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Introduction

Whether you’re a government agency or a company in the defense, security, or aerospace industry, contractors are a must when considering international expansion. This can result in numerous HR challenges along the way. That’s where a Global Professional Employer Organization (PEO) can help.

Companies and government agencies need an agile solution that allows them to employ people and follow the overseas country’s HR, tax, and compliance laws—but without the typical cost and time of incorporating an offshore company. The Global PEO acts as an Employer of Record (EOR), providing a safe and efficient option when employing new staff in foreign lands.

A Global PEO is a trusted partner who has the legal right, experience, knowledge, and network to operate in little known markets globally so that you can focus on your core business. Here are 5 ways on how it can help government agencies and other companies with complex operations and simplify international expansion, particularly as it relates to HR issues.

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Ensures Compliance

Engaging a Global PEO eliminates the anxieties and difficulties of not understanding local regulations and best practices because they possess extensive experience in operating in the area. While the PEO remains the legal employer and therefore retains the legal liability, they will still act as an advisor for best practices around recruitment, hiring, and terminating. As the sole legally liable party in each country, the PEO must ensure compliance with all applicable global, regional, and local regulations. This approach reduces the burden of risk for your company and allows you to focus on your core business.

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Saves Money

Government entities can work with a Global PEO to keep direct costs low as they often already have a workforce present in the target countries. These economies of scale reduce the expense of payroll fees and benefit from bulk savings for healthcare insurance. The model also offers downside protection should you decide to abandon your effort to expand in that country.

Your initial setup costs are virtually nothing, versus what you could have spent on creating entities and preparing your entry into a new market.

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Saves Valuable Time

By being registered in-country, the Global PEO can quickly meet tight transition deadlines, which eliminates the stress of creating a legal entity in an unfamiliar country. With this approach, you can now focus on meeting client expectations instead of wasting effort on the administrative burden of collecting all the necessary paperwork and then waiting to register the business. A Global PEO can on-board a workforce within a few weeks, during which time you can focus on critical projects and moving your business forward.

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Eliminates the Need for Local Incorporation

If you elect to expand on your own, the first step is setting up a local entity via incorporation and registration.

This can be quite time consuming and expensive, requiring skilled accounting and legal support to ensure compliance. While some organizations can justify the time and expense of setting up a foreign entity, utilizing a Global PEO is a better alternative. The PEO already has a legal presence in place that can manage all aspects of employment, payroll, and immigration requirements in the host country. Ultimately, it acts as an intermediary and has the network and expertise to ensure full compliance with all laws and regulations.

Manages Local Payroll in the Host Country

Most countries will require your company to run payroll according to local standards with a registered entity. The practice of remote payroll is rarely permitted, especially for long-term assignments.

A key aspect of running payroll in a foreign country is the calculation and withholding of statutory deductions from pay, including pensions, health insurance, and taxes. The Global PEO takes care of all these crucial details to ensure the payroll is accurate and compliant for each employee. This process ensures that there are no issues with local authorities and is the most cost-effective means to quickly deploy employees abroad.

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Conclusion

Whether your organization is rolling out infrastructure or supporting military deployments, partnering with a Global PEO can facilitate entry into even the most remote locations. In today’s turbulent economic and political environment, changes to policy and governance can occur at the drop of a hat. Ultimately, it pays to have someone on your side that can navigate unfamiliar waters. Invest in a Global PEO and watch your time-consuming headaches turn into solutions that will help you expand internationally with ease.