A few decades ago, hiring an employee in another country was incredibly difficult, and practically unthinkable for a small-time entrepreneur. These days, it's relatively easy to work with someone in another country, and it just keeps getting easier.
There are many reasons why you might want to work with an international employee. You could be seeking someone who will accept a lower payment rate, or you could simply want to broaden your range of possible candidates for consideration. Whatever your motivation, you'll be pleased to know that hiring employees in other countries stands to get even easier in the next several years.
Why is this the case?
The Visa Waiver Program (VWP)
Part of this trend is attributable to relaxing standards of international travel. Thanks to the Visa Waiver Program (VWP), employees in some countries can easily get approved to travel to another country for work, tourism, or transit. There are some strict conditions for a country to be considered to join the VWP; for example, they must be highly economically developed with strict border control and counter-terrorism policies. But already, there are nearly 40 participants in the VWP. If you're looking to interview a potential candidate from another country, or if you just want your international employees to visit your headquarters occasionally, it's much easier to manage travel accommodations than it used to be.
We're also seeing the constant rollout of new technologies designed to make communication easier. Some of these take the form of apps and management platforms, giving employees the chance to communicate in many different mediums, depending on what the situation demands. If utilized properly, the right combination of communication tools can ease the burden of time zone differences between your countries. And translation technology is improving to the point where it can be considered reliable for managing collaboration between two employees who don't speak each other's native tongue.
Better Payment Systems
One of the biggest challenges in managing international employees in the past has been creating and maintaining a consistent payment system. Exchange rates between different types of currency are hard to manage, and if you want to send payments internationally, you typically have to pay significant fees. These days, banks are loosening their international payment standards, making it easier and cheaper to send payments, exchange currency, and manage international payrolls. Third-party payment systems are also emerging to challenge traditional banks, offering businesses hiring international employees more favorable options for disbursing payment. On top of that, secure internationally relevant currencies like Bitcoin are starting to become more popular, enabling modes of payment with minimal transaction fees.
Challenges That Remain
Of course, there are still several challenges you may face when hiring employees in other countries:
- Differences in definitions of employment. Different countries have radically different approaches to employment laws. For example, in the United States, employment is considered "at will," which means either party in the employment relationship can terminate that relationship at any time, and for any reason. An employer can fire an employee without providing justification, and an employee can leave with or without notice. In some countries, like Brazil, an employee can only be terminated if there is a sufficient reason to terminate them; poor performance or decreasing revenue may not be suitable justification, which can make things difficult in some situations.
- PTO differences. Other countries may also have different standards for the management of paid time off (PTO). Generally, companies in the United States don't distinguish between personal days, sick days, and vacation days, with a generic bank of days for an employee to use as they see fit. In many other countries, companies are forced to allocate available "off" days for annual leave, sick leave, and other purposes. It's sometimes hard to understand these differences, and they may make ongoing teamwork more challenging.
- Non-compete agreements, employee inventions, and other legal matters. While some areas of international employee management have been greatly simplified, many legal considerations are still painfully complex. Different countries have different standards when it comes to things like non-compete agreements, non-disclosure agreements, and the transference of invention rights from employee to employer. The nuances of each country's legal system must be taken into consideration, and depending on the nature of your business, can get complicated fast.
There are major advantages in hiring employees in other countries, and our current trajectory is poised to make these hires easier and easier. If you've ever considered hiring someone from another country, whether it's to save money, expand your reach, or just get exposure to another culture, now's the perfect time to get started. There are significant challenges you'll still need to account for, but with the right team and the right mindset, you should have no trouble overcoming them.