These days, remote work and globalization make it easier than ever to hire anyone, anywhere. You can build an international team in no time — but it's not always smooth sailing.
Between dealing with different labor laws and managing a team spread out across multiple time zones, international HR requires a cohesive, inclusive strategy and a bit of know-how.
Key takeaways:
- Each country has unique laws and regulations that cover everything from payroll to data security.
- International HR teams must contend with legal compliance, time zone challenges, cultural differences, etc.
- Partnering with an Employer of Record can help your company address these complex HR challenges.
1. Compliance with International Employment Laws
Labor laws — from payroll and taxation to termination and notice periods — vary significantly from country to country, and even within countries, the regulations can differ by region, state, or municipality.
For example, the United States and India have employment laws that vary from state to state, with differing regulations on minimum wage, overtime, and employee benefits. These regional discrepancies make it critical for companies to be informed about the local requirements in every jurisdiction where they operate.
Labor laws are also continuously evolving, especially regarding taxation, benefits, and termination procedures. Keeping track of these ongoing changes requires a diligent effort on the part of your HR team to ensure that policies are updated promptly and accurately.
Non-compliance with international employment laws can lead to costly legal disputes, penalties, fines, and damage to your organization's employer brand, making it challenging to attract and hire future talent.
To ensure compliance, it's essential for companies to work with local legal experts or HR consultants who can help navigate the nuances of local regulations, ensuring that the company remains in compliance with all applicable laws.
Additionally, implementing a centralized compliance system that can track legal changes in real-time and standardize payroll, taxation, and termination procedures across regions is critical in minimizing legal risk and ensuring compliance regardless of where employees are located.
2. Managing Multi-currency Payroll & Taxation
Every country has specific payroll regulations you must comply with when hiring internationally. For example, Norway has strict payroll laws that govern everything from how employees are paid to what details payslips must include. Many countries also dictate pay frequency. For example, in Zambia, workers must be compensated weekly, while in several Asian countries, like Hong Kong, monthly payments are standard.
International employees typically expect to be paid in their local currency, which can be challenging because of fluctuating exchange rates. To manage payroll compliance and mitigate exchange rate risks, companies should invest in global payroll software that ensures adherence to local laws and automates payments in the correct currency.
Complying with international tax laws is another major challenge in managing international payroll. Each country has different rules for income tax withholding, payroll taxes, and reporting, with some requiring employers to handle tax remittance while others place the responsibility on employees.
To stay compliant, companies should work with local tax professionals or global payroll providers and use automated payroll systems to streamline tax calculations and reporting. Regularly monitoring tax law changes ensures accurate filings and helps avoid costly legal issues.
3. Recruiting, Onboarding, & Retaining Global Talent
Acquiring, training, and retaining top talent is a significant and complex challenge of international human resource management and requires a deep understanding of global recruitment strategies.
For starters, your recruitment and talent acquisition teams must navigate diverse job markets to attract the right candidates. They must also identify the best platforms to advertise roles and familiarize themselves with country-specific salary expectations.
On top of that, they'll need to ensure compliance with credential verification and background check regulations in each country. Otherwise, companies risk missing out on top talent or facing delays due to compliance issues.
Once international employees are hired, onboarding becomes critical to their success. Companies that invest in a structured onboarding process are more likely to see higher employee engagement and productivity.
Beyond introducing company values, policies, and goals, onboarding should include best practices for addressing communication styles and time zone challenges.
Providing mentorship programs and language support can help international hires better integrate into the larger organization. A comprehensive training program sets new hires up for success, and ongoing education and support can be integral to employee retention.
4. Creating Company Culture Across Borders
Building a strong company culture in a remote, international team presents several challenges beyond just physical distance. Employees from different cultural backgrounds may have varying expectations about workplace communication and collaboration, sometimes leading to misunderstandings.
Language barriers and differences in time zones can further complicate real-time discussions, making it harder to establish strong working relationships. Additionally, remote employees may struggle to feel a sense of belonging or connection to the company's mission without a shared office environment, which can impact engagement and retention.
Skilled international human resource management teams can help create a cohesive company with shared norms and values, foster a more inclusive environment, and build employee engagement by:
- Providing cultural awareness training
- Teaching cross-cultural communication skills
- Organizing virtual team-building activities
- Sharing company-wide updates to keep employees informed and engaged
Check out these other tips for building a cohesive company culture across borders.
5. Offering Competitive & Compliant Employee Benefits
Designing a fair and competitive global compensation strategy is challenging because the cost of living and mandatory benefits vary significantly across countries.
For example, while no federal law requires paid maternity leave in the United States, this isn't the norm for most of the globe. And some nations, such as Mexico and the Philippines, have local laws requiring companies to provide 13th-month pay — an end-of-year bonus given to employees in December.
Additionally, currency fluctuations and inflation can impact the actual compensation value, making it essential for companies to review and adjust salary structures regularly. Employers must also consider equity — ensuring employees feel compensated fairly relative to their colleagues, even when pay scales differ by region.
Without careful planning, businesses risk overpaying in some regions or offering inadequate packages that fail to attract top talent.
There's no one-size-fits-all compensation strategy that works when hiring globally. Companies need to research and offer competitive packages that are fair and equitable in each country and strike the right balance between legal compliance, competitive pay, and internal fairness.
Your HR team must also stay current on legal requirements, as these can frequently change with the introduction of new labor legislation.
