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How to Hire and Pay Remote Workers Amid COVID-19 Restrictions

One of the many challenges facing businesses during the COVID-19 pandemic is following through with plans to hire remote employees located abroad.  Because the majority of foreign employees work remotely, this may actually seem easier than hiring an office-based employee during a quarantine period. 

However, assuming that a company still has a current need for the employee, there may be various restrictions that require creative solutions to onboard an overseas employee.  Adding to the problem is that travel, living and work restrictions are currently in a state of flux and subject to change at any time.

This overview will offer you the main issues to look out for as you proceed with your hiring plans and attempt to anticipate how countries may adapt with quarantines, employee benefits and health regulations.

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What to Consider Before Hiring an Employee During the Pandemic

Before committing to a new employee, a company will want to evaluate any practical barriers or restrictions that might be in place in the employee’s location, as well as any health and safety regulations or benefits.

Employee’s Location and Local Restrictions/Benefits

Every country (and even states or municipalities) are imposing their own unique quarantine restrictions on residents and visitors that could inhibit an employee’s ability to work.  For example, if there is a ‘stay at home’ order, that would eliminate the option of shared workspaces commonly used by remote employees, and would require stable connectivity and a suitable space to work from home.

At a more basic level, employees may have children at home if schools are closed, and they may even find it difficult to acquire basic necessities outside work hours.  Some countries do offer some type of access to sick and annual leave benefits if the employee becomes ill from the virus, and those costs may be shouldered either by the government or business or both.  The potential of needing these types of benefits is greater now, and your company should be familiar with your potential leave obligations and any government support.

Safety and Health of the Remote Employee

When you employ a worker abroad you are also responsible for providing a safe and healthy workplace, just as with an office environment.  That may seem like a tall order during this time, but it is still a requirement to oversee the employee’s work environment and limit their exposure to potential health risks of all types.

Worker’s Ability to Receive Work Equipment/Infrastructure Stability

Countries that are imposing enhanced quarantine measures are limiting local travel and delivery services, which could lead to delays in ordering or shopping in person for new computers, furniture and other equipment for an employee.  The suppliers may also be on a work-stoppage order with no products currently being shipped.

If your employee is located in a country where many people are working from home, there could be problems with local infrastructure, such as internet service that could be interrupted.  In those cases, some type of backup would be needed such as a mobile internet service provider.

3 Ways to Hire and Pay Remote Workers

A company who may have been considering setting up a local entity abroad to hire workers could find those plans hindered at least temporarily during the pandemic.  The professionals and government agencies needed may be on limited staff or suspending new business registrations completely.  The question is how to use other hiring methods in the interim, or even longer term.

1. Pay as an independent contractor

Given the current economic uncertainty, it will be tempting to just hire a new worker as an independent contractor and avoid long-term employment obligations altogether.  The problem with this approach is that every country has their own statutory guidelines on classification of workers, and just because a company claims the worker is a contractor does not guarantee that status.

If a contractor is hired full time, paid a regular amount like a salary and has their schedule and work methods controlled by the company then they could be classified as an employee.  That would lead to non-compliance claims against the company, back taxes and contributions and in some cases fines in the foreign location.

2. Use a local partner

One interim method of hiring a new employee is to use a local partner/supplier in the host country where the company has an existing business relationship.  The partner could agree to put your employee on their payroll and take care of all employment administration for your company.  This can work well where your company has a solid business relationship with the partner, who may be willing to help during a transition.

3. Outsource to a GEO/EOR solution

A final option is to outsource employment administration to a Global Employment Organization (GEO) using an Employer of Record (EOR).  The EOR in the host country will be familiar with local restrictions surrounding COVID-19 and can assist with navigating those rules for employees and residents.

Even if your company is planning on eventually setting up their own corporate entity, using a GEO will allow you employ your workers temporarily until the pandemic eases and business life returns to normal.  (Because of the setup logistics involved, Shield GEO does have a six-month minimum for an employee engagement)

Client Case: Shield GEO’s Solution

Recently, a US company reached out to us for a solution for relocating a new employee.  They wanted to hire an Indian citizen via a US employment visa, but due to COVID-19 travel restrictions the candidate could not travel and move to the US.

The company was open to having the employee work remotely, so we suggested using the GEO solution temporarily until travel restrictions eased to the US.  This would allow them to retain the candidate and have them start work right away from India regardless of how long the pandemic would last.  Shield GEO would take care of all Indian payroll and employment tasks and the company only needed to remit payment through our local partner to issue the payslip.  Once travel restrictions eased, they could relocate the employee and transition to a US payroll.

Do you need more information about hiring during the time of COVID-19?

This a difficult time for both employers and employees around the world, and you may have questions about specific country measure in place:

Do most countries offer sick leave benefits for those diagnosed with COVID-19? 

How are countries handling health care payment when there are ‘pandemic exclusions’ or no critical illness provisions in standard health coverages?

Will workers’ compensation claims be allowed for employees who contract COVID-19 while in their own workspace?

For more specifics you can consult with Shield GEO’s COVID-19 Country Page, which is updated regularly for most major markets.

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