Home Blog

Blog

How an Employer of Record Can Help Your Company

Posted by Stacey Jones

|

Aug 6, 2019 9:00:00 AM

As you look to take your business south of the border, you may have many questions. Canadian business owners sometimes feel a bit daunted by entering the US market, and for good reason. There are many different rules to be aware of, as well as things such as cultural architecture-buildings-city-861609differences.

One of the smartest decisions any Canadian business owner could make is to ask for help. You have plenty of choices when it comes to picking a partner, and all of them offer something a little bit different.

One option you may consider is an employer of record (EOR). It’s important to consider what an EOR does, and how they will help you grow your business. 

An Employer of Record Makes Compliance Simple

One of the most compelling reasons to work with an EOR is that they already know the US market. They’re aware of the different rules and regulations. You can call on their expertise to help you navigate these uncharted waters.

Compliance work is key to a business’s success, but it might be a tall task for even the most talented of HR teams. By working with the EOR, you could reduce the amount of time your team spends sorting out taxes codes and deciphering employment law.

EORs Save Businesses Time and Money

Since the EOR works to make your US operations comply with the letter of the law, they can help you avoid hefty fines and penalties. Taking a look at payroll showcases how the EOR helps and provides value.

The IRS reports the average small business pays $845 US per year in payroll fines. Late payments are the most common issue. By working with an EOR, you can avoid late payments and other US payroll missteps. That puts money back in your business’s pocket. You could probably think of a few better ways to spend nearly $850.

More than that, the EOR also saves you money by reducing the amount of time you spend on tasks like payroll and compliance. Since the employer of record’s team is made up of experts, they make quick work of almost any task you set out for them.

Boosting Employee Satisfaction

Canadian business owners should consider working with an EOR to increase employee satisfaction.

How does an EOR make your employees happier? The EOR’s expertise and skill in delivering HR services make it easier to manage your employees the right way. They can help you offer the right compensation package to your US workers, as well as handling payroll, worker’s compensation, and more.

Better yet, they could also advise on where your company policies might be improved to make your firm more attractive to prospective candidates. This makes it easier to hire the right talent and keep them onboard longer.

Navigating Cultural Difference

One thing Canadian business owners may not think of is just how different American work culture is from their own. American workers have very different expectations than Canadian ones. They even prefer different styles of communication and leadership.

Those elements might cause friction between your business and those who work for you. By working with an EOR, you can change the story and provide a better workplace environment. An experienced EOR could help you pinpoint problem spots, and advise you on how to narrow the gap between your Canadian company culture and what your US workers expect from you.

Increase the Success of Expansion Efforts

Perhaps the biggest benefit of working with an EOR is their ability to help you succeed in the US market. Many Canadian business owners make missteps when they go it alone, which may cause problems for the business.

By calling on the experience and expertise of the EOR, you can make expanding into the US much smoother sailing. If you’re curious about what an employer of record could do for you, get in touch with an expert team today.

 

Topics: EOR, Business Expansion, Employment of Record Services

What Are the Differences Between a PEO and a Staffing Agency?

Posted by Stacey Jones

|

Aug 1, 2019 8:00:00 AM

Any business owner or HR manager with a growing business knows that workforce expansion is necessary. This is especially true for international companies who are planning to enter new markets, as this will require a company to staff the new branch office in the new market or handle payroll and compliance for remote staff working out of country.

adult-businessman-contemporary-937481When it comes to employing people, you have a few different partnership options, which can make it difficult to know exactly which type of organization you should hire. Do you need the services of a staffing agency? Or do you require the services of a professional employer organization (PEO)?  

If you’ve ever wondered about the differences between a staffing agency and PEO, you’re not alone. Learn what sets these organizations apart and which could be right for your business.

What a Staffing Agency Does

Most people have heard of a staffing agency and they’ve been around a bit longer than PEOs. 

In the mid-20th century, agencies designed to help other companies with their staffing needs emerged in the United States. Most of the time, these agencies provided workers to a client work site on a temporary basis.

