When expanding your business, PEO services might be the last thing in your mind. But it shouldn’t be.
Global PEO services help you take care of your overseas employees through a co-employment model. PEOs manage everything from their payroll to HR support on behalf of you.
Through a co-employment model, PEO service providers can provide comprehensive human resources support even without a physical presence in the country. In other words, PEO service providers in India can help you manage the HR aspects of your employees in the US, UK, or Australia.
Between 2008 and 2019, the growth rate of business revenue of PEO clients was at 13.5% versus 8.5% for non-PEO clients. Also, companies that used a PEO saw a reduction in administrative costs by as much as $450 per employee.
But that’s not it. There are even more ways a business can benefit from global PEO services when expanding to other countries. Let’s take a look at them.
What is a Global PEO?
Global PEO (Professional Employer Organization) takes care of your global HR requirements through a co-employment model. Their services often include:
● Benefits and administration
● Payroll management
● Ensuring legal and regulatory compliance
Let’s suppose you’re in India but want to expand your business in the US. The state and federal laws (regarding employment) in each state in the US are somewhat different. So, if you’re operating in different states in the US, you’ll need to comply with each of them. If not, you’ll probably pay heavy penalties.
Sounds challenging? Global PEO services can make things easier for you. They ensure legal compliance, irrespective of the state you’re operating in. From hiring the right talent to managing their payroll and filing taxes, they’ll do everything.
On the other hand, you will decide if the person they hired is the right one for the job and the employees’ day-to-day activities.
Depending on your contract, the PEO can also offer additional benefits to employees like health subsidies and training.
Why Use Global PEO Services When Planning Business Expansion?
Enables You to Focus on Expansion
When entering a new market, the last thing you’d want to get into is legal trouble. But, thanks to PEOs, they can help you with employment expansion hiring legally in any country.
As soon as you get into a partnership with the PEO, they will co-employ your worksite employees in the US. The PEO company will then legally and compliantly manage and pay your employees while you handle their day-to-day activities.
The PEO will report, collect, and deposit employment taxes with local, state, and federal governments, keeping you away from any legal troubles in the US.
This will allow you to focus on expansion rather than learning the laws of any country you want to expand to.
In a general scenario, you’ll first register your business in the US, open offices, recruit employees, and start working. You’ll follow a similar process in any country where you expand your business.
However, when you enter into co-employment with a PEO, they’ll manage everything. You won’t have to spend on opening offices or recruiting employees. This will make the expansion process faster and easier.
You can even expand to different countries simultaneously without worrying about the hows and whats. Their global payroll system will ensure all your employees get paid accurately and on time.
Global PEO services are a cost-effective alternative to setting up a wholly-owned entity that would be subject to tax and regulations. In addition, you won’t even have to worry about filing taxes or maintaining compliance, as all your employees will be hired through the PEO.
The PEO provider offers big business benefits to your smaller teams, helping them grow and improve their skills over time. As a result, the productivity is higher, empowering you to expand your business quicker.
Often countries pass regulations that affect how international companies store and access data in their region. For example, European Union passed GDPR (General Data Protection Regulation) in 2016.
GDPR provides privacy and security rights for individuals regarding their digital data. For businesses, this means that the data they keep (of their clients and employees) needs to be secure and accessible to the individual.
If you don’t comply with GDPR, you might have to pay heavy penalties. Global PEOs can eliminate this risk. They already have a system to comply with local laws and regulations.
What Can You Expect from Global PEO Service Providers in India?
While the exact services you’ll get from a PEO service provider depends on your contract, here are three things that you can expect:
Recruitment and On boarding
Finding skilled employees in your budget in a new market can be challenging. However, with PEO services, you can easily find talented candidates. They will also help with onboarding employees and train them as per your company culture.
Payroll is one of the most common challenges companies face when expanding into an international market. Countries across the world have different laws regarding wages. You’ll also need to take care of corporate taxes, pensions, and employee benefits. Thankfully, your global PEO service provider will manage everything.
Additional Employee Benefits
Employee benefits like health insurance are always complex. Combined with local and international laws, things can get more challenging. Your PEO service provider can ensure legal compliance with medical, dental, and vision benefits packages while ensuring the data security of the employees.
Global PEO services make it easier for businesses to expand globally. This is because they have already navigated the complexities and requirements of different regulations globally, ensuring you don’t face any legal troubles in any country. Plus, they reduce operational costs as you won’t spend much on recruiting, training, or infrastructure.
If you plan to expand your business internationally, now is the right time to leverage global PEO services and mitigate your risks. Contact us today to know how we can make your expansion process seamless or write us at email@example.com.