Global Footprint Health Check:
Ensuring International Hiring Compliance

While hiring an employee via an Employer of Record (EOR) can help manage local employment legislation and tax withholding, it does not entirely eliminate the risk of creating a permanent establishment (PE). The determination of a PE depends on various factors such as the nature of the employee’s role, their level of authority, and the extent to which they conduct business on behalf of your company in the foreign country.

Our Global Footprint Health Check can help assess the potential PE risk associated with hiring employees through EOR arrangements. By analyzing your specific situation, we can provide tailored recommendations to ensure compliance and minimize the likelihood of creating a permanent establishment risk.

When using an Employer of Record (EOR) arrangement, you are typically engaging an individual as an employee rather than as an independent contractor. EORs help companies comply with local employment legislation and manage tax withholding for the employees they contract. Misclassification usually occurs when a worker who should be classified as an employee is incorrectly treated as an independent contractor. Therefore paying the contractor via an EOR arrangement does not necessarily reduce your risk of misclassification. 

If you are uncertain whether a worker should be engaged as an employee through an EOR or as an independent contractor, our Global Footprint Health Check can help. Our expert analysis will evaluate your current hiring practices, identify potential misclassifications, and provide guidance on the appropriate classification to ensure compliance and minimize potential legal and financial consequences.

The Global Footprint Health Check is a comprehensive assessment of your company’s international hiring practices. It identifies compliance risks, evaluates permanent establishment exposure, and uncovers contractor misclassifications. This helps you proactively address potential issues, ensuring compliance and minimizing financial and reputational risks during global expansion.

The duration of the Health Check process varies depending on the size of your company and the complexity of your international hiring practices. However, we do commit to returning a completed report within 2 weeks of receiving your completed input form and questionnaire. 

You will need to provide details about your current international hiring practices, including the number of employees and contractors you currently employ, consolidated by the roles they have within your organisation, countries of operation, countries where you have a legal entity set up and any existing Employer of Record (EOR) arrangements. Our team may request additional information if needed to ensure a thorough assessment. Please note that no personal identifiable information is collected about your employees.

Yes, our Health Check identifies potential compliance risks and offers tailored recommendations to address these issues. By proactively resolving these concerns, you can minimize the likelihood of incurring penalties, fines, and other financial consequences related to non-compliance.

Without giving away the full recipe to our secret sauce, our proprietary tax algorithm uses a mixture of dynamic and fixed data points to determine the tax risk.  We have a specialist in-house team that codifies the tax risks using up to date tax legislation from external sources that include paid tax databases, the World Bank, OECD and others to then calculate the corporation tax, payroll tax and social security risks for each country. 

We then overlay the user inputs (e.g. for different roles, country combinations, etc.) to dynamically adjust the risks and solutions.  Each country undergoes a full update on at least an annual basis and during the year is also updated for any material changes to tax legislation.

Employment Law and Employer of Record algorithm inputs are updated using our own proprietary algorithm which itself is updated on at least a quarterly basis.

Absolutely. We prioritize data security and maintain strict confidentiality measures to protect your sensitive information. All data is handled securely and in accordance with applicable data protection regulations. Please also note that no personal identifiable information is collected about your employees.

Yes, our Health Check is designed to cater to companies of varying sizes and industries with international hiring needs. We customize our assessment to suit your unique business requirements and offer expert guidance to help you navigate the complexities of global expansion.

Yes, our team is available to provide ongoing support and consultation as needed. We can help you implement the recommendations from the Health Check via our Geo-Strategy consultancy and offer guidance on best practices for maintaining compliance as your company continues to grow internationally. To ensure you remain compliant as your company continues to evolve and hire in different countries, you should also consider trying out our Hire From Anywhere compliance platform which assesses the risk of each additional hire you make.