Filed under Business partner updateTuesday, 05 December 2017
Managing the employment and payroll requirements of a single foreign contractor can cause headaches. When you have multiple contractors in disparate countries around the world, managing the salary payments and legal considerations can suddenly become a full-time job. When entering into an arrangement with an overseas contractor, there are multiple factors to address. We highlight complexities to consider and what you can do to ensure you retain productivity while avoiding any costly legal troubles in the future.
When your arrangement with the contractor has ended, there are still a number of obligations employers must adhere to. Records of payments, contracts and other agreements should be retained in case of any IRS or State Tax Authority audit. In rare instances, disputes may arise between the employer and contractor even after the arrangement has come to a close. Comprehensive employment contracts and additional clauses that cover confidentiality, intellectual property and notice periods can help to mitigate any potential fallout.
Independent Contractors or an Employee
The final consideration for employers with international contractors is whether the work relationship is defined as that of a contractor or an employee. In the United States, the IRS provides a criteria checklist for determining the correct status for your domestic contractor workforce. However, violation of adhering to that checklist results in severe penalties and fines for employers that misclassify an employee as a contractor. Overseas, each country will have its own unique laws and regulations to determine the employment status – and its own repercussions for misclassification.
A Compliant Engagement
Ensuring you have the necessary resources and processes in place to avoid the potential fallout of compliance failure or employees seeking damages are essential when engaging with independent contractors internationally. Paying employees, handling the day-today administrative tasks and ensuring a straightforward off-board are just some of the
SafeGuard World’s team of expert Global Solution Advisors can discuss available options to ensure you are protected against contractor disputes and government recourse, without the requirement for any significant investment of your resources.
SafeGuard World provides smart solutions for managing your workforce – wherever they are located. Quickly expand into new global markets, compliantly pay workers and convert disparate payroll data into a comprehensive view of your workforce costs for better business decisions. We bring the brightest minds and an unwavering commitment to our clients’ continued success and their international growth.
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HANDLING AND PAYING FOREIGN INDEPENDENT CONTRACTORS © 2017
SafeGuardWorld International All Rights Reserved | 05/17
Contact: Mark Robbins
Phone: 01270 758020