6. Maintaining Data Security & Compliance
Adhering to data privacy laws is crucial when hiring internationally, as non-compliance in protecting employee data can result in significant financial penalties, reputational damage, and legal disputes.
Many countries have stringent regulations to protect data, with rules covering how it's collected, stored, and shared. In fact, it's estimated that personal data privacy regulations apply to approximately two-thirds of the global population.
In the European Union (EU), the General Data Protection Regulation (GDPR) sets a high standard for data protection, and companies that process the data of EU citizens must ensure full compliance, including offering transparency about data usage and providing individuals with the right to access or erase their data.
Other countries, including South Korea, Japan, Brazil, and South Africa, have followed suit by creating their own data protection laws, many modeled after the GDPR.
Companies must implement comprehensive data privacy practices to navigate international data regulations, including establishing clear policies on how employee data is collected, processed, and shared.
Using data encryption tools, limiting access to sensitive information to only those who need it, and providing regular training for HR teams on local data privacy laws can help ensure compliance.
Additionally, adopting cloud-based HR software platforms that offer built-in data protection features and comply with international standards can streamline data management while minimizing the risk of breaches.
7. Time & Location Differences
Employing international staff in multiple time zones can be particularly challenging for international HR departments that must arrange onboarding, training, and performance evaluations across the globe.
In addition to HR scheduling challenges, coordinating across time zones can make it difficult to maintain a sense of team cohesion and ensure everyone has equal access to opportunities.
For example, employees in different time zones may miss out on real-time discussions or feel left out of decision-making processes if meetings occur while they're sleeping.
To address this, HR departments should establish clear guidelines on meeting expectations and prioritize flexibility, allowing employees to participate in discussions through recorded sessions or written summaries. This inclusive approach will enable employees to feel they can still make meaningful contributions even when they can't attend live meetings.
Since not every employee will be online simultaneously, your company must have an established process and tools for asynchronous communication. Utilizing shared calendars, time zone converters, and other software solutions can be hugely beneficial.
For more information, read our guide on how to work effectively across distributed time zones.
8. Managing People All Over the World
There are numerous challenges to managing remote employees on a global scale. Beyond the obvious issue of time zone differences, companies often face communication breakdowns, misunderstanding of expectations, and difficulties in tracking employee productivity effectively.
International remote employees may struggle to stay aligned on projects and goals, particularly if they don't have consistent touchpoints to connect. This can lead to a sense of disconnection from the rest of the team, decreased engagement, and a lack of cohesion in the overall company culture.
HR professionals managing a global workforce must create a consistent structure that addresses these challenges. It should clearly define roles and responsibilities, ensuring all employees understand expectations.
Additionally, providing employees with knowledge-sharing channels, like cloud-based collaboration platforms or project management tools, will help them stay informed and improve collaboration.
Some tools to consider utilizing for your globally dispersed team include:
- Asynchronous communication tools, like Slack, Zoom, or Microsoft teams
- Global payroll solutions to help manage payroll in various countries
- An HR platform like HiBob and BambooHR
- Employee engagement tools, such as Workvivo
- A project-management platform like Jira or Monday.com to track projects
These additional tips can help you manage remote teams like a pro.
9. Handling Work Visas & Global Mobility
If you hire remote international workers who are residents of the country where they reside, there's unlikely to be additional paperwork on your end. However, the situation becomes far more complicated when an employee needs to relocate to another country. This usually will involve applying for a visa or work permit, a process that can be time-consuming and complicated.
Each country has its own immigration regulations and requirements. Navigating this process without the proper knowledge or resources can lead to delays, costly mistakes, or even the rejection of a visa application. Employers are typically responsible for covering visa and sponsorship fees, which can be substantial depending on the country and the type of work permit.
Beyond that, companies must also consider the cost of relocating the employee. This may include expenses such as flights, temporary accommodation, and housing search assistance. Depending on the level of support provided, the overall cost of relocation can add up quickly, making it essential for HR teams to plan and allocate the necessary funds.
To manage these challenges effectively, companies should work with immigration specialists or relocation service providers who can guide them through the visa application process and ensure that all requirements are met.
Developing a clear relocation policy that outlines what costs the company will cover, how the process will unfold, and what resources will be provided to the employee can help streamline the process and avoid confusion.
10. Performance Management & Evaluation
Performance management and evaluation for international teams is challenging due to varying cultural norms, legal requirements, and feedback expectations. In some cultures, direct feedback is welcomed; in others, it can be perceived as harsh.
Additionally, legal regulations around performance evaluations, such as documentation or promotion requirements, differ significantly by country, complicating implementing a consistent system across borders.
To address these challenges, HR teams should create a standardized performance framework with universal criteria, such as goal achievement and collaboration, while allowing flexibility to accommodate local cultural and legal variations.
Training managers to navigate these nuances and adapt their feedback style can improve communication and ensure fair evaluations.
Performance management software can help companies track goals and provide feedback asynchronously, making it easier to manage employees across time zones.
RemoFirst Can Help You Employ and Manage Global Teams
Clearly, there is a LOT to keep track of when it comes to international human resource management, and it can be overwhelming for your internal HR team to tackle. Partnering with an EOR like RemoFirst can significantly simplify the process.
Our team handles several critical human resources and administrative tasks so your HR team doesn't have to, including ensuring compliance with international employment and data privacy laws, as well as:
- Global payroll
- Employee benefits
- Background checks
- Visa applications
Schedule a demo today to learn how RemoFirst can simplify your international human resource management and help your company compliantly hire employees in more than 180 countries.
