Foreign Employer: Hire Remote Employees Directly Across Europe

EU Remote provides an alternative avenue for global companies to hire remote employees across Europe, without establishing entities, contracting an Employer of Record, or misclassifying their employees.
Hire remote employees across Europe, without establishing entities or using an Employer of Record

In an era of talent scarcity, hiring remotely across a wider geographic area has become critical for businesses eager to access the best talent, and leverage talent from around the world. While the intent to expand horizons and tap into diverse talent pools has grown, the traditional methods of international hiring have often proven to be problematic.

Hiring as a Foreign Employer is a valuable alternative avenue for global companies to hire remote employees across Europe. Without establishing entities, contracting an Employer of Record, or misclassifying their employees.

Understanding the Current International Hiring Landscape


To fully grasp the challenges inherent in existing international hiring practices, businesses trying to access talent in a wider geographic area have four options: 

 

Set-up Local Entities:

By establishing a subsidiary or legal branch in the target country, companies ensure a direct presence. However, along with the prolonged setup process and substantial financial overheads, companies also face the daunting responsibility of managing the bureaucracy of local operations and, crucially, bearing local corporation tax liabilities. The efficiency and added financial burden are a deterrent for companies to take this route.

 

Employers of Record (EoRs):

EoRs are third-party firms that, in essence, hire the desired talent on behalf of a company. This method promises speed but introduces another set of complications. Beyond additional administrative layers and costs, there’s a significant concern: the jeopardy of company intellectual property (IP). With EoRs, the actual employer-employee legal relationship is outsourced. This poses inherent risks, especially in cases where an employee might disclose sensitive company information or when disputes arise. The employee, working deeply within the organization’s structure, doesn’t have a direct legal bond with the company. This detachment can potentially dilute IP protection and conflict resolution mechanisms. It’s also worth mentioning that as your team grows in size the financial cost of implementing this solution can act as a barrier to hiring the best people wherever they are, and again impose restrictions on where companies can hire.

 

Employee Misclassification:

The easiest and most cost-effective option when it comes to hiring globally. An employee simply agrees to an independent contractor arrangement and can start to work immediately. The problem is, if local governments view this as a misclassification of employment they are at high risk of penalties and fines. When an employee is misclassified as an independent contractor, the local government is not receiving the required social security contributions and as such it poses a considerable risk for companies.



Restrict hiring via existing entities:

If all the previous options are eliminated from the options, companies are left with the only option of restricting hiring to locations where they have an entity, or office base. This unnecessarily limits them to a smaller pool of talent, and as such, they are completely missing out on the benefits of hiring remotely.


Foreign Employer: An alternative solution

Companies can hire remote employees directly as a foreign employer. A solution that mitigates the risk, high costs, and inefficiencies of the more common solutions, outlined above. At its core, by hiring as a foreign employer, global companies can hire remote employees directly across Europe. Enabling them to tap into talent in 32 European countries without using third parties to hire on their behalf, or establish entities. It resembles the level of compliance and employee onboarding of hiring through a local entity but without the additional bureaucracy of managing the entity and there are no corporation tax liabilities. 

 

Distinctive Attributes of EU Remote

Here’s what sets EU Remote apart:

  • Direct, Streamlined Hiring: Businesses can foster genuine, transparent relationships with their European employees without intermediaries.
  • Comprehensive Compliance Management: EU Remote meticulously oversees European employment laws and regulations, offering companies peace of mind regarding local standards and practices.
  • Cost-Effectiveness and without Tax Liabilities: With EU Remote, businesses can tap into European talent directly without the financial burdens of local entity setups or corporation tax responsibilities.
  • Enhanced IP Protection: Without outsourcing the legal employer-employee relationship, EU Remote ensures a direct bond between the company and its employees, solidifying IP protection and enhancing clarity in dispute resolutions.

 

What does this mean for your team?

We offer businesses an innovative approach to international hiring. It combines the benefits of direct hiring with the assurance of comprehensive compliance management and the added advantages of cost savings and enhanced IP security. For global enterprises, this might just be the blueprint for the next evolutionary step in talent acquisition and integration.

To find out more about this solution, schedule a 15-minute call with a member of our team.