I understand that timezones may mismatch but employees generally accomodate to the timezone everyone wants.
The different countries payroll can be handled by a decent Saas itself.
So, why are companies hellbent on getting US Remote Employees instead of Remote anywhere?
- Working hours. If you are on the West Coast, good luck finding someone in Europe who will be available at 3pm your time.
- Superiority complex. I get the impression a lot of Americans treat everywhere else like it is a third world country. I work for a US company that has a branch in a post-Soviet EU country, and when the C-levels were discussing expanding our team, they were talking as if there would be a queue of people waiting at the door to interview.
Taxes and employment laws are really not an issue, there are plenty of ways around it, especially if you are a small startup. As others have pointed out, the simplest way is to treat someone as a 1099 independent contractor. You pay them gross, and let them deal with all their own tax responsibilities. If you want proper employees there are agencies everywhere who will deal with this for you, and in a lot of cases government agencies will help you and / or give you tax breaks as they want you to invest in their country.
(Source: As a European, I've worked half my career remotely for US companies)
I've already been asked by some silicon valley guy on Discord if France did tech and had universities.
Like come on, Europe is not stuck at La Belle Époque and Victorian Era. And even then, it had tech.
And despite not having a job there atm, they want to stay in California. I told him there are plenty of well paid IT jobs in Europe, but apparently the USA is a special place, and you have to be pay uni debt, and stuff like that.
This is not so simple. Genuinely treating someone as an IC means giving up a lot of control. As the IRS says:
You are not an independent contractor if you perform services that can be controlled by an employer (what will be done and how it will be done).
And merely calling someone an IC while actually controlling their work hours, projects, etc risks legal consequences.
For instance, maternity/paternity leave. If you give someone full leave, one could argue that it's a benefit only afforded to FTEs and that could be enough to convince the local business office that the person is, in fact, an FTE. Now you're in violation and have to pay fines as well as setup a local office of one, who will never visit said office. So you do the proxy office thing, which incurs cost right away. Come tax season, you have to figure out what you owe based on the person and your new legal status as a for profit business in the area. Your cost to operate has just become significantly higher. Now you have to rethink the position and location and a non zero number of these will result in closing the local role and having to let someone go. Lose lose for everyone. The alternative path says "no baby leave because you're a contractor." That sucks too because you like the people you hire and want to do right by them but that also means keeping them employed.
You can find alternatives and that's not a literal situation but it is the combination of a few situations into one example, so the contents are real but not as a single tale. (I don't want to tell anyone's specific story.)
Global remote hiring is hard.
Of course there's legal ways for a company to employ somebody not in the US. But many employees at companies don't want to deal with that headache and create any extra work for themselves.
As proof of that, look at how many jobs ask for remote US workers in a list of XYZ random states. They can legally employ anybody they want to in the US, but they don't want to deal with taking the time out figuring out how to deal with hiring somebody from say Alabama or South Dakota if they've never done that before.
Ironic, I’ve met the exact same mindset from the vast majority of Euros, including this post. Even between other Euro countries. Perhaps, instead of being a so-called “American mindset”, it’s simply a “human mindset” and we all view others outside of our borders as beneath us. It would certainly explain the last few millennia now wouldn’t it?
I thought the idom was "the grass is (always) greener (on the other side)"
Brain drain and mass emigration are a thing in so many places !
In Hungary, this was a factor in Orban being elected to make the country better again for the youth.
In Romania, this caused domestic wages to increase, as so many workers were outposted.
In France, the political and social climate is so toxic that Québec is seen as the getaway to finally enjoy a simple life.
Ukraine is literally at war and being wiped out. I don't think they're having a nice time being smug.
UK is having a hungover from 2016 and Brexit.
Euros don't like the USA for some reason. But it's pretty much the only country that is seen as beneath us. (With UK maybe)
The USA is still an ally, btw. But some trust deserves to be earned back. Especially on social (are we still welcome after Trump? are women and transgenders still humans who have rights ? Is it a crime to kill people who walk suspiciously through the town and don't look like they have a MAGA cap ? Or good policing ?) and economic issues (is the USA still investing in Europe, or is it just FCPA-ing corporations to buy them for cheap and shut them down ?)