Today’s staffing agencies frequently offer additional services, and in many cases, can provide workers on a permanent basis. In fact, some staffing agencies specialize in finding and placing permanent employees, especially in certain industries where there is a high demand for specialized skill and talent.  However when you make a permanent hire through an agency, you assume responsibility for the employee and if you are not setup in that country as an employer you will not be able to compliantly payroll the worker and submit required taxes and burdens.. 

What a PEO Does

PEOs emerged in the 1980s in response to employers’ evolving needs. The 1980s and 1990s were an era marked by rapid global expansion, and many international companies found they needed more than what most temporary staffing agencies could provide.

The PEO was the solution. The PEO offers comprehensive HR services to the client employer. While some of these services overlap with some staffing agencies today, the PEO has traditionally offered payroll services, compliance monitoring, insurance, and more.  As they act as a co-employer it allows a company not set-up in country to hire staff out of country compliantly.  It also allows them to offer the worker similar offerings to their in country staff such as benefits and RRSP’s (401K). 

What’s the Difference?

While staffing agencies and PEOs do have a few services that overlap, there are at least two major differences between these two types of organization.

The first difference is key. Who will employ the workers

In the case of a temporary staffing agency, the agency supplies workers to client sites. These workers remain in the employ of the agency. The situation changes in the case of permanent employees. When you make a permanent hire through an agency, you assume responsibility for the employee and therefore would need to be set up in country to take on the employee onto your payroll.

The PEO, on the other hand, acts as a co-employer, which means they share responsibility for the employees. They’ll supply many of the HR services needed, but decisions about hiring, termination, and compensation are left up to the client employer.  If your employee is out of country the PEO will also assist with in country compliance, an important piece when hiring in a country where you are not aware of the employment laws and legislations. 

Another way to think of the difference is to think about what you’re outsourcing. Both organizations are focused on HR tasks around your workforce. With the staffing agency, you’re outsourcing your hiring process and the associated tasks, while with PEO, you’re outsourcing only the administrative tasks, payroll, and compliance associated with your workforce.

 

Finding the Services You Need

Global companies entering new markets face HR challenges from every direction. That can make it difficult to know who you should work with.

In some cases where you need assistance in finding the right candidate, it makes the most sense to work with a staffing agency. In other cases, where you already have your employee the PEO could be just what you need. There are even situations where it makes sense to call on both a permanent staffing agency and a PEO.

It ultimately comes down to knowing what services will best meet your business’s unique needs. 

Discover how the right partner can help you create a long and lasting relationship with those talented workers.

Topics: PEO Services, Outsourcing HR, Business Expansion

Should I Get an Employer of Record or a PEO?

Posted by Stacey Jones

|

Jul 23, 2019 11:00:00 AM

If you’re hoping to expand into a new market, chances are you’ll be hiring some workers on as part of your team. Employment management is a challenging task in almost any company, even when you’re only managing workers in your home country.

When you move to a new market, you may find compliance, insurance, and even payroll present new challenges. You know you will need a partner with the expertise to help you manage everything, but should you hire an employer of record or a professional employer organization (PEO)?

Determine Your Needs

The first question you should ask yourself is what you need help with the most. If you need help hiring people for your business, an employer of record might be the right choice.

If, on the other hand, you find you need more help with maintaining compliance or administering payroll, then a professional employer organization (PEO) could be the right fit for your business.

When you work with a PEO, you retain control over hiring and termination. The PEO becomes more like a co-employer.

An employer of record, on the other hand, assumes full responsibility for hiring and termination. Some employers like this arrangement, since it reassures them that HR tasks are being handled by the experts. Others feel it gives them too little control over who is working for them.

Thinking Long-Term vs Short-Term

Another way to think about the employer of record vs PEO question is to ask if your concerns are short-term or long-term.

If you’re looking at short-term hires or temporary employment, then working with an EOR may make the most sense.

