all their operations are carried out that will not expose them to unnecessary risks, hence boosting their confidence and certainty level.
Companies must determine how to manage their global workforce as they expand globally. One of the biggest challenges for a business is managing the various legal and regulatory compliance issues that arise when expanding internationally.
This is where the concept of EOR (Employer of Record) comes into play. Using EOR, you can now hire these talented people, bring them on board your team, and get the experience you need without having to set up new offices or deal with the challenges of setting up local operations. The challenge is how to ensure compliance when hiring internationally.
One way to do this is using a Global PEO (Professional Employer Organization). Global PEOs are companies that specialize in providing HR services as an outsourced solution for smaller businesses. Global PEO’s can provide you with several services, including but not limited to: recruitment, payroll, benefits management, and HR compliance management.
Surprisingly, many companies planning to operate in foreign markets do not know that one person is now enough to represent their business overseas, hence making them – both large multinationals and small companies or individuals face a considerable lack of information and support on global employment, international and local taxation and immigration, especially if it is about projects that require that their workforce is sent on international assignments.
Having spotted this growing need for up-to-date information about the complaint global workforce employment process, Acumen International has responded to it with our Global HR Compliance services.
Global PEO Can Provide Professional Guidance and Navigate HR Compliance Complexities
We provide professional guidance for corporate clients, agencies, individual contractors, and freelancers on local employment laws, implied compliance risks, and ex-pats immigration nuances to work out the most cost-effective yet compliant and risk-free solution for you. Our objective is to assist you with Global HR compliance issues and offer you the best payment and taxation options. With this, we save you the time and effort that come with understanding the complicated regulations and tax calculations that are often written in the local languages and subject to frequent changes. We also provide information about the best scenarios for ex-pat immigration and employment.
With our expertise in our Global HR Compliance solutions, we will become the single provider that will solve your global business challenges and save you the seemingly unavoidable costs of HR compliance. Our English-speaking professionals work 24/7 to ensure that we assist you by working out tailored labor solutions (whenever you have the need) that are managed legally and in full compliance with the local employment laws, regardless of your time zone.
Use our solutions to efficiently satisfy your need for skilled professionals in whatever industry you work around the globe and, in turn, improve your chances of sustainable success.
A Professional Employer Organization (PEO) is a specialized staffing firm that provides human capital management services, including administration, payroll, tax compliance, workers’ compensation, employee benefits, and HR consulting services for its clients. These ancillary services allow organizations to constrain their investment in human capital management to a fixed fee per employee per year.
Benefits of Using Global PEO & Employer of Record Services
Global PEOs shoulder the burden of many “non-core” HR and administrative activities – from payroll to benefits administration – enabling PEO clients to focus more on their organization’s core competency. Further, PEOs that are more sophisticated provide expertise to help their clients with strategic HR decisions.
Global employment management centralization. Maximized control. Minimized risk
A Global PEO facilitates quick talent deployment and provides access to various employee benefits solutions to attract and retain your global talent
Eliminating and mitigating certain employment-related risks, including non-compliance and employee misclassification, through the shared responsibility and co-employment arrangement
Scalable technology and infrastructure provided via the global PEO relationship
Reduced and stable global employment management-related cost
A global PEO can facilitate risk-free, quick, and easy market entry by acting as your local legal entity, helping you to avoid the cost and time associated with incorporating into 190 countries
A global PEO allows you to make your global expansion 100% compliant and secure by keeping track and adhering to all local laws and regulations
A global PEO helps you remain agile and scales up or down in your selected foreign markets according to your business needs.
A global PEO facilitates global employment consistency and HR compliance.
Expanding your business globally is a huge undertaking with infinite moving parts. Hiring, onboarding, and compensating a global workforce is a complex process, and terminating employees can be even more challenging. Every country has its own laws governing procedures for firing or laying off employees locally, and failure to comply can result in harsh penalties… Read more How to Avoid Risks of Terminating Overseas Employees
Expanding your business globally is a huge undertaking with infinite moving parts. Hiring, onboarding, and compensating a global workforce is a complex process, and terminating employees can be even more challenging. Every country has its own laws governing procedures for firing or laying off employees locally, and failure to comply can result in harsh penalties for your company.
To further complicate things, the global pandemic has impacted the way companies conduct business, both at home and abroad. Regulations have been imposed on both employers and workers that restrict and redefine employer-employee relations. In many cases, new laws introduced by global governments favor employees over employers, to protect them from unfair termination and overly restrictive policy changes.