As a reminder, a former worker from the Ford factory in Blanquefort ran at the previous presidential election, in here. And the law allowing abortion was just turned into a constitutional right, in a rare transpartisan move to avoid the US situation in the future.
Living in France for the last two years, I don't think I've even heard someone mention Canada's existence - things are fantastic here, relatively speaking.
I am sad to read this stated as common knowledge, especially in a forum that promotes curiosity. It is not true in my opinion, and should not be normalized.
I am not taking sides in "Euros" or people from US or anything like that, because there are competent people everywhere, but this is not a "human mindset". It has a more fitting name: ignorance. I am not saying you are ignorant (you are just expressing a supposedly common view), but people who think they are above foreigners (no matter which specific country we take as reference) are.
In the last few millennia humans have progressed a lot thanks to cross-pollination of many origins: Greek thought, Italian, Arab, British, American, just to name a few. Suffice to say, I do not share this jaded view of the world.
Import/export laws and data compliance laws are another huge factor. In the EU, it means having significantly higher burden. I other areas, lack of laws make enforcement of certain things extremely difficult.
Example: if you run a marketing agency in the US, most liability insurance absolutely forbids non US workers from working in your ad accounts.
For example, if you hired someone in Israel, you are mandated to pay taxes, contribute to pension plan, etc. There are labor laws details that you need to know how to work through, etc.
As a fine example, let's say that you have hired someone in Israel and they worked for you for 5 years. You covered payment and told them that they'll cover local taxes, etc.
You now want to fire them.
The following sequence of events happen:
* They sue for wrongful termination (there is a particular process to follow) * They sue for missing pension contributions (the law says that if you didn't contribute to the pension, you are both civilly and criminally liable). And it can be that you are found to be effectively the "pension fund". * They sue for severance pay, which is calculated as 1 month of salary X years worked.
That can be a huge surprise for you.
That is leaving aside things like what happens around work accidents. Did you carry local insurance for that? Or are you on the hook for millions because of that?
Those are all things that can be solved, but they are a major headache.
I don't know anyone who has ever used these so I guess they are expensive and awkward.
To answer your question more directly, it's not an app but rather a conglomerate of international brick-and-mortar businesses, with legal departments, HR, payroll, insurance... Not lightweight.
You're describing, in a nutshell, consulting.
Consulting firms offer you someone. Maybe it's someone you pick, maybe it's someone they pick, but it is someone whose full time job is working as a consultant at said firm. Here, the firm finds someone they want to hire, and the agency deals with the legal nitty gritty.
If you mean consulting as an individual, it's still different, for both parties, because you recreate an employment situation. The employee has legal employment, notice period, employment rights, insurance, yada yada. Employee has long-term commitment.
If you're saying consulting as an individual is the same as.l employment, well... I guess then every two things are the same...
Every consulting firm I’ve worked with is highly responsive to feedback regarding specific people. If I want that person, I get that person. They work on my team. Someone else handles the paperwork and abstracts away the legal questions.
You come to a firm, talk to some of their guys and you like Alice best, you work with Alice -> consultancy.
You find Bob somewhere in the world, like him, want to hire him, find a company that deals with the legal details -> remote work agency.
Those guys were good. I hope they're doing OK.
It's not hard necessarily, but you do need to get it right for each individual country. I can understand a company exec just not wanting the hassle.
You can employ through contracting agencies in the target country that handle all this stuff, but you'll still have a certain amount of pain when you run into different countries' Ideas of what is appropriate behaviour when firing someone.
And a change like that will likely come, there is a reason why all invoices are now digitalized and reported, most of fake employment relationships are one SQL query away from being found out. Just find people who submit one invoice a month to one client.
An “employer” can structure the contract to avoid IR35, but that’s precisely my point - now the “employer” needs local legal knowledge to maintain an arms length contractual relationship. (HMRC has also made the “employer” liable for IR35 problems: you can’t just punt the legal liability onto the “employee” and forget about it anymore.)