If you’re thinking about hiring permanent employees to work for your business, then a PEO partnership could serve you well. The PEO can help you manage compliance, look after insurance, and administer payroll. If you know employees are only going to be with you for the short-term, you may not want to sign up for payroll services on an ongoing basis.

What Is Your Expertise?

If your team is full of hiring and recruitment experts, you may not need much help with this task. Additionally, you might want to retain control over the hiring process to make sure you’re finding people who are a good fit for your company.

You might find that you need more help with other HR tasks, such as compliance or payroll. As mentioned, working with a PEO could be the answer. The PEO provides an expert team to help you with everything from insurance to compliance to advice on benefits and procedures.

If you’re unsure your HR team is equipped for hiring or terminating employees in the new market, then working with an employer of record should be an option you explore.

Looking at the Bottom Line

One question that comes up when business leaders try to decide whether they need employer of record services or the help of a PEO is the price point. Will one service be more affordable than another?

In many cases, it comes down to what the business requires. The price of either EOR or PEO services will change with what you need.

For some businesses, the PEO will be the right fit. You retain more control, which can be important when it comes to hiring the right people for your business. Their expert advice assists in maintaining compliance in different markets, but it also gives you the opportunity to synchronize your policies and procedures.

With an employer of record, on the other hand, you can rest assured that hiring tasks are being taken care of by an expert team. You also know that your compliance will be top-notch thanks to the EOR’s expertise.

Finding the right services for your business just takes some evaluation of your business needs. Still unsure? Talk to the experts today.

Topics: Business Expansion, Employment of Record Services, American Companies Paying Workers in Canada, payroll outsourcing

The Simplest Way to Expand Business in Canada

Posted by Karen McMullen

|

Jun 17, 2019 9:00:00 AM

The Simplest Way to Expand into CanadaYour business has been growing steadily, but you’re always on the lookout for new opportunities. As your current markets have reached maturity, you’ve been wondering what your next move will be.

Download "12 Differences to Expect When Expanding into Canada" today!

One option now on the table is an international expansion to Canada

How can a company expand internationally?

There are a number of different ways to set up shop in Canada. Some are easier than others. This method may very well be the simplest way to expand business in Canada.

There Are Many Ways to Expand Business in Canada

For some business owners, moving in to Canada involves opening a branch office. This office is much like any other branch office, with the exception that it’s on Canadian soil. If you’ve opened offices in other cities or states, this may feel like the most logical move for you.

You will want to check the legislation governing branch operations, such as the tax laws. There might be a better way to expand business in Canada if you want tax efficiency.

You can also set up as a subsidiary company. This creates a new Canadian company, which is considered a separate entity from your parent company.

An acquisition is another way to expand a business. You could buy a Canadian business or property. Investing into an existing Canadian company is yet another option.

In any of these scenarios, it’s prudent to consult with financial experts, HR experts, and legal experts as well. Having professional advice offers you the strength of informed decisions. You want to make the best choice for your business.

Work with a PEO

The easiest route into Canada for most businesses is through a partnership with a professional employer organization, or PEO.

While you’ll still need to decide whether you’re setting up as a branch office or a subsidiary, working alongside a PEO can take the guesswork out of the HR logistics of your expansion.

Working with a PEO is like bringing in a specialized Canadian HR team. Their experts can help you monitor compliance, and they’ll administer your payroll. Your Canadian employees will be paid on time, every time, and you won’t need to worry about penalties from the Canada Revenue Agency.

The PEO will also provide access to other infrastructure, such as banking or insurance. Some PEOs provide health savings accounts for your employees. Through their program, you can rest assured you’re getting the best price and that the program is compliant..

Is a PEO Partnership Right for Your Business?

You might ask yourself whether you’re in the right position to partner with a PEO. Most small businesses can benefit from working with a PEO. The PEO is built to handle clients of all sizes, which means their infrastructure could help you as your business expands. Whether you have five employees or 500, the PEO is able to provide timely, efficient HR assistance for your business.

This is even more important for international businesses. The PEO’s expert team already knows the ins and outs of employment law, payroll taxes, and more, so they can help you conduct payroll, pay taxes, and provide leave, vacation, and more to your employees.