As a Global Employer of Record service provider, Acumen International assumes responsibility for all stages of engaging international employees on your company’s behalf, from onboarding to dismissal. Our solution is designed to help you avoid legal troubles associated with employee termination around the world, saving you time and money, and preserving your company’s global image.
Following are some facts about employee termination in some of the world’s leading economies.
Employment Termination in the United Kingdom
The UK’s Coronavirus Job Retention Scheme (CJRS) was announced in March 2020 as a furlough program designed to subsidize the wages of 9.6 million UK employees, amounting to nearly a third of the UK’s workforce. The subsidies covered 80 percent of workers’ monthly wages and employment costs, capped at 2,500 Euros per month per worker. As furloughed employees, workers were guaranteed to retain their jobs at the end of the furlough period.
Initially intended to last from March-October 2020, the Scheme has since undergone multiple modifications and extensions, with government contributions being reduced to 70% in July 2021 and dropping to 60% in August, with employers contributing 10% and 20% respectively. The Scheme finally reached its terminus on September 30, 2021, preserving its after-effect.
Since then, the UK government has released a COVID-19 plan for the fall and winter that includes a work-from-home policy, along with mandates for wearing face coverings and proof of compliance with vaccine mandates.
Employment Termination in Canada
In March 2020, Canada’s federal government passed the Employment Standards Amendment Act to provide job-protected leave for employees impacted by COVID-19. The law is meant to prevent employers from terminating their employees for reasons related to COVID-19, such as employee quarantine or caregiving for a family member with the virus.
In general, a Canadian employer cannot force an employee to get a vaccine unless a law states otherwise. For example, first responders and law enforcement are required to be vaccinated. An employer may terminate an employee if they refuse to get vaccinated without a valid reason protected under the Human Rights Code.
Employment Termination in China
Despite being the country hit first and hardest by the pandemic, China implemented an effective strategy to stabilize its economy as much as possible. Before the pandemic, China already had strict termination laws in place. These laws became even more stringent, requiring employers to seek permission from legal authorities to submit a termination letter to an employee. In addition, employers in China are required to give 30 days notice of termination or alternatively, to provide one month’s salary prior to letting the employee go.
Employment Termination in Australia
In Australia, workplace laws are established to ensure that employees are lawfully and fairly terminated. They outline what compensation employees are entitled to upon termination, and provide guidelines for termination due to redundancy. Laws for terminating employment are regulated by the Fair Work Ombudsman and the Fair Work Commission.
Every year, approximately 15,000 unfair dismissal cases are filed in Australia. Any terminated employee can file a case against you, provided they:
are covered by an award or employment agreement
earn less than $158,500 per year
apply within 21 days of the dismissal
Once filed, it is up to the Fair Work Commission to determine whether the employee’s termination was justified and lawful.
Australian employees impacted by the coronavirus have additional protections under a special workplace health and safety law to provide for sickness, quarantine, and lockdowns.
The law addresses the following:
Extended periods of sick leave
Protections in the workplace
Protection from workplace discrimination
Unfair dismissal
The onus of proof of fair and lawful termination falls on the shoulders of the employer, and an accusation can result in costly legal and court fees, even if the case is ruled in the employer’s favor.
Tips on Terminating Overseas Employees
Terminating a foreign employee doesn’t have to be a nightmare. You can take several steps to ensure everything goes smoothly — and legally — when you end the employment relationship. If you’re an employer with employees working abroad, here are some practical tips on avoiding the risks of terminating these workers.
Understand the laws in your employee’s country.
Use an experienced international employment law attorney to help you navigate these laws and any other challenges that might arise during the termination process.
Retain an employment law expert who can help you navigate the unique challenges of termination in a foreign jurisdiction.
Understand how the termination will affect your company’s reputation, ability to recruit top talent, and ability to do business in that country going forward (for instance, if you must rehire your former employee).
How Acumen’s Global PEO Solution Can Help Avoid Termination Risks
International laws regulating employer-employee relations vary significantly from country to country, and even more so with additional pandemic-imposed restrictions in place. An unpredictable pandemic can bring about rapid changes affecting businesses and workers.
Hiring and terminating employees in multiple countries can be challenging, even in a relatively stable business landscape. In more turbulent times, the difficulties are magnified as labor laws evolve to keep pace with current events.
In today’s world, events caused by the pandemic can disrupt your business operations to the extent that you need to lay off or dismiss a large portion of your workforce, exposing your company to accusations of wrongful termination. Employee termination can result in fines and penalties amounting to thousands of dollars if found unlawful or unfair.