> You’ll need to ensure you pay the correct PAYE tax and National Insurance (NI) for any contract which is inside IR35 because you are, in the eyes of HMRC, an employee. You can, however, manage this through your limited company.
https://www.crunch.co.uk/knowledge-tax/can-ir35-contractors-...
I wonder if 2 companies is enough to bypass this.
The difference is that in the former, they're a representative of my business, in the latter, they're providing a service to further their own business.
For example even if you have a "contractor contract", but you only work for one client, you could be considered an employee.
But due to offering the "wrong" contract we also couldn't let them go, since that's very difficult (IMHO, too difficult) outside of gross misconduct, and is probably going to be expensive regardless. They also gave me such a contract by the way, as the first Dutch employee, but that wasn't an issue as no one wanted to get rid of me :-) I actually told them that was not a good idea, but after some turnover in the HR department it seems that got lost.
Both left on their own account eventually, but taking in to account their wages, the increased workload for others, the fact that others literally quit the company because of these toxic assholes, by my estimation each individually cost the company well over a millions euro with nothing to show for it (I'm fairly certain zero code of one survived, and very little of the other).
US talent pool is already deep enough.
If they want to use other countries it’s just for lower wages.
Why not as long as the person I am hiring is equal or better than a similar person in America but say 1/5th the cost. Capitalism 101.
Lower Wages does not always mean lower quality. It just means that an American has to compete harder because they need say 5x salary of their foreign counterparty.
With fully remote world, why would I not hire anywhere in the world as long as I find the right person.
Language, culture, verifiability (even on the level of being able to do a standard background check), payroll, legalities. And all the other reasons they aren't always keen to use offshore people, even if it seems "cheaper". And did I mention language, culture?
The different countries payroll can be handled by a decent SaaS itself.
Throwing a different payroll system into the mix for the the sake of 1 or 2 resources can easily end up being more trouble than it's worth.
Big companies can afford the investment into many small locations and they can afford having the regional expertise to avoid running afoul of local and federal governments. In an ideal world, we'd make this easy for ourselves but the world is not ideal.
Have you ever started a business and run it with a team of folk from across the world on a budget (not including just contracting people via UpWork etc)?
Employees can be upset that you hire oversea. They expect that coworkers there are underpaid, and that you hired these people for that reason. So the image of the company gets a hit even among your workers. And if you go oversea for workforce, they could think that their job will be outsourced as well in the future. And you won't get the same engagement.
Differences in culture do exist as well. I have heard wild stories about outsourcing in India.
Jet lag is also a thing.
kidgorgeous's benefits. govt subsidies can be also right. I think the YC themselves funds nothing but local startups (do they ? I haven't tried to fund a startup yet) Anyway, it's difficult to promote a company that doesn't have any local impact.
However, all the tax and labor laws things are overstated. Countries like France, Romania, India, or Morocco have efficient consulting firms. Large and small companies from any industry work with them everyday on every kind of subject (IT, engineering, ...)
Startups actually do exist outside of the US, believe it or not. And you may find that those are a lot less picky than US ones about the location of remote workers.
Medium-sized companies will have a "legal entity" in e.g. EU and US as well, and can hire workers in those polities. The workers are then "employed" by the legal entity for HR purposes, regardless of where their immediate co-workers are located.
There are also legal limits on how many days per year one can work "abroad" - company policies on this do vary, but HMRC imposes strict constraints on what is allowed. A max of several weeks per year is what I've seen. Also it's not from "any country", it excludes the ones on this list: https://www.gov.uk/government/collections/financial-sanction...
I know a company which hired the best MIT PhD but they also hired the best IIT PhDs for the work. Both of them do equally good. But the IIT PhDs are more cost effective and hence they expanded the program in India.
Typically when I've seen job postings US only they're looking for some type of coverage during US business hours; on-call, supporting juniors, meetings with c-suite, etc.
I can deal with 3 in the AM meetings or whatever if the pay is good anyways.
and because they want to have the idea you are local