Talk to a PEO Today

If you’re thinking of ways to expand business in Canada, talk to a PEO today. Expert insights could help you get started on the road to successful international expansion.

With the right assistance, crossing borders and expanding into new markets is easier than ever before.

blog-cta-12-differences-to-expect-when-expanding-into-canada

Topics: Business Expansion

International Employers: 5 Skills to Look for in Remote Workers in Canada

Posted by Corinne Camara

|

Jun 3, 2019 9:00:00 AM

international-employers-5-skills-to-look-for-in-remote-workers-in-canadaNo matter where in the world your company is based, you want to hire the best people to work for you. For international employers in today’s globalized world, this means finding talented candidates both at home and abroad.

Download "12 Differences to Expect When Expanding into Canada" today!

Technology has made it possible for people to work remotely. This is often an asset for employers who operate in multiple countries. Even if you don’t have a branch office, though, you may still opt to hire remote workers. One of the places you might decide to look would be Canada, especially if you have Canadian operations.

Interviewing and hiring remote workers can be somewhat trickier than hiring people who will work on site. What skills should you seek in remote workers in Canada? Here are a few you should be on the lookout for.

1. International Employers Want Tech-Savvy Employees

Technology is what enables remote work in most cases, so it only makes sense to look for people with strong technological skills. This is especially important since they’ll likely be working on their own most of the time.

This could mean they’ll need to navigate technological issues on their own. While it’s important to provide training for company-specific software and other applications, remote workers with a background in technology will be more independent.

2. Remote Workers Need Good Communication Skills

Another key trait to look for in your Canadian remote workers is good communication abilities.

Communication skills are invaluable in almost any job, whether on site or remote. Given that most remote workers will be communicating via email and instant messages, communication is even more important.

You’ll want your remote workers to be both familiar with communication technologies and able to communicate clearly and according to policies.

3. Organized Workers Perform Better

Another trait for international employers to look for in their remote workers is organizational skills. Some people are self-starters who can prioritize a list of tasks with ease. They’re also good at managing their time, so you can be sure they’re working in the most efficient way possible.

These people make good remote employees, because they’re motivated and productive. People who are less organized or don’t manage time as well will struggle more with the demands of remote work.

It can be difficult to judge organizational skills in an interview, so be sure to ask some questions about these skills. If you can, talk to other employers or colleagues who have worked with the candidate about their work habits.

4. Look for Someone Who Sets Goals

The best remote workers are self-motivated. If you give them a goal, they’ll work towards it. If you don’t, however, they’ll set goals for themselves and strive to reach them.

This trait is important for Canadian remote workers, because it helps them stay motivated and on track. If someone can’t set their own goals, you’ll need to be sure you set out the agenda.

If a worker isn’t goal-oriented, you may find that they struggle with productivity, even when you do set goals for them.

5. Ask for a Demonstration of Critical-Thinking Skills

Critical thinking and problem-solving skills are some of the most in-demand soft skills today. These skills allow your workers to approach problems from different points of view. It also asks them to apply a bit of creativity and reasoning in finding solutions.

Someone who is good at problem solving and critical thinking evaluates an issue from all sides. With all the information in hand, they can recommend a course of action.

This is even more important for remote workers, because they may not be able to ask for guidance or help immediately. Being able to think through an issue and come up with a solution is key.

When international employers look for these five skills in their remote employees, they have a much better chance of hiring the right people.

 blog-cta-12-differences-to-expect-when-expanding-into-canada

Topics: Business Expansion

6 Simple Steps to Expand Your Business into Canada

Posted by Anna Mastrandrea

|

May 27, 2019 9:00:00 AM

6_Simple_Steps_to_Expand_Your_Business_into_CanadaIf your company has been growing for some time or growth has started to slow down, you may be looking for new opportunities. One of those could be expanding your business into Canada.

Download "12 Differences to Expect When Expanding into Canada" today!