Acumen’s Global Employer of Record solution can help to protect your company from compliance violations when downsizing your global workforce. As the legal employer for your overseas personnel, Acumen can help smooth the process of terminating your workforce – locals and ex-pats – without the risk of penalties.
As your global PEO partner, Acumen can onboard, compensate, and terminate your employees on your behalf, ensuring that your company is fully compliant with local labor laws. As part of our service, we provide our clients with expert advice and assistance when it becomes necessary to terminate an employee.
As global employment experts, our team stays abreast of changing laws and mandates in 190 countries worldwide to ensure that our clients always remain legally compliant with local labor laws and regulations.
Benefits of Acumen’s Global Employer of Record Solution
All-stage processing and handling of your global HR needs.
Accurate information about employee records and severance package requirements.
Up-to-date information about regulatory changes in countries where you do business.
Assistance with termination procedures and appropriate documentation.
Reduced risk of fines and penalties when downsizing your workforce.
Around-the-clock assistance, regardless of time zone.
For cost-effective assistance in weathering the global pandemic and other challenges that force you to downsize your global workforce, contact Acumen’s team of global employment experts today. We are available around the clock to help you navigate today’s ever-changing international business regulations and remain compliant in the countries where you do business.
It’s hard to fathom the impact of the COVID-19 pandemic on the global labor market. Entire industries worldwide have ground to a halt due to health concerns, and the globalization that powered the business world has now become an Achilles heel. In essence, many industries across the world depend on human mobility and migration. This… Read more Labor Laws and Regulations Shifts in the Face of COVID-19
It’s hard to fathom the impact of the COVID-19 pandemic on the global labor market. Entire industries worldwide have ground to a halt due to health concerns, and the globalization that powered the business world has now become an Achilles heel. In essence, many industries across the world depend on human mobility and migration. This includes migrant workers in the farm industry, tech support professionals in Asia, entrepreneurs traveling across the globe.
We are already seeing the impact of this change in action, with unheard-of amounts of unemployed people across the world. However, we are in the midst of an unprecedented amount of labor, tax, migration, and payroll changes. Failing to react could leave your company in a position of non-compliance. What should these companies do next?
COVID-19 Updates And The International Labor Market
The major thing that needs to be mentioned here is that while all countries are making some type of change to their laws to account for the pandemic, they are not all the same. Different countries are dealing with different levels of outbreaks and economic concerns, and this is reflected in the shifts.
So, with all this said, here’s a profile of 10 countries making major adjustments to their taxation, labor, migration, and payroll legislation in response to the ongoing pandemic.
United Kingdom: Companies lower than 250 employees can be reimbursed for sick leaves. Notably, employers selecting workers as “redundant” need to be able to prove they are making their decisions not based on discrimination.
Mexico: Mexico and the United States have come together to restrict non-essential land travel across the border to stop virus transmission. This means that travelers may be denied at the border if they cannot supply proper proof. Mexico has also enforced laws requiring companies to pay full salary/benefits to employees during the shutdown.
USA: COVID-19 U.S. statistics point to the country being one of the most impacted in the world by the pandemic. Perhaps one of the biggest recent developments is the halting of most types of immigration. This is specifically designed to keep foreign workers from taking American jobs, so you need to keep that in mind. Also, many state governments are implementing plans for major tax reform to help with recovery in the coming months.
Canada: Canada recently passed a law subsidizing up to 75% of employee wages to avoid mass layoffs, but qualification is contingent on the business structure and percentage of income lost since March of 2020.
Chile: Work contracts are being amended to allow employees to access their unemployment insurance quicker in the event of financial uncertainty.
Brazil: Brazil has suspended payment of its Severance Pay Fund for April and May. One notable change is that teleworking is now allowed regardless of any existing labor agreements or changes in employee contracts.
Germany: Germany is at the forefront in terms of changing business policy for public health. If a business is closed due to a formal ban, all employees are still entitled to up to six weeks of compensation.
Ukraine: In March, work from home was stipulated for the first time by Ukrainian law. Work permits are also suspended for certain activities.
Russia: A flat travel ban has been instituted on all foreigners entering Russia, with some exceptions. Any employees returning from abroad need support from their employers with quarantine for 14 days. New visa applications for foreigners are also temporarily suspended. Employers are also required to pay at least 2/3 of their employee’s salaries even if they are forced to shut down.
