Checklist for American Companies Hiring Overseas

Research by Statista found thousands of employees from US companies working in China, India, Germany, Brazil, France, Malaysia, Argentina - the list goes on. Whether it is as the basis for entering a new market or to take advantage of the global talent pool, American businesses are looking overseas for their next hire. 

Global recruitment is a complex process, so we have created this checklist to make sure nothing slips through. 

Have You Obtained Certification From the Department of Labor?

The US Department of Labor has a mandate to protect worker’s rights and opportunities, so companies looking to hire overseas must apply for certification. Essentially, a business needs to prove there are insufficient qualified US workers willing to perform the job in question. 

A business must:

• Show evidence they need to hire a foreign worker.

• Prove the vacancy criteria matches the criteria for the foreign labor certification program.

• Complete the correct eTA (Electronic Travel Authorization) form.

• Show evidence the specified wage will be paid.

Have You Thought About How You Will Advertise the Job Role?

This is somewhat similar to a home-based hiring process but will include different places to advertise the job and different cultural considerations. Jobs can be advertised on the following websites:

• Indeed 
• Monster
• ZipRecruiter
• GoAbroad.com
• Coolworks
• USponsor Me

Keep in mind a number of these sites charge for posting job vacancies.

There are several things to consider in comparison to hiring home citizens. For example, the hiring process may take much longer as the planning and legislative requirements can take a lot more focus and commitment due to their relative complexity.

Similarly, international resumes may differ in content, tone and even language from US resumes, meaning US companies will have to learn to identify the best candidates from unfamiliar resume styles. 

There are ways of ensuring a more streamlined process for hiring global talent, such as working with dedicated recruiters, HR specialists or Global Professional Employment Organization (PEO) services.

Have You Considered Visa Applications?

In some cases, a candidate will be hired abroad and then move to the Us. This means they will need a visa. A business will need to use Form I-9, issued by the US Citizenship and Immigration Services. Form I-9 will be used to verify the work authorization of the new hire.

As the candidate may not be in the US already, a business can sponsor a visa application. This takes time and can be risky, so it is worthwhile for businesses to seek professional advice to ensure success and complete compliance. 

Sponsoring a work visa includes:

• Applying for a Labor Condition Application (LCA).

• Providing any company-issued statements and relevant documents.

• Filing the petition for a visa on the behalf of the intended recipient.

Do You Know the Tax Requirements Associated With Overseas Employees?

Overseas workers could be liable for tax requirements in the US and the country they are based in. This can be an area of great contention for HR and finance departments, who may be confused about what applies in the foreign jurisdiction - especially if they have little to no experience with these regulations.

To begin, a foreign worker must apply for a social security number with the Social Security Administration (SSA) which is then given to the hiring company. In most cases, foreign workers will be subject to the same payroll taxes as their US counterparts. 

Furthermore, employees working from their home countries will need to complete Form W-8 BEN, also known as the ‘Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals)’. 

Additionally, employees will also have to complete Form W-2 so the I-9 Form can be checked by ICE.

Do You Know How to Manage Payroll With Employees in Multiple Countries?

Foreign employees will obviously require a salary. Overseas payments can be complex, subject to certain regulations and the fickle nature of exchange rates. 

For employees working in foreign countries, organizations can use remote payment options. However, they must also weigh up the pros and cons of these services, as remote payment systems can:

• Hold payments for periods longer than necessary.
• Have higher charges for managing payments.
• Some systems - such as PayPal - charge to receive money.

Alternatively, some businesses have been using Global PEOs to act as Employers of Record within a foreign location, who handle payroll, taxation and benefits in-country.

Global PEO services and support are fast becoming the go-to option for organizations wanting to experience quick, uncomplicated and compliant expansion and setup within foreign countries. To learn more about the valuable services a Global PEO provides, feel free to download our guide.

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