Why would a company want to expand?

There are many good reasons. Reaching a new market is prime among them. Growing your customer base, improving profits, and even taking on the challenge of a new market may be other reasons to consider.

International expansion can be difficult, though, which might be holding you back. With these six simple steps to expand your business, profits will be booming on both sides of the border in no time.

1. Do Market Research before You Expand Your Business

The first item on your list should be to undertake market research. If you’re planning to expand to Canada, take a look at the existing market for your products or services. Are there many competitors? If so, what do you offer that will help you stand out?

If there aren’t many competitors, ask yourself why. Is this an underserved market or an unrecognized need? Other factors, such as market regulation, could play a role.

2. Consult with the Experts on Legal Matters

The next step in expanding your business to Canada is to make sure you understand the legal framework. Will you need to structure your business as a branch or as a subsidiary? Which offers you the most tax efficiency?

You’ll also want to ask questions about employment law and environmental law. How will you go about hiring employees? What are your options for payroll?

It’s best to consult with the experts on these matters. They can help you understand the steps you’ll need to take, as well as provide insight on how to navigate the Canadian market.

3. Consider Logistics

One of the most important steps you can take as you expand your business into Canada is to give some thought to logistics. How will you get products to your customers? Do you need to purchase real estate or hire employees?

You’ll also need to consider banking logistics. How will you pay the vendors you work with or the employees you hire? This consideration goes beyond policies, but to the infrastructure you'll need.

If you work with a professional employer organization (PEO), you may be able to leverage their infrastructure to solve some of these issues. 

4. Hire Your First Employee

You’ll need to file some paperwork beforehand, but your next step should be to locate the right talent.

Finding the right employees can be difficult enough in your home market, but finding them in an international market could be a struggle.

Ask your PEO for their expert insights on the labour market in Canada. They may be able to tell you about the market and challenges, as well as hiring regulations you’ll want to pay attention to.

5. Adjust Your Marketing Strategy

Think back to the market research you conducted in an earlier step. Canadians have different expectations, so what worked well in the US or even another country might not translate to the Canadian context.

Adjust your marketing accordingly. A campaign that addresses the concerns and needs of your Canadian customers will be much more successful.

6. Monitor Performance

Once you’ve moved across the border and opened your doors to the Canadian market, it’s important to keep tabs on how you’re performing. Are you complying with Canadian laws? Are your people productive? Are your marketing messages resonating with the Canadian populace?

A PEO can help you keep tabs on some of these performance metrics. If you haven’t considered partnering with one yet, you should get in touch with us today. We can help you expand your business with ease.

blog-cta-12-differences-to-expect-when-expanding-into-canada

Topics: Business Expansion

Why Health Spending Accounts Are a Great Benefits Option for Your Canadian Employees

Posted by Corinne Camara

|

May 22, 2019 9:00:00 AM

Why Health Spending Accounts Are a Great Benefits Option for Your Canadian EmployeesWhen you expand your business to Canada, you’re going to hire Canadians to play a role in your workforce. You may need them to work in store or on site. You may also employ them remotely.

Download "12 Differences to Expect When Expanding into Canada" today!

As a new employer in Canada, you’ll need to adjust to the labour market. This can mean ensuring you’re paying competitive wages.

In many cases, it will also mean you need to review your benefits offerings. This is an especially important point for companies from countries such as the US, where healthcare is vastly different.

If you’re wondering how to offer health insurance to your Canadian employees, consider health spending accounts (HSAs).

Leveraging Health Spending Accounts in a Government-Funded System

Canada has a public healthcare system, which is funded by taxation. The system covers basic medical care, such as seeing a doctor or visiting a hospital. Canadian citizens pay no out-of-pocket fees for these services, since they’re covered under provincial health plans.

There are many gaps in the Canadian system, however, and Canadians do rely on their employers to help them bridge the gap. Dental care and prescription drugs are two costs Canadians pay for out of pocket on a regular basis.