Cote d’Ivoire: All regular passenger flights have been suspended for an indefinite period. Changes to the existing employment law are minimal as of this date, though there has been talk of suspending import duties for materials being used to help with fight the pandemic.
Empowering Your Global Expansion
With COVID-19 causing companies to adjust their labor laws compliance, payroll schemes, and migration rules at a rapid rate, does this mean that companies have to put their international expansion plans on hold? Not at all, if you use the right support. A global PEO provider is more important than ever during this time to ensure that you keep your plans moving internationally, without any compliance issues. Global PEO services like Acumen International take a lot of the struggle out of international expansion by serving as the technical employer of your foreign teams. What are some of the key benefits we offer?
By using a global PEO service, you can do business in a new country without incorporation. The pandemic has halted a lot of incorporation efforts, so this is likely the only way to start a business quickly.
We make sure that you have total legal compliance in over 190 countries for the workers you already chose. As you can see, employment law is changing even faster than usual. Our services keep you protected from legal fallout.
We also help with payroll and benefits programs for your employees. When the dust settles, a lot of people are going to be reentering the workforce. You need an appealing salary/benefits package to draw in top talent.
As more and more COVID-19 updates come in, expect immigration rules to see more change. However, our services can help with hiring and paying foreign sales reps, as well as other professionals you want to bring in.
Things You Can Do Next
As a result, while COVID-19 is causing changes for those trying to enter new foreign markets, that doesn’t mean you are paralyzed as far as options. It’s still very possible to:
Employ overseas sales forces in key markets
Begin your operations and get presence in the host countries
Expand without incorporation
Begin with a small team of remote workers in a new country and add any headcount later
The key, though, is having a service/partner that can help you stay flexible and compliant as this situation evolves. Global PEO solutions and a global employer of record are the exact methods you need. Be sure to keep following the Acumen International blog for more COVID-19 updates as well
Dearest clients, partners and global team members, thank you all for those 21 years of success and growth together. This wouldn’t be possible without You! So the celebration’s not just ours, it’s also yours ) We are grateful to CEO Nick Ganzha for creating Acumen, and for continuous support and abundance of opportunities for us all! 21 years ago, we… Read more Acumen International celebrates the 21st Anniversary!
Dearest clients, partners and global team members, thank you all for those 21 years of success and growth together. This wouldn’t be possible without You! So the celebration’s not just ours, it’s also yours )
We are grateful to CEO Nick Ganzha for creating Acumen, and for continuous support and abundance of opportunities for us all!
21 years ago, we started as a few but now we are a global team of professionals full of talents, creative solutions and energy. Let’s together reach success Acumen’s surely destined for!
OFFICIAL RELEASE: Dear partners and clients, we officially inform you that we cease all operations in Russia and Belarus due to the devastating war Russia started against Ukraine this year on February 24th. Here are the steps we are taking now. We are terminating all projects with the clients’ employees in Russia and Belarus. All… Read more Acumen International’s response to the Russian military invasion and war against Ukraine!
OFFICIAL RELEASE:
Dear partners and clients, we officially inform you that we cease all operations in Russia and Belarus due to the devastating war Russia started against Ukraine this year on February 24th.
Here are the steps we are taking now.
We are terminating all projects with the clients’ employees in Russia and Belarus. All is done in accordance with local legislation to ensure employees’ rights are protected. We do not want to support Russia and Belarus’ governments with not one penny being paid to those countries.
At the same time, we are helping Ukrainian and international companies to retain their talent who flew to Europe to enable them to continue their operations as usual, no matter where the workers had to settle down. We are helping both our clients and their employees with relocation and compliant PEO employment all over Europe.
We are arranging fast compliant local payroll in the European countries where the Ukrainian nationals have flown after leaving Ukraine.
If you have workers in Ukraine that have fled to or are planning to leave to European countries or any other country in the world, and you want to keep and engage them in a fast and compliant manner, please contact us for help with a fast solution to employ your displaced employees.
All these actions fully reflect our company’s policy and values of our care and support for the Ukrainian people, our clients, and European neighbors and partners.
Acumen International company is doing our best to support our Ukrainian employees and their families and help all those affected by the conflict with donations and what’s within our powers!
