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Comment by bkovacev | Hacker News Reader

I have been trying to get US companies to hire from Eastern Europe (mainly south eastern europe). My company would act as a middleman (essentially outsourcing), pay money to the devs which would work directly 1:1 for that company. The devs would be working for us, yet, we would not manage their day to day activities - we'd just act as an HR/recruiting/legal middleman. I have tried with two major outsourcing companies, yet, they were never that interested. For 100-120k a year, you could get top tier devs with 6-8+ years of experience from Eastern Europe.

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My company uses Eastern European contractors for certain projects as "staff augmentation". Overall, I would say our experience is positive. There are indeed many experienced devs who do great work. But it does have some drawbacks:

1) 10-hour time difference between West Coast US and, say, Kyiv is pretty big. It's easier on EST people, but on the US side you're going to have to plan on jamming your calendars full of meetings between 7:30-10:30am.

2) Because you have fewer "business hours" between two, you need product, project, and engineering management to operate in a fairly well-oiled manner with more stuff spelled-out up-front, otherwise your team across the pond is stuck until the next day for some answer. Also, if your org even attempts to adopt "agile" this communication breakdown will murder your velocity; you're better off doing Waterfall.

3) They cannot be on-call to troubleshoot product issues during US business hours. This makes the business-side uneasy

4) Higher churn-rate than domestic engineers. Mostly over salary; this falls squarely at the feet of the "middleman" who undercuts their engineers. We attempt to ameliorate this by giving them feedback on employees who they should focus on retaining but IME they just view their talent as widgets rather than craftsmen. I've seen several good devs leave over money we'd have gladly paid them but their contracting org refused.

5) Speaking of higher churn rate: Onboarding can be more painful, again because of the TZ difference as well as certain cultural issues.

None of these are deal-breakers. But it's easy to understand why a company might be willing to pay 50-100% more to avoid these concerns.

Somewhat unrelated but just a side comment, many Ukrainian folks are really trying to move away from the spelling of Kiev as you did, instead they prefer Kyiv (I was corrected several times for this by Ukrainian friends/colleagues when I got to the region so just thought I'd share).

https://www.atlanticcouncil.org/blogs/ukrainealert/kyiv-not-...

Noted. Thank you!

1) Absolutely - I have been working for the US companies as an FTE (remotely, but C2C, essentially a contractor), and sometimes the hours do make an issue. It's a 9 hour difference with the West Coast for me, but Central / Eastern works well, if the expectations are properly set.

2) Spot on - Agile does not work well in such environment, I have seen it first hand twice. I feel that with senior/staff level devs, you can expect and should get higher level of autonomy and less hand-holding, so in a solid project oriented company, I do feel that fewer "business hours overlap" would impact much. I do feel that at least 3, preferably more hours should be reserved for meetings / overlap.

3) I'd argue about that one, haha. I have been on-call troubleshooting production at 2-3am my time, not once, but multiple times. For a great employer, with proper compensation and benefits, you'd be surprised what devs from this area would do!

4) YES! Companies are greedy. However, they do have to pay pension/insurance on the hourly rate they give to the dev, think 50-60%, but they don't want to give away their cut at all, it seems to be non-negotiable flat fee, which is deal breaking. Another point is that Microsoft and other big brand outsourcing names are coming to EE and stealing away the workforce.

Disclaimer - I work as a senior/staff level dev with high base salary and equity, so my experience may be a bit skewed.

It's a bit of a confusing niche you're trying to fill. Outsourcing firms are generally providing the HR/recruiting/legal role as their specialty. That they wouldn't want to provide another company a cut when they can do this just fine themselves is unsurprising.

True, it's a hard niche to fill, and yup, slightly confusing even. We'd aim for development companies within the US that have some "outsourcing" presence around the world, but have not tapped into Eastern Europe yet. What we're really looking to do is help developers get connected to the US companies and get paid better and not be looked at as contractors, but FTE with benefits.

An example - in Serbia and Slovenia you arrange a net salary, and the company pays the taxes/insurance etc on top of net salary (usually around 50-60%). So for a senior salary in Serbia of around 4k euros. you're looking at the company paying around 6-7k euros. For a contractor (as a sole proprietor) you can make at most 50k euros a year and then you pay benefits that are minimum 300e. If you go above that you pay 10% tax on profit + 15% personal income tax. You can choose to still pay yourself salary and 50-60% on top of that, and you will most likely not pay yourself a big salary, but take the profit and pay the 15%.

What we would try to accomplish is:

- Not have developer as a contractor, but as an FTE

- Create a pipeline of US based companies

- Bump the salary for devs for 25%-30% -> pay the taxes/pension (30k+ more)

- Take a 15% of the annual salary (20-30k)

- Provide cheap senior/staff/principle devs that are cheaper than the same devs, but same or similar quality

I've done something like this. It worked well with the caveat that even when working as FTEs most Eastern European devs still preferred to work like contractors, e.g. "tell me exactly what to build and I'll build it". It worked best when pairing a senior engineer in the US or Western Europe with a team of 2-3 devs in Eastern Europe.

True and fair point! I have been trying to change that mindset for a while. One major thing I believe is the uncertainty of contracting - they never know when they may not be needed again. However, if an EE dev can align himself with the company and has a senior dev / manager above him who can help him make that transition - I think they'd make a great team.

I know the experience varies, but I've seen nothing but trouble from hiring devs from EE.

It could be trouble hiring remote workers anywhere if no due dilligence is done properly. I worked with both EE and Indians and it was okay. Folks did their job decently, they were paid less (but also didn’t have to take all the bullshit open office, noise and fractal like work hours interrupted by interminable meetings.

Absolutely - every experience matters. In Southeastern Europe - you get what you pay for. We would definitely not try to hire anyone with less than 5 years of experience, thoroughly vetted before even talking to the US companies and/or submitting a resume.

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