How to Hire International Employees & Mitigate Risks

Globalization is about cultural exchange and something that you can monetize. According to the ILO’s 2025 Employment Trends Report, global labor markets remain uneven, with high-income countries facing record-tight hiring conditions, while low- and middle-income regions continue to see elevated unemployment and underutilized talent pools.

At the same time, while high-income countries experience tight labor markets, low- and lower-middle-income countries still encounter higher unemployment rates compared to the pre-COVID-19 times. In this context, hiring international employees is more than a strategy — it’s often the clearest path to bridging the skills gap and building resilient global teams.

Do you represent a forward-thinking tech company? If so, hiring foreign-based employees can be a game-changer for you, bringing fresh perspectives, diverse skill sets, and a global outlook. Now, we’ll walk you through how to hire an international employee the right way — and ensure the experience is smooth, compliant, and rewarding.

The Whys of Hiring Employees Overseas

Did you hear of the advantages of extended hiring geography?

A melting pot of ideas. Contrast backgrounds bring creativity into problem-solving, leading to better products and services.

Access to specialized skills and cost-effective solutions. By hiring prospective foreign workers, you can tap into expertise that's increasingly hard to find at home. In 2025, Gartner points out that companies aren’t just facing a talent shortage — they’re dealing with a growing experience gap. As senior professionals retire and AI tools shift how work gets done, many mid-level teams are left without the deep skill sets needed to lead technical transformations. That’s why more tech companies are turning to international hiring to fill roles and also to bring in the hands-on experience that’s getting harder to source locally.

Why fix your viewfinder in one spot when hunting for tech talent?

Why limit your talent search to one region? In 2025, several emerging tech hubs offer highly skilled specialists at competitive rates:

• Romania – Known for its strong STEM education and growing pool of software engineers, especially in Cluj and Bucharest.

• Colombia – A nearshoring favorite in LATAM with a robust developer community and government-backed tech initiatives.

These countries offer cost-effective hiring, diverse time zone coverage, and strong developer ecosystems — making them ideal for building remote tech teams.

A way to expand your business. With a team spanning different time zones, you can extend your operational hours, providing round-the-clock support and enhanced productivity. With people fluent in the languages of your international customers, you enhance customer satisfaction, boosting your brand reputation.

These worthy points at stake often spark one big question: how can I hire someone from another country without getting tangled in legal or logistical issues? We’ve conducted research and are ready to share the answers with you.А

The Concerns of Hiring Foreign Nationals

Here are some major risks you may face when deciding to hire foreign workers. Frankly, those were risks only for the pioneers of international hiring, who have already “debugged” the mechanisms. Nowadays, each of the described concerns has a simple and elegant solution.

Legal and Regulatory Compliance

While globalization eliminates differences in people’s lifestyles, education, and business ethic, we have no totally unified regulations yet. Different countries have unique labor laws, work permit requirements, and immigration regulations. Non-compliance is fraught with fines or even the expulsion of the employee from the country.

Regardless would it be a remote or office-based mode, when you decide to hire internationally, it could be time-consuming to interpret the 1000 and 1 laws and regulations for each target region.

Some examples of region-specific compliance challenges include:

• AI Hiring Transparency Laws (EU & US) – Countries like Germany and parts of the U.S. (e.g., New York City) now require companies to disclose when AI or algorithms are used in candidate screening, including explainability requirements.

• Digital Work ID and eSignature Compliance (EU Digital Identity Framework) – Starting in 2025, remote workers in the EU must verify employment eligibility using a regionally accepted digital identity wallet.

• Salary Transparency and Pay Equity Acts – New rules in some countries and provinces, such as Canada, now require job postings to list pay ranges and prohibit asking about prior compensation history.

• Remote Work Taxation Laws – In countries like Portugal and Singapore, location-based tax frameworks are evolving. These define when foreign workers become tax residents — especially relevant for digital nomads and long-term contractors.

Are you planning to invite new team members to your location and apply for visas? Keep in mind that handling immigration issues and obtaining work visas and permits can take time, and there's always a risk of delays or rejections. This could impact project timelines and business operations. Plus, you need to study the employment restrictions established by your own government. For instance, the USA and Canada have quite tricky procedures of how to hire a foreign employee.

Moreover, if an international employee's assignment ends, or they decide to leave the company, repatriation can be an expensive and complex process. Moreover #2, the company may lose the knowledge and expertise gained during the employee's tenure.

✅ The solution. Partnership with local experts. Local HR and legal experts can help you navigate foreign employment laws — especially if you’re still figuring out how to hire international employees without running into regulatory roadblocks.