Nick Ganzha | CEO | Acumen International An interview with Iryna Oprya, Acumen International’s Media Department Head If you are ready to scale your business by taking it abroad, you need an experienced global partner to help you navigate the global business landscape. This is especially true after the events of 2020 that impacted businesses around… Read more How to Choose the Best Global PEO in 2022 and Beyond
Nick Ganzha | CEO | Acumen International
An interview with Iryna Oprya, Acumen International’s Media Department Head
If you are ready to scale your business by taking it abroad, you need an experienced global partner to help you navigate the global business landscape. This is especially true after the events of 2020 that impacted businesses around the globe and brought new regulatory guidelines that must be followed.
Acumen International is a leading Global PEO company that provides its Express Global Employment service to help businesses expand and hire global talent in 190 countries. The challenges of 2020 impacted our company in the same ways they affected companies worldwide, but they helped us innovate and grow our services, to be ranked among the best.
Acumen’s interview with CEO and Founder Nick Ganzha in February 2021 covers the many key factors to consider when choosing the best Global PEO for your international business needs. In this interview, Nick reflects on how 2020 impacted the global HR and global employment industries, discusses the complexities and controversies faced by business leaders who plan to expand globally, and forecasts his expectations for global business in 2021.
Nick’s thoughtful answers clearly demonstrate why a Global PEO model is the perfect solution for businesses of any size who want to go global.
Iryna Oprya (IO), Media Department Head, Acumen International:
Nick, thank you so much for doing this interview with us! Before digging in, do you think most organizations today are aware of the Global PEO concept and the opportunities it offers? Please elaborate.
Nick Ganzha (NG), Founder and CEO, Acumen International:
Many companies think of PEO as a US-based concept intended mostly for small businesses. They don’t realize that a global PEO is a global employment solution for businesses of any size, for talent acquisition and retention, and a global expansion solution. Today, businesses of any size can easily expand into any market in the world, to sell their products and hire the best global talent, whatever their resources or stage of development. What was once the prerogative of blue-chip companies with unlimited resources has now become an opportunity for small and medium-sized companies with limited resources to tap into global markets.
Over the past decade we have seen a rising trend toward remote work, which actually shaped our global employment industry. The events of 2020 made remote work ubiquitous across all industries around the globe. Where working remotely once meant working from home in your city of employment, it now encompasses working with companies on the other side of the planet. On a global scale, remote employment is clearly the trend of the future. And who knows? Maybe in the coming decade, remote work will take place on another planet.
IO: What will this growing trend bring with it? What are the key factors that global businesses will need to consider when choosing the best Global PEO?
NG: To me, the one and only major factor to consider is that a Global PEO service is the perfect vehicle to help companies shift from a traditional work model to a remote one if they want to survive and thrive in the business landscape of the future.
IO: How exactly can Acumen International help businesses make this transition?
NG: We do it with our Express Global Employment solution, delivered in 190 countries. EGE is Acumen’s outstanding new service that was recently branded as a separate turnkey solution, designed to meet our clients’ urgent global hiring needs. With EGE, we can employ your selected global workforce on your behalf in any country in the world. Better yet, we can do it within 72 hours or less if we’re talking about employing the country’s local citizens with our 100% compliant solution.
Whether you are an enterprise looking to employ global talent or an agency hiring a global workforce for your clients, our Express Global Employment service provides a one-stop-shop solution to meet all your needs. Acumen is here to help you with expedited and compliant global employee onboarding, worldwide.
IO: Nick, you mentioned remote work as one of the most important global HR trends of 2020. What other trends and changes did 2020 bring about?
NG: First of all, I would say that the COVID-19 pandemic wins the 2020 Trend of the Year award. In addition to health threats and depressing statistics, it has affected every industry and every sphere of modern business life. The global HR and global employment industries were no exceptions. Our greatest challenge was the many international employees who were stranded in various countries due to COVID-19. This posed unprecedented challenges for companies employing a global workforce, in particular the challenge of keeping their global talent compliantly employed in the countries where they were stranded.
Another trend stemming from the pandemic is a plethora of newly posed legal challenges regarding the classification of workers by employers, both domestically and globally. The events of 2020 introduced many business owners to the high cost of worker misclassification cases, and ways to evade them.
IO: What challenges did these global HR trends pose before Acumen International? How did your team cope?
NG: For a complete answer to this question, you need to know a bit about my personal story and approach to doing business. We are constantly listening closely to our marketplace and innovating the portfolio of Acumen International’s services and products to meet the demands of our international clients, to serve them in the most professional and productive ways possible.
IO: Did you follow this same principle in 2020? What changes did last year demand from you personally, Nick?