You could consider providing a traditional health insurance plan, but a new, more flexible option has been gaining favour. Health spending accounts help your employees navigate the gaps in the public system. They also have benefits for you.

Benefits for Your Employees

Traditional health insurance plans often come with caps. Your plan might include $500 for dental or $200 for vision care.

Once those limits are reached, the employee must pay out of pocket. Some plans also have deductibles or co-pays, which also mean the employee pays. If a service or medical item isn’t covered under the plan, the employee will have to foot the bill.

A health spending account is different. HSAs are employer-funded, which means you pay into accounts for your employees. You can add a set amount to the account, and the employee then has that dollar amount to spend on medical services and items every year.

There’s no deductible or co-pay. The employee can use the funds immediately. They can also use the funds for the services they need to pay for. If someone needs a root canal one year and then needs physiotherapy after a car accident the following year, they can use the funds in their HSA to help.

With a traditional plan, they couldn’t do that. The root canal might cost much more than the dental benefit, and physiotherapy might not be covered at all.

Benefits for Employers

Some of the benefits of offering health spending accounts to your Canadian employees should be clear. With an HSA, they can get the coverage they need, when they need it.

How do health spending accounts benefit you as the employer? For one, they’re typically less expensive than traditional plans. They also offer better tax efficiency. You can write off the amount you contribute to the HSA, along with plan administration fees. Insurance isn’t always tax deductible.

Once you’ve made the initial contribution, you can also “top up” accounts for the following year. If an employee has funds left over, you may not need to contribute the full $2,000 or $5,000 to reset for the next year. HSAs can also add value to the business.

Of course, the biggest benefit of an HSA is that it makes you more attractive as an employer. It gives your employees the flexibility they want and the coverage they need. In turn, you can expect a better reputation, lower turnover, and happier employees.

Offer HSAs to Your Employees the Easy Way

Working with a PEO is one great way to offer a benefit like health spending accounts to your Canadian employees. Getting started can be as easy as reaching out to the experts.

blog-cta-7-tips-to-help-you-hire-the-right-peo

Topics: Business Expansion

How Do US Companies Pay Taxes in Canada?

Posted by Ray Gonder

|

May 13, 2019 9:00:00 AM

How Do US Companies Pay Taxes in CanadaAs a US business owner, you’re eager to expand to Canada. Like many other American business leaders, you believe the Great White North is the best market for expansion as you continue to grow. After all, both countries have similarities in culture and a strong history of trade.

Download "12 Differences to Expect When Expanding into Canada" today!

That said, you still have to carefully consider every aspect of your Canadian operations. That includes taxation of the business.

How do US companies pay taxes in Canada? The answer depends on different variables.

Determining Residency

Before you know how you’ll pay Canadian taxes, you have to determine residency. Non-resident corporations are treated differently than Canadian corporations.

Generally speaking, if the company was incorporated in Canada and continues to be incorporated in Canada, it is resident. A resident corporation can be deemed non-resident, provided it's being taxed comprehensively in a tax treaty country.

A non-resident company is incorporated outside of Canada. This includes parent companies that operate Canadian branch offices. Subsidiaries are separate legal entities, so they’d be more likely to be incorporated in Canada and considered resident.

The General Rule for Permanent Establishments

If you create a permanent establishment in Canada, you’ll only pay Canadian tax on the income you generate in Canada. This follows the principle of eliminating double taxation for foreign entities.

A permanent establishment includes a branch office, a workshop, or a factory. A permanent establishment can also include employees or agents who may conclude contracts in your name.

Generally speaking, the tax rate is around 25 percent. There are ways to reduce how much tax you pay, such as through tax treaties.

Tax for Subsidiaries and Separate Legal Entities

If you create a separate legal entity for your Canadian expansion, your tax situation will change. How and what you pay depends on the business structure you adopt.

Subsidiaries are considered Canadian operations, and they’re taxed accordingly. If you pay non-residents, including investors, you’ll need to subject those payments to tax withholding.

If the subsidiary does business in other countries, then you can apply for tax relief through treaties in those countries.