Additional Budgets

Taxation and Double Taxation. International hiring may trigger tax implications for both the company and the specialists. Double taxation, where an individual is taxed in both their home and host country, can create financial burdens — especially when you hire an overseas employee who maintains ties in multiple jurisdictions.

Relocation Costs. International hiring may involve relocating the team member to the company's headquarters or another location. For companies hiring overseas employees, relocation costs can be substantial and should be factored into your overall hiring strategy.

Currency Fluctuations and Payroll Management. When dealing with international employees, the company may be exposed to currency exchange rate fluctuations, which can affect the employee's salary and the company's expenses. Additionally, managing payroll in different currencies can be too sophisticated and, again, reflect on your taxes size.

✅ The solution #1. Contract with global staffing provider. Want the agency to hold the contracts of your team members? Then, your matching option is to sign an arrangement with a global organization skilled at specialized talent search (like hiring tech team members). Your partner, not you, takes over human resources: payrolls, compliance with local regulations, and proper offboarding.

If you wonder what hiring model is available worldwide, just compare EOR vs. PEO. With EOR, there is no need to register a new legal entity to hire international employees.

✅ The solution #2. Requirements review. Thoughtfully prepare the list of skills and qualifications for your new team role. Thus, you most likely will hire the perfect candidate on the first try.

✅ The solution #3. Regular check-ins and feedback. Stay tuned with your foreign teams through regular personal online meetings. Or your HR partner can do it instead of you. The main idea is to prevent burnout and encourage long-term partnership.

Distance-Related Barriers

Be ready to deal with cultural and language differences.

✅ The solution #1. Investing in reliable task trackers and messengers for teamwork. That helps to schedule and conduct meetings across time zones, and collaborate on the project more transparently as if you all were in one room but without trackers. Combine synchronous and asynchronous communication, then you will avoid overloading the team with calls and help it stay tuned at the same time.

✅ The solution #2. Cultural sensitivity and integration. Your in-house team can learn from their foreign counterparts and vice versa. Encourage a company culture which is welcoming and inclusive to all team players, regardless of their background. It’s easier to explain the rules of the “game” in advance. A little hint: with onboarding services provided by your external partner, savvy in the local specifics and human psychology, your new hires start work on the project smoothly from the very first day.

Intellectual Property Protection

If tech specialists from other countries have access to sensitive information or proprietary technology, there may be a risk of intellectual property theft or violations.

✅ The solution. Pay attention to the privacy certifications of your HR partner. If you see CCPA or GDPR among them, it means they safeguard your sensitive data (like source code and customer data) as well as your new hires’ personal information.

A Strategic Approach to Building Tech Teams Abroad

When hiring overseas employees, you’re most likely bringing someone on for more than one month — or even for more than a year. What about establishing a convenient relationship system once, instead of puzzling yourself every time when it comes to paying compensation or clarifying work conditions?

Legal Entity Establishment: a Big Move for a Big Fish

A legal entity in the target location is an approach to divide personal assets and liabilities. It is an additional sign of credibility, which can attract customers and partners. Plus, access to funding is often easier through loans or investments. Tax advantages and deductions can be enjoyed, depending on the type of entity chosen. Furthermore, a legal entity can continue to exist even if ownership changes, ensuring business continuity.

On the other hand, creating a legal entity involves paperwork, costs, and ongoing compliance requirements, which can be burdensome. Personal liability may persist for certain entity types, placing owners' assets at risk. Privacy can be compromised since some information becomes public. Moreover, taxation complexity and potential double taxation can be a drawback. Flexibility may be limited, and dissolution can be challenging, especially with multiple owners.

Outstaffing: a Rational Move

Need not only practical advice on how to hire an international employee, but also professional help with the admin side and People Ops? The EOR services typically are included in the talent management services provided through the outstaffing hiring model, which shares many benefits with offshore staffing services — especially when it comes to reducing admin load and staying compliant across borders.

According to Grand View Research, the global IT services outsourcing market is projected to reach approximately $807.91 billion by 2025 and is expected to grow at a compound annual growth rate (CAGR) of 8.6% from 2025 to 2030, reaching $1,219.31 billion by 2030.

Outstaffing, also known as staff augmentation or extended team model, is a reliable vendor in the foreign country, and they handle both the administrative and HR aspects of employing the team, while you retain full control over their work. It’s a practical path for tech leaders still figuring out how to hire overseas workers without setting up legal entities or handling cross-border compliance solo.

By outstaffing tech teams, you gain access to a dedicated group of skilled professionals who focus solely on your project. This dedicated approach is for those who require new team members to align completely with your goals and vision.

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