Ask HN: How do you hire remote employees (not contractors) | Hacker News Reader

Ask HN: How do you hire remote employees (not contractors)

7 pointscodegeek7 comments

hi lot of startsup are hiring remote which is great. But when it comes to hiring employees, how do handle things like payroll taxes, health insurance etc. if the employee is in a foreign country ?

For example, if a US based startup hires someone from say Europe, how will you handle payroll taxes etc for IRS ? What about Insurance etc as those will apply for the home country of the employee, right ?

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What's the advantages of hiring as employee instead of long-term contractor?

For the latter case, you can just allocate annual budget in raw USDs equal to the total compensation, and let the contractor send invoices for each month. So e.g. if the base salary is 100K that would probably mean ~200K total compensation. So the contractor gets raw 200K USD and she will manage all of her insurance/tax/pension/massage spendings.

There's very little incentive for any company (even big ones) to deal with the headache of treating foreigners as employees of their company when they do not have a local office.

The simplest way to overcome that is for the companies to "contract" work to you and possibly bundle all your insurance and other needs into that contractual payment.

The short story is you're likely looking for a payroll provider that offers an "internationally-based employee" feature, but (correct if I'm wrong payroll SaaS service providers!) I can't think of one that does. A few offer a US-based employer / different state employee offering, but with a foreign employee you need a highly specialized offering. Insurance is a whole other story, but easier...just give them a stipend for their local insurance rates (if any).

This may sound ridiculous, but Basecamp (formerly 37Signals) has likely had this problem in the past/present, so consider just reaching out and asking them. In the past I've contacted [insert name you know here] with a very specific, quick-answer type question a few times and they've been super responsive and awesome.

You seem to have joined two ideas together.

I know quite a few companies that have remote employees (but always in the same country)

I only know of one that has hired a remote employee in a different country. Most companies don't want the hassle. It is not only taxes, but for example a US company is open a really expecting a fast turn around time from a country that has a national holiday.

Plus it takes substantially more time to find qualified people on the other side of the world. Many of the remote workers I know used to work at headquarters for a couple years and THEN moved. It much less risk.

I generally start by hiring a contractor, seeing how they work out and if it does work out well they move into a full time remote position. For the other stuff I talk to my accountant, no clue.

I'd recommend to talk to your tax consultant. In Europe it's normal to have a tax consultant, because the law is very complicated. I don't know if this is usual in the US too...

I am working in a Germany startup and we have considered to hire some remote employees. But because of the size of our company and our internal strategy we decided us against remote workers. We are a quiet tiny company with less then 20 employees. We think that a transparent and frequent discussion is very important. We believe, that this can't be done with employees working remote in an efficient way.

Please feel free to answer and to disagree.

This is where one is wise to use accountants and lawyers experienced in these matters.

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