Filing for Non-Resident Corporations

If your business is considered a non-resident corporation with a permanent establishment, you’ll need to file and pay taxes in Canada.

You’ll need to file a T2 corporation income tax return, along with Schedule 97 on additional information for non-resident corporations. You’ll also have to submit Schedule 20, Part XIV, Additional Taxes on Non-Resident Corporations.

If you have Canadian employees, you’ll need to register for a payroll deductions account. You must also withhold a percentage of payment for services you render in Canada, as well as withhold on passive income you receive.

Finally, you’ll need to file dispositions of taxable Canadian property if you happen to sell taxable property in Canada.

Payroll withholding will be remitted to your payroll account, and the GST/HST collected will be paid to your business’s GST/HST account. The Canada Revenue Agency (CRA) will collect payments for tax, GST/HST, and payroll withholdings through its different branches.

Filing for Resident Corporations

If you operate a subsidiary or are otherwise determined to be a resident corporation in Canada, you’ll pay tax the same way other Canadian corporations pay it. This means filing a T2, along with other relevant forms and schedules.

Like non-resident corporations, you may need to collect and remit GST/HST. If you have employees, you’ll need a payroll account so you can remit your withholdings to the CRA.

Get Help with Payroll

The best step to take is to consult with the professionals, such as a tax lawyer or a financial professional.

Another option you have to make paying Canadian taxes easier is to partner with a professional employer organization (PEO). We can help you look after payroll, which can make your taxes less confusing at the end of the year.

blog-cta-12-differences-to-expect-when-expanding-into-canada

Topics: Business Expansion

5 Great Reasons Global Companies Employ US Workers

Posted by Corinne Camara

|

May 8, 2019 9:00:00 AM

5 Great Reasons Global Companies Employ US WorkersEven if you’ve expanded into another country before, you might feel overwhelmed by the American market.

Request a quote for US payroll services today!

There are many aspects to consider when you move into the US. As you’re aware, laws are very different, which can cause a tangle of red tape. You need to think about tax efficiencies and corporate structure. Your marketing strategy may need to be tweaked. You might even need to revisit your product offers and packaging.

You also must consider how to staff your business. Is hiring US workers the right move? Maybe you can hire independent contractors to fulfill your needs. Perhaps sending existing employees to the US is the right way forward.

Many successful global companies choose employees over any other work arrangement. Here are a few great reasons you should employ US workers.

1. Global Companies Get Insights from US Workers

US workers can offer you insights into the market and culture. You could hire remote workers from your home country, but if you’re serving the American market, will they connect to Americans in the same way?

Employees from the same cultural milieu can smooth relations with your customers. Your customers will also be able to relate to your workers more easily.

US workers can also provide key insights into the market. They have insider knowledge others in your company may lack.

2. They Provide Geographic Insurance

If you don’t have a physical location in the US, you may see no reason to hire employees on US soil. Operations can run from almost anywhere thanks to today’s technology, and your staff can telecommute.

Much like computer servers should be in geographically diverse areas, global companies should think about having a geographically diverse workforce. This provides insurance for your customers. For example, if complications prevent people in India or the UK from getting to work, your US employees will be on standby.

3. It Creates a Community Presence

Global companies often face challenges being accepted into their new markets. Consumers may see you as an outsider and decide not to buy from you.

One way to approach this attitude is to establish that you care about the communities you operate in. What better way to show you care about a community than by hiring locals.

This helps potential customers put real faces to names. By employing their neighbours, friends, and relatives, you offer local opportunities in the community. In turn, community members are more likely to feel sympathetic and connected to your brand.

Your employees could become your greatest advocates. They may talk up your products or services, as well as recommend you as an employer. In short, US workers can be the best brand ambassadors.

4. It’s Easier Than You Think

You may be reluctant to employ US workers due to legal concerns. You might be worried about tax implications or issues around employment law. How can you let someone go? What are the rules about overtime pay, holidays, or vacation pay? What are the leaves like in the US? What about benefits?

