Global Expansion: A Scary but Inevitable Truth for HR Professionals

ScaryWorldofHROutsourcingGlobal expansion is scary, very scary. It’s a potentially risky investment for an organization overall and particularly for Human Resource professionals, who are responsible for the organization’s most strategic and expensive resource — its people!

Decisions have to be made that could have unexpected consequences and what’s make it so scary, is trying to make those decisions without having reliable information, data and facts available to help make those decisions.

You May Not even Know “What You Don’t Know!” 

Now that’s a scary thought. “What Don’t I know?” Well, even the most savvy, shrewd Human Resource (HR) professionals who have spent their careers learning about HR laws and regulations in their home regions–and have become true HR knowledge experts in the UK, the European Union, all of the U.S. states and have even mastered the intricacies of the U.S. Affordable Care Act–will still not be prepared to navigate HR compliance issues on a global scale. Why is that?

Along with global tax planning, global HR is one of the most complex areas an organization can dive into. Every country has a completely different set of guidelines, have different filing requirements for both the organization itself and for its full-time and contingent labor. Some of these requirements are very strict with harsh, and often expensive penalties for non-compliance. Many countries have unreliable banking processes–often with minimum balance and reporting mandates– which make funding global payrolls and tax authorities frustrating and labor intensive. And that assumes that the HR professional even understands the country-specific payroll calculations, tax and social cost contributions, and has a resource in place to execute the payments.

Beyond the Basics

Beyond the basic HR functions such as recruitment, talent management, benefits, payroll and termination knowledge, global expansion also exposes the organization to a host of potential risks. If an Independent Contractor is generating revenue, it could trigger additional in-country taxes. If an Independent Contractor is being terminated, it must be executed according to country-specific laws and then if you throw a disgruntled worker or two into the mix–who enjoy various levels of protection by different governments, then it could be a very scary proposition for the HR professional.

On top of all that, all of this HR administration and these compliance-related tasks will have to be managed across different time zones, thereby working around the clock in some cases, calculating budgets in various currencies (which have rates that constantly fluctuate) and navigate all the cultural differences and employee expectations in any particular country. And if HR thinks they can just “go to a country’s government website to find accurate information about filings, statutory benefits and payroll deductions,” then they better learn the local language, because it probably won’t be available in their first language and if it is translated, its translation may be unreliable and scrutinized by local authorities.

Global Expansion Does Not Have to be Scary

Global expansion is inevitable. For most industries–at least those who want to prosper and remain competitive–expanding into international markets is not a question of whether or not to do, but a question of “when” to do it. For any HR professional who is ready to begin their global journey, or has already experienced some of these scary issues while exploring new countries, there is help out there. All of these fears can be alleviated by outsourcing their Global HR to a professional. You can learn more here about SafeGuard World International, a leading provider of global managed payroll, global employment outsourcing and international HR services.

Global expansion does not have to be scary. Learn more.

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