Use Global PEO solutions for engaging freelancers
Freelancers are a growing segment of the world economy: Engaging a freelancer often provides a flexibility to an organization that is highly sought after. New Horizons Global Partners can help freelancers, and the companies that they work for, to ensure that their working arrangements are legally compliant and cost-effective. New Horizons achieves this through ‘Global Professional Employer Organization’ (‘Global PEO’) solutions.
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How can New Horizons Global Partners support companies to engage freelancers?
New Horizons supports international enterprises by providing Global Professional Employer Organization (Global PEO) solutions. Through a Global PEO solution, New Horizons becomes the ‘Employer of Record’ for former freelancers, taking on payroll, tax and employer responsibilities. We consider some of the other benefits below.
What are the risks for companies engaging freelancers?
It is common for ambitious enterprises to engage freelancers to fulfil their business needs. In many cases, this means engaging freelancers based around the world in various international locations. However, this poses a range of risks:
- Employee misclassification risk
- If the tax authorities in a country deem that an individual is not, in fact, a freelancer, but an employee of your company, your company could be liable for payroll back-taxes, penalties and unpaid employee benefits
- Permanent establishment risk
- This is the risk that the freelancer is classified as a ‘dependent agent’ of your company. This can mean that you are liable for corporate income tax in that country, even if you are not officially established there
- Reputational risk
- Engaging freelancers in contravention of employment and tax laws can do serious damage to your international reputation.
What is the New Horizons process for managing freelancers?
Agreement on Relationship
We agree with you as to how the engagement is to proceed.
We engage current freelancers with employment offers and up-to-date employment contracts.
We hire any additional workers you need to staff your ongoing operations.
Once the workers are hired, we become the ‘Employer of Record’. This means we are responsible for all ongoing payroll, benefits, payroll taxes and compliance.
Frequently asked questions
Often the terms ‘freelancer’ and ‘contractor’ ‘or ‘independent contractor’ are used interchangeably. Other times, ‘freelancer’ is used to refer to individuals who work for multiple clients at a time, often in creative fields; ‘contractor’ is often reserved for individuals with more significant projects with individual clients. The legal rights of freelancers and contractors are primarily protected via the ‘contract for services’ that exists between them and the client.
An ‘employee’, by contrast, works for a business with special protections as guaranteed by the employment law of that country. Often employees receive benefits, such as health insurance and pension contributions, from their employer.
It depends on the true nature of the relationship between your business and the worker. We will be able to advise you if it is possible for an individual to be switched from an employee to a freelancer position.
Our HR cloud solution keeps employee information secure in line with data protection laws and regulations. At the same time, we ensure you have access to all essential employee information and reports as required.