You might think these concerns make hiring US workers too much of a hassle, but it’s not as difficult as it seems. Working with a PEO can help you employ US workers without worrying about the ins and outs of payroll or the tax implications of benefits. The PEO can take on the liability and responsibility for your US workers.

5. It Builds Your Talent Pool

If you’re hoping to continue expanding, then building your talent pool is a good idea.

Employing US workers can help you do just that. When it comes time to expand again, you’ll know you have a strong group of talented individuals to draw on.

Many global companies hire US workers for some of these reasons. It could be a smart move for your business too. If you think it might be a good decision, talk to the experts and discover how the right US talent could help you ensure business expansion success.

blog-cta-7-tips-to-help-you-hire-the-right-peo

Topics: Business Expansion

Should I Hire US Employees or Independent Contractors?

Posted by Anna Mastrandrea

|

May 1, 2019 9:00:00 AM

Should I Hire US Employees or Independent ContractorsYou know you need talented workers to staff your new US expansion. The question for many international business owners is whether they should hire employees or work with independent contractors.

Download our whitepaper "7 Tips to Help You Hire the Right PEO" today!

There are pros and cons to both options. You’ll need to carefully weigh your options in order to make the right decision for your business. Keep these key factors in mind when you approach this vital assessment.

The Costs of Hiring

The first factor almost any hiring manager or business owner looks at is the cost. You likely weigh the costs of hiring and outsourcing at headquarters as well.

In some ways, hiring an independent contractor looks less expensive on paper. You don’t need to pay taxes for them, and you don’t need to pay them benefits. You don’t need to pay them for vacation days or holidays. You also won’t be responsible for supplying material or a workspace.

The contractor handles all of those costs. If you crunch the numbers, though, the picture becomes a little bit muddier.

Contractors may charge higher per hour rates in order to offset their higher operational costs. They may need to carry their own insurance or pay for equipment, and they’ll often pass those costs along to you.

They might also have control over what materials they purchase, and they might not go with the lowest cost item.

Often, hiring an employee is more affordable.

Quality Control

Another risk of hiring independent contractors is the issue of quality. Some contractors do excellent work and are efficient.

However, you could receive subpar work. The contractor may still charge big bucks for a less-than-quality job. They could also try to cut corners by using less expensive materials.

As an employer, you have more say over the equipment, materials, process, and end result from employees. When you work with contractors, you could be at their mercy.

Control of Schedules and Priorities

When you work with an employee, you can ensure your deadlines are met and your priorities are worked on as you request. You can adjust employees’ schedules to make sure jobs are finished on time or you have enough staff on the floor.

When you work with a contractor, you give up most of this control. Contractors usually have more than one client, and they might not prioritize your project.

That could translate into short-staffing on the floor or missed deadlines for your business.

Keeping Consistency in the Business

As you expand into the US market, you’re hoping to build a brand that Americans identify with. If you work with contractors, this can be harder to do.

One of these issues is that independent contractors might not deliver the consistency you need. They also aren’t as invested in your business’s success, so they may not see delivering great customer service or using the best equipment as a top priority.

By hiring and training your own employees, you can ensure a higher level of consistency. Employees are more likely to be invested in your business, and they may stay with your business longer. This allows you to provide continuity to your customers.

Make Employing People Easier

One reason international employers hesitate to employ true employees is because of concerns around employment law and payroll. They don’t understand the ins and outs of the law, and they might be worried they’ll face fines and penalties. By working with a PEO, you can simplify this situation. The PEO takes over all these tasks and the responsibility and liability of employing workers.

On the other hand, international employers hiring independent contractors often misclassify them, and this misclassification can lead to hefty fines and penalties.

Before you bring on an independent contractor, talk to a PEO. Hiring an employee could be the right choice.

blog-cta-7-tips-to-help-you-hire-the-right-peo

Topics: Business Expansion

Subscribe to Email Updates

Recent Posts

sidebar-cta-12-differences-to-expect-when-expanding-into-canada

Posts by Topic

see all