Expand and hire globally, without a local entity
New Horizons Global PEO allows companies to expand overseas and employ staff in new markets and locations without the need to set up a separate legal entity.
This means your company can start doing business overseas in full compliance with employment, tax and other regulations, and without delay.
This allows you to begin operations more quickly, and saves up to 85% of the cost of expansion.
I would like to hire employees in:
Global expansion solutions with multiple benefits
Choose New Horizons as your expansion partner for an efficient and cost-effective global expansion
What does New Horizons do?
New Horizons is an international expansion partner and Global Professional Employer Organization (Global PEO). That means that we:
What is a Global PEO?
A Global/International PEO manages employees on behalf of businesses that are expanding overseas. Global PEO encompasses:
Working with a Global PEO means companies can expand overseas quickly, compliantly and at a lower cost than they could by setting up on their own.
As the ‘Employer of Record’, the Global PEO takes on compliance responsibility for employees, including tax and payroll requirements. While the Global PEO becomes the legal employer, the client company retains full control of employees. This leaves the company to pursue its core business objectives, while the global PEO takes on employer responsibilities (and liabilities).
While services differ between providers, some Global PEOs provide additional services such as recruitment, HR an legal entity establishment.
What are the benefits of Global PEO?
Benefits of engaging a Global PEO include:
One partner for your international expansion
Using a global PEO means streamlining your expansion: There is no need to deal with different service providers in every country that you operate in. Furthermore, there is no need to deal with a different provider for each aspect of expansion. The Global PEO manages the entire ‘lifecycle’ of the expansion and takes charge of recruitment, hiring, HR and legal compliance
Up-to-date legal compliance
It is crucial that companies comply with all the tax and employer regulations in every country that they operate in. Failure to comply can result in significant fines and penalties. As compliance specialists, a Global PEO takes over this compliance responsibility, alleviating the risks for international enterprises
Dealing with permanent establishment risk
‘Permanent establishment’ means a fixed place of business through which the business of an enterprise is wholly or partly carried on. When an enterprise has a permanent establishment in a location, it is liable to pay corporate income tax. In many cases, engaging a Global PEO means that the ‘fixed place of business’ is not established, meaning a corporate tax liability does not arise
Reduced expansion costs
Global expansion is often complex and time-consuming. Outsourcing to an experienced Global PEO saves you time and money – it saves some companies up to 85% of the cost of expansion
Competitive benefits for employees
With a critical mass of employees in your target country, a Global PEO can often provide more competitive benefits packages in your target country, than small-to-medium-sized enterprises would be able to
As with employment compliance, data protection and security rules can differ significantly by country. A Global PEO ensures that all data regulations and laws (such as the EU’s GDPR) are complied with;
Managing ongoing costs of expansion.
Managing and forecasting the ongoing costs of global expansion can be difficult. For example, fluctuating exchange rates in different countries can make it difficult to forecast what upcoming costs will be. Through its cloud solution, New Horizons provides the tools for businesses to better forecast and budget for these costs.
What is the process when you sign up with a Global PEO?
Once you sign up with a Global PEO like New Horizons, the following steps will usually be taken:
New Horizons drafts the offer letter and employment contract for the client’s workforce in a new location
New Horizons check that all necessary visas, work permits, insurances and registrations are in place to begin operations in the target country
New Horizons calculates all payments to employees, distributes wages, deals with employee expenses and keeps meticulous records of all transactions
Ongoing HR management
New Horizons deals with any ongoing HR issues as they arise, such as employee performance issues, terminations and contract renewals.
How does a Global PEO reduce the costs of expansion?
Engaging a global PEO saves costs for your business in a variety of ways:
Is a Global PEO suitable for small companies?
Yes. Engaging a Global PEO is often an excellent option for small businesses initiating an international expansion.
For small companies, setting up a local legal entity often won’t be cost-effective. In addition, a Global PEO has the recruitment, payroll, HR and compliance expertise to hire staff that small businesses may not be able to manage.
Is a Global PEO suitable for medium-sized businesses?
Yes. Global PEOs usually invoice client companies on a ‘per employee’ basis, meaning that this is also a cost-effective solution for medium-sized businesses.
Does a Global PEO make sense for a large company?
In many cases, yes. Engaging a Global PEO gives international enterprises the benefit of local expertise and compliance knowledge which is difficult to replicate, no matter what the size of the company. In addition, a Global PEO can benefit large enterprises by simplifying their international operations. One Global PEO can manage all overseas locations and send just one invoice per month to the client. This may be much more straightforward than operating separate legal entities in every overseas location.
Once a business reaches a certain size in another country, or it needs a more substantial legal presence in that country, setting up a local legal entity may be sensible. New Horizons can support businesses to switch their Global PEO to a local legal entity.
Is a Global PEO a good temporary expansion solution?
Setting up a legal entity overseas can be a time-consuming process. Engaging a Global PEO can be an extremely useful interim compliance solution while you go through the process of setting up a new company. Then once the company is read to operate, the Global PEO can switch those employees over to the new legal entity.
Can a Global PEO be used to hire a remote worker?
Yes. For example, you may find on an international talent search that your best candidate is based overseas, but is willing to work remotely. A Global PEO can hire that individual and become their ‘Employer of Record’ in that country. The candidate would still work under your direction and control on a day-to-day basis.
In other cases, you may have employees that are unexpectedly based overseas for an extended period of time. This may begin to pose a ‘permanent establishment’ risk for your company (meaning that your company becomes liable to pay corporate income tax in that location). This risk can be alleviated by hiring the remote worker in that country via a Global PEO.
Can I use a Global PEO to hire freelancers?
Yes. In some circumstances you may wish to bring overseas freelancers on board as employees, this can be achieved via a Global PEO. Even where you wish to maintain a purely contractual (rather than employment) relationship with freelancers based overseas, a Global PEO may be able to help with payment and contractor management for those freelancers.
Can a company reduce compliance risk by switching a contractor to a Global PEO?
Engaging contractors overseas can pose risks to your organization. In some cases, it can make you liable for ‘employee misclassification’ with the tax authorities. This can result in you paying significant back-taxes and penalties. In addition, an employment relationship can be essential to ensure that you have the necessary degree of control over the employee.
Engaging a Global PEO to onboard and employ this individual removes this significant compliance risk.
Can a Global PEO be used to convert a contractor based overseas into an employee?
Yes. Sometimes a successful relationship with an independent contractor means that you would like to turn them into an employee. This might occur where:
The most cost-effective and compliant way of carrying out this conversion is to engage a Global PEO to hire employees in the target country. This way, you do not need to set up a separate legal entity in that country to employ the individual.
Alternatively, you may plan to register a company in the target country to employ an individual and seek to engage a Global PEO as an interim measure.
Our Global Reach
With coverage that spans more than 150 countries, New Horizons supports your business to grow its international presence. Our team of in-country specialists facilitates your expansion and allows you to hire, onboard, and pay your global workforce.