The Industry of Global Mobility is flourishing, despite predictions and pandemics. Even though hiring from the international talent marketplace is not as easy as employing in home countries, it definitely allows many companies to access skilled workers worldwide. The process of hiring internationally or moving employees abroad for job assignments is manageable provided you have the correct information and proper support.
The challenge
The number one concern is typically compliance, specifically with regulations and local laws. Failing to do things right can not only make unhappy employees but can bring the company fines, penalties, or even bans from doing business in a country. In the interest of national security and with concerns of protecting the local workforce, many countries nowadays enforce prohibitions against illegal employment. The penalties are increasingly becoming criminal, rather than just civil punishments.
It may not be clear how authorities can monitor foreign corporations, as it seems an internal matter from the outset. However, instances of non-compliance being identified are often a result of employee complaints or locally undertaken audits.
The employer should plan international assignments well ahead and not trust solutions that might have seemed quick and easy in the past. Keep in mind that problems only increase when an assignee has family members who accompany them, and trying to enroll children locally in schools, or getting a local driver’s license may result in disaster if visa compliance was not sorted beforehand.
5 common omissions with immigration compliance
Before giving any recommendations, let’s see what are the most common mistakes in compliance when companies are dealing with international assignments:
Employment status errors
If an ex-pat works on a tourist or standard business visa he can face deportation and fines when discovered, as well the employer may be subjected to penalties. It also might be appealing to engage an independent contractor in some countries, but then the company might have obligations to undertake.
Host country’s employment and contract laws violation
Labor and employment laws are designed to protect workers’ rights in general, but every country does it differently. There may be variations in notice periods for termination, a compliant employment contract, over-defending non-competition clauses, etc.
Statutory entitlements and benefits violation
Whereas health insurance and vacation leave sound like a familiar benefit package, mandatory pension contributions or multi-month fully paid parental leave can be a surprise for some employers. Companies shouldn’t avoid these payments in countries where the social structure relies on employer-provided entitlements.
Incorrect payroll running
You will most probably need to run a local payroll if you want to employ internationally. Obviously, understanding foreign intricacies will be difficult if you don’t have a local counselor, accountant, etc.
Triggering permanent establishment
If a company has a business presence in a foreign country, resulting in payment of corporate tax, or undertaking managerial decisions and agreements negotiating or signing, then Permanent Establishment is triggered. There will be some other criteria such as regarding the activity of the business or duration, but generally, when employees create revenue or physical offices are established, PE is triggered. If you hire remotely, there may be less risk for this, but do consider that countries are expanding PE criteria to draw an increase in tax revenue from foreign companies.
Our solution
A part of Clearmove’s key services provided to their clients and assignees is assistance within the area of Immigration, Visa, and Attestation. This helps support the assignee and their families with the smooth relocation and settlement in the new location, ensures following of all the rules, and keeping everyone informed in all relevant areas.
Clearmove can coordinate and manage the following:
- Employment Permits. Preparation and submission of employment entry permit, assistance with a medical test (where required), ID card (where required), Residence visa/permits
- Dependant/Family Sponsorship. Preparation/submission of residence entry permit, assistance with such areas medical tests, ID card, residence visa & any governmental required documentation
- Domestic helpers visa. Preparation and submission of such documents as employment entry permit, medical tests, ID cards, residence visa, and any governmental required documentation.
- Legalization / Attestation of Documents where required.
Clearmove’s consultants will discuss in-depth with the assignee their key requirements in the following key areas and then provide full turn management of liaison with Clearmove Immigration partners and consultants. This ensures everything is fully addressed without the HR department being involved in every issue of the process. Clearmove saves your time and money while delivering services according to the highest standards.
If you want to learn more about our process and how we ensure your company is fully compliant, click the button below.