NG: The events of last year challenged us to react to the many disruptions and innovations that upended the global HR industry. Acumen tries to always keep our finger on the pulse of global business trends, and to quickly respond to changes in the international business landscape.
In response to our global clients’ demands and to stay ahead of our competition, we areabout to roll out several innovative SaaS products this year. These tools would give clients insights on how to employ global workforcecompliantly and payroll cost estimates in 190 countries:
Global HR Assistant (GHRA) – this global knowledge base continually updates the in-country information of 190 countries. It provides our client companies with valuable information, to help them make informed decisions about global employment and in-country compliance.
Global Payroll Calculator (GPC) – this online-only SaaS tool helps clients instantly estimate their total payroll costs and taxes in 190 countries.
Another thing that sets Acumen apart from our competitors is our unique blended business model that encompasses physically present legal entities and leverages in-country partners in countries where we don’t have established entities. This model allows our clients to tap into the deep expertise of in-country market leaders and reduce costs at the same time. We developed our business model specifically to spare companies from the high costs of overseas entity formation.
Our unique model sets Acumen apart as the premier global business partner, providing our clients with the benefits of our extensive local expertise. Our local partners bring us closer to our global clients and keep them in the know about changing in-country policies and conditions.
IO: Is building close relationships with clients a key prerequisite for a world-class Global PEO?
NG: Absolutely! Our intention is to be accessible to every client, to be a company they know and trust. Having a trusted global partner plays a crucial role in the growth and success of companies of all types and sizes. For me, trust is a valuable currency in international business.
Acumen enables companies to work without infrastructure. We provide a light global footprint for them, and we use a similar approach for our own business. What differentiates us from other international PEO companies is that they try to build their own infrastructure, while we work with local partners.
Whether our clients are seeking local support for their international clients, want to acquire global talent, or simply want to expand globally, Acumen becomes their trusted partner. Our international PEO helps companies enter new markets and hire foreign talent, quickly and risk-free.
We pride ourselves on the fact that Fortune 500 companies trust us to serve their global hiring needs.
IO: One final question – what makes Acumen the world’s best Global PEO company?
NG: We aspire to be the best by meeting our clients’ specific needs. We not only build relationships with our clients, but we do everything we can to help them accelerate their success through global expansion. You can learn more about the benefits of our global employment solutions here.
In 2020, Acumen was recognized as an industry leader among other Global PEO providers by the independent US analyst firm NelsonHall in Massachusetts. The firm closely analyzed Acumen’s offerings and capabilities and compared them to other global PEO providers, and listed us at the top.
Acumen’s Global PEO service enables multinational firms to expand globally and engage global talent in 190 countries, with unlimited access to our value-added tools.
IO: Thank you for your answers, Nick. To wind things up, can you tell our readers a little bit about Acumen’s plans for 2021 and beyond? You mentioned your two new self-service tools; what else is on the horizon?
NG: Along with our innovative tools that we are designing to meet our clients’ growing global needs, Acumen has branded our Express Global Employment (EGE) service. This service lives up to its name as a high-speed solution that can help companies to legally onboard the selected candidates anywhere in the world in as little as only 72 hours.
And I am happy to announce the launch of our redesigned website presenting our new brand and identity. In the future, we intend to consistently innovate to meet the ever-changing needs of our global clients.
Acumen International has become more than a global PEO over the past decade. We will continue to respond to newly emerging global HR trends, and to be a trend-setter for the global employment industry in the future.
Taking your company abroad is a bold move, and Acumen makes it easier than ever with our well-thought-out solutions for global business expansion.
Visit our website and enjoy its ultimate user-friendly experience to explore the full range of global employment solutions offered by Acumen International.
Explore our website today, or consult our expert team if you have a hiring need anywhere in the world. See why Acumen is the best global partner to help your company succeed abroad in 2021 and beyond.
Melanie Pizzey, the CEO of the Global Payroll Association, made a kick-off speech thanking all the Symposium participants for joining the GPA today to discuss the changing face of global payroll, what revolutionizes the industry, what’s next to come – and where we are all in it.
I’ve never met payroll deps who are over-staffed. – says Mary Holland, Chief Customer Officer, Payslip. – They always ask for more people. In payroll, we always keep seeing to it that all is happening the way it should. Like at the hospital – when all the processes and people’s lives are under your control – same here, all payroll specialists work much more than their allocated hours would sustain control. So payroll is a profession, and the future’s in that.
Tiffany Appleby, ISVP, Alliances and Marketing, Immedis, concentrated on top ways to drive workplace happiness.
