Businesses often find themselves in need of talent from around the globe, and for different reasons. Some look internationally to find skills or expertise that are not readily available in their local labor market. In some cases, businesses opt for hiring internationally since it can be more cost-effective than recruiting locally.
However, managing international staff comes with its own set of challenges, which requires businesses to create a holistic plan for employee management. The human resources department, in particular, needs to pay close attention to payroll and compliance.
Find out if the benefits of hiring highly skilled migrants (HSMs) in the Netherlands are worth the hassle and learn about particular considerations you need to take into account.
Benefits of hiring international staff
One of the primary advantages of hiring international staff is access to a diverse talent pool. By recruiting HSMs, who come from different countries and backgrounds, companies can benefit from varied perspectives, innovative ideas and specialized skills that may not be readily available locally.
Additionally, HSMs can enhance cultural diversity within your organization, bringing with them a more inclusive and dynamic work environment.
Hiring international talent can also provide businesses with a competitive edge in the global marketplace. Having employees who understand different markets, languages and cultural nuances can facilitate expansion into new regions. They can also help you prepare to navigate international business challenges.
Establishing a local company vs. using EOR services
When expanding operations to a new country, businesses often face the decision of whether to establish a local entity or utilize Employer of Record (EOR) services.
Using EOR services allows you to hire HSMs without the need for a legal entity. EOR providers act as the official employer of record, handling payroll, taxes, benefits and compliance on behalf of the client.
This approach allows businesses to quickly expand their global footprint, avoid compliance risks and focus on their core operations.
From obtaining work permits to managing social security contributions, a local payroll partner can streamline the entire process and ensure smooth operations for your business.
Meanwhile, establishing a local company includes setting up a legal entity, registering with local authorities and managing compliance obligations all on your own. While this approach offers you greater control and autonomy over the company’s daily operations, it also requires significant time, resources and expertise to execute.
If not properly planned and carried out, establishing local entities can prove to be more than what you signed up for. For example, setting up a local legal entity in the Netherlands is relatively straightforward.
However, when your employee requires a visa sponsorship, the process of becoming recognized as a sponsor can be time-consuming, taking several months or even longer.
In such instances, it may be more efficient to partner up with an EOR who can facilitate the visa sponsorship. Then, after your local legal entity is established and sponsorship approval is secured, the employee can be transferred to your organization
Top tips when working with a local payroll company
When managing international talents, partnering with a local payroll company will help you ensure compliance and efficiency.
For example, in countries like the Netherlands, where HSMs are in high demand, working with a local payroll company is particularly advantageous.
They are well-versed in the complexities of Dutch payroll regulations and are experienced in providing tailored solutions to meet the unique needs of HSMs and their employers.
However, before working with a local payroll company, you will need to consider several things:
- Obligation to provide information: The Netherlands imposes an obligation to notify IND within 4 weeks of any updates such as income changes, changes in the employee's presence in the Netherlands, company closure, or change of address that will affect the residence permit or recognition status as a sponsor.
- Obligation to keep and preserve records: In addition, employers are expected to keep the information of the foreign national employee for up to 5 years from the date the person becomes a sponsor.
- Duty of care: The Dutch government places the onus on the employer to carefully select businesses that employ highly skilled migrants. In addition, informing this person about the procedures is also among the employer’s responsibilities.
- Return of a foreign national: In cases where a foreign national leaves the job, the employer is held responsible and liable for the return of the foreign national to his/her country.
Partnering with a local expert like Unusual Payroll can help you mitigate potential hurdles in bringing foreign, skilled talent to the Netherlands.
Trust Unusual Payroll to be your partner in managing international payroll and compliance, allowing you to focus on what matters most: Growing your business and letting your employees thrive.
